Copyright

Intermediary Liability for Copyright Infringement in India: Few Thoughts in the Wake of Viacom v. Youtube [Part I]


About a week ago, we had a guest post summarising the recently delivered judgement in the case of Viacom v. Youtube, a case that dealt exclusively with the liability of an intermediary in the case of widespread copyright infringement, a topic that is fast assuming significance and has formed the subject matter of litigation even in Indian courts.

In the next two posts, I will proceed to do the following – (a) begin with a very quick recap of the facts and ruling in the Viacom v. Youtube case (b) extract the key features that formed the basis of the ruling (c) attempt a comparative analysis and an examination of its applicability in India by alluding to present and proposed statutory provisions, and existent case law on the point.

The objective is not to merely transplant the facts in the case and apply Indian principles, but rather to consider if the principles upheld in Viacom v. Youtube can be sustained in India, in view of the existing provisions and judicial guidance in this regard, and attempt to harmonise the two positions to arrive at a reasonable solution to the problem of fixing sufficient responsibility on an intermediary such as YouTube, to check copyright infringement in India.

I. BACKGROUND TO VIACOM v. YOUTUBE

(a) Facts: The complaint centred on copyright content, which Viacom claimed belonged to it and was uploaded by third-party users and stored on Youtube’s servers and available for public viewing. Youtube took the defence of Section 512 of the Digital Millennium Copyright Act (DMCA) which provides immunity to ISP’s for certain acts if the statutory conditions laid down have been complied with.


(c) Ruling: The District Court held that Youtube qualified for “safe harbour” provisions under the DMCA. The Court laid down the “Red Flag test” consisting of a subjective and objective component, to determine whether Youtube had actual knowledge of infringing content. It held that actual knowledge involved knowledge of specific and identifiable infringement of particular items and not a general awareness or knowledge of prevalence of such activity in general. It also observed that Youtube had complied with the notice-and-takedown procedure under the DMCA and hence could avail of the immunity.

II. APPLICABILITY IN INDIA

Before I dive right into an analysis, it is important to bear in mind that the statutory provisions regulating intermediary liability in India are not as comprehensive and exhaustive as the American Digital Millennium Copyright Act (DMCA) and as flawed as the DMCA may be in certain respects, it is perhaps this inadequacy that is the source of the confusion and ambiguity in India.

What has been previously debated on this blog here, here and here, quite heatedly, is the possible interpretations of the section providing immunity to an intermediary in India, i.e. Section 79 of the Information Technology Act, when read with Section 81 and that it is the best place to start an analysis of intermediary liability in India.

Section 79 and 81 of the Information Technology Act

The biggest difficulty that the Courts will face in deciding a case like Viacom v. Youtube will be in the interpretation of Section 79 and the proviso to Section 81. While Section 79 corresponds to the safe harbour provisions in the DMCA, under S.512, S.81 of the IT Act states that:

The provisions of this Act [IT Act] shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Provided that nothing contained in this Act shall restrict any person from exercising any rights conferred under the Copyright Act, 1957 or the Patents Act, 1970.”

There are two possible interpretations and I will try to bring out the difference in the two positions below. I will focus on the implications for copyright law since Viacom dealt with copyright infringement. For a discussion on why trademarks, geographical indications, plant varieties amongst others have been excluded in S.81(2), you may refer to our earlier posts.

1) INTERPRETATION 1 – Section 81 overrides Section 79

Implication:
The implication of stating that the proviso to S.81 overrides S.79 is that the safe harbour provision envisaged in S.79 will not be available to an intermediary, if that intermediary is otherwise found liable under the Indian Copyright Act. That is to say that if an intermediary is found liable under any of the provisions of the Copyright Act, then irrespective of the safe harbour provisions under S.79 of the IT Act, the intermediary cannot claim immunity and will be held liable.

Knowledge requirement:
If we are to assume that S.81 does in fact override S.79, then the next step would be to examine the essential ingredients that constitute the offence of copyright infringement under the Indian Copyright Act.

Secondary liability is generally found in S.51(a)(ii) and S.63 of the Copyright Act. S.51(a)(ii) uses the expression “reasonable ground for believing” and being “aware”. S.63 of the Act uses the phrase “knowingly infringes or abets the infringement of”. At the same time, it is important to look at the phraseology in S.79(3) of the IT Act, which uses the expression “actual knowledge”. S.79(3) carves out exceptions to S.79(1), essentially outlining situations in which the safe harbour provided for in S.79 will not be available to the intermediary.

It is interesting to see whether it is possible to equate ‘actual knowledge’ under S.79(3) with being ‘aware’ and having ‘reasonable ground for believing’. In that case, establishing liability under the Copyright Act by showing that the intermediary had ‘reasonable grounds for believing’ or was ‘aware’ would have the effect of making out the exception to S.79(1). In that case, since the S.79(3) exception is demonstrated, it is irrelevant whether S. 81 can prevail over S.79, that is to say, whether rights conferred under the Copyright Act would be rendered inapplicable with regard to an intermediary, since the safe harbour exemption would not be available to the intermediary in any case, in view of S.79(3).

However, that does seem a little far-fetched and it is difficult to imagine such a view being accepted since the knowledge requirement under the Copyright Act seemingly marks a much lower threshold than set out in S.79(3) of the IT Act. I raise this point because the ratio in Viacom v. Youtube indicates that general knowledge or awareness of copyright infringement, no matter how widespread, is not sufficient to disentitle an intermediary from immunity. This suggests that ‘actual knowledge’ as described in S.79(3) is qualitatively different from the phrases used in the Copyright Act. Thus, while the DMCA (as interpreted in Viacom) requires ‘actual knowledge’, based on this interpretation of the IT Act, it seems that merely being ‘aware’ of copyright infringement is sufficient to hold the intermediary liable and deprive it of any immunity or safe harbour protection.

Primary Liability for direct infringement:
Of course, one must keep in mind that it is possible to hold an intermediary liable even when there is no knowledge attributable to it. An intermediary may also be held liable for direct infringement where they engage in infringing activity themselves. Primary liability flows from the principle of strict liability, for example where an infringement of the exclusive reproduction right of the copyright owner, gives rise to liability irrespective of whether the alleged infringer had knowledge of the breach or not. This is particularly relevant for an intermediary since ‘transient copying’, which is generally an automated process may fall within the net of ‘reproduction’, and the defence of ‘lack of knowledge’ would fall through completely. The other possibility is that ‘caching activities’ such as duplicating certain images, videos, links or entire web pages on its servers, in order to provide quicker access to such information may also fall within the ambit of cases where there has been no ‘communication to the public’, but the reproduction right of the owner has been encroached upon. However, in respect of such a claim, I would like to turn my attention to the defences available under the Copyright Act, which I deal with under the next sub-heading.

I would also like to quickly go over Viacom’s claims of direct infringement from its original filings and assess their applicability in the Indian context.

(1) Public Performance: Viacom claimed that Youtube infringes its public performance right by displaying videos that it has copyright over. However, there appears to be no volitional act on the part of Youtube in a case where a user clicks on a hyperlink to view the particular video and hence the claim for primary liability will fall short. In Field v. Google it was held that a user clicking a ‘cached’ link, does not attract primary liability for the intermediary.

(2) Public Display: Viacom also claimed that Youtube’s scheme of capturing an individual screenshot from the uploaded video and displaying it in response to searches for videos by users was an infringement of its exclusive rights. It is this image that shows up when a user enters a particular search term, so that he or she can quickly navigate through several such images to find a desired video, without having to view each one individually. This contention places Youtube on stick ground since it seemingly goes beyond an automatic process, so to speak, creating thumbnails by extracting it from the video itself and then storing that image on its servers, without any such request being made by the user. However, the fair use defence is available to Youtube since creation of thumbnails has been previously held to be fair use because of its ‘transformative’ character (See Kelly v. Arriba Software)

(3) Reproduction: Viacom also claims that YouTube makes duplicate copies of its videos and converts them into Flash format, the contention being that this is not an automated process, at the behest of the user. Again, Youtube could claim the fair use defence since the videos are low -resolution duplicates of the original videos as well as the safe harbour defence under S.512(c) which it eventually did.

The above contentions do throw up the question of primary liability of intermediaries in India and it is interesting to examine whether or not an owner could hold an intermediary liable for direct infringement under the Copyright Act for such activities. Firstly, as seen above, it is clear that in certain situations, the fair use defence itself may come to the rescue of the intermediary. Of course, case-law in respect of fair use and dealings must evolve sufficiently to furnish a defence when the statute does not expressly provide for it. As for statutory provisions itself, I believe that the amended S.79 may also come to the defence of intermediaries for claims of direct infringement, so long as the conditions set out under clause (2) are satisfied. I sense that S.79(2)(b)(iii) stipulating ‘modify’ as a condition may have an adverse impact in certain cases, but we can only wait and watch how courts interpret the section.

Defence under the Copyright Act and proposed amendment:
By reading S.81 of the IT Act to override S.79, we must also recognise that this provides an intermediary the right to take any defence available to it under the Copyright Act (The section states: “Provided that nothing contained in this Act shall restrict any person from exercising any right conferred under the Copyright Act, 1957 or the Patents Act, 1970” – which is equally applicable to an intermediary). This is of significance since the proposed amendments to the Copyright Act include an addition to S.52(1) – ‘acts not to be infringement of copyright’ – with the following wording:

(i) the transient and incidental storage of a work or performance purely in the technical process of electronic transmission or communication to the public;
(ii) such transient and incidental storage for the purpose of providing electronic links, access or integration, where such links, access or integration has not been expressly prohibited by the right holder, unless the person responsible is aware or has reasonable grounds for believing that such storage is of an infringing copy; Provided that if the person responsible has prevented the storage of a copy on a complaint from any person, he may require such person to produce an order from the competent court for the continued prevention of such storage.”

The DMCA provides four well-defined safe harbours, two of which are similar in form to the above provision. S.512(b) for temporary storage or system caching and S.512(c) for permanent storage under the control of users. It is clear then that an intermediary taking a defence of ‘lack of knowledge’ will succeed subject to the qualifications provided for in the Act.

Another issue in Viacom which arguably hasn’t received as much attention, but is significant in the context of the proposed amendment to the Copyright Act, is whether a website that enables public performance or ‘communication to the public’ of works uploaded by users is engaging in simple storage, which is protected under S.512(b) or (c), or is taking a step beyond that. The court in Viacom relied on the broad definition of a service provider in S.512(k)(1) – “an entity offering the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user, of material of the user’s choosing, without modification to the content of the material as sent or received” to suggest that more than mere storage must be protected by the safe harbour provisions. However, it appears that the above discussion is redundant in the Indian context since the proposed amendment explicitly includes storage in the process of ‘communication to the public’. Thus, an intermediary such as Youtube need not have to justify the transmission of the stored material to users other than the original storer, since the section justifies public performances already.

Legislative Intent:
It is entirely possible that the Indian legislators did not intend to replicate the DMCA safe harbour provisions. Based on this interpretation of the IT Act, it does appear that way. Support for such an assertion can also be found in the Standing Committee Report on the IT Amendment Act, which indicates that S.79 was intended to grant intermediaries immunity from criminal actions only, and as such does not function in a like manner to the DMCA, which extends immunity to all claims of copyright infringement as well. The basic point remains that irrespective of whether a defence exists under the Copyright Act or not, an intermediary should be allowed to demand immunity from claims of copyright infringement. Interpreting the Act in such a manner negates the very purpose of a safe harbour provision, which S.79 ostensibly aspires to be.

A note on the alternative interpretation of Section 79 and Section 81 immediately follows this post.

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