Operating an online business requires careful attention to numerous potential liabilities, including copyright infringement. Any online service that allows users to post or share information needs to be aware of the federal laws and regulations dealing with potential copyright infringement. The Digital Millennium Copyright Act (DMCA) is a far-reaching law dealing with copyright on the internet and other digital systems, first enacted by Congress in 1998. Title II of the DMCA, also known as the Online Copyright Infringement Liability Limitation Act (OCILLA), creates a “safe harbor” for certain internet service providers (ISPs). The U.S. Copyright Office recently issued new rules regarding safe harbor protection, which took effect toward the end of 2016.
The DMCA covers a wide range of copyright issues, including a prohibition on attempts to circumvent copy-prevention systems in digital media devices. The statute also allows technicians to make temporary copies of software for the limited purpose of computer repair, reversing a court ruling that this constituted copyright infringement. See MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511 (9th Cir. 1993). As the internet has gained prominence, and websites that allow users to upload and share content have become features of daily life for millions of people, the “safe harbor” provisions have perhaps become the most important provisions of the DMCA.
The DMCA identifies four “safe harbors” with limited liability for copyright infringement: (1) “transitory digital network communications,” (2) “system caching,” (3) “information residing on systems or networks at direction of users,” and (4) “information location tools.” 17 U.S.C. § 512. The third item on the list is the most well-known, since it applies to countless ISPs that provide social media, video streaming, and other related services.
The safe harbor applies when a user uploads or shares material that infringes a copyright, protecting the ISP from liability for the user’s infringement. In order to qualify for safe harbor protection, the ISP must either have no knowledge of the infringement or “act expeditiously” to remove or disable access to such information. Id. at § 512(c). The ISP must also not derive a direct financial benefit from the infringing material. Finally, the ISP must designate an agent to receive notifications of alleged infringement from copyright owners. Section 512(c) specifies the form that such notice must take.
The DMCA directs the Copyright Office to maintain a public directory of agents designated under § 512. This directory is the main subject of the new rule published by the Copyright Office last year. 81 Fed. Reg. 75695 (Nov. 1, 2016). The Copyright Office began work on an electronic registration system in 2011, after noticing that ISPs were not updating their directory information as required by law.
The new rule governs the designation of agents through this electronic system. A failure to abide by the rule could result in the loss of safe harbor protection. Important details of the new rule include:
– A deadline of December 31, 2017 to re-designate existing agents through the electronic system;
– Required renewal of agent registration every three years, even if no information has changed; and
– The ability to designate a position, such as a company’s technology officer, or a third-party entity as an agent instead of a specific individual.
For the past four decades, intellectual property attorney James G. Schwartz has represented Bay Area businesses and business owners, advocating for their rights and interests in transactional and litigation matters. To schedule an initial confidential consultation with a member of our skilled and experienced team, contact us today online or at (925) 463-1073.
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