December 4, 2010

Viacom Appeals YouTube Copyright Ruling

Viacom Inc., the owner of MTV, Comedy Central and Nickelodeon, filed a challenge in a federal appeals court Friday seeking more than $1 billion in damages from YouTube for showing thousands and thousands of pirated video clips from its shows.

The challenge has been expected since June when a ruling then rebuffed Viacom's copyright infringement lawsuit against YouTube and its owner, Google Inc.

The legal battle has been dragging on for nearly four years. Oral arguments on the appeal probably won't occur until at least next summer.

The case revolves around the apparent premise that YouTube became the world's leading online video network by turning a blind eye to uncontrolled and widespread piracy occurring on its website.

Viacom argues that YouTube's founders realized the copyright-protected clips from shows such as Comedy Central's "the Daily Show" attracted far more viewers than amateur videos of cute kittens and troubled teenagers.

Google labeled the video-sharing site as "a rogue enabler of content theft" before it acquired the company in 2006, according to documents unearthed in the lawsuit.

Viacom hired attorney Theodore Olson to head the challenge in the 2nd U.S. Circuit Court of Appeals. He served as US solicitor general during the first term of President George W. Bush.

"We are appealing a very bad decision, which would have serious repercussions for our economy and for the creative works for people who spend time trying to enrich our lives," Olson told The Associated Press in an interview.

YouTube remains confident that the lower-court ruling that cleared the service of any wrongdoing will be upheld. "We regret that Viacom continues to drag out this case," spokesman Aaron Zamost said.

Viacom is basing its appeal on an argument it is presenting that YouTube does not qualify for the protections allowed under the 12-year-old law that protects Internet services from copyright claims as long as they remove illegal content promptly after being notified of a violation.

U.S. District Judge Louis Stanton concluded that YouTube had complied with the Digital Millennium Copyright Act, clearing it of legal liability for the theft of its users. He dismissed Viacom's lawsuit before a trial.

But Viacom asserts YouTube doesn't fall under the law's "safe harbor" provision because its founders welcomed the piracy as a way of expanding its audience and increasing the possibilities of becoming rich quick by selling the site to a larger company. The founders cashed in when they sold the video sharing service to Google in 2006 for a whopping $1.76 billion.

None of the three founders are still in any leadership positions at YouTube. The site now relies on technology developed by Google to identify and block any unauthorized content.

Viacom argues that YouTube could have done more to prevent pirated clips from being uploaded to the site, but held off on imposing tougher controls because the site's managers knew viewership would plunge without the copyright-protected content.

Internet service providers and free-speech groups believe more damage would be done if YouTube loses its battle with Viacom. They fear a ruling against YouTube would undermine the digital copyright act and make it more difficult for people to express themselves online, because service providers fearing lawsuits would block controversial content, even if it may be legal.


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