Bad Ruling Says CafePress May Not Qualify For DMCA Safe Harbors

from the dangerous-rulings dept

Fri, Mar 21st 2014 9:54am — Mike Masnick

Every time you think something is obvious and "settled" within the law, along comes some random judge to disrupt things. The latest involves CafePress, the very popular service that lots of people use to easily setup print-on-demand offerings for t-shirts, mugs and a variety of other things. At issue in the lawsuit is that a user uploaded someone else's photograph, leading to a lawsuit against the uploader and CafePress. Under the DMCA's safe harbors, CafePress should pretty clearly be protected, but tragically, the judge thinks otherwise. Even though there are tons of cases highlighting how the service provider definition is broadly applied to, well, online service providers, the judge here seems to think that because CafePress sets the prices for the goods sold, that somehow takes away the safe harbors. From the ruling:

Here, while CafePress is an e-vendor similar to Amazon, eBay, and Photobucket, CafePress's business varies somewhat from these other entities. The largest difference is that CafePress goes beyond facilitating the sale of products between internet users by directly selling products to online shoppers through the CafePress Marketplace. Indeed, CafePress's policy of determining retail prices for products sold through the Marketplace and paying users only a royalty or commission for the sale of their products highlights the fact that CafePress has gone beyond operating a service that merely facilitates the exchange of information between internet users. As such, the Court cannot say, as a matter of law, that CafePress is a "service provider."

But that makes no sense. The company is still, absolutely, a "service provider." As Eric Goldman notes at the link above, in which he says "this opinion is all kinds of crazy:"

Of course CafePress meets the statutory definition of a “service provider” for 512 purposes. It is a “provider of online services.” .... Most fundamentally, the court conflates CafePress’ online and offline activities. I think CafePress clearly qualifies for 512 protection for its online hosting activities..., but 512 doesn’t protect its offline print-on-demand manufacturing and delivery business. Thus, eBay and Amazon are fully protected by 512 for running online ads in their marketplaces. Because they don’t do any 512-disqualifying order fulfillment, they get 512 protection for all of their marketplace operations. CafePress should get identical 512 protection for its marketplace operations. This ruling should panic eBay, Amazon and the many other marketplace operators who think they have 512 protection.

Equally troubling may be the fact that the Judge seems to think that basic metadata stripping in photographs may run afoul of a bar on interfering with "standard technical measures" to protect the work. But that raises the question of whether or not stripping basic metadata is really interfering with "standard technical measures." That seems like a pretty big stretching of the definition of "technical measures."

Of course, it's unclear if the case will go much further. The photographer hadn't registered the copyright by the time the photos were uploaded, so there are no statutory damages on the table (and real damages are quite limited). But, there are always folks out there eagerly looking for rulings they can cite that show the weakening of safe harbors. While it's only a district court ruling, I wouldn't be surprised to see it twisted around and showing up in other cases.

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Filed Under: copyright, dmca, safe harbors, section 512
Companies: cafepress

22 Comments

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zip, 21 Mar 2014 @ 10:02am

"Every time you think something is obvious and "settled" within the law, along comes some random judge to disrupt things."

Judge Otis Wright might be the best example of that -- not that I'm complaining.
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Internet Zen Master (profile), 21 Mar 2014 @ 10:13am

You know
They should start requiring law students to take courses specifically dedicated to important things like safe harbor protections and fair use. That way, when those law students eventually become lawyers and judges, we don't have morons who understand the tech world about as much as the late Ted Stevens presiding over important Internet-related cases.
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John Fenderson (profile), 21 Mar 2014 @ 10:40am

CafePress sets the retail price?
It's been a number of years since I used CafePress, so they may have changed things since then, but when I used them, they didn't set the retail price.

What they did was set something analogous to the wholesale price -- the minimum price the given item must be sold for to use their system. You, the shop owner, could set any price you wanted that wasn't less than that. You got the entire amount that was above CafePress' minimum (that's why I call it analogous to the wholseale price) -- that's how you make your profit.
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Anonymous Coward, 21 Mar 2014 @ 10:54am

whenever Masnick says something is "obvious and settled" you just KNOW the ruling will go the opposite way to what masnick says it will..

Good ol reliable masnick, once again, well called !!!!!
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Anonymous Coward, 21 Mar 2014 @ 11:07am

The ruling makes perfect sense. CafePress is a proactive player in its system. It can't claim it only provides a bulletin board or someplace for users to post, exchange, store files. The CafePress business model is not simply providing a venue. They become partners with everyone. Accordingly, they're jointly responsible and do not deserve the safe harbor protections that'd be afforded them if they just provided the venue.
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Ha Ha Shirt Shop, 21 Mar 2014 @ 11:15am

Re: CafePress sets the retail price?
They changed their strategy in June 2009. But they still have in place the one you describe.

If someone "finds" the product through your own website or link outside their marketplace search then your price shows & you get to keep the profit.

If the buyer "finds" the product through some sort of marketplace search or if it shows in a search engine search directly to the CafePress site then it is deemed a Marketplace purchase & they have set the pricing & set commission.

So depending on how the buyer gets to the product determines what the price will be. For instance many products can be gotten cheaper if a user gets to the product page on CafePress by going through my website (not active btw) instead of going to CafePress & searching for a product in their Marketplace search.

So really they still have both systems in place.

I equate the separate systems as a:

"the buyer came here because CafePress has a ton of stuff, yours just happened to be chosen" - therefore we set the price & your commission is $0.10

vs

"the buyer came to this product because you drove them to your product" - therefore you set the price & your commission is whatever you set it to be & the buyer could still get it cheaper than if we set the price.
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Anonymous Coward, 21 Mar 2014 @ 11:23am

Re:
Cafepress is simply providing a manufacturing service. Cafepress is not deciding on the designs to be produced, only whether they are feasible on their equipment. This is no difference from a telephone company providing the service of enabling you to talk to other people using their equipment. While the phone company validates phone numbers dialled, it does not control the numbers that you dial.
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Anonymous Coward, 21 Mar 2014 @ 11:23am

Re:
The eBay business model is not simply providing a venue. They become partners with everyone.

The Amazon business model is not simply providing a venue. They become partners with everyone.
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Mike Masnick (profile), 21 Mar 2014 @ 11:45am

Re:
The ruling makes perfect sense.

No, it doesn't, as explained. Please pay attention.

CafePress is a proactive player in its system. It can't claim it only provides a bulletin board or someplace for users to post, exchange, store files. The CafePress business model is not simply providing a venue. They become partners with everyone. Accordingly, they're jointly responsible and do not deserve the safe harbor protections that'd be afforded them if they just provided the venue.

You ignore pretty much all precedent on the matter, because that's what you like to do.

Furthermore, CafePress has nothing to do with choosing the images or approving the images, so the idea that it has no safe harbors here is clearly bogus.

Seriously: I know you get paid to post copyright maximalist bullshit, but it would be easier to take you seriously if you were at least slightly intellectually honest.
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Just Another Anonymous Troll, 21 Mar 2014 @ 12:11pm

Re:
So all Mike has to do is say "copyright law is obvious and settled, the judge will rule in the favor of the silly copyright troll/censorer" and the judge will rule in favor of the innocent target? And if he says "the constitutionality of the NSA snooping is obvious and settled, it will definitely be found constitutional" it will be found unconstitutional and we will no longer be spied upon? Mike, quick, call all the rulings how you don't want to see them, and you can SAVE THE WORLD!
Anti-Mike troll just lost THE GAME. (You lost it too)
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Anonymous Coward, 21 Mar 2014 @ 12:31pm

and the reason for leaving out the judges name is what? because he/she has made a complete idiot of themselves, by giving a verdict over something that they have no clue about and wants to bask in anonymity? dont blame them! let's wait for the appeal, eh?
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Susan Cooper, 21 Mar 2014 @ 2:46pm

Re: CafePress sets the retail price?
Cafepress does in fact now set the retail price. All t-shirts are one price, all mugs are one price, etc. You can still set prices to your shops, but the majority of sales are through the marketplace now because often the retail price Cafepress charges in the marketplace is often less than the base price in the shops (before retail is added.) Everything has changed, commissions are now being paid between 5 and 10 % of the marketplace selling price. So if they discount a mug to $5.00, seller makes .50, .25 cents if that item is for a licensed product such as Hunger Games or Army items.
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Anonymous Coward, 21 Mar 2014 @ 4:30pm

Re: Re:
If the product is found through the CafePress Marketplace (at their Price), they are the product producer since they dictate the price and terms.

If the product is found through the artist's website or link, the price is whatever the artist wants to sell at. CP gets a certain amount, the artist gets the rest, so the artist is the producer since it's on his/her terms.
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Anonymous Coward, 21 Mar 2014 @ 6:52pm

Re: Re:
Seems like you disagree with both the judge and me. I'll send him an email with a link to your snivel.

After reading this, I'm sure he'll he'll agree that his ruling is bogus and he's ignored precedent. In fact, I'm certain he will send you a lavish apology and seek your advice on how to properly craft his ruling.

Seriously Masnick, you have a grossly inflated opinion of your command of the law and jurisprudence. The simple fact that you don't like the judge's ruling doesn't mean shit.
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Karl (profile), 22 Mar 2014 @ 9:44am

Re:
CafePress is a proactive player in its system.

They're no more of a "proactive player" than Amazon or eBay, both of which have been found (repeatedly) to be eligible for safe harbors provisions.
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Anonymous Coward, 22 Mar 2014 @ 2:55pm

Re: Re:
Here you go stupid, the judge (the one whose opinion actually matters disagrees.

Here, while CafePress is an e-vendor similar to Amazon, eBay, and Photobucket, CafePress's business varies somewhat from these other entities. The largest difference is that CafePress goes beyond facilitating the sale of products between internet users by directly selling products to online shoppers through the CafePress Marketplace. Indeed, CafePress's policy of determining retail prices for products sold through the Marketplace and paying users only a royalty or commission for the sale of their products highlights the fact that CafePress has gone beyond operating a service that merely facilitates the exchange of information between internet users. As such, the Court cannot say, as a matter of law, that CafePress is a "service provider."
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Anonymous Coward, 23 Mar 2014 @ 4:19pm

Re: Re: Re:
Great argument! I think your previous one, "I'm right because I say so!" was more persuasive, though.
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Anonymous Coward, 24 Mar 2014 @ 12:04pm

Actually, this is only a ruling on a Motion for Summary Judgment, not a final ruling of the court.

Cafe Press filed a motion for Summary Judgment, arguing that there are no disputed issues of material fact that the court must determine before issuing judgment in favor of Cafe Press. On these motions, the burden is extremely high on the party making the motion, and extremely low on the side opposing the motion. While Cafe Press had to present enough undisputed evidence to win the case, all the other party had to do was provide any evidence whatsoever (no matter how small) that would show there is a material issue that still needs to be determined by the court before declaring a winner. In making this determination, the court does not weigh the strength of the evidence.

In this case it appears that there is a material dispute as to whether Cafe Press acts as more than a service provider covered by the safe harbor provision. If Cafe Press loses the case, then there may be cause to worry. Until then, not so much. All the judge did was rule that an issue exists to be decided by the court.
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Karl (profile), 25 Mar 2014 @ 11:08am

Re: Re: Re:
Here you go stupid, the judge (the one whose opinion actually matters disagrees.

Just because I disagree with the judge's stupid opinion does not make me stupid. Also, we'll see what happens on appeal. I predict that this particular part of the ruling will be overturned.

The largest difference is that CafePress goes beyond facilitating the sale of products between internet users by directly selling products to online shoppers through the CafePress Marketplace.

The judge doesn't seem to realize that Amazon and eBay do almost exactly the same thing. Amazon, for instance, directly sells third-party products to online shoppers, using Amazon's own shipping apparatus. eBay does something similar with their eBay Store service. Yet the court rulings that the judge cites in his opinion do not strip DMCA protections from either Amazon or eBay for these reasons.

Please note that I am disagreeing with the judge about whether Cafe Press is eligible for DMCA safe harbors. Whether they actually meet that eligibility is a separate question. And, of course, lack of DMCA safe harbors eligibility does not mean that Cafe Press is necessarily liable for infringement.
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brad parker, 21 Apr 2014 @ 6:55am

Cafe Press - biggest COPYRIGHT breaking scam ever!
Cafe Press lost because it was a jury trial as well - get your facts right. It's obvious Cafe Press is NOT just service provider. They take a submitted image. They NEVER check for any copy right what so ever - thusly inviting every crook in the world to use their service by stealing an image they have no right to and submitting it. Cafe Press takes that image (stolen or not they don't seem to care) and start MANUFACTURING product over seas, and SELLING product on line in 7 different countries, all with out even a credit card number from the art thief who up loaded a stolen image. Cafe Press sells it's ill gained goods. It sends the art thief a % of the dirty deal. This can be Cafe Press keeping as much as 95% of the $! Where does this sound anything like a legitimate business? This is a copyright breaking scam .
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Old Man Parker, 21 Apr 2014 @ 7:10am

Re: Re:CafePress is a proactive player in its system.
NO! You are falling for Cafe Press's evil corporate double speak! They are nothing like eBay or Amazon! They MANUFACTURE the PRODUCT Themselves! The art work and images they get submitted to them are NEVER checked for copyright. Never! This is ringing the dinner bell for ever crook out there who is all too happy to submit an image they have no rights to whats so ever! Cafe Press then sells the (stolen) goods THEY created! Money comes in. Cafe Press then pays a small % back to the crook who up loaded the stolen image. In some cases Cafe Press has been keeping 95% of the sale cost! They are the scourge of the art world right now. Every Artist lives ion fear of finding their hard made WORK up for sale on Cafe Press! Something must be done to stop this.
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Cindy, 6 Jan 2015 @ 10:30pm

Same boat
I'm a trademark owner with first use rights and I'm going through hell w them not only racking up legal fees to protect my brand but having thousands of counterfeits in their marketplace that aren't authorized you mean to tell me they could say my mark doesn't apply to first use dates and would go off trademark date ?
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