Viacom Exec: 'Everyone Knows A Rogue Site When They See One'… Except He Doesn't

from the are-they-serious? dept

There's apparently a bit of a debate within the American Bar Association over its position on SOPA/PROTECT IP. As you can imagine there are lawyers on all sides of the debate. However, some folks involved in the copyright and trademark legislation committees put forth a motion for the group to "support" the proposed laws, leading to some pretty strong push-back from a lot of lawyers (including those who were involved in crafting the DMCA's safe harbors, who see the attempt by SOPA to undermine all of that work as pretty nefarious). Some of those involved in the debates have been sharing some of the back and forth, and among the discussions is an absolutely stunning email from Michael Fricklas, the general counsel of Viacom, and the driving force behind that company's billion dollar lawsuit against YouTube. Think of that as you read the following statement:

In the field, it's pretty easy to tell if you're using a domain that is dedicated to infringing material. If you choose to speak there, I suppose your speech is at risk until you choose to move it elsewhere. I don't think there is a first amendment right to speak on a site that is engaged in pervasive copyright infringement (assuming that there are plenty of places to speak).

It's this single statement that, I think, encapsulates the key point of disagreement between those who support SOPA/PIPA and those who don't. Those on the "stronger enforcement" side always seem to assume a "you know it when you see it" definition of "dedicated to infringement." We hear this all the time when we talk about the possible unintended consequences of such laws or ICE's domain seizures or other attempts at greater, more draconian enforcement efforts. One group insists that "it's obvious" what's infringing and what's not. Sometimes they'll even point to a particular file, as if that "proves" that it's easy to tell what's infringing.

But reality isn't so simple. Let's take Fricklas and YouTube as an example, since he's so sure that "it's pretty easy to tell" when "you're using a domain that is dedicated to infringing material." After all, according to Fricklas' own lawsuit, YouTube qualifies. If SOPA were in place half a decade ago, Fricklas wouldn't have filed a lawsuit. He would have just declared YouTube as "dedicated to theft of U.S. property" under the definitions in the bill ("enabling" and "facilitating" infringement? check! did Youtube "avoid confirming a high probability of the use" of the site for infringement? perhaps. check!). Then he'd send notices that would have effectively killed YouTube, forbidding advertising or payment processors to do business with the site. While YouTube could counternotice, there's no requirement for ad providers or payment processors to ever take it back, and, in fact, the incentives are there for them to just avoid doing business with anyone accused.

So, Viacom gets to kill YouTube, because in Fricklas' mind, it's "it's pretty easy to tell" that YouTube is "dedicated to infringing material." There's just one problem. Back here, in reality, determining what is and what is not dedicated to infringing material is not so easy. It's so confusing, in fact, that Fricklas and his team realized just before the case started, that some of the videos they were suing over, claiming they were infringing... were actually uploaded by Viacom directly. You see, it turns out that it's not so easy to tell. And, perhaps, Fricklas believes that Viacom shouldn't have rights to free speech on platforms like YouTube, as he implies in his statement, but the law doesn't quite work that way. And that's why Viacom was soundly trounced in its lawsuit against YouTube.

The best legal ruling I've seen that does a wonderful job explaining this comes from an Australian court, rather than a US court. In the iiNet case, the judge explained:

Regardless of the actual quality of the evidence gathering of DtecNet, copyright infringement is not a straight 'yes' or 'no' question. The Court has had to examine a very significant quantity of technical and legal detail over dozens of pages in this judgment in order to determine whether iiNet users, and how often iiNet users, infringe copyright by use of the BitTorrent system. The respondent had no such guidance before these proceedings came to be heard. The respondent apparently did not properly understand how the evidence of infringements underlying the AFACT Notices was gathered. The respondent was understandably reluctant to allege copyright infringement and terminate based on that allegation. However, the reasonableness of terminating subscribers on the basis of non-payment of fees does not dictate that warning and termination on the basis of AFACT Notices was equally reasonable. Unlike an allegation of copyright infringement, the respondent did not need a third party to provide evidence that its subscribers had not paid their fees before taking action to terminate an account for such reason.

Copyright infringement is not a straight yes or no question. It involves "a very significant quantity of technical and legal detail." It's easy for people to declare that "it's obvious." But the reality is that it's very rarely obvious. That's why there are supposed to be full on adversarial hearings to determine this kind of thing so that, as in the iiNet trial, all sides can be heard, rather than imposing a sort of death penalty based solely upon a one-sided accusation. Because, all too frequently, we discover that the "obvious" infringement in the accusation turns out to be anything but obvious.

We've already seen it in the US numerous times with ICE's itchy trigger finger. Remember how ICE seized a blog based on claims by the RIAA that it was "dedicated to infringement." Unfortunately, the evidence showed that every song used as "proof" of such infringement, was actually sent by authorized representatives (and one came from an artist who had no connection to the RIAA at all -- not that it stopped the RIAA from declaring it infringing).

What seems "obvious" is rarely as "obvious" as it seems.

But it's this stunningly hubristic belief that it's "obvious" and that the nuances and details of copyright law aren't important, that drives folks like Fricklas to support laws with tremendous unintended consequences. No one denies that there's no legal protection for infringement. But, we want to make sure that when we stamp out infringement that's all we're stamping out. Tragically, having folks like Fricklas telling us that "it's obvious" as to what's infringing and what's not and suggesting that we can trust them to always get it right is not particularly compelling, given their dreadful track record on the subject to date.

Filed Under: copyright, michael fricklas, obviousness, protect ip, rogue sites, sopa
Companies: viacom, youtube

Viacom In Denial Over Court Smackdown In YouTube Case

from the common-sense? dept

With Google's victory over Viacom concerning the applicability of the DMCA's safe harbors to YouTube, it's no surprise at all that Viacom quickly announced its intentions to appeal. And, perhaps because of that, it needs to make statements about how wrong the ruling is. But, as with its position statements and filings throughout this lawsuit, much of the rhetoric from Viacom's General Counsel Michael Fricklas makes no sense at all:

Copyright protection is essential to the survival of creative industries. It is and should be illegal for companies to build their businesses with creative material they have stolen from others. Without this protection, investment in the development of art and entertainment would be discouraged, and the many artists and producers who devote their lives to creating it would be hurt. Copyright protection is also critical to the web -- because consumers love professional content and because legitimate websites shouldn’t have to compete with pirates.

This is both misleading and inaccurate. Fricklas, who I actually think understands these things a lot better than many others in his field, is certainly not dumb. But it's beneath him to mislead with the statement above. Whether or not copyright protection is "essential to the survival of creative industries" (and recent research has shown that statement to be false), the question at play in this lawsuit has nothing to do with whether or not copyright law is allowed to be used. It's merely a question of liability. Nothing in this ruling says that copyright law doesn't apply. It just says that Viacom can't blame Google for the actions of its users. Fricklas tries to mislead by pretending this is about whether or not copyright law applies at all.

It's also frustrating that some reporters covering this story also seem to be taking the same position, saying that this ruling is "a big blow for traditional copyright laws." It is not. Not even close. This ruling does not change traditional copyright laws in the slightest, and is entirely consistent with numerous previous rulings (all cited in the case). All this ruling concerns is who is liable for infringement: the user who uploads infringing material, or the platform provider who hosts it. The folks who crafted the DMCA made it clear that liability belonged squarely on the shoulders of those who did the uploading, and the court agreed.

Nothing in this ruling takes away from copyright law or changes copyright law, and even if you believe Fricklas' unsubstantiated claims that copyright law is essential, nothing in this ruling changes the nature of copyright law. Pretending otherwise is being purposely misleading. Once again, it appears that Viacom is now more interested in fighting this out in the media, rather than the court room.

Before that, however, YouTube and Google stole hundreds of thousands of video clips from artists and content creators, including Viacom, building a substantial business that was sold for billions of dollars. We believe that should not be allowed by law or common sense.

This case has always been about whether intentional theft of copyrighted works is permitted under existing law and we always knew that the critical underlying issue would need to be addressed by courts at the appellate levels. Today's decision accelerates our opportunity to do so.

This is, again, blatantly misleading on so many levels that it really discredits Fricklas. It means that he either does not understand the actual legal issues being discussed in this lawsuit or he's being blatantly dishonest. You pick which is more likely. YouTube and Google "stole" nothing. If they had stolen anything, then Viacom should have gone to the police and pressed criminal charges. But Fricklas knows the law and knows that laws involving theft and laws involving copyright infringement are entirely different. On top of that, he knows that it was users who uploaded the content, not Google. Implying otherwise is misleading. As for what the case "has always been about," again, he's wrong. It's not about that at all. It has always been about one thing and one thing only: who is liable for infringement done by users on a platform. The fact that Viacom chose to focus on the easy target of the platform provider, rather than those actually responsible (the uses), was simply a bad legal choice that Fricklas apparently does not want to accept blame for making.

I'm all for arguing the merits of whether or not Google or its users should be liable for infringement. But implying that this case is about changing copyright law or "permitting theft" is simply untrue.

Filed Under: content, copyright, michael fricklas
Companies: google, viacom, youtube

Viacom Execs Wanted Badly To Buy YouTube; Cited Tons Of Legit Content And Possibilities

from the oops... dept

Viacom's case against Google and YouTube looks worse and worse each passing day. While we weren't that impressed by Google's mentioning the fact that Viacom tried to buy YouTube, back when the initial filings for summary judgment became public, as more details come out, this point actually highlights many more problems with Viacom's claims that YouTube was just a "video Grokster" that thrived on infringing uses. In fact, it looks like Viacom execs were literally trying to push each other aside in trying to get YouTube for their own uses:

MTVN CEO Judy McGrath telling M&A execs: "Help us get YouTube. We cannot see it go to Fox/NBC" and "I want to own YouTube. I think it's critical asnd if it goes to a competitior!!!!!!!!!!!!!!!!! Even if we have to buy it with a partner to keep it below the line." Then-Viacom CEO Tom Freston:"If we get UTube.... I wanna run it." McGrath: "You'll have to kill me to get to it first."

The e-mail that starts that last exchange between Freston and McGrath is more about Viacom than YouTube. "We know what to do. I know this SUCKS its MADDENING that the revenue isn't there when the content is....but we will fix it and get the stock back up. 'Accretive' digital acquisitions and a big idea or two. Fast."

Does that sound like execs talking about a company that is sucking them dry through infringing uses? Furthermore, it takes away much of the strength of Viacom's claims that Google is responsible for all this infringement because it bought YouTube knowing all this. Would Viacom begin suing itself if it had gotten its act together and bought YouTube?

Even more damning is the email exchange between Viacom General Counsel, Michael Fricklas, and Jason Hirschhorn:

"Mostly, YouTube behaves--and why not--user-generated content appears to be what's driving it right now. Also the difference between YouTube's behavior and Grokster's is staggering. while the supreme court's language IS broad; the precedent is not THAT broad."

Yes, that's from the guy who's now trying to convince the world that YouTube was a "video Grokster" and that it survived solely on infringing content. Ouch. Viacom is trying to diffuse those claims by saying that Fricklas was simply ignorant at the time (way to throw your GC under the bus...). Funny, of course, that's it's perfectly fine for Viacom execs to make statements and later retract them, but Viacom harps on statements by YouTube execs, that are taken totally out of context, as if they're gospel.

Separately, Fricklas has put out a "statement" on the case that reads like a blog post without a blog. It seems to highlight how this has really become more of a PR war than a legal war. Fricklas' argument falls down on numerous accounts, though. He compares YouTube to LimeWire, despite astounding differences between the two -- when even he knows the difference is "staggering." But the most ridiculous of all is the following:

Google is the world's leading search engine with a self-proclaimed mission to organize the world's information. However, when it comes to videos on YouTube, Google cynically claims that search is too difficult for them to execute effectively.

That's blatantly untrue and Fricklas knows it. No one is claiming that the search is too difficult. They're claiming that determining whether or not the content is infringing is too difficult, and that's supported by Fricklas' own inability to know which clips were infringing and which were uploaded by Viacom itself. If your own General Counsel can't tell what's infringing and what's not, how is it even close to reasonable to suggest that Google should be able to figure it out?

Also, the following is pretty low and also misleading:

Google claims it could not tell whether Viacom had authorized specific clips on YouTube -- and misleadingly and falsely implies that we're suing on clips we posted. The reality is simple: we are not suing about clips we posted.

No, it's not suing over clips it posted... any more. But the original lawsuit did include such clips until Viacom realized this and dropped those clips from the lawsuit. Pretending that never happened is simply trying to rewrite history.

Filed Under: content, copyright, michael fricklas
Companies: google, viacom, youtube

Viacom's General Counsel Lecture On Copyright Leaves Out Certain Facts

from the well,-that's-something dept

Someone once told me that Viacom's top lawyer, Michael Fricklas, has been known to read Techdirt on occasion. I have no idea if this is true, but it still is interesting to watch him give a lecture to some Yale law students where he offers a somewhat nuanced position on copyright issues (thanks to JJ for being the first of many to forward the video to us), but which repeatedly seems to leave out certain pertinent facts: He starts out by saying that he's a strong supporter of fair use, and doesn't like the idea of having to get licenses for creating new works -- but is concerned about the "exact copy" problem. So, basically he's in favor of fair use for creating new works, but not direct distribution.

He discusses copyright vs. free speech -- and insists that there's no "tension" between the two (despite many recent studies suggesting the exact opposite). Of course, he does a bit of a twist there, by saying that copyright is pro-free speech because it creates incentive for speech. The problem with this statement is that while that's the theory, the evidence for it is somewhat lacking. However, there is tremendous evidence of cases where copyright is used to stifle speech -- and of all the massive extensions and changes in copyright laws over the past 200 years, almost all have served to stifle more speech than they have encouraged.

He then trots out the industry's own numbers claiming how much copyright contributes to the economy, even though those numbers are based on a variety of questionable assumptions, including the idea that all content covered by copyright is only created because of copyright. Along those lines, he also credits copyright for things like the iPod and the Kindle, saying that no one's buying those devices just to look at them. This is correct -- but note the trick. He did not say that it was content that drove the iPod and the Kindle, but copyright. He's wrong. It's content. Not copyright.

He notes that some say that "unlicensed IP" might drive this innovation, but he favors "sustainable innovation" (as if anyone doesn't). And then he makes this odd statement:

"A more sustainable innovation is one where, if you make an investment, you have the opportunity to make a return."

Now, that's a great (by which we mean, useless) statement, because it's obviously true. Who would ever deny that? But it's a sneaky and disingenuous statement, because it implies something that's simply not true: that without copyright or without restrictive licensing, the investors do not have an opportunity to make a return. As we've shown over and over again, plenty of content creators who "free" their IP have not only made a return, but have made a better return than they did under older models that relied on copyright. But it's a sneaky trick that's often used by folks in this debate. You set up this strawman argument and then knock it down, despite the fact that no one ever made the argument, and you argue that something is fact (that you can't make a return) when it's empirically false. It's frustrating that this argument still gets made and people should really start calling the folks who make it out whenever they state such falsehoods.

Later, he talks about the "losses" from piracy, insisting that the findings come from a "sophisticated" analysis, not just from counting all downloads as lost sales. Of course, these numbers came from the same study process that led to some results that even the MPAA (of which Viacom is a major member) had to later admit were bogus. This is also the same "sophisticated analysis" that includes ripple effects in one direction only, so it's actually double, triple, quadruple, quintuple counting some numbers, while totally ignoring how those numbers actually help the industry in other ways. So, sorry if I don't take those loss numbers seriously, no matter how "sophisticated" he thinks they are. They're not. They're only "sophisticated" in how misleading they are.

He does have a short discussion on RealNetworks' RealDVD offering, which he implies enables piracy -- even as he admits he wants the functionality, where he could move a copy of a legally purchased DVD to his hard drive for backup or other viewing, but says his "concern" is that people would do this with Netflix DVDs. He believes that the problem with this is that RealNetworks had to break the encryption put in place by the studios. Notice, again, what Fricklas conveniently leaves out. First, he leaves out the fact that it is already legal for people to make backup copies of content they legally own -- but, thanks in part to Hollywood lobbying, Hollywood itself can block that right, simply by putting encryption on something and then saying that you can't circumvent it without breaking the law (thank you, DMCA anti-circumvention clause). He also leaves out (conveniently) the fact that RealDVD doesn't actually "break" the encryption and that the resulting copy still includes DRM that prevents copies. The fact that he's "concerned" about the Netflix model is of no consequence whatsoever. McDonalds is "concerned" about Burger King, but that doesn't give them a legal right to block them from being in business.

Then he pulls out the ever popular "$200 million movie" myth, which I thought was a favorite of NBC Universal, but I guess Viacom is going with it now as well. It's not a myth that there are movies that cost $200 million. The myth is that people want movies that cost that much. No one watching a movie cares how much it costs. They want good movies, no matter how much they cost. I'm sure people would like some $1 billion or $100 billion movies as well, but that doesn't mean we need to grant Viacom extra special legal privileges to make sure it can make a $1 billion or $100 billion movie profitably. People like good movies. Viacom wants to make profitable movies. We agree. But the $200 million number is meaningless. There are ways to make good movies for both less and more than $200 million and there are ways to make profitable movies even in the face of piracy. The claim that piracy undermines the $200 million movie, which is some sort of "necessity," is simply not supported.

On top of that, he tosses out the debunked claim that if something is "free" it means it's devalued. That's simply not true, no matter how many times people repeat it. If it were true, and the content had no value, no one would want it. Value and price are two separate things.

Then, he discusses the "Kanye West" MTV Video Awards "Imma let you finish..." example, by talking about how Viacom used various filtering tools to pull that clip off of various "unlicensed" user uploaded video sites. But he also talks about how they drove people to use the official Viacom clip, which allowed them to "participate in the benefit" of the video. Now, that's interesting, and it's great that they put their own clips up and made them embeddable. But, again, it's important to note what he left out. In forcing everyone to view the content through Viacom directly, it also increased Viacom's own cost in terms of bandwidth. The advantage of letting others help host and distribute the content is that it actually eases that cost.

His discussion on kicking people off the internet via a "three strikes" mechanism is getting much of the attention on other sites, because he mentions, totally in passing, that suing users "feels like bullying." This may sound like a big deal -- and certainly some other sites (and industry lawyers) are making it out like a big revelation, but it's not. The movie industry has never sued individuals for such things -- only the recording industry has. And even way back in the Jack Valenti days, he talked about why he didn't like the idea of suing individuals. So, this isn't a shift in positioning at all. Rather, it's a repeat of the new silly strategy of some in the industry to try to pretend that kicking people off the internet is "consumer relief." Not quite. Shooting someone in the leg instead of the head is certainly "better," but I doubt that the person shot in the leg considers it "relief."

Oh yes, he also fails to explain how any of that will make more people buy.

Towards the end of that discussion, though, he makes another interesting statement, saying that: "there's no way to deal with this problem other than to move viewing into licensed contexts." Except, that's not true. There are other ways. It's called setting up a business model where people actually do have a reason to buy things, whether they view the content in a licensed or unlicensed manner. I recognize he's on the legal side, rather than the business side, but the idea that the "only" way to deal with piracy is to attack it, rather than embrace it, is a position that the industry long ago should have learned was a mistake.

His final point is discussing how DRM "enables new business models," and he more or less dismisses criticism of DRM as really just being criticism of "bad" DRM (of which there is plenty). However, what struck me, was how none of the "new business models" he described actually required DRM at all. You could do them all in some way entirely without DRM. All the DRM does is add restrictions. Of course, rather than adding restrictions, why doesn't the industry focus on employing new business models that give users more and make them want to buy, rather than trying to enforce artificial limitations?

On the whole, it is an interesting video, and well worth watching, but it conveniently misstates or leaves out important facts throughout. Unfortunately, the Q&A session that follows the presentation wasn't included, so I have no idea if any of the students challenged some of his assertions or pointed out some of the points that he left out. Anyway, maybe we can hope that Fricklas is, in fact, an occasional reader here and can stop by to address those questions and omissions.

Filed Under: copyright, entertainment, michael fricklas, movies, myths
Companies: viacom