COPYRIGHT

Kathy Ossian Founder [email protected] Ossian Law P.C., Michigan image: Clem Onojeghuo / Unsplash.com / Onojeghuo Clem image: Mavrix Photographs, LLC v. LiveJournal, Inc. U.S. Ninth Circuit Court of Appeals, No. 14-56596, 7 April 2017

The Ninth Circuit Court of Appeals decision sheds light on how the use of moderators by a website to screen user content submissions impacts on that website’s ability to defend itself against copyright infringement claims under the US Digital Millennium Copyright Act.

Many online platforms use moderators was the most popular LiveJournal were posted ‘at the direction of the user’ to screen user content submissions. community with its own ‘household and rejecting Mavrix’s position that the Some moderators are unpaid volunteers name7.’ ONTD had an owner, nine review of all posts by the platform’s emerging from the user ranks. How moderators and six maintainers. In moderators disqualified the platform does the use of moderators impact a 2010, due to the growth and popularity from the “broad statutory language of site’s ability to successfully defend itself of ONTD, LiveJournal hired Brendan the DMCA safe harbor13.” The District against copyright infringement claims Delzer, a moderator, as an employee Court granted LiveJournal’s motion for under the Digital Millennium Copyright to serve as ONTD’s ‘primary leader.’ summary judgment, concluding that Act1 (‘DMCA’)? A recent decision by the LiveJournal’s intention in hiring Delzer “LiveJournal is simply the operator of U.S. Ninth Circuit Court of Appeals in was to exercise more control over an online platform on which anyone Mavrix Photographs, LLC v. LiveJournal, ONTD and increase revenues by can create his or her own individual Inc.2 sheds light on this question. running advertisements on ONTD8. blog or start a group blog based on shared interests14.” Mavrix appealed Background The Mavrix lawsuit the District Court’s decision. Mavrix takes and sells photographs In a 2014 complaint filed in the U.S. of celebrities - often candid shots in District Court for the Central District of Ninth Circuit analysis tropical settings - to celebrity magazines3. California, Mavrix alleged that LiveJournal The Ninth Circuit Court of Appeals LiveJournal4 is a social media platform infringed Mavrix’s copyrights by posting undertook a de novo review of the featuring multiple communities in 20 of Mavrix’s photographs in ONTD District Court’s grant of summary which users can post and comment on on seven separate occasions between judgment. To sustain the summary community themed content. LiveJournal’s 2010 through 20149. The photographs judgment ruling, LiveJournal was 2014 Terms of Service (‘TOS’) prohibited involved, including images of singers required to demonstrate “beyond users from uploading infringing content5. Beyonce and Katy Perry, were submitted controversy every essential element” Communities could also establish rules by users. The photos were reviewed and of the afrmative defence of the that did not conflict with the TOS. The approved by an ONTD moderator before DMCA safe harbor15. On the threshold platform utilised unpaid volunteers being posted. Several of the images question of whether the Mavrix photos to screen user submitted posts. also contain a watermark attributing were posted at the direction of the the photo to Mavrix or its website10. user, the Ninth Circuit stated that the These volunteers fell into the following critical “inquiry turns on the role of the categories: (1) moderators, who Mavrix chose to sue rather than moderators in screening and posting performed the review of submissions follow LiveJournal’s DMCA takedown users’ submissions and whether their for compliance with the TOS; (2) procedure. LiveJournal removed acts may be attributed to LiveJournal16.” maintainers, who were moderators each of the photos once it had who could also delete posts and notice of the complaint11. LiveJournal The Appellate Court analysed the case remove non-compliant moderators and responded to the lawsuit by asserting under the common law of agency. users; and (3) owners, one for each DMCA safe harbor protection as the Mavrix argued that the LiveJournal community, who acted as maintainers images were “information residing on moderators were agents of the but could also remove maintainers6. systems or networks at the direction platform, making LiveJournal liable for of users12.” LiveJournal filed a motion the moderators’ actions of reviewing One of the LiveJournal communities for summary judgment on that basis. and approving the posts. The Court entitled ‘Oh No They Didn’t!’ (‘ONTD’) The District Court found in favour of began by citing its earlier decision featured current celebrity news. ONTD LiveJournal, agreeing that the photos in which it had applied agency law

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What alternatives are available to a platform? The most extreme reaction would be to stop using moderators altogether.

continued to determine that a service provider activities went beyond the automatic altogether. The practicality of this was responsible under the DMCA for and limited manual activities20.” approach is limited. On ONTD, LiveJournal copyright infringement by its employees17. strives to maintain the freshness of its The Court then reviewed the following The Court turned to the two remaining content and historically, only one third of undisputed facts to conclude that disputed requirements for establishing user submissions are actually approved there are genuine issues of material the safe harbor defence, namely whether and posted. Moving to a non-moderator fact as to whether the moderators LiveJournal had ‘red flag’ knowledge of model would dramatically change and are LiveJournal’s agents: copyright infringement and lack of any likely destroy the very nature of ONTD. financial benefit from the infringement. A less extreme approach would be to • LiveJournal selected its moderators; The Ninth Circuit ofered guidance to the utilise moderators, but provide them with • The platform gave its moderators District Court on these issues on remand. more autonomy and less supervision various levels of authority in screening On the question of red flag knowledge, and guidelines rather than express rules. posts, owners have greater authority the Court noted that “the fact finder This strategy would rely more upon the than maintainers and maintainers have should assess if it would be objectively DMCA notice and takedown procedures more authority than moderators; obvious to a reasonable person that to address copyright infringement. This • LiveJournal provided moderators material bearing a generic watermark approach would also have an impact on with express direction and criteria for or watermark referring to a service the nature of the platform, ofering less accepting or rejecting submissions; provider’s website was infringing21.” control over content in the first instance. • Although volunteers, moderators perform a ‘vital function’ in the Finally, on the question of whether Another question raised by the Ninth platform’s business model; LiveJournal lacked any financial benefit Circuit’s decision is the potential impact • Delzer, as the primary leader, from the infringement, the Appellate on the moderators themselves. In this supervised moderators, including their Court pointed out that the platform case, the ONTD moderators may find work schedules and removal; and receives advertising revenues based on themselves being witnesses in discovery • At least one user relied upon the number of views to ONTD. Mavrix or even at trial. A moderator may also be moderator approval as a also alleged that approximately 84% of named as a co-defendant. Whether this ‘manifestation’ that the submission ONTD’s content contained infringing will impact a user’s willingness to become complied with copyright law and material and that, in at least one instance, a moderator also remains to be seen. believed that the moderator was the platform permanently blocked acting on the platform’s behalf18. content from a specific source. The Court concluded that “the fact finder should 1. 17 U.S.C. §512(c)(1). While each of the above facts might determine whether LiveJournal financially 2. Mavrix Photographs, LLC v. LiveJournal, Inc., -- F.3d -- (9th Cir. Apr. 7, 2017) (‘Ninth Circuit’). suggest that moderators are, in fact, benefitted from infringement that it 22 3. Ibid. at p. 8. Mavrix’s website is located at http:// agents of LiveJournal under agency law, had the right and ability to control .” www.mavrixonline.com (last visited 29 May 2017). the Court also cited these additional 4. LiveJournal is found at http://www. facts that weigh in the other direction: Implications going forward livejournal.com (last visited 29 May 2017). The Ninth Circuit’s decision has far- 5. Ninth Circuit at p. 6. In April 2017, LiveJournal • ONTD moderators are free to reaching DMCA safe harbor implications updated its current User Agreement to be leave on their own accord; on platforms relying on moderators to based on Russian, rather than US law: http:// www.livejournal.com/legal/tos-en.bml • Moderators may volunteer their screen user submitted content. For a 6. Ibid. at p. 5. time as they see fit; and site like LiveJournal, which relies on a 7. Ibid. at pp. 5-6. • Moderators can reject user network of moderators to keep user posts 8. Ibid. at p. 6. submissions for reasons beyond consistent with its business model, the 19 9. Matrix Photographs, LLC v. LiveJournal, those established by the platform . likelihood is high that moderators will be Inc., Case No. 8:13-cv-00517-CJC-JPR 9 found to be agents. If those moderators (C.D. Cal. July 9, 2014) (‘District Court’). The Appellate Court reversed the District are supervised in any substantial way 10. Ninth Circuit at p. 9. Court’s grant of summary judgment to by a platform employee, the likelihood 11. Ibid. LiveJournal. While the Court could have of a finding of agency increases further. 12. 17 U.S.C. §512(c)(1). stopped there, it went on to the next Providing rules for moderators to follow, 13. District Court at p. 10. question of, if the fact finder on remand limiting moderators’ discretion and 14. Ibid. at p. 18. finds that the moderators are LiveJournal’s exercising other controls over moderators 15. Ninth Circuit at p. 11. agents, did the moderators’ actions all lend further support that the posting of 16. Ibid. at p. 13. fall within or exceed the permissible content submitted by users is attributable 17. Ibid. at p. 14, citing Columbia Pictures Indus., parameters of the DMCA safe harbor. The to the platform and can eliminate the Inc. v. Fung, 710 F.3d 1020 (9th Cir. 2013). Ninth Circuit framed the question for the availability of a DMCA safe harbor defence. 18. Ibid. at pp. 16-18. fact finder as “whether the moderators’ 19. Ibid. at p. 19. acts were merely accessibility-enhancing What alternatives are available to a 20. Ibid. at p. 20. activities or whether instead their platform? The most extreme reaction 21. Ibid. at p. 24. extensive, manual and substantive would be to stop using moderators 22. Ibid. at pp. 26-27.

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