On New Year’s Eve 2015, while most people were out celebrating, the Copyright Office quietly issued an notice of inquiry seeking public input on an incredibly important topic: the effectiveness of Section 512 of the Digital Millennium Copyright Act (DMCA). For those who didn’t skip their New Year’s Eve party to brush up on copyright policy, here’s a refresher: the DMCA is a law from 1998 that, among other things, grants online service providers (OSPs)—basically, all your favorite websites—a legal “safe harbor” from facing lawsuits arising from user copyright infringements. By limiting secondary infringement liability, the DMCA facilitated the growth of so-called “Web 2.0” platforms that allow users to create, consume, and share content over Internet. Without the DMCA’s protections, most of the websites you know and love would never have taken off, sunk by the threat of preposterously expensive copyright infringement lawsuits. Last week, Engine filed comments in the Copyright Office’s inquiry on behalf of a few of the incredible companies that have been able to flourish thanks, in part, to the DMCA’s protections: GitHub, Kickstarter, Medium, and Redbubble.
As the comments explain, the DMCA allows Internet companies to startup and thrive by lowering the risk that a company could face a ruinous copyright lawsuit because of alleged infringements occurring on a given website. Since a single copyright infringement can cost a defendant up to $150,000, the potential liability for a company that allows millions of users to share content is staggering. By granting OSPs a safe harbor from liability for user infringements if the OSP removes content that a copyright owner identifies as infringing, the DMCA drastically lowers the litigation risk of operating an OSP and helps drive investment in the sector. The immense value the Internet provides—both economically and creatively—is evidence that the DMCA has worked and continues to work as intended.
But, no law is perfect, and the DMCA could use a few adjustments to ensure that it continues to help the Internet thrive. For one, the “takedown and notice” process envisioned under the DMCA (in which a copyright owner gives an OSP notice of an alleged infringement by sending a form request to have the material removed, which the OSP must process if it wishes to retain the safe harbor) creates some perverse incentives that undermine copyright’s fundamental goal of promoting creativity. The number of takedown notices sent each year has increased exponentially since the DMCA’s passage, driven in large part by the similar growth in content available online. But, because there are almost no legal penalties for sending a false or fraudulent takedown notice, bad actors can deluge OSPs with false notices in an attempt to stifle competition, drown out dissenting voices, or punish critics. Without any legal deterrent, false notices are becoming commonplace; studies consistently show that around one-third of all takedown notices are deficient in some way. False notices hurt OSPs by increasing the cost of DMCA compliance and by driving away users who see their content improperly deleted.
Neither OSPs nor users have tools sufficient to combat takedown abuse. An OSP that tries to review notices for accuracy risks losing the safe harbor and facing massive legal penalties by refusing to process all received notices, and a user subject to a false notice must disclose personal information and essentially consent to a costly lawsuit if they want to have improperly deleted content restored. And, because wrongful deletions allow the victim to recover only the actual damages lost by virtue of the deletion, it’s economically irrational for any individual user to bring an expensive lawsuit for a false deletion.
For a law that was implemented when only around 40 percent of the population used the Internet (as compared to 84 percent today), the DMCA has aged quite well. The more than 60,000 companies that rely on its protections have all benefitted greatly from its regime of limited liability, as have the millions of Internet users that depend on OSP services to communicate and create. While the Copyright Office would be wise to recommend fixes to the DMCA’s notice and takedown process to discourage bad actors from abusing the system, it should resist the urge to fully disassemble a system that has worked quite well for so many Internet users.