Andrew Bridges is the Google counsel on the board for this video and he brings up a couple very good points in favor of Google.  He points out one of Perfect 10's arguments, for the fourth factor of Fair Use, that Google's Image Search could severely hurt the market for a cell phone in the UK.  He pointed how ridiculous it would be if this large, very useful image search, could fail because of a single cell phone deal.  Clearly this shows that such an argument, from Perfect 10, should not be seriously considered.  He goes on to point out the Perfect 10 starts to combine trademark law with copyright law when they argue about framing.  He makes a very good case that the framing is very similar to hyperlinking, which is clearly not anywhere near copyright infringement. 

            Russ Frackman is the Perfect 10 counsel and brings up a potentially harmful argument against Google.  He argues that Google's linking is direct infringement because it links to copyrighted materials.  He cites a very good example of a South Park website that claims that it is not infringing because it is not hosting the video.  The video is imbedded on the page, but they do not actually host the video.  While this at first seems like a very strong argument, he fails to acknowledge the clear differences between Google and the South Park website.  Google Image Search is not directly linking to the website; rather a computer program is creating the thumbnails and the links.  The South Park website is purposefully linking to an infringing video.  He also points out that Google gains a lot by having their name on the screen in framing and the Image Search in general.  They are not merely providing a service.  While this is obviously true, it does not really hit the important issues.  Obviously the Image Search is important and beneficial to Google; if it was not, they would not have it.  It does not, in any way, contribute to the creation or even the linking to the infringing images.  For that reason alone, that aspect should not hold much importance.

 

            This source is a blog which highlights several opinions on the decision.  Some agree with my thesis while others disagree.  I will use the supporters as examples to prove my thesis and will rebut the opinions of the dissenters.  William Patry offers the opinions in the first two blog entries on the page.  Both are highly critical of the Court's decision in favor of Google.  First he points out that if you tally up the factors, Google received none and Perfect 10 received three, according to him.  This argument is highly flawed because it was actually 2-1 in favor of Google according to the case.  The second argument stated that the Court erred in its assessment of Google as "consumptive."  The case has a good explanation for why this is their opinion and it seems valid.

            John Ottaviani argues that using Copyright Law from the 1970s is not very relevant for this type of technologically-based case.  He fails to realize that it is the concept of what is copyright that has carried over for that long of a time.  Copyright law would have changed had it not been working.  They also used contemporary examples in the decision. C.E. Petit argued against the first and fourth factors of Fair Use.  She argues that they are very similar and will almost always favor the same side.  According to her, the judge used the same facts for each factor and that they are likely being double counted.  She is probably right that these factors overlap and more than they should.  They should, however count for more because of how important they are to Fair Use.  The similarity was likely on purpose.

            Martin Schwimmer wrote, "The thought occurs as I read this section that Google makes this go away by cropping a corner off the thumbnail (or perhaps reproduces thumbs using sepia tone)."  This is amusing, but at the same time, it makes a very good point.  Much of the argument centers on whether or not the thumbnails are the same as the image.  Removing a corner would actually resolve this argument.  It would not change the function of the thumbnails.  This shows me that the argument is being over thought and that thumbnails shouldn't be considered the same.  If such a small alteration can change an opinion that greatly, then it should not even need to be done.

 

           Eugene Goryunov gives her opinion on Perfect 10 v. Google and gives an extensive description of the case, the decisions, and the progression of Copyright Law.  In general, he strongly agreed with my thesis and agreed that Google should not be found liable.  His analysis centers on his assessment of the Court's decisions.  His first assessment is that the judge used a proper application of the "Server" test to in-line linking because "Google's use of in-line linking and framing does not constitute a "display" of images and cannot serve as a basis for finding direct liability.(516)" This supports my thesis because this holds that Google is not directly liable for copyright infringement.

            Goryunov follows this by offering his opinion on the Court's assessment of Fair Use.  He disagreed with the district court's application of the first and fourth factors of Fair Use.  According to Goryunov, "the court abused its discretion by apportioning excessive weight to the commercial nature of Google's secondary use and ignoring the highly transformative secondary use of the technology, which weighs in favor of fair use as a matter of law."  Thus, he agrees with me that the transformative use is more important than the commercial.  This supports my thesis in that the first factor leans towards Fair Use and therefore supports Google.  With regards to the fourth factor, Goryunov stated that, "the court abused its discretion in finding that Google's secondary use of thumbnail copies of P10's full-size images had an adverse effect on P10's market." He continues by arguing that Google's image search actually would not and does not have an adverse effect on Perfect 10's sales.  This also supports my thesis since it claims the fourth factor is Fair Use and is thus supporting Google.

            He continued by speculating what he believes could be a useful addition to Fair Use.  He states that some people have suggested adding a fifth factor that would use public policy as a guiding force.  This would help Google and my thesis, for Google's image search helps the public obtain images greatly, even those which are not infringing on copyright.  He goes on to agree with the District Court's decision to find Google not secondarily liable.  This pretty clearly also supports my thesis and Google's argument.

 

Thesis: The Appellate Court made the correct decision by ruling in favor of Google; their use of thumbnails is not any form of copyright infringement due to Fair Use.

       Perfect 10, an adult entertainment website, sued Cybernet Ventures, an online age verification service, for infringing photographs found on its affiliated websites.  In this case, the court refused to provide Cybernet with safe harbor protection under the Digital Millennium Copyright Act (“DMCA”).   The reasoning of the court provides some insights into whether or not YouTube will be protected by the DMCA.

       In determining whether Cybernet would be afforded safe harbor protection, the court analyzed each of the DMCA’s requirements.  The court looked to the legislative history as guidance and relied upon Congress’ mandate to “take a common-sense, fact based approach not a formalistic one.”  Overshadowing much of the court’s discussion was evidence of Cybernet’s attempt to undermine the intent of the DMCA to forge a working relationship between copyright holders and service providers.  Of particular importance was the fact that Cybernet, after receiving notice from the copyright holder, failed to expeditiously remove infringing material from its system evidencing bad faith and undermining congressional intent. 

       Also significant for purposes of my paper is the Cybernet court’s analysis of the DMCA’s direct financial benefit test.  Here, the court found a direct financial benefit where Cybernet’s income was based on the number of new users to affiliated sites including infringing sites.  The court found that the quality of Perfect 10’s copyrighted images attracted new subscribers.  Thus, the infringing images acted as a draw which increased Cybernet’s revenue.  This case could be problematic for YouTube since Viacom has argued that the infringing works on YouTube’s website attracts more users which in turn drives higher advertising revenue.  Accordingly, the manner in which YouTube generates its revenue will be highly relevant to the financial benefit test.  Whether YouTube satisfies the financial benefit test will be analyzed under Cybernet’s reasoning, other court opinions, and the legislative history that interprets the direct financial benefit test.

Perfect 10 v. Google, Inc. Order by United States District Court of California. February 2006.

In August 2005, Perfect 10 sued Google and Amazon for displaying thumb nail images. Perfect 10, an adult photography company, makes money by selling rights to copyrighted material. Perfect 10 sought an injunction and compensation from Google on the grounds that Google was illegally displaying thumbnail images of copyrighted Perfect 10 photos and linking to third party sites that further illegally host copyrighted materials. Google asserts that it does not infringe directly because it does not create the image that the image search pulls up and displays.

The court issued a preliminary injunction ruling that the thumbnail images from a Google image search did constitute copyright infringement, but the links provided to the full images did not. Google admitted that it created and stored the thumbnail images on its own servers. Thus, as to the thumbnails, Google distributed infringing copies of Perfect 10’s images. The links to the full size photographs do not involve any creation or dissemination even though there is a local browser caching. This local browser caching constitutes fair use. The court found that the use of the thumbnails was not fair use since Google made money from their creation and the thumbnails were not transformative because P10 also licenses thumbnail images. Thus, users could circumvent P10’s licenses by downloading the free thumbnails. The Court did note that Google does “provide great value to the public” as a search engine, stating that “search engines have become essential sources of vital information for individuals, government, non-profits and businesses….” Ultimately, Google’s thumbnail images did economically harm the value of the P10 images. Thus, the Court enjoined Google from further dissemination of the thumbnail images. In the case of AFP, Google must clearly not host and serve the image. However, the act of organizing the web and making news more readily available to users, perhaps even with leads and headlines seems reasonable.

Schmidt, Eric. “Conversation with Eric Schmidt Hosted by Danny Sullivan,” interview by Danny Sullivan (9 August 2006) (http://www.google.com/press/podium/ses2006.html) (last accessed 26 November 2006).

In this interview of Google CEO, Eric Schmidt, by Danny Sullivan at the Search Engine Strategies Conference, Schmidt discusses issues facing Google. He addresses everything from click fraud to protecting user private data. Ultimately, Schmidt underscores Google commitment to provide to Internet users the most relevant information, whether it is news, ad-content or search results. He does confess to a new emphasis on profitability.

Most relevantly, Schmidt addresses the pending lawsuit with AFP. Schmidt asserts that Google understands and wants to be sensitive to various conceptions of rights and copyrights. Schmidt also admits that there is an underlying ambiguity associated with fair use but appears to remain firmly committed to Google’s definition of fair use. Schmidt asserts that Google’s use of parts or snippets of copyrighted materials, like books and news, is not only fair use, but a vital research and knowledge tool. In the interview, Sullivan, expressly asks Schmidt about the AFP lawsuit, and whether the deal between Google and the Associated Press was made to “solve a legal issue.” Interestingly, Schmidt answers that for Google, litigation is just another way of making a business deal. In other words, the AFP lawsuit was not unexpected, but rather something Google understood might occur given its new use of technology. The deal between Google and AP addresses these same issues in a different way – a way that attempts to foreclose litigation and to reach an amicable resolution of essentially the same issue.

            Despite its altruistic mission of making relevant knowledge available worldwide, Google is ultimately a profit making corporation. Schmidt’s comments reveal that Google’s rise from search engine to a dominant corporation rests in its aggressive and liberal interpretation of fair use. Thus, the dispute with AFP could be settled if Google could reach a satisfactory monetary agreement with AFP as it did with the AP. No matter what social cause the EFF or other bloggers ring regarding the global importance of Google and free speech and the public’s right to knowledge, Google is just another company trying to impress its shareholders with its profitability.