As one wades deeper into the turgid waters of 2021, one is heartened to see the dovetailing of two welcome copyright trends. First, our elected representatives in Congress are working to revise the Digital Millennium Copyright Act, the turn-of-the-century statute that Big Tech has hijacked over the past two decades to build billion-dollar valuations while trampling the rights of artists and creators. The most devastating provision of the DMCA is Section 512, which was originally promulgated to protect online bulletin board operators against claims related to files uploaded by readers. Companies like YouTube seized on this section to stream music videos and films without consent and with knowledge that its site was popular because it was a hotbed of pirated content. And companies like Amazon exploited the same section to sell counterfeit and knock-off product with impunity.
But, now, Congress is looking to rewrite Section 512 to more fairly balance the rights of artists with the rights of Big Tech. And, perhaps cognizant of the way the wind is blowing, courts are now issuing orders limiting the safe harbor created by Section 512, which was previously expanded massively beyond the original intent of its authors.
This appears to be what transpired in Atari Interactive, Inc. v. Redbubble, Inc. The accused infringer, Redbubble, like many tech parasites before it, had built a valuable company by exploiting the work of artists and copyright holders without consent. The company sold shirts, hats, mugs, and various other types of swag bearing graphic designs that the company did not create. Atari, the brand responsible for such arcade hits as Pong and Breakout, filed a lawsuit against Redbubble because Redbubble was advertising and selling a wide swath of products bearing Atari trademarks and artwork.
Redbubble attempted to pass the blame for the massive infringement on its proprietary site to the site’s users, asserting that the users uploaded the Atari artwork and its role was simply to display the uploaded artwork to the public.
In claiming that it was wholly unaware of the infringing content and had no involvement in the use of said content, Redbubble was attempting to exploit the Section 512 safe harbor to avoid liability for the obviously infringing items sold on its website. To qualify for such protection, which, in effect, strips artists and copyright holders of any right to pursue damages against the site, Redbubble had to convince the court that the the infringing Atari content at issue permeated its site “by reason of […] storage at the direction of a user[.]”
Then, to be eligible for the safe harbor under Section 512, Redbubble must prove that “(1) it lacked actual or red flag knowledge of the infringing material; and (2) it did 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.’”
Many courts, at the urging of Big Tech, have found tech companies’ business operations to meet the above, even when they had knowledge of the infringement, received financial benefits from the infringement, and actively modified the infringing content. But the Redbubble court does not fall into this trap.
Citing Mavrix Photographs, LLC v. Livejournal, Inc, a Ninth Circuit case from 2017, the court found that Redbubble could not even make the threshold showing that the infringing Atari content had been stored “at the direction of the user.” The court noted that storage at user direction can only be found when the service provider played no role in making the infringing material accessible on its site and did not carry out any activities that were ‘narrowly directed’ toward enhancing the accessibility of the infringing content.
The court concluded that Redbubble failed to meet these requirements because Redbubble actively participated in “modifying the files uploaded by users to display the designs on Redbubble-selected physical products.” Redbubble’s response — that it, like Amazon, simply facilitates access to third-party seller’s products — was swiftly swatted aside by the court. Atari’s argument, which was, in essence, that Redbubble doesn’t just “store” artwork uploaded by its users, was more persuasive because the evidence made clear that Redbubble actively manipulates the uploaded artwork, “copying infringing designs onto model photos to create images of products for sale, and exhibiting those images on Redbubble’s product pages that are hosted on its website[.]”
Given this finding, Redbubble was found to be outside the purview of the Section 512 safe harbor and potentially liable for the infringement at issue. The copyright claims will now go before a fact-finder at trial (or the matter will settle). Hopefully, the courts and Congress continue to align to more fully protect artists and copyright holders and push back against the creeping shadow cast by Big Tech over the artistic community.
Scott Alan Burroughs, Esq. practices with Doniger / Burroughs, an art law firm based in Venice, California. He represents artists and content creators of all stripes and writes and speaks regularly on copyright issues. He can be reached at scott@copyrightLA.com, and you can follow his law firm on Instagram: @veniceartlaw.