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Posted: January 28, 2014

The perils of third-party IP policy shifts

What it could mean for your business

Peter Lemire

A client recently gave me a head's up about some new developments in YouTube’s Content ID System that was causing an uproar in the gaming community and with others who monetize their YouTube videos.

The conflict stems from what appears to be over-aggressive actions on YouTube’s part to attempt to deal with copyright infringement on its service. While YouTube’s actions may not directly affect a lot of mainstream businesses, it can serve as a good lesson for those that use third-party providers to host and disseminate content for their business and how a change in policies by these third parties can radically affect one’s business.

It all started in early to mid-December when content owners started receiving notices that their vlogs (video blogs) were flagged for violating copyright law. As a result the content was either removed or all revenue created by the post through the hosting of ads was funneled to the copyright owner (often without the copyright owner's request).

The main problem with the system is that it is automated and apparently isn’t triggered by a request from the copyright owner. Therefore, there have been a lot of questionable flagging, some of which most likely constitutes fair use. This was one of the more humorous responses (at least in my opinion) (Caution NSFW).

I like the example of a video interviewing representatives from the game Tomb Raider that gets flagged because there are images of the game and sound from the game in the background. Others that have been flagged are reviews of products that might include a brief clip or a screenshot of a user interface.

The YouTube policy once again puts the concept of fair use in the spotlight. The fair use doctrine allows for use of copyrighted works without the copyright owner's permission in certain circumstances. In general, use for purposes such as criticism, comment, news reporting, teaching, scholarship or research are generally not considered an infringement of a third party's copyright. The rationale is that the third party use is not merely to copy but to use limited pieces of the work in a transformative way by incorporating it into a new work.

The trick is, in an age where so much content is being generated, how do you separate the truly infringing works from those that would fall under fair use? With millions and millions of videos on YouTube, it is certainly a daunting task. Often, companies cast a very broad net with the knowledge that some legitimate use will be included.

The YouTube situation is another manifestation of the clash between content owners and those who wish to use small amounts of the pre-existing content in an on-line context. For example, an online retailer may want to show screen images of a certain video game to potential customers, or may want to create on-line reviews of the games or computer programs in order to help their customers make purchasing decisions.

In the context of a product review, the use of those images or video most likely would fall under the preview of fair use. If you are a big enough retailer, you may simply host those reviews on your own website and you most likely would not be affected.

However, smaller enterprises often times rely on YouTube to actually host the content, even if the company includes an embed link to the video on its home page. Therefore these companies and individuals are at the mercy of YouTube’s intellectual property policies and user agreements, which have and continue to evolve over time.

Essentially, a business that relies on YouTube: i) exclusively to provide its content based product; or ii) uses YouTube essentially as a hosting platform for its content-based marketing materials is always subject at some level to YouTube and Google’s (YouTube’s parent company) prevailing views of intellectual property rights. 

This can subject businesses to great harm, if the business has not made other preparations. For companies that provide video product reviews for their customers, they may want to consider hosting the content on their own website as opposed to exclusively on YouTube or Facebook. Failure to do so can put businesses behind the eight ball in the event the tech company they are relying on has a sudden change in policy.

Peter Lemire is a founding member of the intellectual property law boutique, Leyendecker & Lemire. Leyendecker & Lemire specialize in patents, trademarks and related complex civil litigation. Peter Lemire can be reached directly at 303.768.0641 or peter@coloradoiplaw.com. Visit www.coloradoiplaw.comfor further information, including Leyendecker & Lemire’s weekly blog, “Control, Protect & Leverage.” 

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