Consider: the top 20 companies in the United States ranked by market capitalization include no media companies. But according to figures assembled for The New York Times by Equilar, which compiles data on executive compensation, media companies employ seven of the top 20 highest paid chief executives.

The names are familiar and the numbers are large: Leslie Moonves of CBS ($60,253,647), David M. Zaslav of Discovery Communications ($49,932,867), Robert A. Iger of Walt Disney ($37,103,208), Philippe P. Dauman of Viacom ($33,396,104), Jeffrey L. Bewkes of Time Warner ($25,670,263), Brian L. Roberts of Comcast ($25,087,379), and Rupert Murdoch of News Corporation ($22,418,292).

The data indicates that average pay of the 10 highest paid chief executives for media companies was about $30 million, more than the captains of technology or finance and other industries, who average $6 million to $14 million less.

Viacom's argument that the volume of material and "the absence of record evidence that would allow a jury to decide which clips-in-suit were specifically known to senior YouTube executives" (Viacom Opp. pp. 9-10) combine to deprive YouTube of the statutory safe harbor, is extravagant. If, as plaintiffs assert, neither side can determine the presence or absence of specific infringements because of the volume of material, that merely demonstrates the wisdom of the legislative requirement that it be the owner of the copyright, or his agent, who identifies the infringement by giving the service provider notice. 17 U.S.C. § 512(c)(3)(A). The system is entirely workable: in 2007 Viacom itself gave such notice to YouTube of infringements by some 100,000 videos, which were taken down by YouTube by the next business day. See 718 F. Supp. 2d 514 at 524.

Thus, the burden of showing that YouTube knew or was aware of the specific infringements of the works in suit cannot be shifted to YouTube to disprove. Congress has determined that the burden of identifying what must be taken down is to be on the copyright owner, a determination which has proven practicable in practice.

Here, the examples proffered by plaintiffs (to which they claim YouTube was willfully blind) give at most information that infringements were occurring with particular works, and occasional indications of promising areas to locate and remove them. The specific locations of infringements are not supplied: at most, an area of search is identified, and YouTube is left to find the infringing clip. As stated in UMG Recordings v. Shelter Capital Partners, LLC, No. 10-55732, 2013 WL 1092793, at *12 (9th Cir. Mar. 14, 2013) ("UMG III"),

Although the parties agree, in retrospect, that at times there was infringing material available on Veoh's services, the DMCA recognizes that service providers who do not locate and remove infringing materials they do not specifically know of should not suffer the loss of safe harbor protection.

The Karim memorandum states that infringing clips of some well-known shows "can still be found," but does not identify the specific clips he saw or where he found them. The Wilkens declaration submitted by plaintiffs asserts that there were over 450 such clips on YouTube at the time, and presumably some of them contained the infringing matter seen by Mr. Karim. To find them would require YouTube to locate and review over 450 clips. The DMCA excuses YouTube from doing that search. Under § 512(m), nothing in the applicable section of the DMCA shall be construed to require YouTube's "affirmatively seeking the facts indicating infringing activity."

Mr. Karim's memorandum does not tie his observations to any specific clips. Application of the principle of willful blindness to his memorandum thus does not produce knowledge or awareness of infringement of specific clips-in-suit, out of the 450 available candidates. Nor does any other example tendered by plaintiffs.

YouTube's decision to restrict its monitoring efforts to certain groups of infringing clips, like its decisions "to restrict access to its proprietary search mechanisms," do not exclude it from the safe harbor, regardless of their motivation.

The type of generalized guesswork that Viacom engages in bears no resemblance to the showing of specific knowledge of clips-in-suit that the Second Circuit demanded.

It is not Viacom's burden to prove specific knowledge or awareness. That factual issue is relevant only to the affirmative defense that YouTube is asserting; knowledge of specific infringements is not an element of Viacom's copyright infringement claims against YouTube. At trial, it will be enough for Viacom to prove that the clips-in-suit were on the website, along with some other elements of infringement liability.

Viacom does not even try to make the showing of clip-specific knowledge required by the Second Circuit’s ruling. It instead reverses course and claims that it is YouTube’s burden to affirmatively establish its lack of knowledge as to each specific clip-in-suit. Viacom’s novel burden-shifting argument is wrong. It is contrary to the Second Circuit’s decision, all the case law, and the structure of the DMCA itself. Viacom also ignores the record. YouTube has identified more than sufficient evidence of its lack of knowledge of infringement— including the very fact that the voluminous record in this case contains no evidence of such knowledge. Viacom’s inability to offer any evidence from which a jury could find that YouTube had actual or red-flag knowledge of even a single clip-in-suit requires that summary judgment be entered in YouTube’s favor.

We do not find persuasive UMG’s effort to reconcile the internal contradictions its reading of the statute creates by positing that Congress must have meant § 512(c) to protect only “web hosting” services. Web hosts “host” websites on their servers, thereby “mak[ing] storage resources available to website operators.” The thrust of UMG’s argument seems to be that web hosts do not undertake the sorts of accessibility-facilitating functions that Veoh does, and thus the services they perform “fit within the ordinary meaning of ‘storage,’” and thereby “harmoniz[e]” with the notice and takedown procedures. UMG’s theory fails to account for the reality that web hosts, like Veoh, also store user-submitted materials in order to make those materials accessible to other Internet users. The reason one has a website is so that others may view it. As amici note, these access activities define web hosting – if the web host only stored information for a single user, it would be more aptly described as an online back-up service.

As an initial matter, contrary to UMG’s contentions, there are many music videos that could in fact legally appear on Veoh. “Among the types of videos subject to copyright protection but lawfully available on Veoh’s system were videos with music created by users and videos that Veoh provided pursuant to arrangements it reached with major copyright holders, such as SonyBMG.” Further, Congress’ express intention that the DMCA “facilitate making available quickly and conveniently via the Internet . . . movies, music, software, and literary works” – precisely the service Veoh provides – makes us skeptical that UMG’s narrow interpretation of § 512(c) is plausible. S. Rep. No. 105-190, at 8. Finally, if merely hosting material that falls within a category of content capable of copyright protection, with the general knowledge that one’s services could be used to share unauthorized copies of copyrighted material, was sufficient to impute knowledge to service providers, the § 512(c) safe harbor would be rendered a dead letter: § 512(c) applies only to claims of copyright infringement, yet the fact that a service provider’s website could contain copyrightable material would remove the service provider from § 512(c) eligibility.

Copyright holders know precisely what materials they own, and are thus better able to efficiently identify infringing copies than service providers like Veoh, who cannot readily ascertain what material is copyrighted and what is not.

Of course, a service provider cannot willfully bury its head in the sand to avoid obtaining such specific knowledge. See Viacom Int’l v. YouTube.... Even viewing the evidence in the light most favorable to UMG as we must here, however, we agree with the district court there is no evidence that Veoh acted in such a manner. Rather, the evidence demonstrates that Veoh promptly removed infringing material when it became aware of specific instances of infringement. Although the parties agree, in retrospect, that at times there was infringing material available on Veoh’s services, the DMCA recognizes that service providers who do not locate and remove infringing materials they do not specifically know of should not suffer the loss of safe harbor protection.

"You're pulling the shows from the internet?!? What are you, China?!? And by the way, you don't think the kids already have a workaround? This morning, when I woke up, my 8-year-old son was watching Dark Knight Rises in 3D. They're already figuring it out. So basically you're blocking old people from watching the show, and just giving people a chance to discover that there's other entertaining s**t in the world...."

So today it's interesting to hear about a network taking the exact opposite tack. AMC, home of a bunch of popular shows cast somewhat in the HBO mold, was recently dropped from the basic package for Dish satellite subscribers. AMC says that unlike the Viacom/DirecTV situation, they were not asking for more money and this was not a negotiation issue, but rather Dish trying to "gain leverage in an unrelated lawsuit."

So what is AMC's response? Well, the much-anticipated fifth-season premier of Breaking Bad, one of their flagship shows, is airing on Sunday—and they've decided to set up a special online stream just for Dish subscribers, so they can watch it for free. Meanwhile, they point out that virtually every other satellite and cable provider includes AMC in its basic package, and that several are now offering special sale prices for customers switching from Dish. They even have a toll-free line at 1-855-2DROP-DISH offering more information. For Dish, this is what you call a "PR nightmare".

But -- and here's where it gets even more interesting -- Dish claims they dropped AMC because the company insists they also carry some other less-popular networks bundled with it. That's why DirecTV says it dropped Viacom, too. It's a bit of an our-word-against-theirs situation as to the real cause of the conflict, and it's likely that neither company is entirely blameless. But AMC's first move was to go straight to the fans with a special offer to give them what they want. Viacom's first move was to... petulantly punish not only the fans involved in the dispute, but all of their fans.

Both Dish and DirecTV are experiencing backlash—even though some people support DirecTV in the bigger picture, most fans are just reacting to their favorite shows suddenly disappearing, and understandably getting annoyed with their service provider. But while AMC has leveraged the situation as a way to get good PR by offering fans something special, Viacom managed to extract its own dose of negative backlash by further depriving them.

Much like the MPAA, it seems Viacom needs a lesson in communications.

Or, you can attempt to reshape the cultural norms of future generations by going to the source: kids. At least that's what analyst Todd Juenger suggests in a recent report about children's programming on Netflix. Juenger conducted a focus group with mothers and discovered that they really like Netflix as a source of entertainment for their kids, especially since they can put it on whenever they want—and that kids are growing accustomed this. To hear Juenger talk about it, you'd think this was both surprising and bad (it's neither). His advice to the providers of children's programming? Stop this trend immediately:

His advice for entertainment companies is to be cautious about how much kids programming they make available to the online video streaming provider and in which windows. "We remain firm in our belief Viacom and Walt Disney should limit their content availability on Netflix," Juenger wrote.

...

"Moms are increasingly directing their kids to alternative viewing modes for content control, commercial avoidance and time management," Juenger summarized the findings. "The moms we talked to originally subscribed to Netflix for themselves, but have recognized the dwindling supply of content for adults and are now using the service primarily for their kids…The content selection is perceived to be significantly better for kids than for adults, and the lack of commercials and ability to control the viewing choices are seen as positives.”

According to the analyst, the focus groups described children as device agnostic, "happily watching on TV sets, tablets, computers, even phones, with indifference." The result: “Our concern regarding Viacom and Disney’s kids’ networks has been reinforced,” Juenger said. “Viacom and Disney should do everything in their power to steer viewership toward modes with the best long-term economics, namely traditional TV and emerging forms of TV Everywhere VOD.”

Yes, he's confirmed that the "lack of commercials and ability to control the viewing choices are seen as positives", in case anyone in Hollywood was still clinging to the hope that consumers would grow to hate those things. And yes, kids are "happily watching" on a variety of devices, and we can't have that, can we? Some might respond to the observation of a clear consumer preference in young children by trying to embrace that change early (if anything Hollywood does with technology can be called "early" at this point) but Juenger thinks they're better off trying to hold back the tide, or at least redirect it into their proprietary canals.

The funniest part is that suggesting Disney and Viacom should try to "steer viewership" is appealing to the very power such companies are losing. Big media empires don't get to "steer viewership" the way they used to, and that's exactly why these new distribution methods represent a threat to them. Juenger is suggesting they keep the sinking ship afloat by tying it to... itself. That's not going to work.

Emanuel: Cord-cutting's not happening.

Walt: But cord-never is happening.

Emanuel: I don’t think so. I think when people get to a certain age, they pay. Somebody’s got to pay for this, or you’re not going to get premium content, and I think that’s more valuable than "two dogs doing whatever they’re doing on a couch."

I don’t want them to censor results, but they have a bunch of smart guys there that can figure this stuff out.

That’s a stupid example. Look, Google can filter and does filter for child pornography. They do that already. So stealing is a bad thing, and child pornography is a bad thing.

“I’m okay with a little bit of disruption, and let’s see what happens. I dunno. I’m good with it.”

"The defendant is not responsible in principle for the video content on its site; only the users of the site are," the decision reads.

"It has no obligation to police the content before it is put online as long as it informs users that posting television shows, music videos, concerts or advertisements without prior consent of the owner is not allowed."

In addition to the Warner instance mentioned above, the RIAA asked Google to delist a review of the album Own The Night published on The Guardian. The artist behind the album is Lady Antebellum, signed to RIAA-member Capitol Records.

Even more worrying, the RIAA asked Google to delist Last.fm’s entire Electro Pop section because they thought it carried a pirate copy of All About Tonight by Pixie Lott.

Warner also reappeared later on, asking Google to delist a page on news site NME which lists information on the latest movies, which at the time included information on the movie Hall Pass. The same page on NME was targeted on several other occasions, including by anti-piracy company DtecNet on behalf of Lionsgate, who had info on The Hunger Games delisted.

Hollywood Reporter didn’t fare much better either. Sony Pictures asked Google to swing the banhammer against the popular news site after it published an article called “Trent Reznor Releases Six Free Tracks From ‘Girl With the Dragon Tattoo’ Soundtrack” and Sony mistook it for a DVDRIP.

But as soon as Sony’s piracy fears on the first ‘Dragon Tattoo’ movie had subsided they were back as strong as ever with the sequel. This time the sinner was Wikipedia who dared to put up an information page on the movie The Girl Who Played With Fire. Luckily Sony were on hand to ask Google to delist the page.

Oh, and the fun part: she gets to watch movies, pick the most memorable moments, and upload those clips to YouTube. Today, it's L.A. Story.

"We always pick a clip that has a beginning, middle and an end," says Strickland, pointing out the various fields she has to fill out in the content management system before she uploads a clip to YouTube. "I put everyone that's in the scene: so Steve Martin, Richard Grant, Victoria Tennant, Sarah Jessica Parker, I put some of the memorable dialogue — 'SanDeE your breasts feel weird, oh, that's because they're real' — then you put discussion topics, character types, settings, eras, what they're doing."

It consists of hours of tedious work to ensure this licensed content will show up first when you go searching for your favorite movie clip on YouTube. Not an easy task when 60 hours of video are uploaded to YouTube every minute.

While he said he didn’t want to get into copyright math, Perry noted that the number of films released by the six major motion picture studios has dropped from 204 in 2006 to 134 in 2011.... He suggested that online infringement affects ancillary (post-box office) revenues, which isn’t captured in rosy reports of ticket sales. Perry said he doesn’t believe that infringement will wipe out content – rather, it will shift it. We’ll see more small-budget or amateur films, and fewer major studio films. These movies, he suggested, are the iconic ones that people remember and reference, so piracy may have an important cultural impact.

The discussion was impressively thoughtful and civil. The students evinced skepticism about the movie industry’s good faith and bona fides, particularly given the drafting of SOPA / PROTECT IP, and also given the recording industry’s history of suing its users. Perry pointed out that Paramount is trying hard to make content available widely, cheaply, and easily, and that the only other way of altering the reward calculus to users is to engage in enforcement against end consumers, which no one likes. He was repeatedly puzzled by the attitude of law students that infringement isn’t a big deal (since it’s unlawful), particularly when this attitude is justified by reference to movie industry profits.

Most importantly, this opinion exposes a structural deficiency of the 512(c) safe harbor. The statute's simply too long and detailed, and if a defendant fails to satisfy each and every element, the safe harbor is lost completely. This is reminiscent of military strategy and information security: the defense has to work equally well across its entire border, while the adversary can concentrate its attack and only has to succeed on one point of attack to win. The same is true with a 512(c) defense. So, it doesn't matter that YouTube won most of the points of contention; if any single point of contention fails, YouTube's 512(c) defense fails. As I've insisted before, this provides a good lesson for drafters of safe harbors and immunities--to work effectively, the safe harbors/immunities must be pithy and categorical, or else they create too many potential points of failure.

So the court agrees with no one. Given that it rejected everyone else's definitions, we might expect the court to carefully lay out what it thinks the phrase means. Sadly, no. The opinion doesn't provide an express definition of what qualifies as the "right and ability to control," instead sending that issue back to the district court to figure out both the standard and whether YouTube met it. The clearest clue the court provides about the standard is it "involve[s] a service provider exerting substantial influence on the activities of users, without necessarily—or even frequently—acquiring knowledge of specific infringing activity." I have no idea what that means, other than that it's open season for plaintiff fiestas.

Although the parties marshal a battery of other arguments on appeal, it is the text of the statute that compels our conclusion. In particular, we are persuaded that the basic operation of § 512(c) requires knowledge or awareness of specific infringing activity. Under § 512(c)(1)(A), knowledge or awareness alone does not disqualify the service provider; rather, the provider that gains knowledge or awareness of infringing activity retains safe-harbor protection if it “acts expeditiously to remove, or disable access to, the material.” 17 U.S.C. § 512(c)(1)(A)(iii). Thus, the nature of the removal obligation itself contemplates knowledge or awareness of specific infringing material, because expeditious removal is possible only if the service provider knows with particularity which items to remove. Indeed, to require expeditious removal in the absence of specific knowledge or awareness would be to mandate an amorphous obligation to “take commercially reasonable steps” in response to a generalized awareness of infringement. Viacom Br. 33. Such a view cannot be reconciled with the language of the statute, which requires “expeditious[ ]” action to remove or disable “the material” at issue. 17 U.S.C. § 512(c)(1)(A)(iii) (emphasis added).

The difference between actual and red flag knowledge is thus not between specific and generalized knowledge, but instead between a subjective and an objective standard. In other words, the actual knowledge provision turns on whether the provider actually or “subjectively” knew of specific infringement, while the red flag provision turns on whether the provider was subjectively aware of facts that would have made the specific infringement “objectively” obvious to a reasonable person. The red flag provision, because it incorporates an objective standard, is not swallowed up by the actual knowledge provision under our construction of the § 512(c) safe harbor. Both provisions do independent work, and both apply only to specific instances of infringement.

"the internet sent me to ask you what you think of SOPA and why you haven't mentioned it on the show."

Here's all I'll say about that: I've got some reading to catch up on...

A partial fix to SOPA/PROTECT-IP would make rightsowners bear the cost of their overclaiming. Make them put up a $1 billion bond for the privilege of sending cutoff notices; and pay liberally out of that bond if the rightsowners get the law or facts wrong. Write checks to the investors and employees whose economic expectations are disrupted when rightsowners get it wrong. Write checks to the payment service providers and ad networks who turn down money from legally legit businesses based solely on rightsowner accusations. Heck, write checks to the users of those legit services who are treated as inconsequential pawns in this chess match. Sure, a $1B bond obligation with liberal payouts would turn cutoff notices into a sport of kings that only the richest rightsowners could afford, but perhaps that’s the way it should be. A rightsowner's decision to send a cutoff notice should be a Big Deal, the equivalent of going to Defcon 5, and not like sending holiday cards to distant relatives you last saw at Ethan's bar mitzvah.

By its terms, § 512(c) presupposes that service providers will provide access to users’ stored material, and we would thus contravene the statute if we held that such access disqualified Veoh from the safe harbor. Section 512(c) codifies a detailed notice and takedown procedure by which copyright holders inform service providers of infringing material accessible through their sites, and service providers then “disable access to” such materials. 17 U.S.C. § 512(c)(1)(A)(iii), (c)(1)(C) & (c)(3)(A)(iii) (emphasis added). This carefully considered protocol, and the statute’s attendant references to “disabl[ing] access” to infringing materials, see id., would be superfluous if we accepted UMG’s constrained reading of the statute. See Greenwood v. CompuCredit Corp., 615 F.3d 1204, 1209 (9th Cir. 2010) (“We must, if possible, interpret a statute such that all its language is given effect, and none of it is rendered superfluous.” (citing TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001))). Indeed, it is not clear how copyright holders could even discover infringing materials on service providers’ sites to notify them as the protocol dictates if § 512(c) did not contemplate that there would be access to the materials.

We do not find persuasive UMG’s effort to reconcile the internal contradictions its reading of the statute creates by positing that Congress must have meant § 512(c) to protect only “web hosting” services. Web hosts “host” websites on their servers, thereby “mak[ing] storage resources available to website operators.” The thrust of UMG’s argument seems to be that web hosts do not undertake the sorts of accessibility facilitating functions that Veoh does, and thus the services they perform “fit within the ordinary meaning of ‘storage,’ ” and thereby “harmoniz[e]” with the notice and takedown procedures. UMG’s theory fails to account for the reality that web hosts, like Veoh, also store user-submitted materials in order to make those materials accessible to other Internet users. The reason one has a website is so that others may view it. As amici note, these access activities define web hosting -- if the web host only stored information for a single user, it would be more aptly described as an online back-up service...

As an initial matter, contrary to UMG’s contentions, there are many music videos that could in fact legally appear on Veoh. “Among the types of videos subject to copyright protection but lawfully available on Veoh’s system were videos with music created by users and videos that Veoh provided pursuant to arrangements it reached with major copyright holders, such as SonyBMG

Cases analyzing knowledge in the secondary copyright infringement context also counsel against UMG’s general knowledge approach. In Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984), the Supreme Court held that there was “no precedent in the law of copyright for the imposition of” liability based on the theory that the defendant had “sold equipment with constructive knowledge of the fact that their customers may use that equipment to make unauthorized copies of copyrighted material.” Id. at 439. So long as the product was “capable of substantial noninfringing uses,” the Court refused to impute knowledge of infringement....

Requiring specific knowledge of particular infringing activity makes good sense in the context of the DMCA, which Congress enacted to foster cooperation among copyright holders and service providers in dealing with infringement on the Internet...

Copyright holders know precisely what materials they own, and are thus better able to efficiently identify infringing copies than service providers like Veoh, who cannot readily ascertain what material is copyrighted and what is not.

Congress made a considered policy determination that the “DMCA notification procedures [would] place the burden of policing copyright infringement — identifying the potentially infringing material and adequately documenting infringement — squarely on the owners." of the copyright.

We therefore hold that merely hosting a category of copyrightable content, such as music videos, with the general knowledge that one’s services could be used to share infringing material, is insufficient to meet the actual knowledge requirement

UMG argues that Veoh’s purchase of certain search terms through the Google AdWords program demonstrates knowledge of infringing activity because some of the terms purchased, such as “50 Cent,” “Avril Lavigne” and “Britney Spears,” are the names of UMG artists. However, artists are not always in exclusive relationships with recording companies, so just because UMG owns the copyrights for some Britney Spears songs does not mean it owns the copyright for all Britney Spears songs. Indeed, 50 Cent, Avril Lavigne and Britney Spears are also affiliated with Sony- BMG, which gave Veoh permission to stream its videos by these artists. Furthermore, even if Veoh had not had such permission, we recognize that companies sometimes purchase search terms they believe will lead potential customers to their websites even if the terms do not describe goods or services the company actually provides. For example, a sunglass company might buy the search terms “sunscreen” or “vacation” because it believed that people interested in such searches would often also be interested in sunglasses. Accordingly, Veoh’s search term purchases do little to demonstrate that it knew it hosted infringing material.

First, Congress explicitly stated in three different reports that the DMCA was intended to “protect qualifying service providers from liability for all monetary relief for direct, vicarious and contributory infringement.” .... Under UMG’s interpretation, however, every service provider subject to vicarious liability would be automatically excluded from safe harbor protection. Second, Congress made clear that it intended to provide safe harbor protection not by altering the common law vicarious liability standards, but rather by carving out permanent safe harbors to that liability for Internet service providers even while the common law standards continue to evolve.

It is well-established that “[s]econdary liability for copyright infringement does not exist in the absence of direct infringement . . . .”