Capitol Records, LLC v. Vimeo, LLC
CAPITOL RECORDS, LLC v. VIMEO, LLC d/b/a vimeo.com, Defendants EMI Blackwood Music, Inc v. Vimeo, LLC d/b/a vimeo.com
Attorneys
Christine Lepera, Jeffrey M. Movit, Mitchell Silberberg & Knupp LLP, New York, NY, Marc E. Mayer, Russell J. Frackman, Mitchell Silberberg & Knupp LLP, Los Angeles, CA, for Plaintiffs., Robert Lloyd Raskopf, Jessica Anne Rose, Todd Steven Anten, Quinn Emanuel Urquhart & Sullivan LLP, Michael A. Cheah, Iac/Interaetivecorp, New York, NY, Rachel Marie Kassabian, Quinn, Emanuel Urquhart Oliver & Hedges, LLP, Redwood Shores, CA, for Defendants.
Full Opinion (html_with_citations)
OPINION AND ORDER
Three motions are currently pending before the Court in these consolidated cases: (1) Defendantsâ motion for reconsideration pursuant to Local Rule 6.8, (2) Plaintiffsâ motion for leave to file amended complaints to add additional works-at-issue, and (3) Defendantsâ motion for certification for interlocutory appeal pursuant to 28 U.S.C. § 1292(b). The Court grants Defendantsâ motion for reconsideration in part â awarding them summary judgment with respect to an additional seventeen of the videos at issue in the complaint (the âVideos-in-Suitâ) â and denies the motion as to the remaining Videos-in-Suit. The Court grants Plaintiffsâ motion for leave to file an amended complaint and certifies for interlocutory appeal its September 18, 2013 Opinion and Order (the âSeptember 18 Orderâ), as amended by this Order.
BACKGROUND
The Courtâs September 18 Order sets forth the full factual background of this action. See Capitol Records, LLC v. Vimeo, LLC, 972 F.Supp.2d 500, 2013 WL
Defendants operate the website âVimeo,â a platform that permits users to upload and share videos. Vimeo distinguishes itself from other video-sharing sites by requiring users to have created, or at least have participated in the creation of, the videos they upload. As of September 2012, Vimeo hosted over 31.7 million videos, with approximately 43,000 new videos added each day. (Order at 2-3.)
Plaintiffs' â record and music publishing companies â filed suit against Defendants in December 2009, asserting claims for direct, contributory, vicarious, and common law copyright infringement, as well as for inducement to infringe copyright and unfair competition. Their complaints, filed separately but substantively identical, each contained a list of the 199 Videos-in-Suit. Plaintiffs own copyrights to the musical recordings used in each of these videos and, for purposes of the present motions, Defendants do not dispute that the Videos-in-Suit used the recordings without authorization. (Defs.â Response to Pl.s.â 56.1 Stmt, at ¶ 2 n. 3.)
The parties conducted an initial phase of discovery limited to whether any of the Videos-in-Suit were protected by the âSafe Harborâ provision of the Digital Millennium Copyright Act (âDMCAâ). The Safe Harbor limits the liability of service providers for copyright infringement that occurs âby reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider,â as long as the provider satisfies certain criteria. 17 U.S.C. § 512(c)(1). The parties filed cross-motions for summary judgment on the issue of whether Defendants were protected by the Safe Harbor.
In its September 18 Order, the Court granted in part and denied in part both partiesâ motions. First, it concluded that no evidence suggested that Vimeoâs employees had ever viewed the majority of the Videos-in-Suit. Because it found that Defendants had established the other elements of Safe Harbor protection as a matter of law, the Court granted Defendants summary judgment on these instances of infringement. Second, the Court determined that a triable issue existed as to whether Defendants had satisfied the Safe Harbor elements for a second set of Videos-in-Suit. This set consisted of videos with which Vimeoâs employees had interacted, because the Safe Harbor requires that service providers not be âaware of facts or circumstances from which infringing activity is apparent.â See 17 U.S.C. § 512(c)(l)(A)(ii). It also consisted of videos uploaded by Vimeo employees, because the Safe Harbor only extends to material stored âat the direction of a user.â See 17 U.S.C. § 512(c)(1). The Court denied summary judgment to both parties with respect to this set of videos. Third, the Court concluded that the Safe Harbor did not extend to videos containing music recorded before February 15, 1972. Plaintiffs were granted summary judgment on the Safe Harbor issue with respect to these Videos-in-Suit.
The Court thus granted Defendants summary judgment with respect to â144 Videos-in-Suit, save for those Videos-in-Suit containing infringed-upon material recorded before February 15, 1972.â (Order at 56.) Based on Plaintiffsâ undisputed submissions regarding which videos con-
DISCUSSION
1. Motion for Reconsideration
The standard for granting a motion for reconsideration under Local Rule 6.3 âis strict.â In re Optimal U.S. Litig., 886 F.Supp.2d 298, 311 (S.D.N.Y.2012). Generally, a court will deny reconsideration âunless the moving party can point to controlling decisions or data that the court overlooked â matters, in other words, that might reasonably be expected to alter the conclusion reached by the court.â Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir.1995). Courts may also grant reconsideration because of an âintervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.â Virgin Atl. Airways, Ltd. v. Natâl Mediation Bd., 956 F.2d 1245,1255 (2d Cir.1992). A motion for reconsideration âis not an opportunity to advance new facts, issues or arguments not previously presented to the Court, nor is it a substitute for appeal.â In re Optimal, 886 F.Supp.2d at 312 (footnote omitted).
As noted above, in its September 18 Order the Court cited evidence that Vimeoâs employees had interacted with a set of the Videos-in-Suit containing copyrighted music and, from this evidence together with the nature of the videos themselves, determined that a reasonable juror could conclude that Defendants were âaware of facts or circumstances from which infringing activity is apparent.â 17 U.S.C. § 512(c)(l)(A)(ii). Such awarenessâ known as âred flagâ knowledge â would disqualify Defendants from Safe Harbor protection. See Viacom Intâl, Inc. v. YouTube, Inc., 676 F.3d 19, 31 (2d Cir.2012). The Court thus determined that summary judgment was inappropriate as to these videos. (Order at 33.)
Defendants now ask the Court to reconsider its decision as to thirty-five such videos. (See Defs.â Mem. of Law in Support of Motion for Reconsideration and Certification at 3 & n. 1.) They raise two challenges. First, they assert that no evidence shows that their employees ever viewed fifteen of those thirty-five videos. Second, they argue that even assuming a Vimeo staff member watched each of the thirty-five videos, the infringing nature of the videos was not â âobjectivelyâ obvious to a reasonable person,â as the Second Circuit has required to support a finding of red flag knowledge.
The Court agrees with Vimeoâs first argument but not its second (with the exception of two videos, described in Subsection B). It therefore grants summary judgment to Defendants on seventeen of the thirty-five videos for which they seek reconsideration.
The September 18 Order described several ways in which Vimeoâs employees interacted with videos: the employees commented on a videoâs page, âlikedâ the video, or âburiedâ the video so that it no longer appeared on Vimeoâs home page. (Order at 29-30.) For each Video-in-Suit with which employees interacted in one of these ways, the Court concluded, a reasonable jury could find that the employee viewed the video containing copyrighted music and had âred flagâ knowledge of its infringing nature.
The September 18 Order noted two additional ways in which employees interacted with Videos-in-Suit. First, although users could upload videos on Vimeo at no cost as long as they registered for an account, users could also purchase a âPlusâ membership, which entitled them to increased file storage space and additional customization options. (Pis.â Response to Defs.â 56.1 Stmt. ¶ 62.) Citing evidence that Vimeo employees â[rjeviewed some uploaded Videos-in-Suit in âPlusâ usersâ accounts,â the September 18 Order concluded that a triable issue existed as to whether Vimeo employees had âred flagâ knowledge of the infringing nature of these videos. (Order at 29.)
Second, the Court noted that Vimeo employees (and only Vimeo employees) could âwhitelistâ videos, which precluded other users from âflaggingâ the videos for violating the siteâs Terms of Service. (Id.) Employees could whitelist an individual video or a userâs entire account, in which case all of the videos the user had uploaded became whitelisted. (Supplemental Declaration of Andrew Pile, Jan. 5, 2013 (âSupp. Pile Deckâ), at ¶¶ 5, 7.) The Court likewise found that a triable issue existed as to whether Vimeoâs employees had âred flagâ knowledge of the contents of these videos.
Of the videos as to which the Court denied both parties summary judgment, the only evidence of employee interaction with ten of the videos was that the videos had been uploaded by âPlusâ users. (See Supplemental Declaration of James D. Berkley, Dec. 21, 2012 (âSupp. Berkeley Deckâ), Ex. 1.) For five other videos, the only evidence of employee interaction was that they had been uploaded by âPlusâ users and the usersâ accounts had been whitelisted. Defendants assert that the Court should grant them summary judgment as to these fifteen Videos-in-Suit, because no evidence showed that employees viewed any of the videos.
Upon further review of the record, the Court agrees with Defendants. The only evidence that Vimeo employees viewed âPlusâ usersâ videos came from the deposition of Andrea Allen, a Vimeo community monitor. Allen, who was presented with a page showing a list of âPlusâ users, stated that she believed the page was used by moderators to view videos in âPlusâ usersâ accounts to ensure compliance with Vimeoâs Terms of Service. (Declaration of Russell J. Frackman, January 6, 2013 (âFraekman Deckâ), Ex. 3 at 165:2-19 & Ex. 85.) She noted, however, that she had never used the page, that she considered it âa dinosaur page,â and that she did not âknow the last time [it] was used or even talked about.â (Id. 165:11-14.)
Moreover, Defendants have brought to the Courtâs attention evidence that âPlusâ users have uploaded thirty-six percent of the videos on Vimeo, suggesting that âPlusâ users are responsible for a substantial portion of the 43,000 new videos uploaded each day. (Supp. Pile Deck ¶ 23.) It is simply unrealistic to infer that a Vimeo employee watched every âPlusâ video. Indeed, Plaintiffs conceded at oral argument on the motion for reconsideration that they âdonât have evidence that
The Court reaches the same conclusion with respect to whitelisted videos. The only evidence Plaintiffs cite to show that Vimeo employees watched all whitelisted videos is a statement in Allenâs deposition. When presented with an exhibit showing a list of videos marked as âwhitelisted,â Allen explained that â âWhite Listedâ in this context would indicate to someone, a moderator looking at this, that a moderator has looked at this alreadyâ and that the video âcomplies with the guidelines.â (Frackman Deck, Ex. 3 at 183:5-10 & Dep. Ex. 89.) But nowhere does this testimony note whether the videos had been whitelisted individually or whether they had been given that label simply because an entire userâs account had been whitelisted.
To be sure, a jury could infer that when a Vimeo employee whitelists a specific video, the employee has watched that videoâ a point Defendants do not dispute. (See Def s. Mem. of Law in Support of Motion for Reconsideration and Certification at 13-14.) But an employeeâs whitelisting of a userâs entire account is too tenuous, without more, to permit the inference that the employee has watched all of the userâs videos. Vimeoâs Vice President of Product and Development averred that â[w]hen an account is whitelisted, Vimeo staff generally do not watch the videos.â (Supp. Pile Deck ¶ 7.) This assertion is consistent with Allenâs testimony and is not contradicted by any other evidence in the record. Accordingly, Vimeo is also entitled to summary judgment with respect to the five videos for which the only evidence of employee interaction was that the userâs account had been whitelisted.
B. Whether the Infringing Nature of the Videos Was Objectively Obvious
â Defendants assert that even assuming one of their employees watched each of the remaining videos, they did not have âred flagâ knowledge of the videosâ infringing content. This argument is focused on the provision of the Safe Harbor requiring that, in order to be protected from liability, a service provider must not be âaware of facts or circumstances from which infringing activity is apparent.â 17 U.S.C. § 512(c)(l)(A)(ii). The Second Circuit has explained that this âred flag provision turns on whether the provider was subjectively aware of facts that would have made the specific infringement âobjectivelyâ obvious to a reasonable person.â Viacom Intâl, Inc. v. YouTube, - Inc., 676 F.3d 19, 31 (2d Cir.2012).
According to Defendants, the infringing nature of the remaining videos is not âobviousâ because each video contains some original elements and their creators thus have at least a colorable defense that they made âfair useâ of the copyrighted material. See, e.g., Cariou v. Prince, 714 F.3d 694 (2013) (holding that an artist made âfair useâ of copyrighted photographs when he incorporated them into a series of
The Court has reviewed each of the remaining twenty videos and determines that, with respect to eighteen of the videos, a reasonable juror could â but need notâ find that the infringing activity in each video was â âobjectivelyâ obvious to a reasonable person.â Viacom, 676 F.3d at 31. Defendants are entitled to summary judgment on the two other videos: in each of these videos, the copyrighted songs play for only a short time in the background (approximately 38 and 57 seconds, respectively
A juror could reach the opposite conclusion with respect to the other eighteen videos. In the Courtâs analysis, seventeen of these eighteen videos play all or virtually all of the copyrighted song.
Defendantsâ argument for reconsideration focuses on the Safe Harborâs legislative history. They emphasize a portion of the Senate and House Reports (the âReportsâ) addressing a provision of the Safe Harbor not at issue here, § 512(d), which provides a safe harbor for service providers â such as search engines â that offer âinformation location tools.â As with § 512(c), which is the focus of this action, § 512(d) disqualifies providers from Safe Harbor protection if they âturned a blind eye to âred flagsâ of obvious infringement.â S.Rep. No. 105-190, at 48 (1998) (âS. Rep.â); H.R.Rep. No. 105-551, pt. 2, at 57 (1998) (âH. Rep.â). The Reports note that a copyright holder could show âred flagâ
Even assuming that the Reportsâ discussion of § 512(d) applies equally to § 512(c), however, the infringement the Reports describe is different in kind than the infringements at issue in this case. Here, the copyrighted songs were an integral part of the videos: the videos played the songs essentially unmodified and in their entirety, and the length of the video corresponded to the length of the song. A jury could conclude, based on these circumstances, that it would have been â âobjeetivelyâ obvious to a reasonable personâ that the individual users did not have permission to use the well-known songs in their videos. See Viacom, 676 F.3d at 31. Although a jury need not necessarily find that evidence of infringement was obvious in these videos, it certainly could reach such a conclusion in light of the length and recognizable nature of the songs.
Consider, for instance, the video of the artist Christina Aguilera.
Defendants respond that as long as a videoâs use of copyrighted material can âconceivably be justified by a colorable claim of license or fair use,â employees who view the video do not have red-flag knowledge of its infringing nature. (Defs.â Reply Mem. of Law in Support of Motion for Reconsideration and Certification at 5.) As the Court explained in its September 18 Order, however, this argument threatens to collapse the distinction between âactualâ and âred flagâ knowledge, rendering the latter superfluous. (Order at 33.) âRed flagâ knowledge, under Defendantsâ construction of the statute, would seemingly require not only the upload of an unaltered, copyrighted work but also some reliable indication that the user did not have permission to upload the work, in order to negate potential legal defenses to copyright infringement. (See id. at 31.) But
Perhaps recognizing the difficulty in this position, Defendants suggested at oral argument that had Vimeoâs employees encountered a video that simply consisted of the upload of a feature-length film, such as âThe Big Chill,â those employees would have âred flagâ knowledge of the videoâs infringing character. (Oral Arg. Transcript at 16:22-17:2.) But at least one of the videos at issue in this case seems virtually identical to âThe Big Chillâ example. This video appears to be the official full-length music video of the song âMove (If You Wanna)â by the artist Mims.
Even for those videos that contain an original visual image set to the unaltered infringing music, for purposes of the âred flagâ inquiry, the Court finds no legally significant difference between the upload of a full-length and unedited copyrighted film and the upload of a full-length and unedited copyrighted song. A rational jury could find that a video playing the entirety of the Four Topsâ hit song âI Canât Help Myself (Sugar Pie Honey Bunch),â or a song by the Beastie Boys, Radiohead, or Usher, provided âobjectively obviousâ evidence of infringement to a Vimeo employee who viewed the video. Furthermore, as to some of the videos there is additional evidence in the record from which a jury could find âred flagâ knowledge. For example, the web page containing one of the videos, the uploading user announced that he had âmixed [the video] with the track âHarder, better, faster, strongerâ from Daft Punk live record âAlive 2007.â â (Berkley Deck Ex. 38.) As for another video, a Vimeo employee admitted that he had watched the video, had commented on it, and was aware that it contained music by the artist Usher. (Frackman Deck Ex. 5 at 247:19-248:6 & Dep. Ex. 224 (deposition of Dalas Verdugo)).
. In the context of file-sharing programs, courts have consistently rejected service providersâ claims that they were unaware of infringing activity involving well-known works. See Columbia Pictures Indus., Inc. v. Fung, 710 F.3d 1020, 1043 (9th Cir.2013) (concluding that a service provider had red flag knowledge when â[t]he material in question was sufficiently current and well-known that it would have been objectively obvious to a reasonable person that the material solicited and assisted was both copyrighted and not licensed to random members of the publicâ); see also Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 454 F.Supp.2d 966, 987-88 (C.D.Cal.2006) (finding that a service provider intended to induce copyright infringement where it provided a search
Accordingly, the Court grants Defendantsâ motion for reconsideration as to seventeen of the Videos-in-Suit: the fifteen videos for there was no evidence in the record of employee interaction, and two videos where evidence of infringement was not âobjectively obvious.â The Court denies the motion with respect to the remaining eighteen Videos-in-Suit.
2. Motion for Leave To Amend the Complaint
Plaintiffs seek leave to file an amended complaint that adds additional instances of infringement. According to their memorandum in support of the motion, the proposed amended complaint seeks to add 1476 new instances of infringement. Almost one quarter of these involve music recorded before February 15, 1972, and almost one third involve videos with which Vimeo employees interacted in one of the ways outlined in the September 18 Order.
Courts must âfreely give leaveâ to amend a complaint âwhen justice so requires.â Fed.R.Civ.P. 15(a)(2). The Second Circuit has explained that âdistrict courts should not deny leave unless there is a substantial reason to do so, such as excessive delay, prejudice to the opposing party, or futility.â Friedl v. City of N.Y., 210 F.3d 79, 87 (2d Cir.2000).
Nowhere do Defendants assert that amendment would be futile. Instead, they argue that Plaintiffs have unnecessarily delayed the filing of their motion and that granting leave to amend would cause prejudice by requiring additional discovery. These arguments are unavailing.
The record shows that Plaintiffs have contemplated amending their complaintâ and have made Defendants aware of their intention â from the earliest stages of the litigation. In the Case Management Plan and Scheduling Order, the parties agreed to permit Plaintiff to seek leave to amend their complaint to add additional instances of infringement, subject to Court approval, beyond the sixty-day period that otherwise limited Plaintiffsâ right to amend. (Dkt. No. 24.) Plaintiffs communicated to Defendants their intention to amend in October 2010, and Defendants'replied that they âd[id] not anticipate objecting to such amendment,â as long as it âwould be nothing more than the inclusion of additional sound recordings and musical competitionsâ and would not affect the first phase of discovery. (Declaration of Marc Mayer, Oct. 21, 2013 (âMayer Deckâ) at Ex. 3; Declaration of Jessica A. Rose, Nov. 4, 2013 (âRose Deckâ) at Ex. F.) Although Plaintiffs did not raise the issue of amendment again until April 24, 2012, the delay was justified: Defendants did not produce certain documents until February 8, 2011, and from March 3, 2011 to April 4, 2012 the case was stayed pending the Second Circuitâs decision in Viacom. (Mayer Deck ¶¶ 9-12; Rose Deck ¶¶ 24, 26.) In an order dated May 31, 2012, Judge Castel
Defendantsâ argument that amendment would cause them undue prejudice is similarly unpersuasive. To date, the parties have only conducted âPhase Iâ discovery, that is, discovery relating to the applicability of the DMCA Safe Harbor. (See Dkt. No. 24 at 2.) Plaintiffs represent that the only additional Phase I discovery they seek is an updated version of the database showing the âwhitelistedâ and âburiedâ videos. (Pis.â Reply Mem. of Law in Support of Motion to Amend at 2 n. 1.) Additionally, although Defendants claim they are entitled to additional discovery, they have not specified what information they would seek. Neither party has given the Court any reason to believe that significant additional Phase I discovery would be required. Plaintiffs have categorized their complaint based on the Courtâs September 18 Order (noting, for instance, which compositions were recorded before 1972 and which videos were uploaded or âlikedâ by Vimeo employees). (Mayer Decl. at Exs. 5-7.) To determine which new instances of infringement survive summary judgment, the Court need only apply the principles articulated in its September 18 Order and this Order to the remaining videos.
Finally, Defendants acknowledge that Plaintiffs have the ârightâ to âfil[e] a new complaint for any alleged infringements that they neglected to include in the course of fact discovery.â (Defs.â Mem. in Opp. to Pis.â Motion to Amend at 11.) Defendants have not identified any way in which requiring Plaintiffs to file a new action would be more efficient than permitting them to amend their existing complaint to add new instances of infringement. See Kwon v. Yun, 606 F.Supp.2d 344, 365 (S.D.N.Y.2009) (permitting defendant to amend counterclaims in its pleading because defendant âwould be free to file a new actionâ to recover on its claims).
The Court therefore grants Plaintiffsâ motion for leave to file amended complaints.
3. Motion for Certification for Interlocutory Appeal
Vimeo asks the Court to certify for interlocutory appeal the following two questions:
(1) Are the DMCAâs safe-harbor provisions applicable to sound recordings fixed prior to February 15, 1972?
(2) Does a service providerâs mere viewing of a user-generated video containing third party copyrighted music automatically give rise to a triable issue of fact as to the service providerâs knowledge of infringement under the DMCA?
(Defs.â Mem. of Law in Support of Motion for Reconsideration and Certification at 15.) Plaintiffs do not oppose this request as long as the Court certifies âall of the relevant DMCA issuesâ for interlocutory appeal, including whether Vimeo had the âright and ability to controlâ infringing activity, whether it acted with âwillful blindnessâ to infringement, and whether it had instituted a repeat infringer policy. (Pis.â Opposition to Motion for Reconsideration and Certification at 14.)
28 U.S.C. § 1292(b) presents a limited exception to the âbasic tenet of federal lawâ that appellate review should be delayed until final judgment is entered. Koehler v. Bank of Bermuda Ltd., 101 F.3d 863, 865 (2d Cir.1996). Under this provision, a district court may certify for appeal an otherwise non-appealable order when the court concludes that the order â[1] involves a controlling question of law [2] as to which there is substantial ground for difference of opinion and [3] that an immediate appeal from the order may materially advance the ultimate termination of the litigation.â 28 U.S.C. § 1292(b). District courts must âexercise great care in making a § 1292(b) certification,â West-wood Pharm., Inc. v. Natâl Fuel Gas Distrib. Corp., 964 F.2d 85, 89 (2d Cir.1992), and should invoke the provision only in âexceptional circumstances,â Coopers & Lybrand v. Livesay, 437 U.S. 463, 475, 98 S.Ct. 2454, 57 L.Ed.2d 351 (1978).
With respect to the first prong of the test, the â âquestion of law3 must refer to a âpureâ question of law that the reviewing court could decide quickly and cleanly without having to study the record.â Con-sub Delaware LLC v. Schahin Engenharia Limitada, 476 F.Supp.2d 305, 309 (S.D.N.Y.2007). The question must also be âcontrolling,â meaning that reversal of the district courtâs order âwould terminate the action, or at a minimum that determination of the issue on appeal would materially affect the litigationâs outcome.â In re Enron Corp., No. 06 Civ. 7828(SAS), 2007 WL 2780394, at *1 (S.D.N.Y. Sept. 24, 2007).
The second prong of the test, that there exists a substantial ground for difference of opinion, is met when â(1) there is conflicting authority on the issue, or (2) the issue is particularly difficult and of first impression for the Second Circuit.â Id. âThe mere presence of a disputed issue that is a question of first impression, standing alone, is insufficient to demonstrate a substantial ground for difference of opinion.â In re Flor, 79 F.3d 281, 284 (2d Cir.1996). Rather, the district court must âanalyze the strength of the arguments in opposition to the challenged ruling when deciding whether the issue for appeal is truly one on which there is a substantial ground for dispute.â Id.
Courts âplace particular weightâ on the third factor: whether an immediate appeal will materially advance the ultimate termination of the litigation. Transp. Workers Union of Am. v. N.Y.C. Transit Auth, 358 F.Supp.2d 347, 350 (S.D.N.Y. 2005). This requirement, which in practice is âclosely connectedâ to the first factor, In re 650 Fifth Ave., No. 08 Civ. 10934(RJH), 2012 WL 363118, at *2 (S.D.N.Y. Feb. 2, 2012), is met when an intermediate appeal âpromises to advance the time for trial or to shorten the time required for trial,â Transp. Workers Union, 358 F.Supp.2d at 350.
B. Whether Certification Is Appropriate
After reviewing the statutory factors, the Court concludes that two issues from its September 18 Order merit certification. The Court recognizes that § 1292(b) refers to certification of an âorder,â and that, should the Second Circuit agree to hear the appeal, it âmay address any issue fairly included within the certified order.â Yamaha Motor Corp., USA v. Calhoun, 516 U.S. 199, 205, 116 S.Ct. 619, 133 L.Ed.2d 578 (1996). Mindful of the Circuitâs statement that âit is helpful for a district court to frame the controlling questions of law that the order involves,â United States v. Banco Cafetero Panama, 797 F.2d 1154, 1157 (2d Cir.1986), the Court specifies the
i. Pre-1972 Recordings
The Courtâs September 18 Order granted Plaintiffs summary judgment as to those videos that contained music recorded before February 15, 1972, concluding that the DMCA Safe Harbor extended only to those videos that contained music recorded after that date. (Opinion at 55.) The Court concludes that this question satisfies each of the statutory factors.
First, this issue presents a controlling question of law. Because the issue turns almost exclusively on a question of statutory interpretation, âthe reviewing court could decide [it] quickly and cleanly without having to study the record.â Consub, 476 F.Supp.2d at 309. Moreover, its resolution âwould materially affect the litigationâs outcome.â In re Enron, 2007 WL 2780394, at *1. Twenty of the videos alleged to be infringing in the existing complaint involved pre-1972 music, (see Compl. at Schedule B) and Plaintiffsâ amended complaint adds 332 videos containing pre-1972 recordings (see Mayer Deck at Ex. 6). With respect to many of the videos, which party prevails on the copyright claims associated with each of these recordings rests exclusively on the reach of the Safe Harbor.
Second, although the Court remains of the view that 17 U.S.C. § 301(c) cannot be read to permit application of the DMCA Safe Harbor to pre-1972 recordings, the Court recognizes that there exists a substantial ground for difference of opinion on this issue. Indeed, Judge Pauley of this Court reached the opposite conclusion, see Capitol Records, Inc. v. MPStunes, LLC, 821 F.Supp.2d 627, 640-42 (S.D.N.Y.2011),
Third, an intermediate appeal will materially advance the ultimate termination of the litigation. As noted above, Plaintiffsâ amended complaint adds 332 instances of infringement involving pre-1972 recordings. (Mayer Deck at Ex. 6.) If the outcome of the summary judgment motion on the current complaintâin which the Court now concludes that the DMCA Safe Harbor extends to almost three quarters of the Videos-in-Suitâis any indication, a large swath of those 332 instances of infringement will be subject to the Safe Harbor protection. Should the Second Circuit conclude that Safe Harbor protection extends to pre-1972 recordings, many of those 332 instances of infringement would be dismissed.
The Court therefore certifies for interlocutory appeal the question of âwhether the DMCAâs safe-harbor provisions are applicable to sound recordings fixed prior to February 15,1972.â
The Court also agrees with Defendants that the issue of their âred flagâ knowledge merits certification. But Defendantsâ articulation of the question to be certified â -whether a service providerâs âmere viewing of a user-generated video containing third party copyright music automatically give[s] rise to a triable issue of fact as to the service providerâs knowledge of infringement under the DMCAâ (Defs.â Mem. of Law in Support of Motion for Reconsideration and Certification at 15)â misconstrues the Courtâs holding. The Courtâs conclusion that a triable issue exists as to âred flagâ knowledge relies on the videosâ use of recognizable songs, played essentially in their entirety and in unedited form. A more appropriate formulation of the legal question is âwhether, under Viacom Intâl, Inc. v. YouTube, Inc., a service providerâs viewing of a user-generated video containing all or virtually all of a recognizable, copyrighted song may establish âfacts or circumstancesâ giving rise to âred flagâ knowledge of infringement.â
Phrased this way, this question â in the Courtâs view â satisfies the first requirement for certification. That the âred flagâ knowledge inquiry depends in part on the contents of each video does not mean the question is inappropriate for certification. See, e.g., Am. Geophysical Union v. Texaco Inc., 802 F.Supp. 1, 11 (S.D.N.Y.1992) (Leval, J.) (certifying question of whether companyâs photocopying of journal articles constituted âfair useâ and noting that the inquiry âis highly fact-specificâ). Defendants have represented that, for purposes of any interlocutory appeal, they would assume that âVimeo had actually viewed all of the videos with which it âinteracted.â â (Defs.â Mem. of Law in Support of Motion for Reconsideration and Certification at 22 n. 14.) There is no real dispute about the content of the videos: they contain visual images set to copyrighted songs played essentially in their entirety. Determining whether Defendants had âred flagâ knowledge turns largely on the construction of 17 U.S.C. § 512 and the Circuitâs opinion in Viacom. The Circuit could, in this Courtâs view, resolve the proposed question âquickly and cleanly without having to study the record.â In re WorldCom, Inc., No. M-47 HB, 2003 WL 21498904, at *10 (S.D.N.Y. June 30, 2003).
Additionally, the Court recognizes that determining whether a defendant has âred flagâ knowledge of infringement is a difficult question that has important ramifications for service providers such as Vimeo. Athough nothing in the Courtâs orders requires providers affirmatively to police their sites for copyright infringement, see 17 U.S.C. § 512(m), the Courtâs interpretation of âred flagâ knowledge may lead service providers to be more aggressive in further investigating or even removing copyrighted content that they encounter. Viacom defined âred flag knowledge,â but it did not address whether content can be obviously infringing on its face or how that concept interacts with various possible defenses to infringement, such as âfair use.â
These arguments present a substantial ground for difference of opinion. On the one hand, the legislative history of 17 U.S.C. § 512(c) suggests that service providers should not be placed in a position of having to assess the viability of a userâs legal defense to copyright infringement. On the other, insulating a service provider from liability unless all conceivable defenses could be negated would effectively read the âred flagâ knowledge provision out of the statute in light of the corresponding âactual knowledgeâ provision. Resolution these arguments will have far-reaching implications in this case and others. See Klinghoffer v. S.N.C., 921
Finally, an appeal on this issue would âmaterially affect the ultimate termination of the litigation.â 28 U.S.C. § 1292(b). The amended complaint alleges 475 infringing videos with which Vimeoâs employees interacted. (Mayer Decl. ¶ 15 & Exs. 5-7; Pis.â Mem. of Law in Support of Motion to Amend at 3.) Reversal of the Courtâs decision on the issue of âred flagâ knowledge could lead to a grant of summary judgment in favor of Defendants on most, if not all, of these instances of infringement. Should the Second Circuit agree with Defendants on both the first and second certified questions, the litigation may well be narrowed from 1675 instances of infringement (the total alleged in the amended complaint, see Mayer Deck ¶ 14) to 29 instances (the number of videos allegedly uploaded by Vimeo employees, see Mayer Deck ¶ 15 & Exs. 5, 7; Pis. Mem. of Law in Support of Motion to Amend at 3; Capitol Records, 972 F.Supp.2d at 518, 2013 WL 5272932, at *15). Certification of the above question is appropriate because a definitive answer may save the Court and parties âvast amounts of expense and time.â Am. Geophysical Union, 802 F.Supp. at 29.
Hi. Plaintiffsâ Proposed Questions
Plaintiffs ask the Court to certify a host of issues from its September 18 Order, at times not making any attempt to articulate a precise legal question but instead simply pointing out aspects of the Order raising âissue[s] that require[] clarification from the Second Circuit.â (Pis.â Opposition to Motion for Reconsideration and Certification at 19.) Although the Circuit is of course free to consider any of the issues Plaintiff raises, see Yamaha Motor Corp., USA v. Calhoun, 516 U.S. 199, 205, 116 S.Ct. 619, 133 L.Ed.2d 578 (1996) â and a number here indeed are âcomplex and novelâ (Pis.â Br. in Opposition to Motion to Certify at 14) â the Court does not believe any of the proposed questions satisfy the statutory criteria.
First, Plaintiffs ask the Court to certify the issue of whether Vimeo had the âright and ability to controlâ the infringing activity on its system. See 17 U.S.C. § 512(c)(1)(B). The Second Circuit in Viacom concluded that âthe right and ability to control infringing activity under § 512(c)(1)(B) requires something more than the ability to remove or block access to materials posted on a service providerâs website.â 676 F.3d at 38 (internal quotation marks omitted). But the Circuit declined to provide further guidance regarding what constituted the âright and ability to control,â beyond noting that inducing infringement and issuing detailed instructions regarding usersâ content âmightâ rise to the level of control. Id. In light of the limited guidance in Viacom and the statuteâs âconfusedâ legislative history, see id. at 37, a âsubstantial ground for difference of opinionâ exists regarding this issue, 28 U.S.C. § 1292(b).
Nonetheless, this issue does not present a âcontrolling question of law.â Id. Plaintiffs are unable to articulate the precise legal question that the September 18 Order raises with respect to this issue; their proposed question essentially asks whether, considering the totality of the circumstances in this case, Defendants had the right and ability to control usersâ content.
Second, Plaintiffs seek certification of the Courtâs holding that Defendants must be willfully blind to specific instances of infringement to lose Safe Harbor protection. (See Order at 3.) This issue presents a âpure question of lawâ that would not require the Circuit to âstudy the record.â Narragansett, 921 F.Supp.2d at 196. But it is a question that the Circuit appears to have answered. In Viacom, the Court concluded that âthe willful blindness doctrineâ is another method of âdemonstratfing] knowledge or awareness of specific instances of infringement under the DMCA.â 676 F.3d at 35. In view of the Circuitâs holding that âactualâ or âred flagâ knowledge must relate to âspecific and identifiable instances of infringement,â id., it seems that proof of willful blindness must also be tied to specific instances of infringement. See also id. (âWhen [a service provider] has reason to suspect that users of its service are infringing a protected mark, it may not shield itself from learning of the particular infringing transactions by looking the other way.â (quotation marks omitted and emphasis added)).
Here, although Plaintiffs cited evidence that suggests that Vimeo employees may have turned a blind eye to infringement of musical recordings on the website, none of that evidence connects such âwillful blindnessâ to any of the Videos-in-Suit. Because of this deficiency, the issue does not satisfy the second § 1292(b) criterion for certification.
For the same reason, the Court declines to certify the third issue Plaintiffs seek to appeal, relating to Defendantsâ knowledge of infringement. No evidence in the record showed that Defendants ever viewed the majority of the Videos-in-Suit; there is no âsubstantial ground for difference of opinionâ on this issue. Nor were Plaintiffs entitled to summary judgment on the issue of knowledge with respect to the videos Vimeo employees uploaded or with which they otherwise interacted: although a jury could find that infringement in these vid
Finally, the Court declines to certify Plaintiffsâ three proposed questions relating to Vimeoâs repeat infringer policy.
CONCLUSION
To summarize:
(1)Defendantsâ motion for reconsideration of the Courtâs September 18 Order is GRANTED in part and DENIED in part. Defendants are entitled to summary judgment with respect to seventeen additional Videos-in-Suit: fifteen videos for which the only evidence of employee interaction was that the videos were uploaded by âPlusâ users or users whose accounts had been âwhitelisted,â and two videos for which evidence of infringement was not âobjectively obvious to a reasonable person.â
(2) Plaintiffsâ motion for leave to file an amended complaint to add additional works-at-issue is GRANTED.
(3) Defendantsâ motion to certify for interlocutory appeal the September 18 Order is GRANTED. The Court certifies the following questions:
(a) Whether the DMCAâs safe-harbor provisions are applicable to sound recordings fixed prior to February 15,1972; and
(b) Whether, under Viacom Intâl, Inc. v. YouTube, Inc., a service providerâs viewing of a user-generated video containing all or virtually all of a recognizable, copyrighted song may establish âfacts or circumstancesâ giving rise to âred flagâ knowledge of infringement.
The Courtâs September 18, 2013 Order is amended to include this Opinion and Order. Defendants shall have ten days from the entry of this Opinion and Order to apply to the Second Circuit for leave to proceed with the appeal. The case is STAYED pending a determination by the Second Circuit.
The Clerk of Court is requested to terminate the motions pending at docket en
SO ORDERED.
. Citations to the September 18 Order will be to the version uploaded to ECF, Dkt. # 119 in 09 Civ. 10101, and will take the form (Order at_). All further docket entries cited in this Opinion and Order correspond to 09 Civ. 10101.
. Compare Compl. at Schedule B (listing videos containing pre-1972 recordings), with Supplemental Declaration of James D. Berkley, Dec. 21, 2012 ("Supp. Berkley Decl.â) at Ex. 1 (listing videos with which Vimeo employees interacted). Defendants do not dispute, for purposes of the summary judgment motion, that Schedule B of the complaint accurately reflects which videos contain pre1972 recordings. (Defs.â Response to Pis.' 56.1 Stmt. ¶ 3).
. No evidence in the record supported a finding of âactual knowledgeâ under 17 U.S.C. § 512(c)(1)(A)Âź.
. These videos incorporate the songs "All the Small Thingsâ by Blink 182 and âPraise Youâ by Fatboy Slim, and are associated with Vimeo identification numbers 1889583 and 217550, respectively.
. See Supp. Berkley Deck at Ex. 1 (chart summarizing the videos with which Vimeo employees interacted); Declaration of James D. Berkley, Jan. 6, 2013, at Ex. 2 (electronic versions of Videos-in-Suit); Compl. at Schedule B (list of pre-1972 videos).
. This video is associated with Vimeo identification number 2021311.
. "Genie in a Bottleâ has been described as "one of the best-selling singles of all time.â See "Genie in a Bottle,â http://en.wikipedia. org/wiki/Genie_in_a_Bottle.
. This video is associated with Vimeo identification number 3300782. Because the only evidence Plaintiffs offered to show that a Vimeo employee interacted with the video was that it was uploaded by a "Plusâ user, the Court grants Defendants summary judgment with respect to this video in this Order, despite the fact that a jury could find that it was obviously infringing. See Section 1.A, supra.
. Presumably, the only evidence of employee interaction for some videos in the latter category will be that the videos were uploaded by "Plusâ users or by users whose accounts had been "whitelisted.â For the reasons described in this Order, Defendants will be entitled to summary judgment on those videos.
. Although Judge Pauley noted that the question "may involve a substantial ground for difference of opinion,â he ultimately declined to certify it for interlocutory appeal because "certification would only delay the ultimate resolutionâ of the case. Capitol Records, Inc. v. MP3 tunes, LLC, No. 07 Civ. 9931(WHP), 2012 WL 242827, at *1-*2 (S.D.N.Y. Jan. 9, 2012). Here, a decision by the Second Circuit has the potential to narrow the litigation significantly.
. Plaintiffs propose two questions with respect to the right and ability to control. First: âWhether acts such as (1) the implementation and use of content monitoring programs de
. The three proposed questions are as follows. First: "Whether a purported repeat infringer policy that provides only that Vimeo 'reserves the right' to terminate users who use its service to infringe, without specifying the nature of the conduct or nature or type of violations that would result in termination, effectively communicates to users that there is a realistic threat of losing ... access to the Vimeo system.â (Pis.' Mem. in Opposition to Certification at 20 (internal quotation marks omitted).) Second: "Whether a repeat infringer policy has the ability to maintain the strong incentives for service providers to prevent their services from becoming safe havens or conduits for known repeat copyright infringers, when representatives and employees of the service provider are themselves engaged in acts of repeat infringement but are not terminated as users, observe others engaging in acts of repeat infringement, and encourage users to do so, without taking any action.â (Id. at 21 (internal quotation marks and citation omitted).) Third: "Whether a service provider has reasonably implemented a repeat infringer policy where it fails to engage in any systematic tracking of user violations but instead relies on a demonstrably faulty and ad hoc system dependent upon the memory or subjective evaluation and discretion of the service providerâs employees, and where the service provider has produced only scattered documents which it purports to evidence the implementation of such a policy.â {Id. (internal quotation marks omitted).)
. See supra note 4 and accompanying text.