Terms of Use and the Digital Millennium Copyright Act (DMCA)

Recently, several clients with existing websites asked me to review their online Terms of Use (“TOU”). While the TOU were respectable, there were areas where each could be improved. Interestingly, the area where all of the clients had made mistakes was with regard to the Digital Millennium Copyright Act (the “DMCA”). A summary of the DMCA is available from the U.S. Copyright Office.

Copyright law gives the creator of an original work certain exclusive rights for a specified period of time. These include, for example, the rights to publish, distribute, adapt and copy the work. Anyone who exercises one of these rights without authorization from the copyright owner has committed copyright infringement.

Online service providers usually have little control over the content that their users post. Unfortunately, some users are inclined to post others’ copyrighted works (such as music or videos) without permission. Service providers can operate their businesses effectively only if they have protection against such infringing activities.

DMCA Provisions

Enacted in 1998, the DMCA is divided into five Titles. Title II is the Online Copyright Infringement Liability Limitation Act. That Title added Section 512 (Limitations on liability relating to material online) to Title 17 of the United States Code. Section 512 created new limitations on liability in the following areas: transitory communications; system caching; storage of information on systems or networks at direction of users; and information location tools. If a service provider satisfies the requirements of that section, it will not be subject to monetary damages for copyright infringement, and injunctive relief will be restricted.

Section 512(c) (Information Residing on Systems or Networks At Direction of Users) specifies the requirements that have the greatest significance for TOU. Simplified a bit, that section protects service providers if:

• They do not know about infringing materials on their systems.
• They do not receive any financial benefit from the infringing activity.
• And they expeditiously remove or disable access to materials when properly notified of claimed infringement (colloquially, a “takedown notice”).

Furthermore, Section 512(c) requires that the service provider designate an agent to receive takedown notices and specifies, at length, six elements to be included in every notice. These elements pertain to:

1. Signing the notice.
2. Identifying the work that was infringed.
3. Identifying the infringing material.
4. Providing contact information for the complaining party.
5. Stating a good-faith belief of infringement.
6. Stating, under penalty of perjury, that the complaining party is authorized to act on behalf of the copyright owner.

Compliance Problems

This is where the existing TOU had their greatest trouble. Problems included describing takedown notice elements incorrectly, providing incomplete information about the designated agent, and not filing information about that agent with the Copyright Office.

It is ironic that a service provider can create trouble by describing the six notice elements incorrectly, because there is no requirement that the service provider describe those elements at all! Nevertheless, it makes sense to do so for efficiency and public relations. There is nothing to be gained telling the copyright owner that a notice is inadequate after the fact; it is better to describe the required elements up-front. Yet, the requirements are lengthy and are likely not to read properly if merely pasted into the TOU from the statute. As a result, there is a need to paraphrase or rewrite them, or an incentive to copy them from someone else’s website, which is an easy way to make a mistake.

Problems pertaining to the designated agent usually arise from ignorance of the law but are straightforward to correct. The website must display at least the name, address, phone number, and e-mail address of the agent. In addition, information about the service provider and the designated agent must be provided to the Copyright Office.

So if you are a service provider and plan to publish or revise your TOU, here are some recommendations to help you maintain protections provided by the DMCA.

• Describe takedown notice elements accurately.
• Provide required contact information for the designated agent.
• Designate an agent to receive notification of claimed infringement at the Copyright Office.

Check out all posts about DMCA takedown notices.

Dana H. Shultz, Attorney at Law  +1 510 547-0545  dana [at] danashultz [dot] com
This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact a lawyer directly.