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Viacom Files A Second Appeal in Viacom v. YouTube/Google - They'd Like a Trial and a Different Judge ~pj
Saturday, July 27 2013 @ 11:32 AM EDT

Viacom can't seem to find a judge to agree with them that the DMCA Safe Harbor should be reinterpreted Viacom's way or that YouTube/Google, specifically, should lose its protection because of its conduct. Their war against Google's YouTube is into its 7th year, and Viacom still thinks that YouTube and parent Google should be held responsible for what users do on it. Specifically, it wants them to have the editorial burden of preventing copyright infringement from happening in the first place, not acting on it when notified of specific infringement by the copyright owner, and it wants it to have to pay for it all by itself.

So far, it hasn't worked out for Viacom, because that's exactly what the DMCA says shouldn't happen, so they're appealing a second YouTube victory on summary judgment, shopping for an outcome they'd like better than what they keep getting. It argues to the appeals court that the district court judge failed to properly follow the appeals court's directions after the first appeal.

So in their opening appeal brief [PDF], Viacom asks the U.S. Court of Appeals for the Second Circuit to send the case back once again to the district court for a trial, but this time with a different judge, once who might be more receptive to Viacom's interpretation of the DMCA:

Given the protracted nature of this litigation (the case is now well into its seventh year) and the evident firmness of the district court’s erroneous views regarding the DMCA, this Court should exercise its discretion to remand the case to a different judge “to preserve the appearance of justice.”
Not that this implies any criticism of the judge, Viacom tells the court. No. Oh no.

You know Hollywood. They want what they want and they want it now. So rather than ask Congress to change the law, they are shopping for a judge who will do it for them the easy, cheap -- and I might add, improper -- way via a strained interpretation of the law's wording based on the Grokster case. But in reality, whether they realize it or not, what they *really* want is for the Internet never to have been born, or at least to be different, more controlled from above, like television and the movies, where they can control everything their way, and users just sit back and passively buy what they sell. And since they can't have that, they want Google to have to control users on the Internet on *their* dime instead of Viacom's, which under the law has the responsibility to identify copyright infringement and send take-down notices. Not so, Viacom argues, if, as in the Grokster case, YouTube was willfully blind.

Here's how Viacom describes to the court what it's been enduring, how it sees it, and what it wants:

Now, after more than six years of litigation and a prior reversal of summary judgment by this Court, the district court has again granted summary judgment to YouTube on its affirmative defense under Section 512(c) of the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 512(c). The renewed grant of summary judgment, like the prior one, strips the Section 512(c) safe harbor of several key independent requirements, reducing it to the notice-and-takedown provision in subsection 512(c)(3). Failing to heed this Court’s guidance on remand, and ignoring much of the vast evidentiary record, the district court has again concluded that the DMCA safe harbor places the entire burden of combating online piracy on content owners, and grants immunity even to avowedly piratical websites that “welcome” and benefit from massive infringement, as long as they comply with take-down notices initiated by copyright owners, scrupulously avoid learning the location of specific infringing clips, and do not “participate in” or “coerce” the infringing acts of users. This grant of summary judgment is completely inconsistent with this Court’s guidance on the “right-and-ability-to-control” and “knowledge” exceptions to the DMCA safe harbor. Contrary to this Court’s instructions, the district court failed to apply the Grokster inducement standard as a basis for determining the right and ability to control, and failed fairly to apply the doctrine of willful blindness in assessing knowledge of infringement. Once these and other errors are corrected, the grant of summary judgment must again be reversed.
So here we go again.

Say, is there anyone in the known world who *doesn't* want to sue Google and get some money, honey? Any legacy business executive who doesn't somehow believe that Google is to blame for the Internet being how it is? Guys, Google didn't invent it; it just figured out how to run a thriving business on it. You could try to do the same instead of trying to ruin it for everyone. What? Too hard?

The first time Google won on summary judgment, the judge wrote [PDF], "General knowledge that infringement is 'ubiquitous' does not impose a duty on the service provider to monitor or search its service for infringements." So "the burden is on the owner to identify the infringement," he wrote. And that's what annoys Viacom.

So it appealed, and the appeals court sent the case back to the same judge, telling it to look at the issue of willful blindness, and, to Viacom's grief and frustration, the judge still said Google was in the right and granted its motion on summary judgment a second time. The DMCA says what it says, and everyone but Hollywood seems to agree that the purpose is to hold folks like YouTube/Google harmless so long as they take down infringing materials when notified by the copyright owner. As Google/YouTube successfully argued, how are they able to even know who owns what? Only the copyright owner knows for sure. In discovery, it turned out some of what was on YouTube that Viacom was complaining about was placed there by Viacom. I mean.

So now, this appeal. Why did Google buy YouTube, when everyone knew it had infringing content on it, Viacom argues, and doesn't that prove they meant to profit from infringement? Sigh. You can follow the entire sad saga, document by document, thanks to EFF's collection here. And here's the second successful summary judgment motion [PDF] by Google/YouTube filed on March 29th, and its memorandum in support [PDF], along with Viacom's opposition [PDF].

What's This New Appeal About?

Viacom sets forth what it views as the appeal issues:

ISSUES PRESENTED

1. Whether, viewing the evidence in the light most favorable to Viacom, there is at least a genuine dispute of fact about whether YouTube’s practice of welcoming copyright infringement and its strategic use of piracy to achieve its business objectives place it outside the safe harbor of 17 U.S.C. § 512(c) because:
a. YouTube “receive[d] a financial benefit directly attributable to infringing activity” that it had “the right and ability to control”; or

b. YouTube had actual knowledge or awareness of specific infringing material on its site, or alternatively, willfully blinded itself to such material, and failed to remove it.

When lawyers write that there is a "genuine dispute of fact", they mean they want a trial, not a judge ruling on summary judgment. So that is one goal here.

But here's the core of it. Viacom wants Google/YouTube to lose its Safe Harbor immunity due to what it calls "guilty knowledge", as it explains when detailing the history of the case, because the DMCA says that a service provider can lose safety if it has "actual knowledge" of infringement (or “aware[ness] of facts and circumstances”) and fails to act. So the question is, to Viacom, what did YouTube know and when did it know it? And how should that "awareness of facts and circumstances" be interpreted? Remember that this is Viacom's memory and its point of view, not necessariy the unbiased truth of what happened:

IV. Procedural History

A. Original Summary Judgment Proceedings

After fact discovery, the parties cross-moved for summary judgment. Despite acknowledging that “a jury could find that the defendants not only were generally aware of, but welcomed, copyright-infringing material being placed on their website,” the district court granted Defendants’ motion and denied Viacom’s, holding that the DMCA safe harbor immunized Defendants. SPA6, 30 (referred to hereafter as Viacom I).

Section 512(c)(1)(A) of the DMCA provides that a service provider loses the safe harbor for user-generated content stored on its site if it had “actual knowledge” of infringement or “aware[ness] of facts and circumstances” indicating infringing activity and failed to take action. 17 U.S.C. § 512(c)(1)(A). The district court held that both refer to “knowledge of specific and identifiable infringements.” SPA15. Ignoring willful blindness, which Viacom had emphasized in its briefing, the district court found as a matter of law that Defendants never obtained such disqualifying knowledge, other than through takedown notices, to which – in the court’s view – Defendants responded adequately. The district court also expressed the view that the takedown-notice regime in subsection 512(c)(3) provides an adequate remedy for copyright owners. SPA16.

Section 512(c)(1)(B) of the DMCA requires that to qualify for the safe harbor, a defendant must “not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity.” 17 U.S.C. § 512(c)(1)(B). As to this exception, the district court again imposed a specific-knowledge requirement, holding that Defendants could not control infringement on YouTube because they did not have “item-specific” knowledge of infringing clips. SPA25-26.

B. First Appeal

Viacom appealed, and this Court reversed in part. Although it agreed with the district court that “actual knowledge” and “aware[ness] of facts and circumstances” under Section 512(c)(1)(A) “apply only to specific instances of infringement,” the Court vacated the grant of summary judgment because “a reasonable juror could conclude that YouTube had actual knowledge of specific infringing activity, or was at least aware of facts or circumstances from which specific infringing activity was apparent.” SPA49-50, 54 (referred to hereafter as Viacom II) (internal quotation marks omitted). The Court also held that willful blindness constitutes knowledge under the DMCA, where a defendant is aware of a high probability of infringement but deliberately shields itself from learning of specific infringing clips. Noting that the district court had failed to address willful blindness, the Court remanded for consideration “whether the defendants made a deliberate effort to avoid guilty knowledge.” SPA56 (internal quotation marks omitted). Furthermore, this Court “counsel[ed] in favor of explicit fact finding on the issue of willful blindness.” SPA56 n.10.

This Court also reversed with respect to the “right and ability to control” under Section 512(c)(1)(B), holding that the district court “erred by importing a specific knowledge requirement” into that provision. SPA56-57 (internal quotation marks omitted). Explaining that “control” under the DMCA “requires something more than the ability to remove or block access to materials posted on a service provider’s website,” this Court gave two examples of “something more”: (1) proof of “inducement of copyright infringement under MetroGoldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (2005),” and (2) the type of control present in Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F. Supp. 2d 1146 (C.D. Cal. 2002). SPA59-60 (internal quotation marks omitted). The Court remanded for a determination whether there are material disputes of fact under this standard. SPA60-61.

C. Remand Summary Judgment Proceedings

On remand, Defendants again moved for summary judgment based on the DMCA, resting on the same factual record. The district court granted the motion. SPA96-97 (referred to hereafter as Viacom III).

With respect to knowledge or awareness under Section 512(c)(1)(A), the district court flipped the normal rule and held that the plaintiff copyright owner bears the burden of proving that the service provider has specific disqualifying knowledge, even though the DMCA safe harbor is an affirmative defense. It cited the notice-and-takedown provision in subsection 512(c)(3), which it read as a determination by Congress that “the burden of identifying what must be taken down is to be on the copyright owner.” SPA79. Thus, even though “the defendants were conscious that significant quantities of material on the YouTube website were infringing,” SPA51-52 (Viacom II), the district court held that they had no burden to show that they lacked specific knowledge or awareness of any of Viacom’s clips-in-suit. And because YouTube’s internal records would not allow Viacom to identify which specific clips Defendants’ employees viewed, the district court concluded as a matter of law that Defendants should be deemed not to have had disqualifying knowledge. SPA77-79.

The court also concluded that Viacom had failed to raise a triable issue of fact as to Defendants’ willful blindness. Instead of following this Court’s instruction to consider “whether the defendants made a deliberate effort to avoid guilty knowledge,” and its recommendation in favor of explicit factual findings, the district court did neither. SPA56 & n.10 (internal quotation marks omitted). It reasoned that the problem with the proffered willful blindness evidence was that it did not identify “[t]he specific locations of infringements,” and “g[a]ve at most information that infringements were occurring with particular works, and occasional indications of promising areas to locate and remove them.” SPA82. Put differently, the court seemingly concluded that even if Defendants were assumed to have all the knowledge they willfully avoided, they still would have had to conduct some follow-up investigation to locate specific infringing clips. As a result, the district court held as a matter of law that Defendants could not be held liable on a willful-blindness theory. SPA83. But the district court discussed almost none of the actual willful-blindness evidence proffered by Viacom, including proof that filtering technology would have detected and blocked illegal clips automatically but You-Tube refused to apply it to Viacom’s content. SPA80-83. With respect to the right-and-ability-to-control exception, the district court did not apply the Grokster inducement standard as instructed by this Court. Instead, it held that control requires “participation in” or “coercion of” infringing activity of users, and that without such conduct a service provider’s “motivation” to facilitate infringement is irrelevant. SPA91. In so doing, the district court ignored the actual holdings in Grokster and in the Ninth Circuit’s recent decision in Columbia Pictures Industries, Inc. v. Fung, 710 F.3d 1020 (9th Cir. 2013), which Viacom emphasized. Applying its own strict standard, the district court concluded after a cursory review of the evidence that Defendants lacked control: while “[t]hat evidence proves that YouTube for business reasons placed much of the burden on Viacom” continually to search the website for infringing clips, “[t]hat is where it lies under the safe harbor.” SPA90 (internal quotation marks omitted).9

________
9 Viacom previously argued that Defendants’ syndication of clips-in-suit to third parties fell outside the scope of the Section 512(c) safe harbor. This Court remanded that issue for further fact finding, SPA61-64, and the district court concluded that Defendants’ syndication fell within the safe harbor. SPA96. Viacom is not appealing that portion of the district court’s summary judgment ruling.

I think you could read this history, even as told by Viacom, as evidence that Viacom failed to prove its case ("And because YouTube’s internal records would not allow Viacom to identify which specific clips Defendants’ employees viewed, the district court concluded as a matter of law that Defendants should be deemed not to have had disqualifying knowledge."). But it obviously thinks the appeals court is more favorable to its position than the district court was, so it's trying for a win by getting the appeals court, they hope, to tighten up this ship and make the district court do what Viacom wants. But the problem Viacom faces is that Google can't remove what it can't reliably identify. How in the world can Google know who owns all the content on YouTube? It can't know who uploaded the materials and whether that person or entity has the rights to do so unless a copyright owner tells them.

Nevertheless, Viacom argues that YouTube has the responsibility and the ability to control what happens on YouTube:

SUMMARY OF ARGUMENT

To prevail on the Section 512(c) safe-harbor affirmative defense, a service provider must meet each of the following requirements: (1) it must not receive a financial benefit directly attributable to infringing activity that it has the right and ability to control; and (2) it must not obtain actual knowledge of infringement or awareness of facts or circumstances from which infringing activity is apparent, or if it does, it must act expeditiously to remove the infringing material. On remand, in adjudicating these requirements, the district court failed to follow this Court’s instructions and failed to apply the correct legal standards. The grant of summary judgment must therefore be reversed.

First, YouTube profited from infringement it had the right and ability to control. In Viacom II, this Court held that the right and ability to control can be established through a showing of Grokster inducement or the types of control at issue in Cybernet. YouTube had the right and ability to control the massive infringement occurring on its site under both theories. The record shows that YouTube operated its service “with the object of promoting its use to infringe copyright.” MetroGoldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 936–37 (2005). YouTube purposefully (and successfully) built its business on infringement, attracting users and advertising revenue through the “major lure” of “blatantly illegal” clips of Viacom’s highly popular television shows and movies. That is enough to constitute Grokster inducement. Nevertheless, the district court failed even to consider YouTube’s Grokster intent, an issue seldom amenable to summary judgment. As for Cybernet, the record shows that YouTube actively designed and operated its service to take advantage of the fact that infringing uploads were drawing in viewers and advertising revenue. Only by misapplying this Court’s instructions and largely disregarding the record could the district court conclude that YouTube lacked the right and ability to control infringement.

Second, YouTube had two types of disqualifying knowledge under the DMCA, either of which is enough to deny YouTube the safe harbor: actual knowledge or awareness of specific infringing clips, and knowledge of such clips imputed through willful blindness. As to the former, even in the face of extensive evidence of YouTube’s review of infringing clips, including Viacom’s clips-in- suit, the district court impermissibly shifted the burden of proof on YouTube’s affirmative defense to Viacom to identify which specific clips-in-suit YouTube knew about. If the burden had been properly allocated, it would have been clear that YouTube has not met its burden of showing that it lacked knowledge or awareness of Viacom’s clips-in-suit. There is also at least a genuine dispute of material fact as to whether YouTube willfully blinded itself to infringement of Viacom’s clips-in-suit through its awareness of a high probability of infringement coupled with its many deliberate efforts to avoid learning of specific instances of that infringement. These efforts most notably include YouTube’s intentional refusal to deploy technologies that YouTube already was using for other select content owners.

So, as you can see, the real issue is how much does a service provider have to do to block infringement? Viacom has it in its head that Google can wave a magic wand and make it go away without Viacom having to lift a finger. It wants Google to prevent copyright infringement, not deal with it when notified of it, and while the DMCA doesn't put that burden on service providers, Viacom thinks it should, since in its mind there is filtering software that could do the job:
To the extent the district court even considered record evidence of You-Tube’s editorial control at all, it improperly discounted it because the court once again misunderstood the DMCA and Viacom II. The court placed heavy emphasis on Section 512(m), which provides that safe-harbor protection shall not be conditioned on “a service provider monitoring its service or affirmatively seeking facts indicating infringing activity.” 17 U.S.C § 512(m). On the court’s view, Section 512(m) makes all decisions regarding monitoring irrelevant to the right-and-ability-to-control analysis, regardless of whether the defendant chooses to monitor or filter for some offensive or infringing content, and “regardless of the[] motivation” behind the defendant’s policies. SPA91.14

Section 512(m) does not have such an all-encompassing reach. It states only that service providers need not affirmatively adopt monitoring systems to enjoy the protection of the DMCA’s safe harbor; it does not prevent a court from considering, as part of the Section 512(c)(1)(B) analysis, a defendant’s actual exercise of control over its service, including its decisions to exclude some objectionable content while allowing, and thus encouraging, copyright infringement. Even in the absence of an affirmative duty to monitor, a party that curates the content on its web-site may be held liable for “welcoming” infringing activity. This is particularly so given that YouTube’s monitoring efforts like community flagging were visible to the public, and their selective use sent a clear, encouraging message to would-be infringers. Moreover, nothing in Section 512(m) suggests that it protects a service provider’s decision to implement a monitoring program selectively so as to extract favorable licensing deals from content owners.

________
14 In reaching this conclusion, the district court relied on a portion of Viacom II that did not consider the right and ability to control, but instead interpreted a different part of the statute—§ 512(i)—that is not at issue here.

That's the toxic argument, that while YouTube blocked things like porn, it didn't block copyright infringement to prevent it happening in the first place in the early days. The district court told Viacom that YouTube has no such responsibility under the law as written, but Viacom wants that looked at again in light of YouTube's specific conduct.

But again, Google can figure out what is and what isn't porn just by looking at it. How does it know if a specific clip is authorized or not if the copyright owner doesn't tell it? And that is what Viacom doesn't want to have to keep doing.

But, just in case you are easily persuaded by Viacom's description of Google/YouTube of refusing to should its responsiblities, here's a brief snip from Google's memorandum in support of its second successful summary judgment motion, which Viacom is appealing. In it Google reveals that it is blocking materials, with Viacom's help, since 2008, when Viacom finally agreed to help out:

B. YouTube’s Efforts To Help Copyright Owners Stop Infringement

YouTube has always taken copyright issues seriously, and its founders recognized that doing so was important to building their business. SUF ¶¶ 48-59; RVSCS ¶¶ 1.111, 1.114; Botha Decl. ¶ 6; Hurley Opening Decl. ¶¶ 11-16, 19. YouTube has never solicited infringing material or encouraged users to post unauthorized videos. SUF ¶¶ 48-59; see also Hurley Opening Ex. 25 (Hurley: “we should never promote piracy or tell them how to do it”). To the contrary, YouTube’s earliest advertisements emphasized its aim to “become a community of digital video authors and their videos.” SUF ¶¶ 11-13; see also Hurley Opening Decl. ¶ 10 & Ex. 11. The very name of the service and its slogan (“Broadcast Yourself”) reinforced YouTube’s focus on personal videos. SUF ¶¶ 6-9 (citing Schapiro Opening Ex. 162 (“The videos you upload should be about you (hence, YouTube!)”)).

Consistent with that message, YouTube has long worked to deter users from uploading unauthorized material and to assist content owners in protecting their copyrights.1 In addition to its Terms of Use, which prohibit users from posting unauthorized copyrighted material (SUF ¶ 49), YouTube provides a “Copyright Tips” page to help users understand copyright law and avoid inadvertently posting infringing videos. SUF ¶¶ 53-54. YouTube has also registered an agent to receive notices of alleged infringement from copyright holders; expeditiously removes allegedly infringing materials upon receiving such notices; terminates the accounts of users suspected to be repeat infringers; and maintains a team of employees to assist copyright owners in removing unauthorized material. SUF ¶¶ 60-87. Copyright holders and anti-piracy groups like the Motion Picture Association of America have repeatedly praised YouTube for its efforts to combat copyright abuse. SUF ¶¶ 70, 87.

From early in its operations, YouTube has also used technological measures to help content owners. In early 2006, YouTube introduced a tool that allows copyright holders to mark allegedly infringing videos and have them removed with the click of a button. SUF ¶¶ 90-93. At the same time, YouTube deployed “hashing” technology that blocks any user from uploading identical copies of videos previously removed in response to takedown notices. SUF ¶¶ 88-89. In February 2007, YouTube started using audio-based “fingerprinting” technology licensed from a company called Audible Magic. SUF ¶¶ 94-96. Recognizing the limits of existing technologies, YouTube rapidly supplemented its use of Audible Magic by building its own fingerprinting system. SUF ¶¶ 97; see also King Opening Decl. ¶¶ 11-28.

YouTube’s pioneering technology, called Content ID, uses audio- and video- fingerprinting technology developed in-house to identify videos on YouTube. SUF ¶¶ 97-110. Content ID scans every single video uploaded to YouTube and compares it with reference files provided by participating copyright holders. SUF ¶ 106. If a match is identified in a portion of the video, the system applies the content owner’s instructions about what to do with the video. SUF ¶ 105. YouTube was the first user-submitted content website to develop its own video-based fingerprinting system. SUF ¶ 100. Since it launched in October 2007, Content ID has been used by thousands of copyright holders to make their own choices about how, where, when, or whether they want their material to appear on YouTube. SUF ¶¶ 104, 109-10. YouTube offered Content ID to Viacom as soon as it launched, and Viacom signed an agreement to start using the technology in February 2008. SUF ¶¶ 111- 112; see also King Opp. Decl. ¶¶ 7, 9-10.2

________
1 In the early days of the service, YouTube’s founders occasionally came across what looked like professional media content that they were concerned may have been posted without authorization. They consistently rejected such videos, which they viewed as inconsistent with their vision for the site. SUF ¶ 9; see also Hurley Opening Decl. ¶¶11, 15- 17 & Exs. 9, 13, 17, 19, 20, 21, 30; Hurley Opp. Decl. ¶6 & Exs. D-G; Hohengarten Ex. 206. In July 2005, for example, Chad Hurley wrote to tell a user that his video had been “rejected because it was copyrighted material,” explaining that “[w]e are trying to build a community of real user-generated content.” Hurley Opening Ex. 22.

As you can see, Viacom's problem has been addressed since it finally agreed to cooperate in 2008. So what is Viacom's problem, you are asking? Indeed. Google is doing way more than the law requires it to do.

What Viacom wants isn't just its own issue solved, since it's still suing after it has been solved. It wants the DMCA reinterpreted. It doesn't want to have to pay anything to solve its problem either, preferring that the full economic burden fall on Google and services like it. Here's how EFF described the significance of Viacom's litigation when it began:

These lawsuits will test the strength of the DMCA safe harbors as applied to online service providers that host text audio and video on behalf of users. The whole idea of the DMCA safe harbors was to provide legal protections for online service providers like YouTube who otherwise would hesitate to create the online platforms that have revolutionized creativity culture and commerce. Consequently the outcome of this case will be important not just for YouTube but also for lots of other online services including eBay Blogger Flickr Scribd Amazon and many others. Previous court rulings have recognized that the safe harbors apply to video hosting sites.
That's all this is really all about now, trying to stretch the DMCA. Well. That and money. Copyright infringement is a lucrative business, if you catch my drift, and not in the way Viacom is alleging against YouTube. It's a plaintiff gold mine, if it can prevail, and it thinks by focusing on YouTube before Google bought it, it can.

Here's Viacom's original complaint [PDF], if you'd like to compare. And here's Groklaw's main coverage of this horrible litigation:


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