Italian court finds Google and YouTube liable for failing to remove unlicensed content (but confirms eligibility for safe harbour protection)

Topazio, one of the soap operas
produced by Delta TV

Is YouTube an active host and, if so, ineligible for the safe harbour protection within Article 14 of the E-commerce Directive?

As readers with an interest in intermediary liability know, this is not a novel question: indeed, it has been already raised a number of times before national courts.

A few weeks ago, in a decision available on Marchi & Brevetti (sentenza 7 April 2017 No 1928, RG 38113/2013, Delta TV v Google and YouTube – judge rapporteur: Guglielmo Rende), the Tribunale di Torino (Turin Court of First Instance) revisited this issue, and provided an interesting response.

Readers might recall that this decision follows other interim rulings commented on this blog here and here.

Background

Back in 2013 Delta TV, which produces and owns the copyright to a number of South-American soap operas (including audiovisual works for the Italian, Monaco, Swiss, San Marino, Maltese, and Vatican markets) brought proceedings against Google and YouTube.

The claimant submitted that, if one searched Google's search engine by using the title of the soap opera at issue, on the first page of results there would be a link to YouTube where relevant episodes, accompanied by advertisements, would be available without Delta TV’s permission.

Google and YouTube responded that, among other things, Delta TV’s action should be dismissed on consideration that, upon receipt of valid [ie with the indication of the URLs relating to the various videos] takedown requests, they would have removed all the videos available on YouTube. In any case:

·       no liability would subsist in relation to either of them, because of the safe harbour regime within Decreto Legislativo 70/2003 [ie the piece of legislation by which Italy transposed the E-commerce Directive into its own legal system];

·       Delta TV did not submit any valid takedown requests before bringing proceedings. This was because a generic cease-and-desist letter without the indication of relevant URLs would not be adequate to trigger any obligations of removal on an intermediary like YouTube.

Following an interim phase [see above], the Turin Court of First Instance ruled as follows.

YouTube is not an active host

The judge noted at the outset that the videosharing service managed by YouTube should be in principle considered akin to that of a hosting provider, and – as such – eligible for application of the liability regime for hosting providers within Article 14 E-Commerce Directive/Article 16 Decreto Legislativo 70/2003. As a consequence, there could be no preventive, general monitoring obligation on YouTube, pursuant to Article 15 E-Commerce Directive/Article 17 Decreto Legislative 70/2003.

Having said so, the judge turned to consideration of whether YouTube should not be regarded as merely passive and neutral, but rather as an active host which, as such, would be ineligible for application of the safe harbour regime. This would be so on consideration of an allegedly active role on the side of YouTube to organize, and promote the content hosted on its platform.

The notion of ‘active host’ has been subject to criticism, and the Milan Court of Appeal actually called it “misleading” in relation to hosting providers (sentenza 95/2015).

According to the Turin Court a host would become active and - therefore - fall outside the scope of the safe harbour regime, when it intervenes by modifying or taking part in the elaboration of the content hosted on its platform.

This would NOT be the case when a hosting provider:

·       Indexes and organizes the content hosted;

·       Matches the content with advertisements similar to the content itself;

·       Concludes agreements with third-party uploaders to share advertising revenue;

·       Makes it possible for users to make the videos visible only to their own contacts, thus excluding general availability of videos to YouTube users and – by doing so – possibly hiding unlawful content.

According to the court, in fact, those above would be activities finalized exclusively to an improvement of the use, visualization and commercial exploitation of content, not elaborations that would alter the content of the video shared among users. More specifically [translation from Italian is mine]:

“only an intervention that alters a video uploaded by third parties is suitable to remove the exemption from liability within Articles 16 and 17 of Decreto Legislativo 70/2003.

Vice versa, an intervention that valorizes that video, by adding it to an index, matching it with advertisements adequate to the relevant type of video, or making it visible to similar videos – does not remove the neutrality [of the hosting provider], because it does not affect the content of the video.

Nor is it possible to repress the fact that such behaviours are all finalized to increasing the economic revenue of YouTube, as that is acknowledged by the law where, under Article 2(a) of Decreto Legislativo 70/2003, expressly refers – as the scope of application of such piece of legislation – to “the economic activities carried out online”, that must be identified as “information society services”."

In light of the foregoing, it follows that YouTube is eligible for the safe harbour regime within Articles 16 and 17 of the Decreto Legislativo.

Random soap opera (but featuring a Kat)

The specificity of the takedown request: indication of the relevant URLs

Turning to the content of a takedown request, readers will probably remember that Italian courts have adopted different approaches. While there is a line of cases that requires the indication of the URLs relating to the relevant content to be removed, there are also decisions [here, here, and here] that have found that the mere indication of the title of the work whose related videos must be removed suffices.

The Turin court recalled that the technical counsel it appointed had observed how a mere search of content by title would return a “very” significant number of false positives, ie content that should not be removed. According to the technical counsel it would not be possible to identify univocally all the relevant videos to be removed only by providing the commercial title of the works they relate to.

The court concluded that only indication of the URLs would allow the unequivocal identification of the content to be removed, although – of course – it would not help preventing future uploads through YouTube’s ContentID programme [what is required to this end, in fact, is the provision of relevant reference files against which possible matches can be found].

Indeed

The obligation to prevent future uploads

The court accepted that a platform like YouTube can prevent the re-uploading of content previously removed. Although the judge noted that a slight alteration of the video at issue would result in an alteration of the related HASH value, the provision by the relevant rightholder of reference files to be used within ContentID might reduce – yet not eliminate completely – this problem.

It follows that [once again, the translation is mine]:

“being this fully possible from a technical standpoint, yet with a slight risk of failure, there subsists on YouTube an actual legal obligation to prevent further uploads of videos already flagged as infringing of third-party copyrights”.

Further to Article 14 E-commerce Directive/Article 16 Decreto Legislativo 70/2003, a hosting provider is not responsible for the information stored at the request of third parties, but only upon the condition that it is not actually aware that the activity or information is unlawful.

“Such knowledge surely arises when a third party notifies an infringement of his/her copyright, and the uploader does not seriously or at all contest such notification.

Upon obtaining knowledge of the unlawful activity, the operator of the video sharing platform has the obligation … to act and cooperate with the copyright owner to bring to an end the unlawful activity at issue and avoid its repetition.”

What happened after Delta TV sued Google and YouTube

Delta TV claimed that, after serving its writ of summons to Google and YouTube [this, unlike the earlier cease-and-desist letter contained indication of the URLs relating to the videos for which removal was sought], there were several visualizations of the relevant videos. According to the court, Google and YouTube should have expeditiously removed the videos and prevented further uploads, but this only occurred in part. Among other things, the videos – while no longer visible from Italy – remained visible from abroad.

For these reasons, the court partly [it rejected the request for damages relating to missed compensation for private copying] accepted Delta TV’s request for damages for copyright infringement, and ordered Google and YouTube to pay EUR250k further to an equitative assessment of the price for the missed authorization for the use of Delta TV’s works.