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Chapter 5
and voluntary industry initiatives, as the government and private sector grapple with striking a
balance between (1) providing adequate enforcement mechanisms for trademark and copyright
owners and (2) maintaining the freedom and openness commonly associated with the Internet in
the United States.
As the focus on voluntary industry initiatives has increased over the past two years, several main
categories of Internet-focused policy responses have emerged. Such strategies range in scope and
effectiveness and many include mechanisms such as the implementation of online complaint forms
or the creation of hybrid gradual response systems that might result in suspension of an
individual’s Internet service. While none of these measures represent a definitive solution to the
online piracy and counterfeiting issue, they potentially offer tools that could be used as part of a
multi-pronged approach together with legislation, to reduce illegal activities being conducted or
offered by PFWs through their websites and online services.
Any discussion of voluntary industry initiatives must examine the relevant industries’ incentives
for adopting those strategies. Essentially, do sufficient incentives exist for intermediaries to
embrace, implement, and promote voluntary measures to deter PFWs from continuing their operations?
If not, would it help to implement legislation to encourage voluntary measures, for instance
to shield such intermediaries from liability for certain reasonable steps taken to address PFWs?
B. Current Copyright and Trademark Legal Framework
1. The Digital Millennium Copyright Act
The Digital Millennium Copyright Act (“DMCA”), enacted in 1998, incentivizes certain categories
of intermediaries to share in the burden of copyright enforcement compliance by limiting their
liability for the infringing activities of their users. Prior to the enactment of the DMCA, ISPs and
website operators were potentially exposed to copyright infringement liability because every time
a user accessed infringing content, the provider’s server reproduced a copy of protected material. 4
Under the 1976 Copyright Act, any reproduction of a copyrighted work without consent of the
copyright holder that is not excused by an exception or limitation to copyright constitutes copyright
infringement. 5 ISPs also were exposed to claims of secondary liability for their users’ infringing
reproductions and distributions. 6 The safe harbor provisions of the DMCA grant ISPs immunity
from liability for monetary damages (although not from limited injunctive relief) for material
transmitted, edited, or posted by a user. 7 In order to qualify for immunity, an ISP must expeditiously
remove identified infringing material in response to a takedown notice submitted by a copyright
holder 8 or if/when the ISP has actual or red-flag 9 knowledge of the presence of infringing material
or activity on its server. 10 As a condition of eligibility, ISPs must also designate an agent to receive
infringement notifications, implement a reasonable repeat infringer policy, and accommodate
standard technical measures. 11
The safe harbor provisions allow websites such as YouTube and Facebook—which primarily rely
on user-submitted content—to operate without facing potentially expansive civil liability related
to copyright infringement. The safe harbor provisions were explored and explained in a recent
dispute between Viacom (as the content owner) and YouTube (as the service provider). Viacom
brought suit against YouTube in the Southern District of New York alleging that YouTube induced
users to engage in copyright infringement, “directly, vicariously or contributorily[,] subject to
damages of at least $1 billion . . ., and injunctions barring such conduct in the future.” 12 YouTube,
“an online video hosting service that enables users to share their personal and original video clips
across the Internet through websites, mobile devices, blogs, and electronic mail,” 13 claimed immunity
under the safe harbor provisions of the DMCA; YouTube argued that it was immune as long as
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