The Sony Rule
Like many moms, Stephanie Lenz gets a charge when her eighteen-month baby bops to popular music. On February 7, 2007, Lenz was fortunate enough to have a digital camera at hand when the baby starting bopping, and she captured a riveting 29 second video performance. The cause of the bopping, which can be heard in the background of the video, is the Prince song "Let’s Go Crazy". Like many moms, Lenz likes to share these precious moments with her family and friends, which sharing is now greatly enabled by such Web 2.0-social-networking-video-sharing-websites such as YouTube.
The next day, Lenz uploaded the video to YouTube.
Four months later, Universal Music sent a take-down notice to YouTube alleging that the Baby Bop video infringed a copyright owned or administered by Universal by dint of the fact that "Let’s Go Crazy" could be heard in the background.
Under the DMCA, YouTube pulled the video and sent Lenz an email notifying her that it had removed the video pursuant to Universal’s notification that the material infringed their copyright, and that further incidents of copyright infringement could lead to the deletion of her account and all videos uploaded to her account.
Lenz responded with a counter-notification demanding that the video be reposed because it did not infringe Universal’s copyright in any way.
Under the DMCA, Universal had to put up or shut up. Universal declined to institute a lawsuit against Lenz for copyright infringement, and the video was reinstated.
On August 15, 2007, Lenz filed a lawsuit against Universal in Federal Court alleging four counts:
1) §512(F) Misrepresentation
2) Interference with Contract
3) Declaratory relief of non-infringement
The claim is that Universal violated 17 U.S.C. §512(f) by knowingly materially misrepresenting that the Baby Bop video infringed their copyright.
Universal moved to dismiss the claim on the ground that the cause of action fails to state a claim upon which the court may grant plaintiff relief.
Universal moved to dismiss the Declaratory relief pursuant to FRCP 12(b)(1) and 12(b)(6) on the ground that Plaintiff has failed to allege a justiciable case or controversy.
Judge: On the state of mind issue, Rossi promulgates a subjective standard, not an objective one.
Rossi and Diebold are not inconsistent. Did no investigation in Diebold. Universal not up to Diebold.
More facts showing a subjective standard; you can establish facts.
As for pre-emption, DMCA is the remedy for this area.
Doesn’t seem to be a case or controversy, even under Medimmune.
EFF: Lenz plead actual knowledge. Can make the inference under Twombly.
Judge: But the problem is that anyone can meet the threshold to sue if they don’t like the take-down. Rossi says that you need to use reasonableness, you need something that is just self-evident.
EFF: At the pleading stage, we should be able to survive.
Judge: Unless there is a heightened pleading standard, anybody can bring a claim.
EFF: Congress intended to strike a balance because the take-down is so easy.
You can reconcile Diebold and Rossi.
Declaratory relief: Universal claimed infringement, and did not concede fair use. So sword is hanging over Lenz for 3 years. Universal could file anytime over the next 3 years.
Universal: Pleading standard just means that there needs to be some knowledge. The claim is that anyone looking at the video would know; however, there is no such thing as self-evident.
Dec. relief – just because a take-down notice is done, doesn’t subject one to Federal jurisdiction. But Judge says that non-conclusive. Universal claimed that DMCA 512 is just an informal process.