Equals Three, LLC. v. Jukin Media, Inc., Case No. 2: 14-cv-09041-SVW-MAN, United States District Court Central District of California, October 13 2015
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The United States District Court Central District of California granted in part Jukin’s motion for summary judgment to the extent that Jukin asserts Sheep to Balls is not a fair use of Jukin’s videos, and denies Jukin’s motion regarding fair use in all other episodes.
Though at a summary judgment stage, the court almost resolved fair use claims in favor of Equals Three. The court found almost all of Equals Three’s episodes highly transformative as “the jokes, narration, graphics, editing, and other elements that Equals Three adds to Jukin’s videos add something new to Jukin’s videos with a different purpose or character”. The only exception lies when the Sheep to Balls video was used as “news footage without adding transformative to what made the footage valuable”. The court also found speculative employees’ testimony insufficient evidence for market harm despite possibility of substitution. Based on a weighing of the four factors, the court held that the factors weighed in favor of Equals Three’s use within all its videos except the episode titled Sheep to Balls. The court, by ruling this way, noted that commenting on viral videos constituted transformative works, which usually further copyright’s goal to promote the arts and sciences..
Plaintiff Equals Three, LLC, who produced short humor programs on YouTube, sued defendant Jukin Media, who amasses a library of user-generated internet video clips to license on the clip creators’ behalf, for a declaratory judgment and relief under section 512 (f) of the Digital Millennium Copyright Act that prohibits fraudulent use of DMCA takedown notices. Jukin counterclaimed and asserted that Equals Three infringed upon nineteen of its copyrights. Equals Three argues that since May 1, 2014, Jukin has filed at least 41 copyright infringement claims with YouTube regarding Equals Three’s episodes, and the filing of such a claim results in Equals Three’s inability to earn advertising revenue on that episode and allows Jukin to place advertisements on the episode to redirect viewers to Jukin’s own YouTube channel. In holding as it did, the court reasoned that almost all of Equals Three’s episodes were highly transformative, and based on a weighing of the four factors of the fair use doctrine, held that the factors weighed in favor of Equals Three’s use within all its videos except the episode titled Sheep to Balls.
The case is significant because it requires the court to distinguish between commenting on humorous videos in a way that transforms the original video and exploiting videos for their humor without paying for their use. The court notes that the demarcation between the two is unclear but rules that the transformativeness through non-parody commenting or criticizing on viral videos outweighs its commercial nature in this case. Its decision potentially paves the way for fair use arguments for mash-up video production while leaves many copyright issues regarding viral videos open.