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Veoh ruling bolsters YouTube effort to fend off $1 billion Viacom suit

Judge dismisses Lo Group's copyright infringement charges against video-sharing site Veoh

By Heather Havenstein
August 28, 2008 12:00 PM ET

Computerworld - YouTube's efforts to fend off Viacom International Inc.'s  $1 billion copyright infringement lawsuit against its parent, Google Inc., were likely bolstered yesterday when a federal judge threw out a similar suit Lo Group Inc. filed against online video-sharing site Veoh.

Lo Group had charged that Veoh Networks Inc. had not done enough to stop its users from uploading unauthorized Lo adult film clips.

Judge Howard Lloyd ruled that the Veoh site includes tools for protecting copyright owners, and that the site qualified for "safe harbor" protections under the Digital Millennium Copyright Act (DMCA).

"Veoh has simply established a system whereby software automatically processes user-submitted content and recasts it in a format that is readily accessible to its users," according to Lloyd's summary judgment. "Veoh does not itself actively participate or supervise the uploading of the files. Nor does it preview or select the files before the upload is completed. Instead files are uploaded through an automated process which is initiated entirely at the volition of Veoh's users."

Some observers said the ruling should bode well for Google in its battle against Viacom, which last year filed a lawsuit alleging that more than 160,000 videos posted on YouTube violate Viacom's copyrights.

Mike Masnick, president and CEO of IT research firm Techdirt, noted in a blog post that YouTube's policy of following DMCA rules is much like Veoh's.

"This ruling suggests that YouTube is also protected by the DMCA safe harbors, just as many had stated from the beginning," Masnick noted. "The key issues raised by Lo (and also raised by Viacom) is that these sites lose their DMCA safe harbors because they take action on the content, often transcoding the content from one format into Flash. However, the judge in the Veoh case trashed that argument pretty easily."

Blogger Michael Arrington added that the judge's note that checking every video for infringement isn't realistic, provides a solid argument for YouTube in the Viacom case.

"[YouTube] has said 13 hours of video content is uploaded every minute on YouTube," Arrington added. "If it's impossible for Veoh to monitor all content, YouTube is going to have an order-of-magnitude larger problem. If you take reasonable precautions against copyrighted materials on your service, you may be OK."

Despite such observations, Judge Lloyd did note that his decision is confined to the Veoh case.

"[The ruling] is not intended to push the bounds of safe harbor so wide that less than scrupulous service providers may claims its protections," Lloyd said. "Nevertheless, the court does not find that the DMCA was intended to have Veoh shoulder the entire burden of policing third-party copyrights on its Web site (at the cost of losing its business if it cannot.). Far from encouraging copyright infringement, Veoh has a strong DMCA policy, takes active steps to limit incidents of infringements on its Web site and works diligently to keep unauthorized works off its Web site."

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