DMCA “Bad Faith” Takedowns and Counternotifications may require a Plaintiff to prove subjective bad faith.

Introduction

Many people are submitting knowingly false DMCA takedown claims on YouTube.  The DMCA law prohibits this type of bad faith conduct. However, proving it may be more difficult than you may think.  The Plaintiff filing a 512(f) misrepresentation claim may have a tough burden of proof, at least for now.  This blog discusses three fairly new cases in this area.

DMCA takedown law

The DMCA provides a rapid procedure for copyright owners to protect the widespread proliferation of their digital content. A DMCA notice requires a signed statement under penalty of perjury that the submitting party has a good faith belief that the content identified in the notice is infringing on a copyright, together with “[a] statement that the complaining party has a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law” under § 512(c)(3)(A)(v) of the DMCA.

Under § 512(f) of the statute, that “[a]ny person who knowingly materially misrepresents under this section ... that material or activity is infringing ... shall be liable for any damages, including costs and attorneys' fees, incurred by the alleged infringer ... who is injured by such misrepresentation, as the result of the service provider relying upon such misrepresentation in removing or disabling access to the material or activity claimed to be infringing[.]” See 17 U.S.C. § 512(f). Defendants “face[ ] liability if [they] knowingly misrepresented in the takedown notification that [they] had formed a good faith belief the [photographs] were not authorized by the law, i.e., did not constitute fair use.” See Lenz, 815 F.3d at 1154

Weinberg v. Dirty World, LLC

Anyone abusing the right to file DMCA takedown notification by submitting meritless claims of infringement to service providers, however, may be subject to liability under Section 512(f), which provides in relevant part that:

Any person who knowingly materially misrepresents under this section … that material or activity is infringing … shall be liable for any damages, including costs and attorneys' fees, incurred by the alleged infringer … who is injured by such misrepresentation, as the result of … relying upon such misrepresentation in removing or disabling access to the material or activity claimed to be infringing.

17 U.S.C. § 512(f). To state a claim for misrepresentation under Section 512(f), therefore, one must allege:

(1) knowing and material misrepresentation that copyright infringement has occurred by the one filing the DMCA takedown notification;

(2) the alleged infringer relied on such misrepresentations;

and

(3) injury to the alleged infringer as a result. 

See Automattic Inc. v. Steiner, 82 F. Supp. 3d 1011, 1026 (N.D. Cal. 2015) (citing Online Policy Grp. v. Diebold, Inc., 337 F. Supp. 2d 1195, 1204 (N.D. Cal. 2004)).

Here, Dirty World alleges the first element of knowing and material misrepresentation by claiming that Weinberg sent a DMCA takedown notification on August 4, 2015, the second DMCA notification, in which Weinberg asserted that he owned the copyright of the image used in post no. 1128246 (that is, Photo 2) and that Dirty World is infringing that copyright—that is, he asserted that Dirty World infringed his copyright in Photo 2 (referencing to Photo 2 and stating that “Mr. Weinberg and Ms. Londre are the copyright holders of certain photographs (the ‘Photographs') posted on the Website. These postings of the Photographs, and any other uses of the Photographs on the Website, are not authorized by the copyright owners, their licensees, agents, or by law…. This is our last request that the infringing photos be taken down, prior to suing for copyright infringement.”).

Dirty World also alleges that it relied on the alleged misrepresentation in the takedown notification by removing the image contained in post no. 1128246 (that is, Photo 2) from its website. Such reliance on the alleged misrepresentation is  prima facie sufficient to support both the materiality of the misrepresentation in the first element as well as the second element of a Section 512(f) violation.  See Diebold, 337 F. Supp. 2d at 1204 (“The misrepresentations were material in that they resulted in removal of the content from websites and the initiation of the present lawsuit.”);  Automattic, 82 F. Supp. 3d at 1026. Moreover, Dirty World sufficiently alleges knowledge of the misrepresentation component of the first element by asserting so generally.  See CC ¶¶ 59-61;  see also Fed. R. Civ. P. 9(b) (“Malice, intent,  knowledge, and other conditions of a person's mind may be alleged generally.”) (emphasis added);  accord  Curtis v. Shinsachi Pharm. Inc., 45 F. Supp. 3d 1190, 1199 (C.D. Cal. 2014). In any event, Dirty World clearly alleges that “Weinberg knew that he was not the owner of any exclusive rights in at least one” of the images at issue, “nor was he authorized to act on behalf of any such owner” ( see CC ¶¶ 27, 61) which further bolsters the inference that Weinberg knowingly misrepresented in the second DMCA notification that Dirty World infringed  his copyright when he held no copyright over the image. 

Automattic, 82 F. Supp. 3d at 1026 (finding, upon a motion for default judgment, where the court took all factual allegations in the complaint regarding liability as admitted, that defendant could not have reasonably believed that the content at issue was “protected under copyright”). Weinberg's assertion that “[s]uch statements cannot serve as a basis for liability” under Section 512(f) ( see Motion at 9) ignores the plain fact that without ownership or authorization over the copyright, Weinberg could not have reasonably believed that he was protected by the Copyright Act or, stated differently, that Dirty World could be liable to him for copyright infringement; and as such, Weinberg knowingly misrepresented copyright infringement in his second DMCA takedown notification.  See  Iqbal, 556 U.S. at 678 (declaring that where a plaintiff facing a Rule 12(b)(6) motion has pled “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged,” the motion should be denied);  see also Schwarzer, Tashima & Wagstaffe,  Cal. Prac. Guide: Fed. Civ. Proc. Before Trial (“Schwarzer”) § 9:214.4 (The Rutter Group 2016) (“When a complaint's allegations are capable of more than one inference, the court must adopt whichever plausible inference supports a valid claim.”) (citing  Starr v. Baca, 652 F3d 1202, 1216 (9th Cir. 2011);  Watson Carpet & Floor Covering, Inc. v. Mohawk Industries, Inc., 648 F3d 452, 458 (6th Cir. 2011)). Finally, Weinberg does not assert that Dirty World has not alleged injury from its reliance on the alleged misrepresentation included in the DMCA notification.

After all, Dirty World removed the allegedly infringing content from its website, eliminating any and all commentary from its community of users on that image, which, the Court can infer at this motion to dismiss stage, generates “national media attention” and, in turn, website traffic and advertising revenue for Dirty World from the website.  See CC ¶ 52;  see also id. ¶¶ 13-20; Complaint ¶ 3 (“Dirty World generates traffic to TheDirty.com, and hence profits to Dirty World, by posting infringing images and then adding, and encouraging others to add, loathsome insults.”). As such, Dirty World has stated sufficient facts to support a plausible claim for misrepresentation under Section 512(f), and dismissal is not warranted under Rule 12(b)(6).  See Automattic, 82 F. Supp. 3d at 1026;  Mendiondo, 521 F.3d at 1104 (“Dismissal under Rule 12(b)(6) is appropriate  only where the complaint lacks a cognizable legal theory or  sufficient facts to support a cognizable legal theory.”) (emphases added). Because the Court finds that Dirty World has sufficiently stated a plausible claim for Section 512(f) violation on the basis of the second DMCA notification, it need not address the sufficiency of the pleadings on the basis of the remaining DMCA notifications sent by Weinberg.

Weinberg also argues that Dirty World fails to allege any specific fact to support Weinberg's lack of good faith in considering fair use before sending DMCA notices.  See Motion at 7-9; Reply at 5-6. In light of the foregoing, specifically where Dirty World alleges that Weinberg was not the copyright owner ( see CC ¶¶ 27, 61), Dirty World need not also plead failure to consider fair use to withstand a Rule 12(b)(6) motion.  See supra n.7. In any event, Dirty World plainly alleges that Weinberg did not form a good faith belief that the use of the images in question was not fair because he failed to consider Dirty World's fair use, given the context (set forth in great detail in its counterclaim) in which it operates as an internet service provider (“As of January 2017, TheDirty.com contains more than 160,000 unique posts and many tens of millions of comments submitted by third party users.”);  Iqbal, 556 U.S. at 678; Schwarzer § 9:214.4. Such factual allegations regarding the subjective condition of Weinberg's mind are sufficient, without anything more, to raise the reasonable inference that Weinberg could have believed that Dirty World's use of the relevant images constituted fair use or, relatedly, that Weinberg could not have held the belief in good faith that use of the images by Dirty World was “not authorized by … the law” as required under Section 512(c)(3)(A)(v).  See Fed. R. Civ. P. 9(b) (“ Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally.”) .

See also  Lenz v. Universal Music Corp., 815 F.3d 1145, 1151 (9th Cir.),  cert. denied, 137 S. Ct. 416 (2016) ( “Fair use is not just excused by the law, it is wholly authorized by the law.”);  id. at 1152 ( “[ 17 U.S.C. § 107 ] explains that the fair use of a copyrighted work is permissible because it is a non-infringing use.”). To be clear, if a copyright holder ignores or neglects our unequivocal holding that it must consider fair use before sending a takedown notification, it is liable for damages under § 512(f) .  

If, however, a copyright holder forms a subjective  good faith  belief the allegedly infringing material does not constitute fair use, we are in no position to dispute the copyright holder's belief even if we would have reached the opposite conclusion.  A copyright holder who pays lip service to the consideration of fair use by claiming it formed a good faith belief when there is evidence to the contrary is still subject to § 512(f)  liability.

Moreover, as a subjective inquiry, whether or not Weinberg actually possessed a good faith belief that Dirty World's use constituted fair use is a factual determination generally resolved on the basis of evidence at summary adjudication or at trial.  See Rossi v. Motion Picture Ass'n of Am. Inc., 391 F.3d 1000, 1005-06 (9th Cir. 2004) (affirming a summary judgment determination that no issue of material fact existed as to defendant's good faith belief that plaintiff's website infringed upon its copyrighted materials);  Diebold, 337 F. Supp. 2d at 1204 (finding, upon cross-motions for summary judgment, a knowing material misrepresentation of copyright infringement where “[n]o reasonable copyright holder could have believed” that copyright protection existed, at least with respect to the portions of the content clearly subject to the fair use exception, and where the claimant specifically intended its DMCA notifications to prevent publication of content);  Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 456 (1984) (discussing favorably the district court's conclusion, which was based on a complete record at trial, with respect to fair use of copyrighted material); Lenz v. Universal Music Corp., 815 F.3d at 1155–56, 1158 (affirming the district court's order denying the parties' cross-motions for summary judgment where plaintiff failed to “provide evidence” “to meet a threshold showing” that defendant subjectively believed that the use in question constituted fair use);  cf. Lenz v. Universal Music Corp., 572 F. Supp. 2d 1150, 1156 (N.D. Cal. 2008) (finding, where, unlike here, copyright ownership was well-established, that the operative complaint sufficiently pled allegations of bad faith and deliberate ignore of fair use to withstand a Rule 12(b)(6) motion).

While Dirty World may or may not ultimately prevail on its Section 512(f) claim depending on whether Weinberg subjectively formed a good faith belief that allegedly infringing material did not constitute fair use, that is a matter for another day. For now, based on the allegations set forth in the counterclaim, and under the liberal notice pleading standard of Rule 8(a)(2), which requires only “a short and plain statement of the claim showing that the pleader is entitled to relief” (see Fed. R. Civ. P. 8(a)(2)), the Court finds that Dirty World has properly alleged a plausible claim for DMCA false notice under Section 512(f) of the Copyright Act. IV. Conclusion Based on the foregoing discussion, the Court would deny the motion to dismiss.   Weinberg v. Dirty World, LLC, No. CV 16-9179-GW(PJWX), 2017 WL 5665022, at *5–8 (C.D. Cal. Apr. 24, 2017). Ninth Circuit has held that, in submitting a takedown notification,  “a copyright holder need only form a  subjective  good faith belief that a use is not authorized.”  Lenz v. Universal Music Corp., 815 F.3d 1145, 1153 (9th Cir. 2015),  cert. denied, ––– U.S. ––––, 137 S.Ct. 416, 196 L.Ed.2d 290 (2016), and  cert. denied, ––– U.S. ––––, 137 S.Ct. 2263, 198 L.Ed.2d 698 (2017) (citing  Rossi v. Motion Picture Ass'n of Am. Inc., 391 F.3d 1000, 1004 (9th Cir. 2004) (emphasis added)).

In other words, a copyright holder is not liable for misrepresentation under the DMCA if they subjectively believe the identified material infringes their copyright, even if that belief is ultimately mistaken. It is clear to this Court that the same subjective standard should apply to the “ good faith belief” requirement for counter notifications. If the same standard did not apply, creators of allegedly infringing work would face a disparate and inequitable burden in appealing an online service provider's decision to remove or disable access to their work. Given the fact that the statutory requirements for takedown notices and counter-notifications are substantially the same, the DMCA plainly does not envision such a scheme.  Cf.  Rossi, 391 F.3d at 1005 (“Juxtaposing the ‘good faith' proviso of the DMCA with the ‘knowing misrepresentation' provision of that same statute reveals an apparent statutory structure that predicated the imposition of liability upon copyright owners only for knowing misrepresentations regarding allegedly infringing websites.” See  Hosseinzadeh v. Klein, 276 F. Supp. 3d 34, 44 (S.D.N.Y. 2017)

Here is another 512(f) case from the Northern District of California

Here was the Court's holding:

Stern v. Lavender, 319 F. Supp. 3d 650, 683–84 (S.D.N.Y. 2018)

Here is a case (not from the 9th Circuit, but from New York).

Defendants' Counterclaim Based on Plaintiffs' “Take-Down” Notices to eBay Plaintiffs move for summary judgment on the Lavenders' remaining counterclaim. It alleges, under 17 U.S.C. § 512(f), that plaintiffs, through counsel, in sending “takedown” notices to eBay, knowingly and materially misrepresented, in bad faith, to eBay that the Lavenders' posting of works for sale on eBay was infringing a Stern copyright, when plaintiffs knew it was not. The facts underlying this claim are largely undisputed, as they are drawn from correspondence.  On February 7, 2017, plaintiffs' counsel, representing the Bert Stern Trust, submitted takedown notices of infringement to eBay, pursuant to the DMCA, Pub. L. 105-304, § 202, Oct. 28, 1998, 112 Stat. 2860 (codified at 17 U.S.C. § 512(c) ). Counsel claimed that several listings the Lavenders had posted, which offered to sell original or Modified Prints, infringed Stern's 2013-registered copyright. Counsel's notices initially designated eBay's “reason code 4.2” as the basis for asserting infringement.

That code connotes that the “[l]isting contains [an] unlawful copy of [a] copyrighted image.” An email exchange with eBay followed. Explaining the reason-code designation, plaintiffs' counsel stated: “The items are a limited edition print of a copyrighted photograph and are works of visual art. The uploading and public display of these items on eBay constitutes copyright infringement without regard to whether the item is counterfeit or not. No one can photograph these items as that too would constitute copyright infringement.” JSF Ex. 13B. An eBay official responded that the reason code was incorrect, and that if counsel's “concern [was] with the product being sold,” the Trust needed to submit a revised notice with a reason code related to “copyright-item infringement.”  Id. Plaintiffs' counsel thereupon changed the designated reason code to code 6.1, a residual category for “other” types of infringement. JSF Exs. 13B & 14. Alongside that entry, on each notice, plaintiffs' counsel wrote, “copyright infringement: Unauthorized reproduction and public display of an item protected by copyright.”  Id. Ex. 14. The Lavenders' counterclaim here is under § 512(f), which makes liable a person who “knowingly materially misrepresents” to a service provider “that material or activity is infringing.” 17 U.S.C. § 512(f). Relevant here, it is a complete defense to a claim under § 512(f) that the party issuing a takedown notice had a subjective good faith belief that the use in question was “not authorized.”  Hosseinzadeh v. Klein, 276 F.Supp.3d 34, 44 (S.D.N.Y. 2017). (“A copyright holder is not liable for misrepresentation under the DMCA if they subjectively believe the identified material infringes their copyright, even if that belief is ultimately mistaken.”) (citing  Lenz v. Universal Music Corp., 815 F.3d 1145, 1153 (9th Cir. 2016) ).

The evidence here uniformly supports plaintiffs' defense of good faith. And critically here, the Lavenders have not supplied a factual basis on which to find the opposite: that plaintiffs, in pursuing takedown notices, made a knowing material misrepresentation. Plaintiffs' claim of copyright infringement in connection with the Lavenders' offer to sell Last Sitting photographs and Modified Prints was clearly colorable. It tracks the infringement claims that will proceed to trial in this lawsuit. And while the facts as to whether the late Stern had given away certain items and authorized certain posthumous actions are disputed, the Trust had sound reason to conclude that he had not done so and that the Lavenders do not own the objects they were offering for sale. If so, the Lavenders' display of photographs of those objects incident to the offer of them of sale would necessarily violate plaintiffs' copyright (as those displays would no longer be fair use because they would not be in service of lawful sales). For the Trust to assert this position did not evince bad faith or entail the making of a material misrepresentation. Further, as to the “reason code” that plaintiffs' counsel came to use, counsel's written exchange with eBay reflects that counsel accurately recited plaintiffs' theory of infringement to eBay, and then relied on eBay's instructions as to the code to use. The Court therefore enters summary judgment for plaintiffs on the Lavenders' counterclaim.  See, e.g.,  UMG Recordings, Inc. v. Augusto, 558 F.Supp.2d 1055, 1065 (C.D. Cal. 2008),  aff'd, 628 F.3d 1175 (9th Cir. 2011). So there seem to be a few observations that can be made about a DMCA 512(f) “bad faith” takedown or counter-notification at this juncture:

1.   Plaintiff (or Counter-Claimant) should be able to get by a motion to dismiss the lawsuit alleging bad faith takedown if it properly pleads the knowing misrepresentation being made in bad faith and that no reasonable copyright owner would have believed in the good faith of the action taken  

2.  Defendant appears to have a defense of “subjective good faith” that they can raise  

3.   Plaintiff may be required to disprove the defense (i.e. to show some evidence that the subjective intent is objectively unreasonable or not bona fide or was in bad faith).

This makes 512(f) claims very interesting.  We will continue to track these cases in the 9th Circuit and elsewhere.

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