Can Universal be held liable for damages for making a misrepresentation in a Digital Millennium Copyright Act (“DMCA”) takedown notice to YouTube? That’s the question that is now cleared for trial in the long-running California case Lenz v. Universal Music Corporation, a/k/a the “baby dancing case,” now in its sixth year.
The facts of this case are relatively straightforward. In February 2007, a mother, plaintiff Stephanie Lenz, recorded her toddler dancing to Prince’s song “Let’s Go Crazy” in the family kitchen and uploaded a 29 second clip to YouTube under the title “Let’s Go Crazy #1”. Then, in June 2007, an employee of Universal (administrator of Prince’s copyrights) determined that a DMCA takedown notice should be sent to YouTube.
As required by law, Universal’s takedown notice stated that Universal had “a good faith belief” that Lenz’s use of the Prince song in her video was “not authorized by the copyright owner, its agent, or the law”. YouTube initially took down the clip but reinstated it after Lenz sent a DMCA-compliant counter-notice. The video, which has been viewed over 1.2 million times, can be seen here.
Lenz claimed that Universal’s DMCA takedown notice, by claiming a “good faith belief” that Lenz’s video was not authorized by law, involved a knowing, material misrepresentation and that she was entitled to damages for a fraudulent notice under Section 512(f) of the DMCA. Both parties moved for summary judgment on the issue.
Lenz’s claim stemmed largely from a belief that Universal’s procedures for reviewing videos before requesting removal was deficient and left the company willfully ignorant of the fact that her video made an authorized and obvious fair use of the Prince song. Universal disagreed and argued that its employee had the requisite good faith belief due to observation that the song was clearly recognizable, played loudly throughout the entire video and was referred to in the video by Lenz, who asked her child, “What do you think of the music?” Universal also noted that the song’s name was part of the video’s title. The court noted that neither the employee who sent the notice nor the Universal guidelines made any mention of fair use.
The Primary Issues
The Court ruled on two major issues:
A. Did Universal Make a Misrepresentation of Fact?
Yes, to the extent that Universal could not have formed a good faith belief that the video was infringing because it did not conduct a fair use analysis. In its analysis, the court pointed to its previous holding that a DMCA takedown notice is not sent in good faith unless the doctrine of fair use has been considered with respect to the use in question. This requires consideration of factors such as: (i) the purpose and character of the use; (ii) the nature of the copyrighted work; (iii) the amount and substantiality of the portion of the copyrighted work used; and (iv) the use’s effect on the market for the copyrighted work.
While Universal’s employee did consider a number of facts relevant to a fair use, the court found that Universal did not instruct its employee on fair use specifically or come to a proper “legal judgment” on the issue. Therefore, according to the court, Universal could not have had a good faith belief that use of Prince’s song was not authorized by law (i.e., under the fair use doctrine), as claimed.
B. Was the Misrepresentation Knowing, Resulting in Liability?
The court could not decide this issue on summary judgment. Under § 512(f) of the DMCA, a material misrepresentation in a DMCA takedown notice can result in liability for resulting damages – but only if the misrepresentation is subjectively knowing. According to the court, this means that Universal must have had some actual knowledge or been willfully blind of the fact that its takedown notice for the Lenz video contained a material misrepresentation. To meet the required subjective standard of knowledge that the copyright owner was sending a notice against something it knew or should have known was non-infringing, it is not enough to show that a copyright owner’s process was not thorough enough – say, for not considering fair use.
As summarized by the court, at trial “Lenz is free to argue that a reasonable actor in Universal’s position would have understood that fair use was ‘self-evident,’ and that this circumstance is evidence of Universal’s alleged willful blindness. Universal likewise is free to argue that whatever the alleged shortcomings of its review process might have been, it did not act with the subjective intent required by § 512(f).”
As previously established, copyright holders have a duty to conduct a fair use analysis prior to sending a DMCA takedown notice, although it need not be a “full-blown fair use analysis” – just at least an “initial assessment as to whether the fair use doctrine applies to the use in question.” Despite this duty, however, this case confirms that merely forgoing a fair use analysis does not open a copyright holder up to liability for sending a fraudulent notice under §512(f) of the DMCA. Rather, liability under § 512(f) hinges on whether the copyright holder had actual subjective knowledge or was willfully blind to the fact that the disputed use was authorized by the copyright holder, its agent or the law, but nonetheless asserted otherwise.
Unless the parties resolve the matter among themselves, the next step for the case is trial.