DMCA ‘Safe Harbors’ Broadened With Ruling

Rhett Pardon
LOS ANGELES — A recent federal court decision involving an adult site operator against several Internet companies is certain to muddy the “safe harbors” provisions of the Digital Millennium Copyright Act.

“[The ruling on immunity] is a mixed bag, and it doesn’t answer some questions,” Fred von Lohmann, an attorney for the San Francisco-based Electronic Frontier, told XBiz. “But one thing is for sure: Adult webmasters are now more exposed to potential claims under the DMCA, and the ‘notice-and-take-down’ rule has been changed with the decision.”

The June 22 ruling grants some motions for summary judgment and denies others, but it articulates an expansive interpretation of specific DMCA safe harbors provisions.

The case, brought on by online adult company Perfect 10, was initiated on allegations of copyright infringement, trademark violations, unfair competition, false advertising, violation of right of publicity and RICO (Racketeer Influenced and Corrupt Organizations) Act violations.

Defendants in the case — age-verification service Internet Key, third-party payment processor iBill, web-hosting provider CWIE and subscription payment manager CCBill — sought to have charges against them tossed on grounds that they qualified for DMCA safe harbors protections.

The DMCA was written into federal law in 1998, limiting online service providers from copyright infringement liability, among other conditions.

In U.S. District Court Lourdes G. Baird’s ruling, however, she brought age-verification and payment services into the DMCA safe harbors, raising the possibility that more Internet businesses that don't fall under the usual web-hosting and connectivity categories will qualify.

Baird ruled that the online service providers qualified for the DMCA's "information location," or "linking" safe harbors.

Beverly Hills, Calif.-based Perfect 10 in the case argued that safe harbor only applied to search engines like Yahoo and Google, which locate and link to sites they're not affiliated with.

But Baird said that a company that linked to a limited network of sites with which it had contractual relationships still qualified under the safe-harbors provisions.

The DMCA requires that copyright holders alleging a violation must first issue a DMCA “notice-and-take-down” to the company or individual in question.

But Baird raised the level for how specific the notice-and-take-down must be before copyright owners can demand that a service provider terminate an allegedly infringing subscriber.

“There’s a serious risk adult webmasters will have under her decision,” von Lohmann of the EFF said. “The court tightened the requirements that the notice can trigger.”

Baird also ruled on the issue of the Communications Decency Act’s Section 230 immunity, which shields Internet service providers, as well as other online businesses, from prosecution for many of their subscribers' actions.

The Los Angeles-based judge in her 56-page ruling said the right of publicity for public figures is an intellectual-property matter, ruling out Section 230 protection for publishers.

“This could be potentially troublesome for online celebrity sex sites, like the Cameron Diaz site,” von Lohmann said. “The sites won’t be shielded under Section 230 of the DMCA.”

The case is Perfect 10 Inc. vs. CCBill LLC, et al, No. CV-02-7624.