Viacom vs. YouTube: Beyond Privacy

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In spite of the DMCA's impact on the Web, it is still a relatively young law, say legal experts. It is still being challenged, and a long body of case law firmly establishing its breadth and limits has yet to be established. "The law is still developing in this area and that is probably going to happen for a while," says Jennifer Urban, director of the USC Intellectual Property & Technology Law Clinic.

Judges and lawmakers are typically more sympathetic to arguments that protect companies from rights holders' lawsuits when their industries are still nascent. Few want to squash a developing industry and few rights holders want to spend thousands to millions suing a company that can't offer them substantial compensation. In recent years, however, many Web sites have started to sell ads against their user-generated content, giving rights holders the ability to seek higher damages and argue that the young industry has grown up.

Rethinking Users' Latitude

Already, there have been rulings limiting the scope of the DMCA. The decision against peer-to-peer file-sharing company Grokster in 2005 created case law that made sites more vulnerable to lawsuits. Under the ruling, sites could be liable for users' actions if they took measures that deliberately encouraged users to do illegal things. In its lawsuit, Viacom is arguing that YouTube is "inducing" users to commit illegal actions by highlighting copyrighted videos in areas such as YouTube's most-watched section. Viacom also argues that YouTube wants illegal content to stay on the site since it potentially profits from the additional traffic such content draws in. "We don't know if the court is going to buy that argument, but the consequences are enormous," says Electronic Frontier Foundation senior staff attorney Matt Zimmerman. "It will depend on the way the ruling comes down."

Viacom has been clear about its plans for YouTube users. The company says it has no plans to go after people who watched a few episodes of The Daily Show or The Colbert Report. "The information we've requested will be used to support Viacom's claims that Google and YouTube are infringing its intellectual property," says Mike Fricklas, Viacom's general counsel. "I also can say with complete certainty that we will not use any of the data provided to pursue individual end users."

As for the DMCA laws, Zimmerman and Urban both believe they should provide protection to YouTube. After all, it takes down material once it's notified and, according to Google, tries to keep the same infringing material from being posted again.

Ultimately, however, the judge will have to decide whether Google or YouTube is liable. And, if Judge Louis Stanton rides the current wave coming out of Europe, Web sites may have to seriously rethink how they manage their users.

Holahan is a writer for BusinessWeek.com in New York.