How can a website operator avoid being sued for publishing material in User Generated Videos (UGV) and other media-rich content that is the copyright of a third-party?

Intermediaries (e.g. website operators and hosts) became increasingly concerned when in Playboy Enterprises v Frena (as long ago as 1993) the US courts found a bulletin board operator liable as a primary infringer even though it hadn't placed the offending material on the site and was totally unaware of any infringement.

In the US the Digital Millennium Copyright Act (DMCA) seemed to have resolved the issue.  Under that Act, anyone who acts merely as a conduit by transmitting, routing or providing connections and who does not modify any content, or someone who is engaged in automatic caching, will not be liable to compensate the copyright owner for any claim relating to these activities.  Anyone hosting or linking will enjoy the same immunity so long as he does not know of the infringement and isn't aware of any circumstances that would make the infringement apparent, and provided the intermediary does not receive a direct financial benefit from the infringement. 

Any intermediary involved in caching, hosting or linking must be able promptly to remove or disable access to offending material if it receives notice of a claim of infringement.

That legislation has not, however, prevented the likes of Viacom suing YouTube for $1bn dollars on the grounds that the inclusion of video clips on YouTube infringes Viacom's copyright.  

Viacom is not the first to sue YouTube for copyright infringement. Robert Tur, the owner of the the footage of the OJ Simpson car chase, is sue YouTube and claiming that YouTube is not protected by the DMCA because it makes money from web advertising. At the first hearing the judge refused to find in favour of Mr Tur on the grounds that the issue of financial benefit only arose if it was established that YouTube controlled the infringing material, i.e. that YouTube was more than a mere conduit. Mr Tur failed to produce any evidence about that, but neither did YouTube show that it exercised no control. The case is unresolved and will go to the next stage in the US.

Under the UK e-Commerce Regulations 2002, a host (someone who stores information provided by a recipient of a service and here information includes copyright material such as video clips), is not liable to pay financial compensation to the copyright owner if:

1. the host:

(i)         does not have actual knowledge of any unlawful activity or information and, where a claim for damages is made, is not aware of facts or circumstances from which it would have been apparent to him that the activity or information was unlawful; or

(ii)         on obtaining such knowledge or awareness, acts expeditiously to remove or to disable access to the information, and

2. the recipient of the service was not acting under the authority or the control of the host.

Hosts are not obliged to monitor material, or actively to seek facts or circumstances that indicate that material may be unlawful. Indeed it may be dangerous to monitor or moderate postings to the site; by doing so the host may find that the recipient of the service (the person posting the unlawful material) is acting under the control of the host.

To protect themselves as much as possible, hosts should:

• include terms in their contracts with users allowing the host to remove any suspect material from the site without notice to the user;
• include terms in their contracts with users that allow them to withdraw the service from anyone they suspect is posting unlawful material;
•  immediately remove material if a complaint is made - if they take time to assess the material and then decide not to remove it, the defence provided by the e-Commerce Regulations may not be available; and
• identify the source of the material and refuse to accept further material from that source.