Athos Overseas Corp. v. Youtube, Inc.

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ATHOS OVERSEAS LIMITED CORP., Plaintiff, v. YOUTUBE, INC., YOUTUBE, LLC, and GOOGLE, LLC, Defendants.

No. 21-21698-Civ-GAYLES/TORRES

United States District Court, S.D. Florida

August 29, 2023

AMENDED^[1]REPORT AND RECOMMENDATION ON THE PARTIES' MOTIONS FOR SUMMARY JUDGMENT

EDWIN G. TORRES UNITED STATES MAGISTRATE JUDGE

This matter is before the Court on Athos Overseas Limited Corp.'s (“Athos” or the “Plaintiff”) Motion for Partial Summary Judgment (“Plaintiff's Motion”) [D.E. 125], and Defendants YouTube, Inc., YouTube, LLC, and Google LLC's (collectively, “Defendants”) Cross Motion for Summary Judgment (“Defendants' Motion”) [D.E 134-1]. The parties filed timely responses [D.E. 139, 138] and replies [D.E. 147, 150] to each motion, therefore, the motions are now ripe for disposition.^[2] After careful consideration of the briefing materials, the evidence of record, the relevant authorities, and for the reasons discussed below, we hereby RECOMMEND that Defendants' Motion be GRANTED, Plaintiff's Motion be DENIED, and the case be dismissed with prejudice.

I. BACKGROUND^[3]

This lawsuit alleges copyright infringement arising from the posting of copyrighted materials on YouTube's website by third-party users. The Plaintiff in this action is a Panamanian entity owned by Carlos Vasallo (“Mr Vasallo”), a businessman and video producer, who holds title to hundreds of classic Mexican films that have been allegedly uploaded and displayed on YouTube without his prior authorization.

According to Plaintiff, Defendants are liable under direct and secondary infringement theories for YouTube's failure to prevent the systematic re-posting of Plaintiff's copyrighted movies to its platform. Plaintiff contends that YouTube has turned a blind eye to rampant infringement of Athos' copyrights by refusing to employ proprietary video-detection software to block or remove from its website potentially infringing clips, and not just clips specifically identified by URL in Plaintiff's DMCA takedown notices. In essence, Plaintiff argues that evidence of YouTube's advanced video detection software, in conjunction with the thousands of takedown notices Athos has tendered upon YouTube, give rise to genuine issues of fact as to whether Defendants have forfeited the DMCA's safe harbor protections.

Defendants, on the other hand, assert that Athos cannot displace YouTube from the safe harbor of the DMCA because Plaintiff's construction of the statute is at odds with its plain language and applicable case law. Defendants submit that Plaintiff is incapable of meeting its burden of proof insofar as Plaintiff proffers no evidence of knowledge of specific infringement, relies on a conception of knowledge that clashes with the DMCA's non-monitoring provisions, and cannot point to evidence linking its theory of infringement to any of the particular clips-in-suit. In light of this evidentiary deficit, Defendants posit, this Court should find that YouTube's actions comport with the DMCA and grant judgment on their safe harbor defense.

A. The Digital Millennium Copyright Act (“DMCA”)

“The DMCA was enacted in 1998 to implement the World Intellectual Property Organization Copyright Treaty” and to “update domestic copyright law for the digital age.” Viacom Int'l, Inc. v. YouTube, Inc., 676 F.3d 19, 26-27 (2d Cir. 2012) (quotes and citations omitted). In passing the DMCA, Congress attempted to strike a balance between the protection of copyrights and the continued development of the internet. See Capitol Recs., LLC v. Vimeo, LLC, 826 F.3d 78, 82 (2d Cir. 2016). To that end, the DMCA enhanced “copyright protection by establishing a ‘notice-and-takedown regime' that requires service providers to ‘expeditiously . . . remove . . . material that is claimed to be infringing,” while expressly relieving “[internet service providers] of any obligation to monitor the postings of users to detect infringements as a condition of qualifying for the safe harbor.” Capitol Recs., LLC v. Vimeo, LLC, No. 09-CV-10101 (RA), 2021 WL 2181252, at *2 (S.D.N.Y. May 28, 2021) (quotes and citations omitted) (alterations in original).

Indeed, the DMCA contains several “safe harbor” provisions that shield internet service providers (“ISPs”) from liability if they meet applicable statutory conditions. See Ventura Content, Ltd. v. Motherless, Inc., 885 F.3d 597, 602 (9th Cir. 2018). First, a party seeking the protection of the DMCA must satisfy certain eligibility criteria, “including the adoption and reasonable implementation of a ‘repeat infringer' policy that ‘provides for the termination in appropriate circumstances of subscribers and account holders of the service provider's system or network.'” Viacom, 676 F.3d at 27 (quoting 17 U.S.C. § 512(i)(1)(A)).^[4] In addition to these threshold criteria, the ISP must also satisfy the requirements of the applicable safe harbor. The relevant safe harbor provision here is § 512(c), which provides as follows:

(1) In general.-A service provider shall not be liable . . . for infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider, if the service provider-

(A) (i) does not have actual knowledge that the material or an activity using the material on the system or network is infringing;

(ii) in the absence of such actual knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or (iii) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material;

(B) does not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity; and

(C) upon notification of claimed infringement as described in paragraph (3), responds expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity.

17 U.S.C. § 512(c)(1).

Thus, in order to qualify for the protection of this safe harbor, the ISP must not know of the infringement; the infringement must not be apparent; it must remove infringing material when it learns about it or upon receipt of a valid DMCA notice; and it must not directly benefit financially from the infringement in situations when it can control the activity. See Motherless, Inc., 885 F.3d at 604; Viacom, 676 F.3d at 28.

B. The Alleged Infringement

The relevant facts in this dispute date back to 2014. After finding out that some of his movies were being displayed on YouTube's website without his authorization, Mr. Vasallo retained Gibney Anthony & Flaherty (“Gibney”) in November 2014 to keep track of clips on YouTube that infringed on Athos' copyrights. In addition to this monitoring function, Gibney was tasked with the enforcement of Athos' copyrights, which it carried out by compiling and sending DMCA takedown notices to YouTube on Athos' behalf.

Following the engagement of Gibney as copyright enforcement agent, Mr. Vasallo met with YouTube employees in January 2015 to discuss ways in which YouTube and Athos could cooperate to facilitate Athos' enforcement efforts. As part of these discussions, Defendants offered Mr. Vasallo access to YouTube's most powerful copyright protection software, Content Id. These talks reached an impasse, however, after Mr. Vasallo refused to agree to YouTube's Content Hosting Services Agreement (“CHSA”), due, in part, to the fact that the CHSA contained a release of claims provision.^[5]The CHSA was a standard agreement to which all Content ID participants had to agree. Unwilling to partake in YouTube's automated copyright protection software tools, Athos was relegated to the individualized takedown process prescribed by the DMCA.

Gibney continued to monitor and tender takedown notices on behalf of Athos, and, between June and November 2015, it sent a number of demand letters asking YouTube to take affirmative steps to prevent the re-posting of clips that infringed upon Athos' copyrights. Gibney noted in these letters that despite sending hundreds of DMCA takedown notices and having YouTube remove the noticed videos, third-party users continued to upload new clips that infringed on Plaintiff's works (in many instances, the same works). The letters also claimed that YouTube had the tools to proactively filter out unauthorized clips-including info-graphic software- that it could use to police its systems and prevent the future posting of infringing clips without additional input from Athos. [D.E. 134-2 at 109-114].

YouTube responded to Gibney in December 2015 via email. In its response, YouTube pointed out that it could not operate its copyright protection tools on behalf of Athos, or any other copyright owner, because only copyright holders know the full extent of their copyrights. Additionally, YouTube noted that it was its normal procedure to implement video-matching technology to make sure that identical copies of noticed and removed clips are never reuploaded; that YouTube had already offered Athos access to its most powerful copyright protection software; and that Athos had chosen to forego participation in the Content ID program. Id. at 117. YouTube reiterated that, if it chose to, Athos had the option of using the automated copyright tools offered by the platform at no cost. Id.

Almost six years and thousands of DMCA takedown notices later, Athos filed this lawsuit against Defendants on May 3, 2021 asserting copyright infringement and related claims based on the public performance, display, and reproduction of infringing clips on YouTube's website.^[6] On March 29, 2022, this Court granted in part Defendants' motion to...