Thursday, June 3, 2021

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Copyright Holders Hold Cloudflare Liable for Failing to Terminate Repeat Infringers
Ernesto Van der Sar, 03 Jun 10:28 PM

cloudflare logoPopular CDN and Internet security service Cloudflare has come under a lot of pressure from copyright holders in recent years.

The company offers its services to millions of sites. This includes multinationals, governments, but also some of the world's leading pirate sites.

Many rightsholders are not happy with the latter category. They repeatedly accuse Cloudflare of facilitating copyright infringement by continuing to provide access to these platforms. At the same time, they call out the CDN service for masking the true hosting locations of these 'bad actors'.

Cloudflare sees things differently. The company positions itself as a neutral service provider that doesn't 'host' any infringing content and says it passes on information temporarily cached on its services.

This means that if copyright holders report problematic URLs to Cloudflare, the company forwards the DMCA takedown notices to its customer. By doing so, Cloudflare is convinced that it operates in accordance with the law.

Repeat Infringer Lawsuit

That stance is not appreciated by all rightsholders and in 2018 the service was taken to court over the issue. The case wasn't filed by major entertainment companies, but by two manufacturers and wholesalers of wedding dresses. Not a typical "piracy" lawsuit, but it's a copyright case that could have broad implications.

In a complaint filed at a federal court in California, Mon Cheri Bridals and Maggie Sottero Designs argued that, despite multiple warnings, Cloudflare failed to terminate sites operated by counterfeit vendors. This makes Cloudflare liable for the associated copyright infringements, they said.

Cloudflare disagreed and filed a motion to dismiss. The company said that the rightsholders failed to state a proper claim, as the takedown notices were not proof of infringement, among other things. The California Federal Court disagreed, however, and allowed the case to move forward.

Rightsholders Request Summary Judgment

This ruling was good news for Mon Cheri Bridals and Maggie Sottero, which have now filed a motion for summary judgment. The companies argue that Cloudflare is liable for both direct and contributory copyright infringement, hoping to establish this as fact before trial.

The wedding dress manufacturers explain that they sent Cloudflare numerous takedown notices. These notices identified allegedly infringing images that were hosted by Cloudflare's subscribers and requested the company to take action to prevent further infringements.

In response, Cloudflare forwarded these notices to its clients and their hosting providers, as is common policy. However, according to the rightsholders, this is not enough.

"Cloudflare did not investigate the alleged infringement, did not request any information from its customers, did not remind its customers of Cloudflare's infringement policy or threaten any type of disciplinary action […] and did not do anything to evaluate whether its customer was indeed engaged in infringing activities.

"It did not matter whether Cloudflare received 1, 101, 10,000, or 1,000,000 infringement notices concerning a domain client – its response and handling of the complaints was always the same," the dress manufacturers add.

Cloudflare believes that it's following the law. In the past, the company stressed that it doesn't store any infringing material on its servers, so forwarding the notices is sufficient.

"Cloudflare Can and Should Take Action"

The wedding dress manufacturers clearly disagree and claim that the CDN provider could and should have taken simple steps to prevent infringements

"[A]fter receiving numerous notices of infringement implicating a website client, Cloudflare could have taken simple measures to prevent further infringement, including evicting the infringing content from its cache servers and terminating caching services until the website proves compliance with Cloudflare's anti infringement policies," the companies write.

"And while Cloudflare may not have control over the infringing content on a website's origin host servers, it can and should do its part to curb infringement by not permitting repeat infringers to use its services to more effectively and quickly distribute infringing material to consumers in the United States."

With the motion for summary judgment, the copyright holders ask the court to rule that, because it failed to act, Cloudflare indeed is liable for the repeat infringements of its customers. If that is the case, the only remaining issue will be the scale of the damages claim.

Potential for Broad Implications

Cloudflare will likely disagree with these allegations but, at the time of writing, it has yet to respond in court. Previously, Cloudflare scrutinized the practices of the wedding dress manufacturers' DMCA takedown partner, while describing the notices as invalid.

This isn't the first time that the repeat infringer issue has come up in US courts. Several movie companies successfully sued ISPs that failed to take action against repeat infringers. These ISPs didn't host any copyrighted material either.

While the present case doesn't directly involve any pirate sites, it could have potentially far-reaching consequences. If the court rules that Cloudflare's current policy is insufficient, it could be required to take stricter action against other sites as well.

A copy of the motion for summary judgment, submitted at a California Court by Mon Cheri Bridals and Maggie Sottero Designs, is available here (pdf)

From: TF, for the latest news on copyright battles, piracy and more.

'Terminating Internet Access Based on Piracy Accusations is Extremely Harmful'
Ernesto Van der Sar, 03 Jun 12:39 PM

DangerTwo years ago Internet provider Cox Communications lost its legal battle against a group of major record labels.

A Virginia jury held Cox liable for pirating subscribers because it failed to terminate accounts after repeated accusations, ordering the company to pay $1 billion in damages.

The ISP disagreed with the verdict and filed an appeal. In its opening brief, filed at the Court of Appeals for the Fourth Circuit last week, Cox argued that it's incorrectly being held liable for pirating subscribers. Not only that, but the company also warned against the harm that a loss of Internet access can cause to businesses and individuals.

Cox is not alone in this assessment. This week, a variety of organizations and groups have submitted amicus curiae briefs to the court, supporting Cox's call to reverse the verdict. All these groups highlight the harm Internet disconnections will cause.

Law Professors Back Cox

The first amici curiae brief comes from seventeen intellectual property law professors, who are connected to universities throughout the United States. They highlight various legal arguments.

For example, the professors explain that Cox shouldn't be held liable for vicarious copyright infringement, as there is no evidence that its policies acted as a 'draw' to potential pirates. On the contrary, Cox's anti-piracy policy appeared to be more strict than those of its competitors.

"There was no evidence in this case that customers subscribed to Cox because of any knowledge or expectation about how it treated infringement. Indeed, the record shows no evidence that customers subscribed to Cox for any reason other than to access the internet for its wide variety of legal uses," the professors write.

Disconnections are Disproportionate

Keeping the current verdict intact will violate internet principles, the professors note. It causes disproportionate harm because ISPs have to closely monitor the traffic of subscribers, which invades privacy. Alternatively, they can terminate accounts of customers based on third-party allegations, which would be harmful as well.

"If ISPs are forced to engage in proactive enforcement, they have a limited set of actions they can take to control alleged infringement. Their primary tool — terminating accused subscribers from the internet altogether — is a blunt instrument that would lead to remedies disproportionate to any violation.

"The COVID-19 pandemic has reinforced the internet's importance," the professors add (pdf). "A loss of internet service, now more than ever, could seriously harm almost every aspect of an individual's personal and professional life"

EFF and Others Chime In

Similar arguments were made by other amici curiae. This includes a broad coalition of the EFF, Public Knowledge, the Center for Democracy and Technology, and various library organizations.

Their brief (pdf) stresses that Internet terminations are not required under the DMCA, as there are other options to deter pirates. If ISPs are required to disconnect users, based simply on third-party complaints, it will lead to catastrophic consequences.

"More aggressive termination policies would punish the innocent and guilty alike," the organizations warn the court.

"Distance learning, telework, and telemedicine have become essential during the pandemic and are likely to remain so. For many or even most subscribers, loss of internet access would be catastrophic."

Internet Association's Power Company Analogy

A similar warning is repeated in the amicus curiae brief from the Internet Association. The group argues that ISPs can indeed stop piracy by terminating Internet access, but that doesn't make it a reasonable solution.

If an ISP can be held liable for copyright infringement because it fails to terminate alleged pirates, would the same apply to the power company that supplies the energy for the pirating device?

"Termination of internet access to a house, business, or smaller ISP is not like removing or disabling access to infringing content," the Internet Association writes (pdf).

"It is more like cutting off electricity to a building. Doing so may stop illegal downloading from occurring on the property, but failure to do so does not make the power company contributorily liable for whatever takes place."

Using a Cannon to Shoot a Mosquito

In yet another amici curiae brief, the broadband and wireless organizations CTIA, NTCA, and USTelecom, present another analogy.

In addition to various legal arguments, the groups equate the use of Internet terminations to stop piracy to shooting cannons to kill a mosquito. It may work, but at what cost?

"This is a quintessential case of using a cannon to kill a mosquito. The consequences of denying consumers access to the internet based on unverified allegations of prior copyright infringement cannot be overstated," the organizations write (pdf).

"It has become particularly evident over the past year that the internet has become not only an essential platform for the exercise of free speech, but a critical means of access to education, employment opportunities, vaccines, medical care, defense and vindication of legal rights, and access to food and other essential products and services."

All the highlighted briefs support Cox's request to reverse the district court's liability ruling. In the weeks to come, the music companies are expected to share their arguments, which will likely be backed by other copyright holders in various amicus briefs.

From: TF, for the latest news on copyright battles, piracy and more.

 
 
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