The case originates from a home video posted on YouTube that features a baby dancing to the Prince tune, "Let's Go Crazy." Universal sent a takedown to YouTube, which complied and sent notice of the removal to the poster, Stephanie Lenz. Lenz responded by requesting that the video be reposted because it constituted a fair use and therefore did not infringe Universal's copyright. The video was later reposted and remains there today.
Lenz filed suit, alleging misrepresentation pursuant to 17 U.S.C. Section 512(f). Among the requirements for filing a takedown notice, the content owner is required to affirm that it has a "good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law." It is Lenz's contention that Universal did not have such a good faith belief because it did not consider whether her use was authorized by the law as a fair use.
Universal moved to dismiss the case for failure to state a claim. Universal's position is that fair use is not a matter it must consider before issuing a takedown notice because fair use is merely an excused infringement of copyright rather than an authorized use.
This issue touches on one of the odd paradoxes of copyright law in the U.S. Fair use is almost universally spoken of as a "defense" to copyright infringement, rather than a permitted use. However, as pointed out by Bill Patry (in an earlier post that I cannot currently find), this dichotomy is frequently overstated.
The court looks to the language of the statute, wherein Section 107 provides that "[n]otwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work . . . is not an infringement of copyright." Because fair use is not an infringement of copyright, it is not contrary to the law, and if it is not contrary to the law then it necessarily must be permitted. Therefore, one can only conclude that an act which is "not contrary to the law" is one that is "authorized by law." The court continues:
Accordingly, in order for a copyright owner to proceed under the DMCA with “a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law,” the owner must evaluate whether the material makes fair use of the copyright. 17 U.S.C. § 512(c)(3)(A)(v). An allegation that a copyright owner acted in bad faith by issuing a takedown notice without proper consideration of the fair use doctrine thus is sufficient to state a misrepresentation claim pursuant to Section 512(f) of the DMCA. Such an interpretation of the DMCA furthers both the purposes of the DMCA itself and copyright law in general. In enacting the DMCA, Congress noted that the “provisions in the bill balance the need for rapid response to potential infringement with the end-users [sic] legitimate interests in not having material removed without recourse.” Sen. Rep. No. 105-190 at 21 (1998).This is a very interesting holding because it places the fair use analysis on the front-end and seems to entirely eliminate the notion that "fair use" is only a defense to copyright infringement. It seems to make perfect sense and perhaps sheds some clarity on the role fair use will play in our industry in the future.
Of course, at the same time it places a far greater burden on the content owners. Prior to this ruling, content owners were issuing takedown notices for any use that was not licensed by them. Certain fair uses are clear - news-reporting, for instance. However, now the content owners must review all of the personal videos posted and determine whether or not such use is fair. The courts have had a bearish time making this determination on their own and I imagine it will be even more challenging for the content owners to get it right. And, if they fail, they risk being on the hook for a bad faith finding. Then again, it could be that if the content owner can show it made a good faith effort to determine whether the use was fair, but was wrong, then the court could not find that the takedown was issued in bad faith.
It should be remembered that the court is not saying Lenz's use is a fair use, but only that Universal had the burden to evaluate whether or not it was a fair use prior to issuing the notice. Hopefully, the parties do not settle and the case is allowed to proceed on the merits, so that both users and content owners will have a decision to rely on to help all of us figure out what is and is not a fair use in our current media environment.