Attorney Steve® BitTorrent Legal Updates - Flava Works vs. myVidster.  File sharing case law.

Introduction

According to Wikipedia:

"Flava Works, Inc v. Gunter, 689 F.3d 754 (7th Cir. 2012), is a decision by the United States Seventh Circuit Court of Appeals, authored by Judge Richard Posner, which held that Marques Gunter, the sole proprietor of the site myVidster.com, a social bookmarking website that enables its users to share videos posted elsewhere online through embedded frames, was not liable for its users' sharing and embedding of copyrighted videos.

The court of appeals reversed the decision of the United States District Court for the Northern District of Illinois, which had granted a preliminary injunction against myVidster, citing sufficient knowledge of infringement on Gunter's part, while denying safe harbor defense under the Digital Millennium Copyright Act (DMCA). The Court held that Gunter was not directly liable because the copyrighted content was not stored on myVidster's servers, and was not contributorily liable because there was no evidence that conduct by myVidster increased the amount of infringement.

Case brief for the Trial Court case

Facts: Flava Works, Inc. (“Plaintiff”) is an adult entertainment company that owns copyrights to a variety of adult videos. Plaintiff produces, distributes, and sells its videos over the internet through its website, flavaworks.com. Defendant, Gunter dba myVidster (“Defendant”), operates a website known as myVidster.com (“myVidster”). MyVidster allows users to upload and share links to content hosted on third-party websites, including links to Plaintiff's copyrighted videos. MyVidster also allows users to comment on and share videos with one another.

Procedural History: Plaintiff brought suit against Defendant in the United States District Court for the Northern District of Illinois, alleging that Defendant's website was infringing on Plaintiff's copyright by allowing the free sharing of its videos. Plaintiff sought damages and an injunction to stop the infringement.

Issue: Whether Defendant's website, myVidster, is liable for copyright infringement by allowing users to post and share links to Plaintiff's copyrighted videos.

Holding: The District Court held that Defendant was liable for copyright infringement. The court found that Defendant had knowledge of the infringing activity, failed to remove or disable access to the infringing videos, and received a direct financial benefit from the infringing activity. The court also found that the fair use doctrine did not apply.  An injunction was issued.

Reasoning: The court reasoned that Defendant had knowledge of the infringing activity due to the presence of a tool that allowed users to flag infringing content, as well as the presence of comments from users pointing out the infringing nature of the videos. The court further reasoned that Defendant had a direct financial benefit from the infringing activity because it received advertising revenue from the infringing videos. Additionally, the court found that the fair use doctrine did not apply because the videos were being used for commercial gain and had a detrimental effect on the market for Plaintiff's videos.

Defendant argued "fair use" defense

38. Plaintiff's direct copyright infringement claim as against defendant SalsaIndy is barred in whole by the doctrine of fair use, as set forth in 17 U.S.C. § 107.

39. SalsaIndy's use of the thumbnail images is highly transformative.

40. SalsaIndy's use serves the purpose of improving access to information on the Internet versus artistic expression.

41. SalsaIndy's use of the thumbnail serves as a pointer directing a user to the source of the information.

42. SalsaIndy has acted in a manner that is compatible with the principles of good faith and fair dealing.

43. SalsaIndy has not intentionally misappropriated Plaintiff's works for the purpose of commercial exploitation.

44. Plaintiff's images have been previously published, and therefore, Plaintiff has exploited its right of first publication.

45. The thumbnail image captures only a screenshot of the video.

46. The thumbnail image is only a small and insubstantial portion of the entire work.

47. SalsaIndy's use of the thumbnail images does not harm Plaintiff's market for its images of videos.

48. SalsaIndy does not currently sell or market thumbnail images.

49. SalsaIndy does not currently sell or market screenshots of its videos.

50. The thumbnail images are in no way a substitute for the full-length video, and accordingly, do not harm Plaintiff's ability to license or sell its videos.

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