While the Internet promotes creativity and diffusion of ideas and entertainment, it has also enabled widespread dissemination of copyrighted materials. This class action lawsuit filed by Viacom International Inc. against Youtube in 2005 details the large-scale infringement Youtube has committed against music, film, and television companies. Although Youtube claims the websites purpose is to provide a forum for "user generated" material, the website contains innumerable copyrighted content. One could view clips from every genre of film or television and music clips from live shows or music videos. The plaintiffs hold Youtube responsible because they have enabled the format for such infringement without assuming the responsibility of monitoring the content. Furthermore, the plaintiffs argue "the availability on the Youtube site of a vast library of the copyrighted work is the cornerstone of the Defendant's business plan." Because Youtube makes significant profit off of these copyrighted works, they leave it to law abiding individuals and copyright owners to monitor the site. Even if the site removes the illegal content once notified, it usually returns to the site within no time. Moreover, Youtube has devised a feature that precludes copyright owners from finding infringing videos.

Viacom holds Youtube responsible because the site "knowingly reproduces and publicly performs the copyrighted works" and allows for extended distribution by enabling one to "embed" a video into another website. Although users are the ones who originally upload the content, Youtube converts the material to their own software format for display and reproduction. More importantly, such websites dissuade people from producing creative works in fear their copyrights will be violated and subject to egregious exploitation. Youtube acknowledges such illegality by sending cease and desist letters to people who provide software that can be used to make copies of Youtube's videos. Youtube sites that such copies are "unauthorized" yet the plaintiffs recognize that Youtube does not want such copies available because they need viewers for their own site to retain advertising revenues. As compensation for Youtube's violations, the plaintiffs order that the defendants device a system to prevent infringement and provide statutory damages for past and present infringements amounting to at least one billion dollars.

This lawsuit directly pertains to my paper in that it shows the legal measures the film industry is taking to combat piracy. Because my paper also focuses on the evolution of the industry in this online world, it is important to note the setbacks such technological develoments have caused for the industry.

On March 13, 2007, Viacom International Inc. filed a class action lawsuit against Youtube claiming massive copyright infringement by the defendant. Viacom filed the suit after sending takedown notices to Youtube demanding over 150,000 copyrighted videos be removed from its servers. In its complaint, Viacom notes “millions have seized the opportunities digital technology provides to express themselves creatively.” However, Viacom argues that Youtube has “harnessed technology to willfully infringe copyrights on a huge scale.” Youtube, the complaint urges, has built a library of infringing video clips in order to increase profit. Rather than attempting to remove all infringing videos, Youtube “has decided to shift the burden entirely onto copyright owners to monitor the Youtube site…to detect infringing videos and send takedown notices to Youtube.”  Viacom claims that Youtube increases its own value at the expense of copyright holders through the following methods: displaying advertisements above infringing videos, allowing users to embed infringing files onto other websites to draw users to Youtube and subsequently increase ad revenue, and permitting users to keep copyrighted videos hidden from the public. Viacom also notes that Youtube hosts the videos on its own servers, rather than simply acting as a conduit through which users pass files. This, in Viacom’s interpretation, makes Youtube the primary copyright infringer as it is the entity that is actually “performing” the copyrighted footage.

Youtube is one of the more influential websites in the development of Web 2.0. The website has essentially ushered in a new age of internet democratization by giving all users the ability to create and host content. Viacom’s complaint fails to take several important copyright issues into account, however, decreasing the lawsuit’s validity in several key issues. First and foremost, it assumes that Youtube has a clear intention of hosting copyright infringing content. While the court decided that Grokster, in MGM Studios v. Grokster, did not have sufficient non-infringing uses to escape liability, Youtube was developed as a website where average internet users can upload home videos. When asked about a memory associated with Youtube, users will typically discuss a humorous home movie they saw rather than an illegal movie clip. Similarly, Viacom assumes that Youtube is responsible for policing its site for all copyrighted material, failing to mention the DMCA once in the lawsuit. The Safe Harbor clause of the Digital Millennium Copyright Act, however, removes service providers from liability for any copyrighted material that users upload to their servers, specifically if the content provider removes material that a copyright holder insists is infringing. Youtube immediately removes material upon receipt of a takedown notice, typically without even ensuring that the entity which issued the notice is actually the copyright holder. Youtube is similarly protected by the Inducing Infringement of Copyrights Act, which protects sites which do not induce others to commit copyright infringement. Rather, Youtube encourages users to produce their own works.