The inducement rule "premises liability on purposeful culpable expression and conduct."¹ It prohibits "deliberately urging consumers to make illicit use of the product or showing them how it could be done."²

I. Introduction

¶ 1         Is it a prudent business judgment to purchase a web site company for $1.65 billion that streams amateur video clips and allows anyone to upload copyrighted videos?³ That sounds like a classroom hypothetical illustrating potential copyright infringement liability and bad business judgment.

¶ 2         It appears the contemporary proliferation of social networking web sites⁴ and the millions who use YouTube⁵ convinced Google to acquire YouTube for that extravagant price. Months later, Viacom sued YouTube for copyright infringement seeking injunctive relief and $1 billion in damages⁶ for showing 150,000 of its copyrighted clips illegally 1.5 billion times.⁷ The Viacom complaint alleges that "YouTube's brazen disregard of the intellectual property laws fundamentally threatens not just Plaintiffs, but the economic underpinnings of one of the most important sectors of the United States economy."⁸ If Viacom is successful, could this be the end of social networking sites and what appears to be a cultural shift in the digital media?

¶ 3         The recent phenomenon of social networking has vast social and political consequences as presidential candidates and others have adopted them to project their electronic messages.⁹ Millions of students have pages on MySpace and other social networking sites that display intimate personal information,¹⁰ which is often accompanied by copyrighted content that has been uploaded without the owner's consent. The potential copyright violations of social networking sites creating this cyber phenomenon are the basis of this paper.

¶ 4         Part II discusses the context of the internet copyright issues at stake and presents the overarching policy goals that guide courts and legislators alike in formulating copyright policy. Part III reviews the common law history of secondary copyright infringement liability, which permits a copyright owner to sue a web site that enables a direct infringer to use its site to copy or upload copyrighted content without the owner's permission. Part IV analyzes 17 U.S.C. §512, the "safe harbor" of the Digital Millennium Copyright Act (DMCA), and its application to social networking sites. This statute is the principal defense in the Viacom v. YouTube case.¹¹ Because one can expect the uploading of copyrighted video clips without the owner's consent to be common practice on social networking sites, the application of the DMCA's safe harbor provisions to secondary copyright infringement is the salient issue to be resolved. To the extent that social networking sites are ineligible for DMCA safe harbor protection, their liability will be determined under traditional copyright doctrines. Part V therefore explains the United States Supreme Court's decision in Metro-Goldwyn-Mayer Studios Inc. v. Grokster that established the new inducement rule's application to social networking sites.¹² Part V also discusses whether social networking sites are likely to escape liability in the absence of safe harbor protection under the Grokster standard. This analysis has special significance because the DMCA was adopted by Congress in 1998, long before the existence of social networking sites.¹³ Part VI concludes by proposing an outcome to the YouTube case that would largely allow social networking sites to remain within the safe harbor of the DMCA.

II. Copyright on the Internet

¶ 5         In discussing copyright liability in the context of social networking sites, it is easy to fixate on content that has been created by large motion picture studios, widely published authors, or well-known songwriters. Perhaps this is so because those who have been the most vocal in expressing concern over copyrighted content on the internet have included or represented these types of companies or individuals. Yet because copyright subsists from the moment of a work's creation, with no additional steps required by the author to secure a copyright in that work,¹⁴ nearly all recently-created content on the internet is copyrighted, including pedestrian user-created content. This means that a short home video of a birthday party given in honor of the family pet or a two-minute video demonstration of "How to Tear a Phone Book in Half"¹⁵ are both entitled to the protections of federal copyright law.

¶ 6         Because a growing number of social networking sites allow users to post photos, videos, and other digital files for public viewing, inevitably resulting in their copying and distribution, copyright issues within social networking sites are pervasive. Prominent among these sites with respect to video sharing is YouTube, where approximately 100 million videos are watched every day.¹⁶ Users wishing to upload videos must expressly grant to YouTube "a worldwide, non-exclusive, royalty-free, sublicenseable and transferable license to use, reproduce, distribute, prepare derivative works of, display, and perform" the videos.¹⁷ Copyright infringement of purely user-created videos that do not contain copyrighted works thus becomes a non-issue.

¶ 7         Copyright concerns arise not when users upload their own videos, but when a user uploads a third party's video or a video that contains within it content belonging to a third party. This would include blatant copyright violations such as uploading the full-length film "Schindler's List," but may also include less obvious acts of infringement, such as posting a five-minute video of a fifth-grader's dance recital that is performed to copyrighted music.¹⁸ It is possible, of course, that even non-permissive uses of copyrighted works may be legal under the fair use doctrine.¹⁹ However, if fair use does not apply and permission has not been granted, a person uploading copies of a work to the internet with the intent that they be copied, distributed, and viewed by others commits copyright infringement.

¶ 8         Locating end-users who infringe copyrighted works can be difficult and expensive, however,²⁰ so copyright holders have sought to aggregate their legal claims by bringing suit against the entities which made the copyright violations possible — in this case, YouTube — under secondary copyright liability theories.²¹ The road to such secondary liability for facilitating digital content exchange was paved by suits against music file-sharing companies Napster,²² Aimster,²³ and Grokster,²⁴ all of which resulted in decisions favorable to the imposition of secondary copyright liability. Is YouTube destined to go the way of Napster, being forced to radically alter its business model until it is nothing but a shadow of its former self?²⁵ Should it be? What is YouTube's culpability for the copyright violations that are occurring on its web site?

¶ 9         As is frequently the case with novel legal issues, the answers to new questions can be inspired by considering existing analogous scenarios, then determining which of those scenarios most closely animates the current fact pattern.

¶ 10         Copyright infringement is in the nature of a tort,²⁶ so it is worth considering torts that are enabled by the products or services of third parties. No one suggests that manufacturers of baseball bats should be held liable for battery committed by users of the bats.²⁷ Similarly, the authors could not find a reported case holding camera manufacturers (whether of digital or analog cameras) liable for the derivative works created when camera owners take pictures of underlying copyrighted works.²⁸ Nor is there a widespread movement seeking to hold typewriter or computer manufacturers liable for the copyright infringement of typewriter or computer owners, though the question has been posed.²⁹ Nor have companies that manufacture photocopying machines been held liable for copyright infringement by the machine's owners.³⁰

¶ 11         Each of these products could be used to break the law, yet society, via the legislative and judicial processes, has largely chosen not to impose liability on the manufacturers of these products. Why? Perhaps the most obvious answer is that these products can be used lawfully in a variety of ways that are considered valuable. Imagine banning the game of baseball because of the number of crimes committed each year using bats,³¹ or forbidding the manufacture of cameras or photocopy machines because they could be used to commit copyright infringement.³²

¶ 12         Clearly, there is a balancing of interests occurring in the decision of whether and when to impose copyright liability, whether direct or secondary. "In enacting a copyright law Congress must consider . . . two questions: First, how much will the legislation stimulate the producer and so benefit the public; and second, how much will the monopoly granted be detrimental to the public?"³³ Copyright rewards owners and thus stimulates them to create works that contribute to the public good. Nevertheless, "[t]he copyright law, like the patent statute, makes reward to the owner a secondary consideration."³⁴ "[T]he ultimate aim [of copyright law] is . . . to stimulate artistic creativity for the general public good."³⁵ It is therefore unsurprising that, when balancing the public good created by cameras, computers, and photocopying machines against the potential copyright infringement that is enabled by their manufacture, society has come to tolerate some increased likelihood of copyright violations in exchange for the significant benefits derived from these products.

¶ 13         Cameras, photocopiers, and computers have existed for decades or longer, and recognizing their value is a comparatively simple matter. With new technologies, it is not always readily apparent to what extent those technologies are, or will be, beneficial.³⁶ Caution must therefore be exercised when legislating or deciding that a certain piece of new technology imposes too great a cost to copyright holders. What would society be like if the four dissenting justices in Sony³⁷ had carried the day and Sony was forced to alter or discontinue its product? Nor is it clear that the pro-copyright resolution of Napster³⁸ and its progeny have led to an optimal state of affairs. Theft of musical works on the internet is still rampant³⁹ and public respect and support for copyright laws may be waning.⁴⁰ More importantly, five years after Napster, there is still no alternative web site where the public may legally (and by payment of appropriate fees) obtain as wide a variety of music with the ease and efficiency that had been enabled by Napster.⁴¹

¶ 14         The copyright conundrum thus remains and, in the online context, begs for a rebalancing. On the one hand, the internet has been described as a "giant photocopier,"⁴² and its ability to make perfect copies has been cited as a reason why the internet "threatens copyright holders as never before."⁴³ On the other hand, this ability to make perfect copies cheaply, easily, and without respect to distance or geography is the source of tremendous potential and provides the foundations for services that may in the future confer tremendous public benefits.

III. Secondary Copyright Infringement Liability

¶ 15         There are two related but distinct theories by which one entity can be held secondarily liable for copyright infringement, or liable for the copyright infringement of another: contributory copyright infringement and vicarious copyright infringement. Although the lines of distinction between contributory and vicarious infringement are not clearly drawn,⁴⁴ contributory infringement requires an intent to induce another to commit infringement,⁴⁵ while vicarious infringement occurs when one party profits from the infringing activities of another while failing to exercise a right to stop the infringing activity.⁴⁶ The Copyright Act does not reference either of these common law theories of secondary liability.⁴⁷ Nevertheless, secondary liability "is imposed in virtually all areas of the law"⁴⁸ and, more to the point, has long been a fixture in copyright law jurisprudence.⁴⁹

¶ 16         In Gershwin Publishing Corp. v. Columbia Artists Management, Inc., the seminal case on contributory infringement liability, the court ruled that a person "who, with knowledge of the [direct] infringement activity, induces, causes or materially contributes to the infringing conduct of another, [he] may be held liable as a 'contributory' infringer."⁵⁰ The common law of torts traditionally recognized contributory liability where a person or business establishment directly contributes to another's wrongful conduct.⁵¹ A finding of knowledge of the direct copyright infringement and a material contribution by the secondary infringer are both necessary to establish contributory infringement liability.⁵² Secondary infringement may take the form of inducing the direct infringers to violate copyright laws.⁵³ This can be evidenced by a business model designed to attract direct infringers or continuing to allow infringement when notified of the wrongful conduct.⁵⁴

¶ 17         Contributory infringement liability is especially relevant to social networking sites, which host millions of user-posted files that may directly infringe a copyright. Web sites may potentially receive daily notifications by countless numbers of copyright owners alleging their works are being infringed.⁵⁵ Such notifications could establish "knowledge" on the part of the web site, thereby subjecting it to potential contributory infringement liability. They risk potential secondary copyright liability based on the theory of being facilitators of the direct infringement.⁵⁶

¶ 18         Vicarious infringement has its origin in the common law,⁵⁷ found in the doctrine of respondeat superior.⁵⁸ It is established on the theory that the defendant had the right and ability to supervise the direct infringement and had a direct financial interest in the infringed copyrighted work.⁵⁹ "To escape imposition of vicarious liability, the reserved right to police must be exercised to its fullest extent. Turning a blind eye to detectable acts of infringement for the sake of profit gives rise to liability."⁶⁰ Direct financial interest includes both present interest as well as a "future hope to monetize."⁶¹

¶ 19          The early so-called "dance hall" cases placed vicarious copyright infringement liability on establishments where music was performed by an infringing band or orchestra even though the dance hall proprietor was not involved in the choice of infringing music played by the band but acquired a financial benefit from the performance.⁶² In one of these cases, Shapiro, Bernstein & Co. v. H.L. Green Co., the court ruled that knowledge of the infringement is not necessary when a reasonable person should have known of its occurrence.⁶³

¶ 20         An ongoing relationship with a direct infringer makes it more likely that a party will be held liable for secondary copyright infringement.⁶⁴ In order to post a video on YouTube, a user must sign up (and thereby agree to the YouTube terms of service),⁶⁵ which makes it more likely that YouTube will have an ongoing relationship with those who have uploaded content. Generally speaking, providers of services (including social networking sites) are more likely to have ongoing relationships with their customers than are vendors of products, such as a VCR.⁶⁶

¶ 21         This theory of secondary copyright liability should be especially worrisome to social networking sites. A financial interest is surely evident by the vast number of subscribers and advertising patrons. A social networking site, without knowledge of the direct copyright infringers, could be held liable based on a common law duty to supervise in a careful manner. A reasonable standard of supervision would work in favor of copyright holders because the vast number of posted videos should suggest that reasonable supervision would create awareness on the part of the web site of the direct infringement.

¶ 22         In Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd.,⁶⁷ the defendant, Grokster, distributed free software allowing peer-to-peer users to share files directly with each other without going through a central server. Most of the users shared copyrighted music and video files without the permission of the copyright owners. Metro-Goldwyn-Mayer Studios Inc. alleged that Grokster "knowingly and intentionally distributed their software to enable users to infringe copyrighted works in violation of the Copyright Act."⁶⁸ Justice Souter, writing for the majority, framed the issue by stating: "The question is under what circumstances the distributor of a product capable of both lawful and unlawful use is liable for acts of copyright infringement by third parties using the product."⁶⁹

¶ 23         This question will continue to be relevant to copyright infringement claims based on secondary contributory infringement brought against social networking sites. Consider that YouTube has created a network where both lawful and unlawful use is possible. The Grokster Court applied the rule on inducement of infringement by stating:

[E]vidence of active steps . . . taken to encourage direct infringement such as advertising an infringing use or instructing how to engage in an infringing use, show an affirmative intent that the product be used to infringe, and a showing that infringement was encouraged overcomes the law's reluctance to find liability when a defendant merely sells a commercial product suitable for some lawful use.⁷⁰

¶ 24         In a claim against a social networking site, the plaintiff during discovery would question the nature of the business plan, its marketing strategy, and any e-mails or other correspondence that might reveal the company's intent to "encourage direct infringement." The Grokster Court was careful to point out that:

[M]ere knowledge of infringing potential or of actual infringing uses would not be enough . . . to subject a distributor to liability. Nor would ordinary acts incident to product distribution, such as offering customers technical support or product up-dates support liability in themselves. The inducement rule, instead, premises liability on purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful purpose.⁷¹

¶ 25         That rule as expressed by the Supreme Court is not especially helpful because if a copyright owner notified the website of an alleged infringement, one could argue that the social networking site by continuing to post the infringing content is engaging in "purposeful, culpable expression and conduct." What is meant by "purposeful, culpable expression and conduct" will continue to perplex counsel advising a network receiving alleged copyright violations.

¶ 26         For example, consider the famously popular iPod, and in particular the 80 gigabyte version which can hold up to 20,000 songs.⁷² The unit is available on Apple, Inc.'s web site for $349.⁷³ However, at $0.99 per song,⁷⁴ it would cost nearly $20,000 to fill the iPod to capacity, which is more than fifty times the cost of the iPod itself. Given that iPods have enjoyed wide popularity among high school and college students (who may be reluctant or unable to spend $20,000 on music) one might infer that Apple's business strategy and profits are based on the assumption or even intent that purchasers will use its product to store and play unauthorized copies of music.⁷⁵ Does that proposed business strategy constitute "purposeful, culpable expression and conduct?" Assume for the moment that iPod users do in fact illegally copy large amounts of copyrighted material to and from their iPods. If this is the case, should Apple be any less condemned than YouTube, simply because it is more difficult to identify the direct infringement offline than online?

IV. The "Safe Harbor" of Section 512 of the DMCA

¶ 27         In enacting the Digital Millennium Copyright Act of 1998, Congress sought to protect the rights of copyright holders while allowing internet service providers to operate and innovate without the fear of unlimited liability.⁷⁶ Thus, a series of safe harbors was established so that, by complying with the requirements of the DMCA, companies providing certain internet-based services could be assured that they would not have to pay damages for copyright infringement. The safe harbors protect "service providers" who are engaged in various online activities, including the provision of "transitory digital network communications," "system caching," and "information location tools," or who control or operate a system or network where material is stored "at the direction of a user."⁷⁷ Moreover, the legislative history of this section makes clear that "qualifying service providers" will be relieved of liability not only for vicarious and contributory infringement, but also for direct copyright infringement.⁷⁸

¶ 28         The subsection of the DMCA that most directly applies to social networking sites is § 512(c), which creates a safe harbor from liability for service providers for "information residing on [a service provider's] systems or networks at the direction of users," provided certain conditions are met.⁷⁹ These conditions address (1) the service provider's knowledge of the infringing material, (2) the financial benefit to the service provider that is derived from the infringing material, (3) the service provider's response in removing infringing material when notified thereof,⁸⁰ (4) the service provider's implementation of a policy whereby users who repeatedly engage in copyright infringement may have their account access disabled, and (5) the implementation of "standard technical measures" that allow copyright owners to identify copyrighted works.⁸¹ Conditions (4) and (5) have been described by courts as "threshold conditions."⁸² In addition, an entity must as a threshold matter qualify as a "service provider."⁸³

¶ 29         As a threshold matter, an entity seeking to take refuge in any of the § 512 safe harbors must meet the threshold conditions of qualifying as a service provider, reasonably implementing a termination policy, and accommodating standard technical measures.

¶ 30         Only those entities that qualify as "service providers" are entitled to the benefit of the §512 safe harbors.⁸⁴ Thus, whether YouTube is considered a service provider is a critical threshold matter. Section 512 provides two different definitions for the term "service provider." The first definition applies to § 512(a), addressing "transitory digital network communications," and defines a "service provider" as "an entity offering the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user, of material of the user's choosing, without modification to the content of the material as sent or received."⁸⁵ The hosting of a web site does not fall within this definition, whereas providing connectivity for such a web site does fall within the definition.⁸⁶ The second definition is broader,⁸⁷ and includes all entities captured by the first definition, plus "provider[s] of online services or network access, or the operator of facilities therefore."⁸⁸

¶ 31         Fortunately, this oblique statutory language has been clarified somewhat by the legislative history and by case law, which have made it clear that the definition of "service provider" is very broad.⁸⁹ The Senate Report accompanying the DMCA noted that "services such as providing Internet access, e-mail, chat room and web page hosting services" were specifically contemplated by the legislature as being covered by the broader definition of "service provider."⁹⁰ Courts have consistently applied a broad definition to the term "service provider" to bring within the definition a wide range of entities, including, Aimster,⁹¹ eBay,⁹² and Amazon.⁹³ Even Napster may have fallen within the purview of § 512.⁹⁴

¶ 32         Subsection (c) of §512 protects service providers from liability for "infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by . . . the service provider."⁹⁵ The Senate Report accompanying the Digital Millennium Copyright Act provides several illuminating examples of specific activities which would be covered under this subsection: "Examples [of activities protected under §512(c)] include providing server space for a user's web site, for a chat room, or other forum in which material may be posted at the direction of users."⁹⁶ While none of these situations addresses music or video files per se, the class of entities which could conceivably "provide[] server space" is broad. Moreover, the following page of the legislative history specifically provides the example of "online site[s] offering audio or video" in the context of §512(c).⁹⁷ Given these specific examples and the broad definition of "service provider," it is not surprising that legal scholars have concluded that YouTube is an intended beneficiary of the §512(c) safe harbor,⁹⁸ though it must still be determined whether its activities are sufficient to meet all of the safe harbor's requirements.

¶ 33         Second, a service provider may only avail itself of the §512 safe harbors if the service provider has "adopted and reasonably implemented, and inform[ed] subscribers of . . . a policy that provides for the termination . . . of . . . account holders . . . who are repeat [copyright] infringers."⁹⁹ Under the Ninth Circuit's formulation of this subsection, whether a service provider has satisfied the termination policy standard requires a three-pronged inquiry: The service provider must have (1)adopted such a policy, (2) informed users of thepolicy; and (3) reasonably implemented the policy.¹⁰⁰ YouTube's policy is available to users on its web site, and tracks the statutory language fairly closely.¹⁰¹ Thus, the first two prongs of the test seem to be satisfied. Whether the policy has been reasonably implemented is a more difficult question, and case law is sparse.¹⁰² A modicum of insight can be gleaned from Perfect 10, Inc. v. CCBill, LLC, where it was noted in dicta that a service provider's failure to adequately record the contact information of entities associated with alleged infringement may constitute a failure to reasonably implement a termination policy.¹⁰³ This conclusion is based on the simple logic that if no adequate record of infringers is maintained, it will be difficult to terminate such infringers.

¶ 34         Similarly, the Ninth Circuit in Ellison v. Robertson suggested another way to run afoul of the reasonable implementation standard.¹⁰⁴ The court noted that AOL had changed the e-mail address at which it received copyright infringement notifications, but had neither provided notification of the change nor arranged for e-mail forwarding from the old account.¹⁰⁵ Thus, copyright infringement notifications sent by copyright owners would have "fall[en] into a vacuum," making it difficult for AOL to become aware of potential infringements and terminate accounts where appropriate.¹⁰⁶

¶ 35         In an even more egregious example of failure to comply with the implementation standard, the service provider in Aimster could not implement its termination policy because it had deliberately prevented itself from becoming aware of specific infringing activity. By encrypting the communications between users, Aimster was unable to determine who exchanged files, what files were exchanged, or when the files were exchanged.¹⁰⁷ The court had no tolerance for such maneuvering: "[A]dopting a repeat infringer policy and then purposely eviscerating any hope that such a policy could ever be carried out is not an 'implementation' as required by [the DMCA]."¹⁰⁸

¶ 36         In light of Ellison, Aimster, and CCBill, service providers are presumably taking greater care to avoid such obvious blunders. Nevertheless, stumbling blocks may still arise. For example, even if a service provider terminates a user's account, there may be little to prevent that account holder from signing up for a new account. This is a particular concern at free sites such as YouTube, where the barriers to creating new accounts may be especially low. Currently, a user account at YouTube may be created in seconds by entering an email address and other basic information.¹⁰⁹ YouTube does not appear to verify any of the information, other than the e-mail address (though by registering, users must agree to YouTube's Terms of Use and Privacy Policy).¹¹⁰ Thus, even if YouTube diligently terminates the accounts of repeat offenders, which it claims to do "automatically,"¹¹¹ the policy may be largely ineffective.¹¹² Nevertheless, the statute does not require that service providers "effectively" terminate the accounts of repeat offenders, but that they "reasonably" do so. So long as a service provider diligently responds to infringement notices and consistently terminates the accounts of repeat infringers, this should in most cases constitute reasonable implementation.¹¹³

¶ 37         The analysis of whether methods exist to prevent infringers from re-registration, and whether such methods outweigh their costs, involve complicated technical and policy questions better addressed by Congress. Congress could, for example, require service providers to implement "standard technical measures" to prevent users from re-registering, just as is currently required in the context of identifying copyrighted works.¹¹⁴ It has not done so, however, so to require service providers to not only terminate the accounts of repeat infringers but also prevent them from reregistering goes beyond what is required under the statute, thus treading too closely to the safe harbor and creating uncertainty.

¶ 38         In its complaint, Viacom states that "YouTube . . . has decided to shift the burden entirely onto copyright owners to monitor the YouTube site... to detect infringing videos and send notice to YouTube demanding that it 'take down' the infringing works."¹¹⁵ However, Congress, not YouTube, has placed this burden on copyright holders.¹¹⁶ The DMCA does not require active monitoring or "policing" of a service provider's web site to come within safe harbor protection.¹¹⁷

¶ 39         Although safe harbor eligibility is not predicated on active monitoring by service providers to detect infringing activity,¹¹⁸ service providers must "accommodate[], and . . . not interfere with standard technical measures" in order to fall within the section's protections.¹¹⁹ Section 512(i) defines "standard technical measures" somewhat recursively as "technical measures that copyright owners use to identify or to protect copyrighted works."¹²⁰ This requirement apparently stems from Congress' belief that the key to combating online copyright infringement lies in technology.¹²¹ Beyond these general statements, what constitutes a standard technical measure has not been developed by the case law. It has been suggested that digital watermarks or copyright management systems might fall under this definition.¹²² However, the statute specifies that standard technical measures include only those measures that "have been developed pursuant to a broad consensus of copyright owners and service providers in an open, fair, voluntary, multi-industry standards process."¹²³ No "industry consensus" has yet resulted from a "multi-industry standards process."¹²⁴ So, although it is likely that watermarks and copyright management systems will one day fall into the category of standard technical measures, they do not do so today.

¶ 40         Nevertheless, Viacom attempts to circumvent this difficulty by eschewing the term "standard technical measures" in favor of "reasonable measures,"¹²⁵ "available copyright protection measures,"¹²⁶ or simply "measures."¹²⁷ The complaint alleges that YouTube "prevents copyright owners from finding on the YouTube site all of the infringing works from which YouTube profits," and "has deliberately withheld the application of available copyright protection measures." ¹²⁸ Specifically, Viacom alleges that YouTube's practice of limiting the number of results returned for a given search to 1000 clips prevents copyright holders from identifying all of the infringing files available on the network.¹²⁹ In addition, YouTube has created a feature that allows users to privately share videos.¹³⁰ Because only those designated as "friends" by a user can view videos uploaded by that user, Viacom complains that copyright holders are unable find infringing videos shared using this feature.¹³¹

¶ 41         Although these allegations may be correct, they have no bearing on whether YouTube has accommodated or interfered with "standard technical measures" but rather, whether it has accommodated or interfered with "available measures," or at least, "measures." Conflating "measures" with "standard technical measures" would deny effect to the statutory language in §512(i)(2)(A) and thus violate a cardinal principal of statutory construction.¹³² Even were that not the case, the definition of "standard technical measures" also excludes measures that "impose substantial costs on service providers or substantial burdens on their systems or networks."¹³³ YouTube may be able to show, for example, that limiting search results to 1000 hits saves substantial costs by reducing the necessary computing capacity, or that the practice substantially improves network performance by reducing the amount of time it takes to display search results to users.

¶ 42         The allegations regarding the "friends" feature raise public policy concerns, and courts should be chary of adopting their logic. A substantial benefit accrues to the public from the ability to share files privately. For example, although many people enjoy posting personal photographs, travel diaries, and other messages on publicly available websites or blogs, many others prefer to transmit such communications privately through e-mail or other means. Similarly, many YouTube users may prefer for legitimate reasons to share audiovisual content privately. Unfortunately, traditional methods of private video sharing are cumbersome and slow, such as creating videotapes and mailing them to intended recipients. Sending video by e-mail attachment is faster, but file-size may prevent effective transmission. Other methods such as FTP require technical knowledge not possessed by much of the general public. YouTube's "friends" feature allows ordinary people to quickly, easily, and privately exchange video files, thus providing a significant social benefit.¹³⁴

¶ 43         Moreover, the "friends" feature can be distinguished from Aimster's network design, which the Aimster court viewed as part of scheme to encourage copyright infringement.¹³⁵ Recall that Aimster included an encryption feature as part of its free software that allowed users to exchange music files privately.¹³⁶ Denouncing this tactic, the court noted Aimster's "ostrich-like refusal to discover the extent to which its system was being used to infringe copyright"¹³⁷ and pointed out that "Aimster [had] failed to show that its service [was] ever used for any purpose other than to infringe . . . copyrights."¹³⁸ Clearly, encryption solely for the purpose of illegal file sharing can hardly be justified on the basis of social benefit. In contrast, if YouTube can show that a meaningful number of users legitimately use the "friends" feature to keep private content private rather than to evade copyright infringement detection, the YouTube court should look favorably upon the feature.

¶ 44         Viacom alleges that "YouTube . . . knowingly reproduces and publicly performs the copyrighted works uploaded to its site."¹³⁹ Viacom will seek to demonstrate that YouTube does not deserve the protections of the safe harbors established by the DMCA, since the protections are available only to the extent that the service providers are "innocent."¹⁴⁰ A service provider is not innocent (and will not be able to take refuge in the safe harbor of § 512(c)) if it has "actual knowledge that the material . . . on the . . . network is infringing."¹⁴¹ Even in the absence of actual knowledge of infringement, a service provider will not be immune from liability if it is "aware of facts or circumstances from which infringing activity is apparent."¹⁴² However, the standard for determining whether a service provider has such apparent knowledge is an elevated one: A service provider will only be deemed to have apparent knowledge if that service provider "deliberately proceeded in the face of blatant factors of which it was aware."¹⁴³

Examples of such blatant infringement may include statements from the vendor that a product is bootlegged or pirated, chat rooms hosted by the service provider in which users discuss how the service can be used to circumvent copyright laws, or the offering of hundreds of audio files in a single day for peer to peer copying.¹⁴⁴

¶ 45         At the other extreme, the Senate Report provides some illuminating commentary with respect to the knowledge standard and activity that falls clearly outside the safe harbor of § 512(d)¹⁴⁵:

The important intended objective of this [apparent knowledge] standard is to exclude sophisticated "pirate" directories-which refer Internet users to other selected Internet sites where pirate software, books, movies, and music can be downloaded or transmitted-from the safe harbor. Such pirate directories refer Internet users to sites that are obviously infringing because they typically use words such as "pirate," "bootleg," or slang terms in their uniform resource locator (URL) and header information to make their illegal purpose obvious to the pirate directories and other Internet users. Because the infringing nature of such sites would be apparent from even a brief and casual viewing, safe harbor status for a provider that views such a site and then establishes a link to it would not be appropriate.¹⁴⁶

It is apparent from the quoted text that Congress specifically contemplated sites illegally offering copyrighted audiovisual and musical works for download, and sought to exclude from the safe harbor service providers that create directories linking to such sites. The activities described in the quoted passage stand in sharp contrast to the activities of YouTube. Although user-posted copyrighted material is available on YouTube, YouTube has not assembled and provided users with a directory list of "obviously infringing" sites. Unlike pirate sites which may have the word "pirate" or "bootleg" in the URL or on the site itself, thus clearly indicating that the works are almost certainly both copyrighted and unauthorized, the YouTube site contains videos that may or may not violate the copyrights of others.

¶ 46         The determination of whether or not a particular video infringes a copyright is a challenging one. First, soundtracks or other content contained within amateur YouTube videos may be authorized by the copyright holders. At least four musical rights organizations — Universal Music Group, Warner Music, BMG, and the British society MCPS-PRS Alliance — have signed deals with YouTube that authorize the use of at least some of their songs in user-generated YouTube videos.¹⁴⁷ Second, even professional music videos or prime-time content such as clips from CBS's hit television series "Survivor" may in fact be authorized for YouTube viewing by the copyright owner.¹⁴⁸ Third, even where content is unauthorized, its use may not be illegal. The determination of whether a particular video infringes a copyright involves a sophisticated legal analysis where reasonable people may differ on the application of originality,¹⁴⁹ fair use¹⁵⁰ (including transformative use¹⁵¹), and public domain.¹⁵² For instance, a video clip of a wedding may be "original" but extensive filming of the stained glass windows in the church could be a copyright infringement or fair use. A significant issue with the fair use defense is the fact-sensitive aspect of its application. A political parody may borrow copyrighted music and be transformative enough to constitute fair use.¹⁵³ Hence, each alleged instance of infringement must be independently analyzed by legal counsel. One can readily appreciate the daunting magnitude of this task for the larger social networking sites such as YouTube, where tens of thousands of new files are posted daily.¹⁵⁴ Congress appreciated this difficulty and sought to avoid it by clearly explaining that the termination policy requirement was not intended to "undermine the knowledge standard . . . by suggesting that a provider must . . . make difficult judgments as to whether conduct is or is not infringing."¹⁵⁵

¶ 47         Thus, although it is widely believed that a substantial amount of the content on YouTube is infringing,¹⁵⁶ the nature of social networking sites like YouTube contrasts sharply with that of the "pirate sites" targeted by Congress. A large amount of YouTube's content either does not infringe or may not infringe. Some has been licensed from copyright owners or their representatives, some constitutes parody or is otherwise a fair use of copyrighted works, and some includes homemade videos where the YouTube user is herself the copyright holder.

¶ 48         Strictly applied, the actual and apparent knowledge provisions would preclude immunity if a copyright holder notified the service provider of infringing material residing on its network, or if the service provider otherwise came to be aware of the infringing material. Such a strict application of the statute would inevitably lead to the imposition of liability even for well-intentioned service providers. For example, service providers proactively choosing to locate and remove infringing content would lose the protection of the statute the moment they uncovered it, since at that moment they would have "actual knowledge" of the infringing material. The DMCA therefore allows service providers to remain within the safe harbor, even after becoming aware of infringing material contained on the network, so long as the service provider "acts expeditiously to remove, or disable access to, the material."¹⁵⁷ Once the site has been duly notified of the alleged copyright infringement, generally by a DMCA-compliant cease and desist letter identifying the copyright owner's works that have been infringed, the site has an obligation to "expeditiously . . . remove, or disable access to the material that is claimed to be infringing"¹⁵⁸ or risk losing the safe harbor protection of § 512.¹⁵⁹ The take down notification must be in writing and must (1) be signed by the copyright owner or her agent, (2) identify the copyrighted work(s) claimed to have been infringed, (3) identify the material that is claimed to be infringing (4) include contact information for the complaining party, (5) include a statement that the complaining party has a good faith belief that use of the material has not been authorized, and (6) include a statement that the information contained in the notice is accurate and that the complaining party has the right to assert the copyright. Notices which are not "substantially" compliant are ineffective.¹⁶⁰ However, as long as the notice identifies the infringing works and the infringed works and provides contact information (elements (2), (3), and (4), above), the party receiving notice is obligated to attempt to contact the complaining party to request the missing information.¹⁶¹

¶ 49         YouTube claims that it immediately complies with such requests¹⁶² and has received considerable press for its compliance with some of the larger take-down requests.¹⁶³ Although copyright owners may be unhappy with the effectiveness of their takedown requests,¹⁶⁴ it appears that YouTube is largely within the bounds of this portion of the safe harbor.

¶ 50         Even if a service provider has no knowledge of the infringing material (or, upon learning of the infringement, acts expeditiously to remove the material), safe harbor protection is nevertheless unavailable if the service provider (1) has the right and ability to control the illegal activity and (2) receives a "financial benefit directly attributable to the infringing activity."¹⁶⁵

¶ 51         The right and ability to control the illegal activity refers to more than just the right and ability to remove material after the fact, but "presupposes some antecedent ability to limit or filter copyrighted material."¹⁶⁶ Thus, it has been held that Amazon did not have the right and ability to control third party vendor sales taking place via Amazon's online marketplace, where Amazon was never in possession of the products, did not preview the products prior to their listing, and "did not otherwise involve itself in the sale[s]."¹⁶⁷ In contrast, the right and ability to control has been found where a provider of online age verification services "refused to allow sites to use its system until they compl[ied] with its [requirements with respect to site layout, appearance, and content.]"¹⁶⁸ Postings to YouTube are extensively automated, with little or no involvement from the service provider. It is true that those wishing to upload videos to YouTube must first register, but registration is a quick and simple process that does not appear to contain any mechanism for screening out would-be registrants.¹⁶⁹ Nor is there a process for filtering infringing or otherwise inappropriate videos as they are uploaded,¹⁷⁰ although YouTube has been promising content-screening technology since 2006.¹⁷¹ Given that YouTube prescreens neither registrants nor videos, YouTube's circumstances seem closer to those of Amazon.

¶ 52         Although there is no bright-line rule to determine whether or not a benefit received by the service provider is "direct," some general guidance has evolved from the case law and legislative history. If users pay a fixed fee, regardless of illegal activity, a finding of direct benefit is less likely.¹⁷² Commentary from the Senate Report buttresses this rule:

[R]eceiving a one-time set-up fee and flat periodic payments for service from a person engaging in infringing activities would not constitute receiving a 'financial benefit directly attributable to the infringing activity.' Nor is subparagraph (B) [of § 512(c)(1)] intended to cover fees based on the length of the message (per number of bytes, for example) or by connect time.¹⁷³

YouTube's services are provided to users for free; YouTube instead generates revenue from advertisers whose advertisements are displayed alongside user videos. Each time an infringing video is played, YouTube generates revenue from the associated advertisement. Thus, in a literal sense, some portion of YouTube's revenues is directly attributable to infringing activity. Stopping the analysis at this point and finding a direct financial benefit leads to a perverse result: if YouTube charges its users a periodic fee to use its services, whether they upload infringing videos or not, it would not receive a direct financial benefit under the Senate Report's formulation; however, if revenue is generated from advertising, with exactly the same users posting exactly the same videos, a direct financial benefit would be found. This interpretation imposes artificial constraints on a service provider's revenue generation model without producing any concomitant benefits in copyright violation reduction.

¶ 53         If the analysis is carried a bit further, however, the appropriateness of Congress' formulation becomes apparent. A business model based on flat user fees gives the service provider little or no incentive to condone infringement. In contrast, a revenue model based on advertisement gives a service provider every reason to condone infringement, at least if the service provider believes that continued infringement will attract more users and thereby increase its advertising revenue.¹⁷⁴ This is likely the rationale behind the rule that if "infringing activity constitutes a draw for subscribers" a direct financial benefit is more likely to be found.¹⁷⁵

¶ 54         In 2004, the Ninth Circuit's significant and questionable statement that the "draw" need not even be "substantial"¹⁷⁶ established a precedent that is now being followed by other courts.¹⁷⁷ This is a troubling development. Illegal uses of a technology will very frequently draw some users to that technology.¹⁷⁸ If a copyright owner were to visit YouTube, MySpace, Facebook — or almost any site where users are able to post music, photos, or video files — and discovered illegal material on that web site, the copyright owner would be able to tautologically argue that the infringing activity had drawn those users who are viewing or otherwise using or consuming the infringing material. This would effectively condemn an entire category of business model, regardless of the extent to which those sites cooperate with copyright owners or seek in good faith to prevent infringement.

¶ 55         In YouTube's case, the question of whether the draw must be substantial is largely academic. Commentators seem to agree that the amount of infringing material on YouTube is in any case substantial (and, by some accounts, overwhelming),¹⁷⁹ and that the infringing material has contributed significantly to YouTube's rapid rise from start-up to multibillion dollar company.¹⁸⁰ Thus, even if the draw did need to be substantial, YouTube would still probably run afoul of this portion of the rule. Not surprisingly, Viacom repeatedly asserts in its complaint that the infringing material available on YouTube draws traffic to the YouTube site.¹⁸¹ While infringing activity on YouTube no doubt draws users — probably a substantial number of them — to the site, this alone will not prevent taking refuge in the safe harbor. It must still be proven that YouTube had the right and ability to control the illegal activity, a difficult showing to make, as discussed above.

V. Liability in the Absence of Safe Harbor Protection

¶ 56         The DMCA did not create a new standard for online copyright infringement. Instead, as the Fourth Circuit has noted, it "merely added a second step to assessing infringement liability for Internet service providers, after it is determined whether they are infringers in the first place under the preexisting Copyright Act."¹⁸² As a practical matter, most courts faced with the question have chosen to first evaluate the defendant's ability to fit within the DMCA's safe harbors.¹⁸³ If the defendant is eligible for safe harbor protection, the inquiry ends and the defendant is subject only to the remedies specified in § 512(j); if not, the complicated determinations of secondary and direct liability must be made. It is not difficult to understand why courts prefer to make a safe harbor determination before going down the muddled path of secondary liability.

¶ 57         As previously discussed, safe harbor protection may be unavailable for a variety of reasons. Only "service providers" are eligible for § 512 safe harbor protection, which protection can be lost, for example, if the service provider fails to remove infringing material under §512(c)(1)(C), fails to reasonably implement a termination policy under §512(i)(1)(A), or receives a direct financial benefit while having the right and ability to control infringing activity.¹⁸⁴ If safe harbor protection is unavailable, a court must then conduct a traditional copyright infringement analysis.

¶ 58         Before there can be secondary liability, there must be primary liability based on a direct infringement.¹⁸⁵ Direct infringement, in turn, will not be found if the use made does not fall within the scope of the copyright holder's exclusive rights,¹⁸⁶ nor if the defense of fair use applies.¹⁸⁷

¶ 59         Fair use is a statutory right given to the public to use a copyrighted work for limited purposes such as research or criticism during the work's protected period of the author's life, plus seventy years.¹⁸⁸ The copyright holder's exclusive rights, such as the right of reproduction, are therefore not absolute but are subject to the significant exceptions embodied within the fair use doctrine.¹⁸⁹No bright-line rule exists to determine whether a given use is "fair." Instead, the Copyright Act enumerates four factors to be considered in making a fair use determination:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work [including whether it is primarily creative or primarily factual]; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.¹⁹⁰

Although they are all important considerations, the fourth factor, proof that the use would not diminish the actual or potential value of the copyrighted work, is given considerable weight and has been described as "the most important and indeed the central fair use factor,"¹⁹¹ though the Supreme Court has since emphasized that all four factors must be "explored . . . and weighed together."¹⁹² Moreover, the technological environment and particular technological innovations can and should be considered when making a fair use determination.¹⁹³

¶ 60         Among the exclusive rights claimed by Viacom to be infringed is the right to publicly perform the work.¹⁹⁴ However, in the vast majority of cases, videos posted by users to YouTube have extremely limited viewership, casting doubt on whether the use would constitute "public performance."¹⁹⁵ Nevertheless, by uploading works to the YouTube site, users are causing the work to be reproduced, which is also among a copyright holder's exclusive rights,¹⁹⁶ so fair use must still be considered. While an exhaustive fair use analysis of the myriad types of videos available on YouTube is beyond the scope of this paper, a few points are worth mentioning. Some use of copyrighted content on YouTube is clearly illegal, such as breaking up the entire film "8 Mile" into twelve nine-minute segments and posting each of them on YouTube.¹⁹⁷ Even where only a small portion of a copyrighted work is uploaded, this does not necessarily render the use fair.¹⁹⁸

¶ 61         Although many uses of copyrighted content will not be fair uses, in general the doctrine of fair use should be liberally applied in the context of social networking sites. For example, it is currently the case that "[a] broadcast of a sports clip with music during network news requires payment of performance royalties — even if the music is barely audible over the routine and sports commentary."¹⁹⁹ Courts should be cautious in extending this rule to the social networking or video sharing environment. If a proud parent wants to post a video on YouTube of her child performing a dance routine to copyrighted music, so that distant friends and family (or even anyone in the world who so wishes) may view it, this should, in most cases, be considered a fair use of the copyrighted background music so long as the posting would not likely affect the potential market for the work.²⁰⁰ This might be the case, for example, if the music in the video is of such quality that few users would consider it a substitute for the original work or if it would be practically impossible for users to search for and locate the musical work. There is an obvious benefit to facilitating the sharing of such works, and where such sharing does not cause economic injury to the copyright holder, it should be allowed as a fair use.²⁰¹ This is "consistent with the First Amendment policy of providing the fullest possible access to information . . . ."²⁰² Finally, even if such economically harmless uses of copyrighted works do not constitute fair use by the end-user, they should weigh against a finding of secondary liability.²⁰³

¶ 62         The effect on the market value of the posted copyrighted material is a critical factor under the fair use doctrine. The copyright owner/plaintiff would have to rebut the fair use defense that the market of its music or video would not be jeopardized by its unauthorized use. This becomes especially difficult when the work has been transformed and has taken on a new meaning as in a parody or political satire that uses copyrighted material. Even the posting of a copyrighted sporting event for a limited period would probably not dissuade people from attending games.²⁰⁴ Indeed, it may even create a larger market.

¶ 63         In any event, YouTube's stated policy is to promptly remove videos containing soundtracks owned by a record label where permission has not been granted.²⁰⁵ If strictly applied, this policy would leave no room for fair use postings of copyrighted content. YouTube thus has a stated policy that is legally conservative and tends to err on the side of greater copyright protection. In particular, YouTube takes this conservative position with respect to so-called "mash-ups," where a user integrates various works by splicing them together.²⁰⁶ While such works would likely be classified as derivative works and thus subject to the exclusive rights of copyright holders,²⁰⁷ some mash-ups may be strong candidates for a fair use defense.²⁰⁸

¶ 64         Finally, Viacom contends that YouTube itself is directly infringing copyrights by publicly performing, displaying, and reproducing its copyrighted works.²⁰⁹ This argument has been addressed and rejected by several courts, and is not likely to succeed.²¹⁰

¶ 65         Grokster distributed free software that allows users to engage in peer-to-peer file sharing without the need for a central server.²¹¹ The software could be used to exchange any type of digital file, but the court found that the prominent use of the software was to share copyrighted music and video files.²¹² In fact, 90 percent of the files available for download were copyrighted,²¹³ though it was not clear how often copyrighted versus uncopyrighted content was actually downloaded.²¹⁴ Grokster apparently made no effort to filter copyrighted material from users' downloads or disable access of those who used Grokster to download copyrighted materials.²¹⁵

¶ 66         The Supreme Court decided the case on a contributory liability theory and thus did not reach the issue of whether Grokster might be liable on a vicarious liability theory.²¹⁶ Recall that under a vicarious liability theory, profit and ability to control are the important considerations; whereas under a contributory theory, it is the intent to induce another to commit copyright infringement that controls the analysis. The Court found Grokster liable under a contributory liability theory because it intentionally encouraged others to commit acts of infringement.²¹⁷ Grokster had distributed an electronic newsletter "containing links to articles promoting its software's ability to access popular copyrighted music"²¹⁸ and helped users locate and play copyrighted materials.²¹⁹

¶ 67         YouTube has avoided many of the mistakes of Grokster, Aimster, and others that led to the imposition of secondary liability. Aimster's user tutorial gave "as its only examples of file sharing the sharing of copyrighted music."²²⁰ YouTube, in contrast, in a video tutorial providing instruction to users on how to upload videos, uses the example of a video entitled "No Donkey, No Fun," which does not appear to be copyrighted.²²¹ The video tutorial further warns that "[u]nless you recorded it or it belongs to you, it's not allowed on the site."²²² In Grokster, the Court found evidence of illegal intent in the name "Grokster" because it was an "apparent derivative of Napster" and thus served to show that Grokster was attempting to attract former Napster users who were seeking a new venue to illegally download copyrighted works.²²³ In contrast, the name "YouTube" implies that the content is intended to be user-generated, not the copyrighted material of third parties.²²⁴ It is widely recognized that, despite the availability of copyrighted material on its site, YouTube is a venue for sharing video generally, rather than for sharing copyrighted material in particular.²²⁵ Indeed, the company was apparently born of the frustration its founders experienced in trying to share video taken at a dinner party with friends, not out of a malevolent desire to exploit the copyrights of others.²²⁶

¶ 68         YouTube easily meets the Sony rule that where a product is capable of substantial non-infringing uses, its provider may avoid contributory infringement liability.²²⁷ Unlike previous peer-to-peer companies that have been litigated out of existence, YouTube can point to a large and growing volume of actual (rather than merely theoretical) non-infringing uses. Individual users, of course, have posted a large volume of home-made videos on YouTube,²²⁸ and while the amount of user-created content on social networking sites is difficult to measure precisely, it is clearly substantial.²²⁹ Major studios — from Twentieth Century Fox to Universal to Warner Brothers — are intentionally using YouTube to promote their content.²³⁰ Millions of songs, as well as other content, have been licensed for legitimate use on the YouTube site.²³¹

¶ 69         Moreover, there is a strong public policy argument that favors the continued development of YouTube and similar platforms. YouTube's facilitation of video content sharing constitutes a tremendous present public benefit,²³² allowing those with minimal technological savvy to easily exchange works that may be educational,²³³ newsworthy,²³⁴ or simply have deep personal meaning.²³⁵ Given the ultimate aim of copyright "to stimulate artistic creativity for the general public good,"²³⁶ copyright law must allow breathing room for technologies that dramatically increase the ease with which works can be accessed and exchanged.²³⁷ Nor are theorized potential benefits in short supply. For example, it has been suggested that YouTube's approach to video sharing may one day be incorporated into online dispute resolution platforms.²³⁸ Another commentator has noted that short sitcom pilots could be aired on YouTube prior to investing in a full-length television series, allowing YouTube viewers to weigh in on whom to cast in leading television dramas, and breathing new life into moribund programs.²³⁹ More generally, allowing YouTube to continue could deliver tremendous long-term benefits as new uses of the technology emerge — with benefits that inure to consumers and copyright holders alike.²⁴⁰

VI. Conclusion

¶ 70         Who would argue that society would be better off without the VCR or the photocopy machine? A goal of copyright law is to promote the wide public availability of copyrighted works, and web sites such as YouTube clearly promote such wide public availability. At the same time, the idea that a company valued at over $1 billion can continue its business model while copyright holders watch their copyrights being impetuously violated and scramble to submit unending take-down notices, may make some level-headed judges sit askance at the bench. Yet this is the balance of interests that has been struck by Congress; and while no legislation can ever perfectly satisfy two masters, the safe harbors of the DMCA seem very nearly optimal. So long as a company is diligent in taking down offending material, terminating repeat offenders, and accommodating standard technical measures, all the while conducting a business that is otherwise legitimate, it has done its part and should be allowed to concentrate its efforts on further innovation in the comforting knowledge that it is safe from copyright infringement liability. Whether YouTube has effectively and timely accommodated standard technical measures and the extent to which it has induced direct infringement are ultimately factual determinations to be made in court. Whatever the outcome of these factual issues, the result should not be another tombstone in the peer-to-peer graveyard. To shut down YouTube would be a grave error that would have adverse consequences across the social networking landscape, needlessly chopping with an axe what should be more delicately pruned with shears.

¶ 71         As the contours of the safe harbor have not yet been brought into focus, social networking sites should constantly review with counsel the emerging cases addressing DMCA compliance, and scrupulously adhere to the DMCA's strictures. To guard against liability in the event that DMCA protection is found to be unavailable, companies should also consider their activities in the context of current copyright liability doctrines. This may not be an easy task. Exactly what the Grokster court meant by ruling that secondary copyright liability is based on the network "promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement"²⁴¹ is not quite clear. Online business models, corporate strategies, and advertisements should be carefully reviewed to negate any semblance of "promoting infringement." While service providers are busy remaining on the legitimate side of the copyright law, courts must be equally attentive to the incentives they are creating as they progressively define the nuanced requirements of the DMCA. The significant value of online social networking demands that decisions be carefully structured to require responsible behavior on the part of service providers while assuring the continued existence of this cultural phenomenon.

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