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ISP not liable for copyright violations even after review of content

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    News Media Update         FOURTH CIRCUIT         Copyrights & Trademarks    

ISP not liable for copyright violations even after review of content

  • Internet service providers are not liable for copyrighted materials posted by others on their sites, even if the host site does a cursory review of the material, a federal appellate panel ruled.

June 22, 2004 — Internet service providers are protected from copyright infringement liability when subscribers post copyrighted materials on the host’s Web site, even if the host reviewed the material, a three-judge panel of the U.S. Court of Appeals in Richmond, Va., (4th Cir.) ruled yesterday.

In CoStar Group v. LoopNet , the court held that Internet service providers are not liable for postings by subscribers that may violate copyrights. LoopNet’s Web site is a hosting service that allows its users, often real estate brokers, to post listings of commercial real estate properties. Its site boasts that it is “No. 1 in Commercial Real Estate Online” and contains more than 240,000 commercial lease and sale listings.

CoStar Group, Inc. and CoStar Realty Information, Inc., which own copyrights to many commercial real estate photos, filed suit claiming that some of their copyrighted photos were illegally posted on LoopNet’s site. Because LoopNet copied the photos into its computer system, the ISP was liable for infringement, whether or not it was a passive participant, the suit contended.

However, the Fourth Circuit held that LoopNet is not directly liable because it was not the actual duplicator of the photos.

Allowing items to be posted is “passive conduct” by the host ISP and falls under the protection of the safe harbor immunity provision provided under the Digital Millennium Copyright Act. The fact that LoopNet reviewed photographs takes it outside the protection of the DMCA’s safe harbor, but the Fourth Circuit extended protection to include cursory review.

LoopNet subscribers must agree to “Terms and Conditions” that include not posting photographs without authorization, according to the court’s opinion. The authorization requires the subscriber to agree to another set of “Terms and Conditions” and a warranty stating that the subscriber has “all necessary rights and authorizations” from the copyright owner, the opinion said.

When photos are posted, a LoopNet employee does a cursory review of the photo to determine whether it depicts commercial real estate and to look for any obvious copyright violations, such as text or a copyright notice, according to the opinion. However, the court held that this gatekeeping practice is not actual content control and not significant enough to create liability upon LoopNet as a direct infringer in the event that copyrighted material should slip through and be posted, which is what occurred in this case.

Jonathan Hacker, attorney for CoStar, declined to comment on the ruling, while LoopNet attorney Kurt B. Opsahl did not return phone messages seeking comment.

(CoStar Group, Inc. v. LoopNet, Inc.; Defendant-Appellee Counsel: Kurt B. Opsahl, San Francisco) CZ


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