9th Circuit: Wrong E-mail Address Could Sink AOL's DMCA Safe Harbor

The Ninth Circuit Court of Appeals just came down with an interesting copyright decision involving SciFi author Harlan Ellison and AOL over whether AOL could be vicariously and contributorily liable for its users downloading Ellison's books via AOL's USENET archives.

In the case, AOL asserted that it was not liable under the DMCA Safe Harbors (17 USC 512). However, the court found that it wasn't clear that AOL qualified for the harbors because it had, at one point, changed its DMCA-complaint email address from copyright@aol.com to aolcopyright@aol.com without telling anybody for months. The court said that the case had to go to trial on whether AOL had "changed its email address in an unreasonable manner" and thereby taken itself out of the safe harbor protections.

The Court also briefly discussed contributory and vicarious infringement. On contributory, it held that a jury might find that AOL should have had knowledge of the infringing works being on their system because the old email inbox had received Ellison's email (among others) and a subscriber had also called them on the phone to complain about infringing works generally on the newsgroup in question, alt.binaries.e-book.

The e-mail standard doesn't trouble me as much, but the phone call one certainly does. Just because one person (who isn't even the copyright owner) calls your company on the phone to complain about something on your servers generally shouldn't, in my mind, trigger "knowledge" liabiliity generally. Perhaps the caller specifically mentioned Ellsion, but the opinion isn't clear about that.

The Court also addressed the issue of "material contribution," which is the second element of contributory infringement. It affirmed the ruling in RTC v. Netcom by holding that temporary storage of and providing access to news groups with infringing works on them could be a material contribution and so a jury must decide if it is.

On vicarious liability, the Court first rejected the suggestion that financial benefit (the second element of vicarious liability) should be substantial in nature. Rather, the court said it merely needed to be a "draw" to use the service or buy the product. It then found, however, that Ellison hadn't provided evidence that AOL customers either subscribed to AOL for access to USENET or cancelled their subscriptions when access to alt.binaries.e-books was blocked.

This is a nice part of the decision. In a lot of cases, copyright plaintiffs will generally accuse companies of making money off of copyright infringement without showing how the infringement directly ties into the companies profits. Now, in reality, every internet company makes some money because of infringment because infringing copyrights on the 'net is like breathing air on the earth. So it's important that the Court focused the analysis on whether or not these particular infringements had a cause-and-effect relationship on how much money AOL made. It's a much tighter (and tougher) test for plaintiffs, and appropriately so.

Finally, the decision notes that if AOL can prove that its policy for DMCA take-downs was reasonable, it will qualify for the safe harbor under 512(a), the "conduit" provision. This is interesting because AOL kept the USENET archives for up to 14 days on its servers. The fact that the Ninth Circuit considered this still to be "transitory" is a good observation of the reality of computer networks and the fact that storing data temporarily, even for a week or two, is pretty typical activity for ISPs.

p.s. The decision is also interesting because one of the panel members, Sydney Thomas, is also one of the panel members on the MGM v. Grokster case about P2P liability in the vicarious and contributory context.