Mike - in general, the law doesn't allow cable providers to retransmit broadcast signals by paying a nominal fee. There are actually two statutes that limit how cable providers may retransmit broadcast signals.
Section 111 of the Copyright Act requires cable providers to pay broadcasters a nominal fee. ivi is indeed paying that fee, asserting that it's a cable provider covered by the statute.
But there's more. A section of the Communications Act, 17 U.S.C. § 325(b), requires cable providers to obtain consent from broadcasters before retransmitting their signals. (There are some exceptions to this rule, such as when cable providers are retransmitting broadcast signals to "unserved households".)
ivi boldly claims that it is a cable system for purposes of the Copyright Act, but not a cable system for purposes of the Communications Act.
Therefore, while cable companies typically pay on average33 cents per subscriber per month to each broadcaster whose signal they retransmit, ivi is paying a tiny fraction of that.
If I operate a site that, unbeknownst to me, facilitates an act of criminal copyright infringement by one of my users, I could be deemed a 'foreign infringing site.' there is no scienter or knowledge requirement. That's a big problem, and essentially imposes a duty to monitor.
While no case law directly supports my argument (since no prosecution of an individual in Bieber's position has ever taken place), I don't think it's fair to characterize my argument as a "stretch" in light of U.S. criminal laws and precedents. 18 U.S.C. § 2(b) states that "[w]hoever willfully causes an act to be done which if directly performed by him or another would be an offense against the United States, is punishable as a principal."
Also, see United States v. Gooding, 25 U.S. 460, 469, 6 L. Ed. 693 (1827):
[I]t is the known and familiar principle of criminal jurisprudence, that he who commands, or procures a crime to be done, if it is done, is guilty of the crime, and the act is his act. This is so true, that even the agent may be innocent, when the procurer or principal may be convicted of guilt, as in the case of infants, or idiots, employed to administer poison.
While Bieber's uploaded videos were not contemporaneously streamed as the uploads took place, his willful actions directly caused YouTube's servers to contemporaneously stream his videos to tens of millions of individuals. While YouTube technically engaged in the performance, the service was merely an innocent agent -- an unwitting instrumentality to Bieber's (possibly) criminal act. Bieber had actual knowledge that his action of posting a video to YouTube would result in YouTube's servers publicly performing copyrighted compositions. Indeed, that was the very reason he uploaded his videos in the first place!
I misrepresented the Napster case. Thank you for pointing it out. I incorrectly recalled the Napster technology as involving the centralized distribution of songs through Napster servers. In fact Napster servers only offered a centralized file index. As such, the case does not support my contention. My bad.
However, I maintain my original contention that Bieber, not YouTube, was the performer. While no cases support my contention directly, I do not see how the cases you cite state otherwise. In fact, the Cartoon Network court explicitly declined to answer the very question of whether Cablevision or its customers were performing for purposes of the Copyright Act. Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121, 134 (2d Cir. 2008):
Cablevision contends that (1) the RS–DVR customer, rather than Cablevision, does the transmitting and thus the performing . . . As to Cablevision's first argument, we note that our conclusion in Part II that the customer, not Cablevision, “does” the copying does not dictate a parallel conclusion that the customer, and not Cablevision, “performs” the copyrighted work. The definitions that delineate the contours of the reproduction and public performance rights vary in significant ways. For example, the statute defines the verb “perform” and the noun “copies,” but not the verbs “reproduce” or “copy.” Id. We need not address Cablevision's first argument further because, even if we assume that Cablevision makes the transmission when an RS–DVR playback occurs, we find that the RS–DVR playback, as described here, does not involve the transmission of a performance “to the public.”
The MP3.com case is inapposite because MP3.com held "master copies" of songs, making it the principal public performer, unlike YouTube (which holds one copy of each video file, including those which are substantially similar). In MP3Tunes, the court denied EMI's motion for summary judgment in most respects in August 2011, in part because it is unclear whether MP3Tunes engaged in infringing public performances.
YouTube users uploading videos must grant YouTube a performance license. From YouTube's ToS, 6(c):
For clarity, you retain all of your ownership rights in your Content. However, by submitting Content to YouTube, you hereby grant YouTube a worldwide, non-exclusive, royalty-free, sublicenseable and transferable license to use, reproduce, distribute, prepare derivative works of, display, and perform the Content in connection with the Service and YouTube's (and its successors' and affiliates') business, including without limitation for promoting and redistributing part or all of the Service (and derivative works thereof) in any media formats and through any media channels
That criminal copyright infringement prosecutions occur quite rarely is a weak justification for recklessly expanding the criminal code further. Just as past performance does not predict future returns in the world of investing, a history of prosecutorial restraint tells us surprisingly little about what may happen a decade or two (or a century) down the line.
To be sure, I'm all for prosecutorial discretion, but it should augment, not supersede, carefully and narrowly crafted statutes. As former U.S. Attorney General Edwin Meese of the conservative Heritage Foundation has argued, overcriminalization is a serious and growing problem in America. For more about this, see this recent Wall Street Journal expose that discusses how two men were charged with federal felonies merely because they were found digging for arrowheads at their favorite campground. Here's an excerpt:
The Andersons are two of the hundreds of thousands of Americans to be charged and convicted in recent decades under federal criminal laws—as opposed to state or local laws—as the federal justice system has dramatically expanded its authority and reach. As federal criminal statutes have ballooned, it has become increasingly easy for Americans to end up on the wrong side of the law. Many of the new federal laws also set a lower bar for conviction than in the past: Prosecutors don't necessarily need to show that the defendant had criminal intent.
No, not capiche. It comes back to the definition of a "public performance" under the Copyright Act. The Second Circuit held, and the Supreme Court declined to modify, precedent requiring a contemporaneous perception of the content by the public. You haven't shows this occurs when a user uploads a video to YouTube, because it doesn't. You have shown that there is ultimately a public performance (done by someone else I might add), but not a contemporaneous one. I am aware of no precedent holding that this constitutes a public performance.
I am aware of no case explicitly holding that actions closely resembling Bieber's violate the performance right, but reading the pertinent case law as a whole, it seems to me that Bieber performed the songs publicly via electronic means.
Let's break the issue down into its elements. Here are what I view as the two questions presented in determining whether Bieber himself violated the performance right:
1) Did an infringing public performance occur?
2) If so, who is the principal (the actor primarily responsible for a criminal offense)?
As for (1), see my comment above in which I cite the ASCAP case. In ASCAP the court held at 69 that streaming songs over the Internet to the public a constitutes a public performance. Each time a user viewed one of Bieber's videos on YouTube, a contemporaneous transmission occurred in which the infringing video was perceived by the user in real-time. Based on ASCAP, and assuming the user did't download the file but instead actually watched in on YouTube (or via an embed), a public performance occurred.
As for question (2), see Napster at 1013, which I also cited in my comment above. Here is a relevant excerpt from the opinion (A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013 (9th Cir. 2001)):
Plaintiffs claim Napster users are engaged in the wholesale reproduction and distribution of copyrighted works, all constituting direct infringement. . . . The district court agreed. We note that the district court's conclusion that plaintiffs have presented a prima facie case of direct infringement by Napster users is not presently appealed by Napster.
In Napster, the unauthorized distribution was technically performed by Napster servers. Yet the court nonetheless held that Napster's users, rather than Napster itself, were directly liable for civil infringement. (Napster was found to be secondarily liable.) This makes sense: if you use my car to murder somebody, I am not the principal, you are. The fact that you used my property as an instrumentality with which to commit a crime does not absolve you of direct liability. Depending on the circumstances, I may be civilly or criminally liable, but not on a direct basis. In the civil context, I could be contributorily or vicariously liable. In the criminal context, I could be aiding and abetting, or an accessory to the crime (where permitted by statute).
Relating all this back to Bieber, it was his deliberate action of uploading infringing videos to YouTube that directly caused the resulting public performances. He knowingly uploaded infringing videos with the intent that untold users would subsequently stream his videos. The tens of millions of streams of Bieber's videos were the foreseeable and direct result of Bieber's volitional actions. Had he hosted the videos on his own server in his own home, he would face the same liability. That he used YouTube's servers is irrelevant in determining Bieber's liability, since he is clearly the principal. YouTube likely had no actual knowledge of Bieber's videos at the time they were uploaded, nor did YouTube have intent to infringe. Bieber, conversely, was presumably well aware that his videos depicted unauthorized recitations of copyrighted compositions, and he intended to perform them electronically in uploading the videos to YouTube.
You are correct, thanks for bringing this to my attention. Do you know if any appellate level courts have made this same finding (or any NY courts)?
I'm not aware of any appellate rulings yet, but stay tuned to the Veoh case before the 9th Circuit and the YouTube case before the 2nd Circuit. Terry Hart recently analyzed this very issue over at Copyhype and does a nice job laying out the issues. For an NY court's take on this, see Viacom Int'l Inc. v. YouTube, Inc., 718 F. Supp. 2d 514, 527 (S.D.N.Y. 2010):
As stated in Io Group, Inc. v. Veoh Networks, Inc., 586 F.Supp.2d 1132, 1148 (N.D.Cal.2008), such “means of facilitating user access to material on its website” do not cost the service provider its safe harbor.
It appears that Bieber may well have willfully uploaded videos to YouTube depicting his unauthorized recitations of copyrighted musical works. Bieber's uploads directly and at his behest resulted in tens of millions of streams (public performances) of these unauthorized videos, violating performance rights. Ergo, he may be criminally liable under H.R. 3261 § 201, if prosecutors could show the preceding elements beyond a reasonable doubt. Capiche?
As for your second point, care to cite any authorities? I am aware of no cases in which 512(c)-compliant OSPs have been found liable for violating the performance right on account of their users' infringing activities. Moreover, several federal courts have explicitly held that 512(c) covers not only storage but also streaming. See, e.g., UMG Recordings, Inc. v. Veoh Networks, Inc., 620 F. Supp. 2d 1081, 1083 (C.D. Cal. 2008):
UMG contends that Veoh does not qualify for § 512(c) immunity because of four functions performed by Veoh's software which are allegedly not “storage” and are not undertaken “at the direction of a user.” The Veoh software functions [include] . . . allowing users to access uploaded videos via a technology called “streaming” . . . [T]he Court holds that the four software functions at issue do fall within the scope of the § 512(c) safe harbor because they are undertaken “by reason of the storage at the direction of a user.”
It's true that YouTube pays royalties to some rights holders, but that's part of a voluntary agreement it reached with rights holders. YouTube does lots of things voluntarily because it wants to maximize ad revenue. Working with, rather than against, rights holders helps YouTube by reducing the likelihood that popular videos will be abruptly removed. However, that does not mean YouTube would be subject to liability for videos of Bieber's covers if YouTube had no mechanical licenses (assuming, of course, it satisfied the 512(c) safe harbor requirements, etc.).
If Mike or freebieber.org are claiming that Bieber's mere act of uploading his infringing videos to YouTube is a violation of the performance right, I think that's wrong based on ASCAP. Rather, his act of uploading is a violation of the reproduction right. Had no users watched Bieber's videos, no performance rights would have been infringed.
But that doesn't mean that freebieber.org's underlying argument -- that S.978 and/or H.R.3261 would potentially subject Bieber to felony copyright infringement liability -- is wrong. Your argument that "YouTube is engaged in the act of streaming/performance" is correct from a technological perspective, but incorrect from a legal perspective. Federal courts have repeatedly held that Internet service providers and other OSPs may not be held liable for direct copyright infringement on account of their users' infringing activities. Contributory and vicarious copyright infringement liability may be found in some cases, depending on the specifics (knowledge, inducement, the 17 U.S.C. § 512(C) safe harbor, etc.). Liability for direct infringement ultimately rests with users at whose behest the underlying infringing acts occur. As the Napster court noted, there can be no secondary infringement liability where there is no underlying direct infringement.
See Ellison v. Robertson, 189 F. Supp. 2d 1051, 1056-57 (C.D. Cal. 2002) aff'd in part, rev'd in part and remanded, 357 F.3d 1072 (9th Cir. 2004):
AOL's role in the infringement as a passive provider of USENET access to AOL users cannot support direct copyright infringement liability. See Religious Technology Center v. Netcom On–Line Communication Services, Inc., 907 F.Supp. 1361, 1372–73 (N.D.Cal.1995). In Netcom, the court held that the defendant, an internet services provider like AOL, could not be found guilty of direct copyright infringement based on copies of works that were made and stored on its USENET servers. See id; accord ALS Scan, Inc. v. RemarQ Communities, Inc., 239 F.3d 619, 622 (4th Cir.2001); Costar Group, Inc. v. Loopnet, Inc., 164 F.Supp.2d 688, 696 (D.Md.2001).
Bieber's problem isn't that he made his performances available for download, but that he made them available for contemporaneous public performance by streaming them on YouTube. YouTube's servers were the facilities Bieber used to stream his videos, which he uploaded with the intent that users would access them contemporaneously. As such, he is the principal with direct liability for the streams, not YouTube. See A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013 (9th Cir. 2001) (holding Napster secondarily liable for its users' direct infringement via Napster facilities).
The ASCAP court seemingly states that streaming a work constitutes a performance, whereas non-contemporaneous file transmission (e.g. downloading) constitutes a reproduction. ASCAP at 69 (emph. added):
RealNetworks performs music in audio and audio-visual contexts through a number of websites and subscription services. Like Yahoo!, these sites and services publicly perform musical works in numerous formats, including, inter alia, radio, television, movie, game, and music-video formats. Also like Yahoo!, only a portion of the content on RealNetworks’ sites and services consist of performances of musical works. In addition to performing music on websites and through services, the Internet Companies offer to users copies of recordings of musical works through download transmittals.”
Thus, if Bieber is violating the reproduction right each time he uploads a video, isn’t he also violating performance right each time a YouTube user streams an infringing video he uploaded?
Does it concern you that Protect IP permits the attorney general to commence an in rem action against a domain if the owner/operator does not have "an address within a judicial district of the United States?"
The new bill's private right of action is indeed troubling, but it's extremely important to note that, according to the summary, it would not allow rights holders to obtain court orders disabling domain names or censoring search results for allegedly infringing sites. The private right of action would only apply to ad networks and payment processors. A lawful site can still operate meaningfully for a limited duration pending an adversarial hearing without being able to earn ad revenue or process payments.
Also, if the new definition of websites "dedicated to infringing activities" is, as claimed in the summary, substantially narrower than the definition contained in COICA, perhaps the new bill will be properly viewed as less worrisome than its predecessor. The breadth of COICA was arguably its single biggest red flag; if the new bill would ensnare fewer potentially innocent sites, it stands to reason that it's less of a threat (although still arguably antithetical) to free speech.
You are mistaken. Courts have repeatedly held that under Section 230, online intermediaries (third parties) are not liable for defamatory or libelous user content even if they refuse to remove the material upon request.