JOLT Digest

By Brittany Horth

Oracle v. Google Trial Begins

The Oracle v. Google trial began on Monday, April 16, 2012 in the Northern District Court of California in San Francisco by swearing in twelve jurors for what is expected to be eight weeks of testimony, reports Ars Technica. According to an overview by All Things D, Oracle alleges that Google’s Android mobile operating system violates both copyright and patents on Java, which Oracle acquired from SunMicrosystems in 2010. The New York Times reports that both Google CEO Larry Page and Oracle CEO Larry Ellison appeared as witnesses in the first week of trial, as Google argued that Java is free and Oracle argued that Google knew it needed to get a license to use Java. The case is likely to address the issue of whether application programming interfaces (APIs) can be copyrighted in general.

FCC Says Google’s Wi-Fi Sniffing Did Not Violate Wiretapping Laws

The Federal Communications Commission (FCC) stated that Google did not violate federal wiretapping law when its street view cars collected data such as e-mails, passwords, and text messages from unencrypted Wi-Fi networks, reports Wired.  The FCC’s conclusion is in direct contrast to the holding of the Northern District of California in 2011. In support of its decision not to take enforcement action, the FCC cited the fact that the unencrypted Wi-Fi networks are accessible to the public, which has broader implications for customers who use the free, unencrypted Wi-Fi networks provided by businesses such as coffee shops. But the FCC also explained that it was “impossible” to uncover whether Google had accessed the encrypted data that it collected from the unencrypted Wi-Fi networks because a Google engineer who developed the relevant program refused to share information with the FCC.

Teller of Penn & Teller Alleges Violation of His Copyrighted Magic Trick

Raymond Teller of Penn & Teller is suing Gerard Dogge for copyright infringement of his magic trick entitled Shadows after Dogge posted a YouTube video of a magic trick called The Rose & Her Shadow and offered to reveal the secret for $3,050, reports The Hollywood Reporter. Teller sent YouTube a Digital Millennium Copyright Act (DMCA) takedown notice and attempted to pay Dogge not to reveal the secret but initiated a lawsuit when negotiations failed. Teller registered the trick with the U.S. Copyright Office, which requires that magic tricks be “fixed in a tangible medium of expression,” back in 1983. The success of the claim will depend on whether Teller can demonstrate that Dogge’s trick is a “substantially similar expression” of Shadows.

Second Circuit Ruling Leaves Open Possibility That YouTube Is Not Protected By Safe Harbor
By Jacob Rogers – Edited by Julie Dorais

Viacom Int’l, Inc., Football Ass’n Premier League Ltd. v. YouTube, Inc., Docket No. 10-3270-cv (2nd Cir. April 5, 2012)
Slip Opinion

The Second Circuit partially affirmed and partially reversed a decision by the U.S. District Court for the Southern District of New York, granting summary judgment to YouTube on all claims of direct and secondary copyright infringement brought by Viacom. The district court held that YouTube qualified for safe harbor under the Digital Millennium Copyright Act, 17 U.S.C. §512(c), which protects service providers from liability for acts of infringement by users.

The Second Circuit affirmed the district court’s holding that §512(c)(1)(A)’s exception to the safe harbor provision “requires knowledge or awareness of specific facts or circumstances that indicate specific and identifiable instances of infringement,” but it vacated the district court’s summary judgment order because certain internal emails within YouTube raised a genuine issue of material fact as to whether it had such knowledge. The court also held that the “right and ability to control” an infringer under §512(c)(1)(B), which also creates an exception to the safe harbor provision, does not require knowledge of specific acts of infringement but requires more than vicarious liability at common law. It additionally held that willful blindness may be relevant to determinations under §512(c)(1)(A), although it is limited by the congressional mandate that safe harbor for service providers not be conditioned on monitoring. See §512(m). The court accordingly remanded the case for the district court to apply this “right and ability to control test” and address the issue of willful blindness in the first instance.

The Technology and Marketing Blog provides an overview of the case, noting that, regardless of the specific decision of the district court on remand, this decision is likely to raise litigation costs for all digital content providers seeking safe harbor under the DMCA. The New York Times Media Decoder Blog suggests that the suit has no winners, as both sides expressed lukewarm sentiments at the result and Viacom is currently pursuing a business partnership with YouTube simultaneously with this litigation. (more…)

By Heejin Choi and Dorothy Du – Edited by Julie Dorais

This past August, the Digest summarized some of the legal challenges that major service providers of online music and video streaming faced. Below are updates of select stories:

Grooveshark – All Four Major Record Labels Are Now Suing

Back in August 2011, the Digest reported that Universal Music Group, a major record label, filed a copyright infringement suit against Grooveshark, the popular music streaming service. Universal accused Grooveshark employees of posting more than 100,000 pirated songs, CNET explains. The lawsuit is still pending, and Wired reports that Universal could be seeking the maximum damages of a whopping $150,000 per song. In December 2011, Sony Music Entertainment and Warner Music Group joined the lawsuit through an amended complaint, according to UPI. Most recently, on January 4, 2012, EMI Music Publishing sued Grooveshark’s parent company Escape Media for breach of contract, CNET reports. The New York Times reports that EMI has accused Grooveshark of failing to make a single royalty payment to EMI since signing a music licensing pact with EMI in 2009. CNET says Grooveshark maintains that it is protected under the Digital Millennium Copyright Act’s safe harbor provision, 17 U.S.C. §512(c), which immunizes online service providers from acts of copyright infringement committed by their users under certain conditions. With EMI’s suit, all four major record labels are now suing Grooveshark.

Cloud Music (Amazon, Google and Apple) – MP3tunes Decision Affirms Legality

JOLT Digest reported back in August 2011 that providers of “cloud music” services and apps, such as Amazon, Google, and Apple, may be vulnerable to suits for copyright infringement because the music uploaded by users could have illegal origins. On August 22, the United States District Court for the Southern District of New York handed down its opinion in a lawsuit by EMI against MP3tunes, a cloud-based online music locker service similar to those provided by Amazon, Google, and Apple. See Capitol Records, Inc. v. MP3tunes, LLC, 07 Civ. 9931 (S.D.N.Y. Aug. 22, 2011). Wired explains that rather than requiring every user who wanted the same song to upload it separately, MP3tunes employed a bandwidth-saving strategy in which its software would check the server to see if the song was previously uploaded. If a match existed, the song would be added to the user’s digital music “locker” without requiring an upload. JOLT Digest summarized Judge Pauley’s opinion, which held that MP3tunes met the legal threshold to be protected by the Digital Millennium Copyright Act’s safe harbor provision.

The MP3tunes decision was good news for Google and Amazon because it affirmed the legality of cloud music services. Moreover, it cleared the way for them to take advantage of similar space-saving techniques. Up to then, both had required users to upload every song, regardless of whether it had previously been uploaded by another user, Wired reports. In November 2011, Apple launched a $25-a-year iTunes Match service, which, similar to MP3tunes, scans users’ iTunes music collection and cross-references the songs with its servers, according to Time Techland. That same week, Google Music launched. Mashable reports that the two services would compete with Amazon’s Cloud Player, which had been launched earlier. Amazon’s Cloud Player was removed from Apple’s App Store in November, however, because of “legal complications with the music industry,” Apple Insider states.

Although currently free of legal troubles, Google requested permission from the United States District Court for the Southern District of New York on February 1 to file an amicus brief in support of ReDigi. In its letter to the court on behalf of Google, Fenwick & West expressed concern over the case’s threat to the cloud computing industry. The court, however, denied Google’s request.

Zediva – Movie Streaming Service Closes Operations in Settlement Agreement

In October, 2011, the online movie streaming service Zediva and the Motion Picture Association of America (MPAA) reached a settlement to resolve a lawsuit filed by Hollywood last April, as covered by The Hollywood Reporter. In August, 2011, the MPAA won a preliminary injunction to effectively shut down Zediva, which operated with no licensing agreements with the studios, Wired reports. The Digest covered the legal debate this past August. Zediva originally appealed this decision to the Ninth Circuit, according to The Hollywood Reporter, but has now agreed to permanently discontinue its services and resolve all claims for $1.8 million.

ReDigi – Court Denies Preliminary Injunction Against Used Music Dealer

On February 6, 2012, a federal district court judge denied Capitol Records’ request for a preliminary injunction against ReDigi, ExtremeTech reports. ReDigi sells “used” digital tracks using a software that it claims can identify files that have been legally purchased and restrict a user’s access to such files once the user sells them through its marketplace. This past January, Capitol Records sued ReDigi for copyright infringement in the U.S. District Court for the Southern District of New York (complaint available at Copyright’em) seeking both a preliminary injunction to shut down the website and $150,000 per track in damages. Capitol Records alleged that “ReDigi makes and assists its users in making systemic, repeated, and unauthorized reproductions and distributions of Plaintiff’s copyrighted sound recordings” and that it acts as a “clearinghouse for copyright infringement.” Judge Sullivan denied the request for the preliminary injunction on the basis that Capitol Records could not show irreparable harm, and the parties now await further proceedings, Intellectual Property Magazine reports. Wired.com hosts the brief order, and attorney Ray Beckerman’s website provides an excerpt of the court transcript. According to ExtremeTech, this suit could have important implications regarding the application of the “first sale doctrine” under the Copyright Act of 1976, by which the purchaser and owner of a product has the legal right to resell that product.

Heejin Choi is a 1L at Harvard Law School, and Dorothy Du is a 2L at Harvard Law School.

By Charlie Stiernberg

What Changed in Google’s Privacy Policy

Google recently announced changes to its privacy policy and terms of service, prompting concerns by a bipartisan group of congressmen over the future safety of customer data. Reuters reports that Pablo Chavez, Google’s director of public policy, responded directly to the lawmakers’ questions in a letter, stating that “the updated privacy policy does not allow us to collect any new or additional types of information about users.” The Electronic Frontier Foundation (“EFF”) applauded Google’s efforts to notify its customers of the changes, but criticized the company for not adequately explaining what it meant until after the congressional inquiry. According to EFF, the major substantive changes include (1) combining all of Google’s separate product policies into one, (2) removing the separation between customer data sets stored in each of those products, and (3) using the information obtained from one product in another. The new privacy policy goes into effect on March 1, 2012.

Intel Purchases $120M in Patents from RealNetworks

Intel agreed to pay RealNetworks $120 million for 190 patents and 170 patent applications covering RealNetworks’s streaming video codec technology. The Wall Street Journal reports that this is the latest in a set of large patent purchases by major technology companies, which peaked in June with the Nortel Networks patent auction. Competition in the smartphone and tablet markets has become more intense and patents more important as companies, including Intel, expand their businesses into the mobile sector. According to ZDNet, Intel called some of the patents “foundational,” indicating its belief that that some are important to the company’s efforts in the mobile media space. In addition to the sales agreement, Intel acquired the video codec’s development team, and the two companies signed a memorandum of understanding to develop next-generation video software and related products.

New Mobile Device Privacy Act Proposed

Rep. Edward Markey released draft legislation this week that would require mobile phone carriers to reveal if they are employing tracking software such as Carrier IQ. Wired reports that under the Mobile Device Privacy Act, consumers would have to give their consent before data—including web usage, call history, and text messages—can be sent to third parties. According to Ars Technica, the controversy started when a developer publicized the widespread use of Carrier IQ software on smartphones a few months ago. Rep. Markey said such software should only be used with the consumer’s “express consent,” and emphasized that the legislation is just a “discussion draft” right now. Sprint and Apple both recently announced they are dropping Carrier IQ, but T-Mobile and AT&T still use it. Verizon does not.

Twitter Reveals 4,400+ DMCA Takedown Notices Last Year

Twitter partnered with Chilling Effects, a project sponsored by the Electronic Frontier Foundation and the Berkman Center for Internet & Society, to publish all Digital Millennium Copyright Act (“DMCA”) takedown notices it has received since November 2010. Ars Technica reports that the site lists 4,410 takedown notices in that time frame. While Twitter regularly deletes tweets to gain safe harbor under the DMCA, the company stated that it wants to “be transparent with users.” The Huffington Post breaks down the requests by sender, showing that Magnolia Pictures, a New York film distributor owned by Mark Cuban, was responsible for a third of them. Web Sheriff, a third-party that automates takedown notices for its customers, sent at least half of all the requests in the list.

Megaupload.com indicted by Department of Justice
By Daniella Adler – Edited by Abby Lauer

U.S. v. Kim Dotcom et al., 1:12-cr-3 (E.D. Va.)
Indictment

The Department of Justice recently brought a criminal indictment against Megaupload.com and related websites in the Eastern District of Virginia on three different counts of copyright infringement as well as money laundering and racketeering.

The indictment calls the operators of Megaupload.com and its environs the “Mega-Conspiracy” and describes it as a “worldwide criminal organization.” The government estimates that $175 million in profits from subscriptions and advertising comes directly from the large volume of copyrighted material illegally posted on the website. Among the individuals indicted were Megaupload.com founder Kim Dotcom and several of the sites’ main employees and officers.

Currently, when users attempt to access any of the “Mega” sites, they are confronted with an FBI Piracy Warning, which explains that the domain has been seized, states that the “individuals and entities” associated with the crimes have been indicted, and lists the charges.  (more…)