TL;DR
- On 6/22, the CJEU ruled YouTube is not liable in copyright infringement case brought against the platform — setting a standard for how a diligent operator may avoid being held liable for communicating copyrighted content to the public according to the pre-Article 17 of the DSM Directive legislation (InfoSoc and E-Commerce Directive)
- The ruling encourages platforms to monitor for copyright infringement by implementing content recognition technology solutions to ensure compliance
- This judgment will affect all platforms that may potentially communicate copyrighted content to the public, not only those who are subject to Article 17 of the DSM Directive (the Directive on Copyright in the Digital Single Market)
The CJEU ruled YouTube is not liable in copyright infringement case
On June 22, the Court of Justice of the European Union (CJEU) decided in favor of YouTube in the latest of a string of copyright infringement lawsuits directed towards platforms. The ruling concerned two cases, both referred for a preliminary ruling by the German Federal Court, involving uploaded recordings by british performer Sarah Brightman by unauthorized users, and file-hosting service Cyando, where the users uploaded content from publishing group Elsevier without clearance. The Court focused on the following two questions.
First, the Court established criteria which indicate that the platform carries out communication to the public (Note: communication to the public is a specific EU legal concept. An author has an exclusive right to communicate her work to the public, i.e. make the work available to the public by any means. Anyone else who desires to communicate the work to the public has to obtain authorization from the author). The Court made it clear that if the platform communicates to the public without a proper license, it loses safe harbor protection.
Second, the Court clarified that if the role of the platform in providing content isn’t active, it is covered by the safe harbor protection even though its users upload illegal content.
In essence, the Court used YouTube to demonstrate how to apply its new “Communication to the Public Test” (a non-exhaustive set of criteria which can help courts determine whether the platform carries out communication to the public). YouTube has passed the test because it has implemented a content recognition solution (in this case, their Content ID technology) to identify copyright, among other measures. While many see this as a win for YouTube, there are broader implications from the ruling that platforms should note.
The estimated effects of the judgment
The biggest takeaway from this ruling is that platforms need to implement measures to ensure they aren’t communicating copyright-protected content to the public, with the CJEU recommending content recognition technology as a viable solution, along with taking other measures such as informing users that uploading copyright-infringing content violates the platform’s terms of service.
CJEU reassured platforms won’t lose safe harbor protection if they have mechanisms in place to scan content for infringement (as these mechanisms only detect content that has been previously flagged by rightsholders). It’s worth noting that if the platform did find a piece of content for which they don’t have a license, they must act in order to avoid liability.
This ruling will also affect the upcoming European regulation of platforms, Digital Services Act, (DSA), as DSA is built on the foundations of E-Commerce Directive which this ruling clarifies.
The interplay between the judgment, safe harbor provisions and Article 17
Before the judgment, all operators, aside from those who explicitly infringed copyright, were protected under safe harbors. However, now any platform that fulfils some of the criteria of the “Communication to the Public Test” is unprotected. For example, this applies to platforms failing to utilize technological measures that take down copyright-infringing content where appropriate (examples of this type of technology are YouTube’s Content ID or Pex’s Attribution Engine).
New legislation known as Article 17 of the DSM Directive introduces a novel set of rules on copyright liability of a subset of platforms — classified as Online Content-Sharing Service Providers (OCSSPs), such as YouTube — with respect to copyrighted content uploaded by their users. However, many platforms don’t fall within the scope of Article 17 and continue to follow the regime of the previous legislation (InfoSoc and E-Commerce Directives). For those platforms, the judgment is significant, because under the pretense of clarifying the respective provisions of the Directives, it essentially reduces the certainty that the platforms enjoy the safe harbor protection and by laying down the “Communication to the Public Test,” incentivizes platforms to put in place additional measures to avoid liability.
How Pex’s Attribution Engine can help
Safe harbors in the E-Commerce Directive have kept platforms from being responsible for the content distributed by users so long as they don’t have actual knowledge of illegal activity, thus perpetuating the responsibility onto users. As these safe harbours are being removed for qualifying OCSSPs because of Article 17, and clarified for platforms still governed by the E-Commerce Directive in cases like this one, platforms are facing a great deal of ambiguity around when and why they may be held liable. Leveraging technology to detect copyright in user uploads is the best way for a platform to gain certainty and stability while mitigating their risk.
Technologies like Pex’s Attribution Engine, which identifies, attributes, and licenses copyrighted content before it’s published to user-generated content (UGC) platforms, ensures compliance increases access and confidence for creators. With Attribution Engine, platforms no longer have to rely on legislative loopholes in order to be protected from infringement and users can upload freely while respecting copyright.
Interested in working with Pex for your platform? Contact our team today.
