This appeal arises from a copyright infringement lawsuit brought by major record labels, including Capitol Records and EMI affiliates, against the video-sharing platform Vimeo. The plaintiffs alleged that 281 user-uploaded videos contained their copyrighted musical recordings without authorization. While Vimeo conceded that these specific videos were infringing, it argued it was immune from liability under Section 512(c) of the Digital Millennium Copyright Act (DMCA). The district court had previously granted summary judgment to Vimeo, finding that the platform lacked actual or red flag knowledge of the infringement and did not have the right and ability to control the infringing activity. The plaintiffs appealed, arguing that Vimeo's employees had sufficient knowledge of the infringement and that Vimeo's active curation of content, including promoting certain videos and banning others, disqualified it from the safe harbor.
The Second Circuit, writing through Judge Leval, addressed two primary grounds for disqualifying Vimeo from the DMCA safe harbor: red flag knowledge and the right and ability to control infringing activity. First, regarding red flag knowledge, the court clarified that the standard requires facts making infringement 'objectively obvious' to an ordinary person without specialized knowledge of copyright law. The court rejected the plaintiffs' argument that Vimeo's employees, who knew music licensing was 'confusing' and had been told not to use copyrighted music, possessed red flag knowledge. The court reasoned that knowing a video contains copyrighted music does not make it obvious that the use is unlicensed or not fair use, especially given the complexity of fair use doctrine and the existence of Vimeo's own licensing store. The court noted that even copyright experts struggle to distinguish fair use from infringement, so it was not apparent to non-expert employees that the specific videos were not authorized. Second, regarding the right and ability to control, the court interpreted this statutory phrase to require 'substantial influence' over user activity, citing its prior decision in Viacom v. YouTube. The court found that Vimeo's activities—such as giving 'likes,' promoting videos to 'Staff Picks,' or banning specific categories like gameplay videos—did not amount to substantial influence. These actions were non-coercive and affected only a tiny percentage of the millions of daily uploads. The court emphasized that denying safe harbor protection for such minimal editorial judgment would undermine the DMCA's goal of encouraging the creation of online services by shielding providers from the prohibitive cost of policing all user content.
The decision preserves Vimeo's immunity from liability for user-uploaded infringing content under the DMCA, provided the platform does not have specific knowledge of infringement or exercise substantial control over user activity. It sets a high bar for copyright holders to prove that a service provider had 'red flag knowledge,' requiring evidence that the infringement was obvious to a layperson, not just that the provider knew the content was copyrighted. The ruling also clarifies that routine curation and moderation activities, such as promoting popular videos or enforcing content guidelines, do not forfeit safe harbor protection unless they amount to substantial influence over the infringing activity itself. The case was affirmed, meaning the district court's dismissal of the copyright claims against Vimeo stands.
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