UMG RECORDINGS, INC. V. SHELTER CAPITAL PARTNERS LLC, No. 09-55902 (9th Cir. 2013)Annotate this Case
Court Description: Copyright. The panel withdrew its opinion filed on December 20, 2011, and appearing at 667 F.3d 1022 (9th Cir. 2011); granted appellant’s petition for panel rehearing; denied as moot a petition for rehearing en banc; and filed a superseding opinion in an action for direct and secondary copyright infringement brought by Universal Music Group, a producer of music videos, against Veoh Networks, the operator of a publicly accessible website that enables users to share videos with other users. In the superseding opinion, the panel affirmed the district court’s summary judgment. The panel wrote that although Veoh had implemented various procedures to prevent copyright infringement through its system, users of Veoh’s service had been able, without UMG’s authorization, to download videos containing songs for which UMG owned the copyright. The panel affirmed the district court’s holding that Veoh was protected by the Digital Millennium Copyright Act “safe harbor,” 17 U.S.C. § 512(c), which limits service providers’ liability for “infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider.” Agreeing with the Second Circuit, the panel rejected UMG’s arguments that the safe harbor did not apply because: (1) the alleged infringing activities did not fall within the plain meaning of “infringement of copyright by reason of the storage [of material] at the direction of a user;” (2) genuine issues of fact remained about whether Veoh had actual knowledge of infringement, or was “aware of facts or circumstances from which infringing activity [wa]s apparent;” and (3) Veoh “receive[d] a financial benefit directly attributable to . . . infringing activity” that it had the right and ability to control. The panel affirmed the district court’s Fed. R. Civ. P 12(b)(6) dismissal of claims for vicarious infringement, contributory infringement, and inducement of infringement against three Veoh investors. The panel also affirmed the district court’s denial of Veoh’s request for attorneys’ fees under Fed. R. Civ. P. 68 on the basis that fees were not properly awardable under the Copyright Act. The panel remanded to the district court to analyze separately whether Rule 68 costs, excluding attorneys’ fees, were warranted.
This opinion or order relates to an opinion or order originally issued on December 20, 2011.