Partner Christiane Stuetzle, senior associate Patricia Ernst, and research assistant Susan Bischoff authored an article for Law360 covering how online content service providers must act to mitigate risks and avoid liability under the European Union’s Copyright Directive, created in an effort to strengthen the rights of copyright holders by making certain platforms that host user-uploaded
Reports of social media scams that have caused users to lose money had tripled by the end of 2020’s second quarter, resulting in the loss of $117 million during the first two quarters of this year alone. Romance scams and supposed economic relief offers are a large part of the problem, but e-commerce scams are…
- On June 7, 2019, the highly controversial EU Copyright Directive (“Directive”) came into force, requiring EU Member States to transpose its provisions into national law by June 7, 2021.
- To recap, the most relevant provisions of the Directive require the implementation of the following rules into national law:
- Online content-sharing service providers’ liability for copyright-infringing content, Article 17
Online content-sharing services are subject to direct liability for copyright-infringing content uploaded by their users if they fail to prove that they made “best efforts” to obtain the rights-holder’s authorization or fail to evidence that they made “best efforts” to ensure the unavailability of such content. They are also liable if they fail to act expeditiously to take down uploads of work for which they have received a takedown notice.
- Exceptions and limitations to copyright protection
The Directive introduces exceptions and limitations (e.g., for text and data mining (incl. in favor of commercial enterprises)); provisions regarding collective licensing; and recall, transparency, and fair remuneration rights for authors.
- Ancillary copyright for press publishers, Article 15
Press publishers are granted an ancillary copyright for press publications, covering the reproduction and making available of such content by information society service providers (excluding only hyperlinks accompanied by “individual words or very short extracts”).
- Online content-sharing service providers’ liability for copyright-infringing content, Article 17
- The German Federal Ministry of Justice and Consumer Protection’s latest draft act (Referentenentwurf) for the national implementation of the Directive was leaked in September 2020 (“German Draft Act”). In summary, the current German Draft Act proposes to implement Article 17 as follows, deviating in part from the EU Copyright Directive:
- De minimis use: In contrast to the EU Copyright Directive as well in contract to the German Copyright Act, the German Draft Act additionally provides for a de minimis copyright exemption for non-commercial minor uses such as 20 seconds (against a statutory license fee to be paid to collecting societies). This is the most criticized provision of the German Draft Act and makes it very likely that this draft will be revised again by the German legislature shortly.
- Flagging: Furthermore, without any legal basis in the Directive, as to avoid the risk of over-blocking, based on the German Draft Act, users shall be technically enabled to flag their content as (i) contractually authorized or as (ii) authorized based on copyright exemptions, if such content is identified to them as blocked content. If content is flagged, the provider is not obligated to block or remove content unless the flagging is obviously incorrect.
- Online content-sharing service providers’ liability for copyright-infringing content: The German Draft Act follows the provisions of the Directive on the scope of liability for online content-sharing service providers.
- Licensing: Going beyond the Directive, the Draft Act imposes a unilateral obligation on online service providers to contract with representative rights-holders. Effectively, online service providers will have to accept licenses available through a collecting society or a major rights-holder under certain conditions such as the appropriateness of the requested remuneration.
- Blocking and Removing: If a rights-holder has provided corresponding information to an online service provider, online service providers are obligated to block non-authorized uses of rights-holder’s work (“stay down”). Similarly, following a rights-holder’s request after a work has already been uploaded without authorization, online service providers are obligated to remove such work (“take down”) and to block the work in the future (“stay down”). Factually, the German Draft Act thereby embraces the use of upload filters.
- Copyright Exemptions: The Draft Act expressly determines copyright exemptions under the German Copyright Act (e.g., caricature, parody, pastiche) as being applicable.
A federal district court judge in Brooklyn, N.Y., dismissed the complaint in a case filed by Genius, a platform that lets users share and annotate lyrics, holding that the plaintiff’s claims were preempted by copyright law. The suit alleged that Google had stolen from Genius transcriptions of song lyrics, and included those song lyrics…
Is scraping data from a publicly available website trade secret misappropriation? Based on a new opinion from the Eleventh Circuit, It might be.
In Compulife Software, Inc. v. Newman, Compulife Software, a life insurance quote database service alleged that one of its competitors scraped millions of insurance quotes from its database and then sold the proprietary data themselves. Compulife brought a number of claims against its competitors, including misappropriation of trade secrets under Florida’s version of the Uniform Trade Secrets Act (FUTSA) and under the Federal Defend Trade Secrets Act (DTSA).
Following a bench trial, Magistrate Judge James Hopkins found that, while Compulife’s underlying database merits trade secret protection, the individual quotes generated through public Internet queries to the database do not. So using a bot to take those individual quotes one by one did not constitute a misappropriation of trade secrets. On appeal, however, the Eleventh Circuit disagreed, vacated, and remanded the case.
Facts of the Case
Compulife’s main product is its “Transformative Database,” which contains many different premium-rate tables that it receives from life insurance companies. While these rate tables are available to the public, Compulife often receives these tables before they are released for general use. In addition, Compulife applies a special formula to these rate tables to calculate its personalized life insurance quotes.…
Continue Reading Webscraping a Publicly Available Database May Constitute Trade Secret Misappropriation
Mashable initially sought a license from the plaintiff, a professional photographer named Stephanie Sinclair, to display a photograph in connection with an article the company planned to post on its website, mashable.com. The plaintiff refused Mashable’s offer, but Mashable, nevertheless, embedded the photograph on its website through the use of Instagram’s API.
Continue Reading S.D.N.Y.: Public Display of Embedded Instagram Photo Does Not Infringe Copyright
A federal district court in Illinois allowed claims for vicarious and direct copyright infringement to proceed against an employee of the Chicago Cubs Baseball Club for retweeting a third-party tweet containing the plaintiff’s copyrighted material. Read the opinion.
Every day, social media users upload millions of images to their accounts; each day 350 million photos are uploaded to Facebook alone. Many social media websites make users’ information and images available to anyone with a web browser. The wealth of public information available on social media is immensely valuable, and the practice of webscraping—third parties using bots to scrape public information from websites to monetize the information—is increasingly common.
The photographs on social media sites raise thorny issues because they feature individuals’ biometric data—a type of data that is essentially immutable and highly personal. Because of the heighted privacy concerns, collecting, analyzing and selling biometric data was long considered taboo by tech companies — at least until Clearview AI launched its facial recognition software.
Clearview AI’s Facial Recognition Database
In 2016, a developer named Hoan Ton-That began creating a facial recognition algorithm. In 2017, after refining the algorithm, Ton-That, along with his business partner Richard Schwartz (former advisor to Rudy Giuliani) founded Clearview AI and began marketing its facial recognition software to law enforcement agencies. Clearview AI reportedly populates its photo database with publicly available images scraped from social media sites, including Facebook, YouTube, Twitter, and Venmo, and many others. The New York Times reported that the database has amassed more than three billion images.…
Continue Reading Clearview AI and the Legal Challenges Facing Facial Recognition Databases
Here at Socially Aware we covered a wide range of issues in 2019. We reviewed an opinion reminding us that user-generated content posted on social media platforms is not necessarily freely available for use in other contexts, and a rare instance of a federal district court holding that a browsewrap agreement was enforceable.…
For the last twenty years, the music industry has been in a pitched battle to combat unauthorized downloading of music. Initially, the industry focused on filing lawsuits to shut down services that offered peer-to-peer or similar platforms, such as Napster, Aimster and Grokster. For a time, the industry started filing claims against individual infringers to dissuade others from engaging in similar conduct. Recently, the industry has shifted gears and has begun to focus on Internet Service Providers (ISPs), which provide Internet connectivity to their users.
The industry’s opening salvo against ISPs was launched in 2014 when BMG sued Cox Communications, an ISP with over three million subscribers. BMG’s allegations were relatively straightforward. BMG alleged that Cox’s subscribers are engaged in rampant unauthorized copying of musical works using Cox’s internet service, and Cox did not do enough to stop it. While the DMCA provides safe harbors if an ISP takes appropriate action against “repeat infringers,” BMG alleged that Cox could not avail itself of this safe harbor based on its failure to police its subscribers.…
Continue Reading Will the Music Industry Continue To Win Its Copyright Battle Against ISPs?