Reel Pop

Those looking for an answer to YouTube's present predicament -- whether to filter copyrighted content before licensing agreements or after licensing agreements -- may find a few clues if they direct their attention to a court order issued last week in a little known case called MGM v. Grokster.

Yes, the infamous MGM v. Grokster case is still kicking around, almost six years later, in LA federal district court, where it returned after the Supreme Court failed to clarify several important issues concerning copyright infringement. The major defendant left in the case now is Streamcast, and the court is preparing to issue a permanent injunction against Streamcast's Morpheus software.

Sound like old news? Well here's where it gets interesting, because whatever happens next in this case may have an impact on whether and how YouTube (or any video-sharing service) capitulates to demands to filter video content.

To understand why, let's look closer at the current situation facing YouTube. The vid share site has issued an ultimatum of sorts to media companies who want YouTube to weed out copyrighted content. In return for a licensing agreement to show some of your content, YouTube says, we will provide filters that ensure our users don't upload your shows.

The media companies are, of course, not enthused with this proposition. Their position is that YouTube is obviously turning a blind eye to infringing activity and, moreover, that Google is exacerbating the problem by linking Google Video search to YouTube. After all, the argument goes, if YouTube is able to filter pornography -- whether via algorithms, human intervention, or both -- then certainly they can filter Saturday Night Live and Daily Show episodes.

Those accusations may be true. However. YouTube is in an interesting position. According to the DMCA safe harbor protections, they only have to remove videos if they receive a takedown request and if they had no prior knowledge said videos were infringing. YouTube personnel may have theoretical knowledge of infringement, but that alone isn't an offense, and meanwhile YouTube cannot be held liable for the trespasses of its users.

But YouTube has even less incentive to filter videos, and here's why: Filters aren't perfect. Should the filter fail to stop all infringing works, YouTube could be sued for contributory or vicarious infringement. By deploying such a filter, YouTube would also be tacitly admitting they have knowledge of infringement, and that the infringement is so pervasive that it warrants filtering software. That's a legal vulnerability.

Thus, YouTube, in proffering deals to Viacom and others, is likely asking that a) those companies waive the right to sue, and b) those companies provide the database for filtering software. YouTube doesn't want to get stuck with its pants down.

Here's where MGM v. Grokster comes into play.

Last week the plaintiffs in the case requested a permanent injunction against Grokster. That injunction asks the court to forbid StreamCast from distributing, promoting or supporting the Morpheus P2P app unless StreamCast has a system in place (read: filters) to prevent the unauthorized use of copyrighted works.

However, the court questions who is liable if those filters don't work. In the case of third-party filters (SNOCAP and Audible Magic are mentioned specifically), StreamCast should not be held liable if the filters fail to "exhaustively" prevent infringement. Another option is for StreamCast to create a homemade filter (the YouTube option), but then the question of who provides the database for that filter comes into question:

...The Court is not certain how to proceed if Streamcast insists on maintaining its homemade filter, and must affirmatively ensure that its database is complete. Plaintiffs likely believe that their artist-title pairs and hash values are commercially valuable, and that they should not be forced to provide such information for free. The Court tends to agree. Additionally, this Court does not necessarily believe that StreamCast must be given an opportunity to employ a homemade filter which lacks a complete database, if other feasible alternatives exist. Plaintiffs are ORDERED to brief the issue and also detail how Plaintiffs could independently obtain a list of all copyrighted works to be protected  (and thus, "notice") in order to "exhaustively" prevent infringement.  StreamCast shall respond as well.

In other words, the technology is legal but we don't seem to have a way of ensuring we can filter the content. If we're lucky, the outcome of this process will include some kind of precedent concerning how content filters are to be used, and who will provide the requisite information.

The court has ordered the parties to respond by March 27.

Update: There's news now that YouTube is licensing Audible Magic for its filtering. The current discussions underway in the Grokster case provide some additional questions and answers about how the courts may deal with 3rd party filtering should YouTube get sued. Here's the relevant bit from the court order:

...it seems that StreamCast could be  found in contempt of Court even if it employs a filter licensed by SNOCAP, Inc. or Audible Magic.  For example, if there is a shortcoming in these companies'  filtering technology, and direct infringement by end-users ensues, StreamCast could be held liable under the proposed permanent injunction because
the third-party filtering system did not  ''exhaustively"  stop the  infringement of  "any" copyrighted works -  in effect, it was not a "perfect" filter.  Thus, the Court ORDERS Plaintiffs to explain whether they would agree to an injunctive remedy that held StreamCast harmless for another's direct infringement resulting from an  "effective" third-party filter's technological shortcomings -  assuming of course that StreamCast has not engaged in any obstruction or otherwise caused the filtering tool to fail. And if
StreamCast implements a homemade filter matching Plaintiffs' proposed specifications, it appears that StreamCast should be similarly free from liability if the technology is not "perfect." If Plaintiffs do not agree to such a term, then StreamCast will have the discretion to offer a rebuttal in its supplemental brief.

(c)  DATABASE SHORTCOMINGS  -  This leads the Court to the issue of notice and the Ninth Circuit's decision in A&M  Records, Inc. v. Napster, Inc., 239 F.3d 1004  (9th Cir. 2001).  In this Court's view, if StreamCast accepts a proposed  filter that Plaintiffs
recommend  (e.g., SNOCAP, Inc., Audible Magic), then it would follow that StreamCast could not be held  liable if SNOCAP or Audible Magic fail to include a complete index of copyrighted material as part of their filter.  An  incomplete index could allow end-users to infringe despite the presence of a filter on other copyrighted works.