Intermediary Liability And Copyright

Date : July 23, 2019

Introduction

“Intermediary liability means that the intermediary is held liable for everything its users do.”  - Rebecca MacKinnon

This quote explains what intermediary liability entails for service providers. However, before getting into the concept of intermediary liability, we first need to understand what exactly an intermediary is and what it entails within its ambit.

The Information Technology Act, 2002 defines the term intermediary under section 2(w) as follows- “(w) "Intermediary" with respect to any particular electronic message means any person who on behalf of another person receives, stores or transmits that message or provides any service with respect to that message;”

Now that the meaning of intermediaries is clarified, we can delve into the concept of intermediary liability. As explained through the quote above, intermediary liability is when the intermediary service providers are held responsible for any material breaching copyright violations put up by their users. However, there are various guidelines that have been laid down regarding this liability of intermediaries.

 

Analysis

Relevant Provisions

(a) Copyright Act, 1957 –

In 2012, there was a major amendment to the Copyright Act, 1957. As per the amendment, Section 52 lays down a number of cases where infringement of copyright is exempted. Section 52(1)(c) talks about intermediary liability and states that such intermediaries are not responsible unless they are aware or have reasonable grounds for believing that such storage is of an infringing copy:”

(b) Information Technology Act –

Section 79 of the Information Technology Act exempts network service providers or intermediaries from liability if it is proved that the offence or contravention was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence or contravention.

The explanation to this Section provides that the network service provider is an intermediary. Therefore, when we look at all these provisions, it is clear that the intermediary has received protection from copyright infringement under the statute. However, there is an important caveat to this protection- the intermediary can be protected only if it was not aware that the information hosted by it was copied material.

In order to understand this concept further, we can look at a few cases.

For instance, in the case of Super Cassettes Industries Ltd. v. Myspace Inc. & Anr.[1] A division bench of the Delhi High Court held that that intermediaries could be held liable only when-

(i)        They have actual or specific knowledge and not constructive knowledge of the existence of infringing content on their website.

(ii)       They do not take any steps to have such content removed.

Another case that is important is the case of Kent RO Systems Ltd. & Anr. v. Amit Kotak & Ors.[2], where the court held that the intermediary is obligated to remove information hosted on its portal only on receipt of an order from the relevant governmental agency or pursuant to a court order.

Therefore, looking at the above cases and reading them along with the statutory provisions we can see that in India, intermediaries cannot be held liable unless they had proper information, and unless proper order is given by the requisite authority.

 

Situtaion in other Countries

United States

Section 512(c) of the Online Copyright Infringement Liability Limitation Act, part of the Digital Millennium Copyright Act, 1998 makes intermediaries liable for infringing material if they receive a financial benefit directly attributable to the infringing activity, or are aware of the presence of infringing material or do not act expeditiously to remove the material upon receiving notice of the same.

In the case of Viacom Int’l Inc. v. YouTube Inc.[3] the court held that in order to hold intermediaries liable for copyright infringement, the copyright owner has to prove that such intermediaries had specific knowledge of infringement. The intermediary may be held liable if it had specific knowledge of infringement.

Why is intermediary liability relevant today?

The European Union recently passed a controversial amendment to the European Union Directive on Copyright. Article 13, (Article 17 in the amended version), the provision around which the controversy is centred, makes online platforms liable for copyrighted content hosted on their sites, which means that they will be liable for the copyright infringements perpetrated by their users.[4]

This is expected to have far-reaching effects, particularly on small operators who do not have the monetary capacity to put in place the technology and resources required to comply with the new directives.

The passing of this directive was hotly contested and a petition to ban the same was signed by millions of people.[5] It is popularly called the “meme ban”, reflecting its widespread cultural effect.

At present in the United Kingdom, there is an availability of injunction against service providers, if they have knowledge of the infringement.[6]

However, within two years it will have to modify its legislation as per the directive, which will place upon the intermediaries a much higher degree of liability than there is at present, even though the current provisions seem to be more reasonable. This would be the case with most EU countries.

Coming back to India, the draft Information Technology [Intermediaries Guidelines (Amendment) Rules] 2018 propose that intermediaries must deploy automated tools to identify and remove public access to unlawful content, and enable tracing of the originator of the information on its platform.[7]

These rules are not in consonance with the view expressed by the Supreme Court[8] which says that it is unreasonable to expect intermediaries to judge the legitimacy of each item given high volumes of content.

Therefore, a trend towards more stringent intermediary liability can be seen, which may lead to various problems. There is an urgent need to come up with a balanced intermediary liability regime to protect interests of all sides, and to ensure that there is no adverse effect on any party.

Author: Mridula Dalvi, Intern at Khurana & Khurana, Mumbai. , Intern at IP and Legal Filings  and can be reached at support@ipandlegalfilings.com.

References:

[1] 2011 (48) PTC 49 (Del)

[2] CS(COMM) 1655/2016

[3] 07 Civ. 2103 (S.D.N.Y. April 18, 2013)

[4] https://www.wired.co.uk/article/what-is-article-13-article-11-european-directive-on-copyright-explained-meme-ban

[5] www.change.org

[6] L'oréal S.A and Ors. v. eBay International Ag. And Ors.

[7] https://www.prsindia.org/billtrack/draft-information-technology-intermediaries-guidelines-amendment-rules-2018

[8] Shreya Singhal vs. Union of India AIR 2015 SC 1523

[9] Bibliography Acts- (a)The Copyright Act, 1957 (b) The Information Technology Act, 2000 (c) Digital Millennium Copyright Act, 1998, (United States) (d) European Union Directive on Copyright

[10] https://www.wired.co.uk/article/what-is-article-13-article-11-european-directive-on-copyright-explained-meme-ban

[11] https://www.prsindia.org/billtrack/draft-information-technology-intermediaries-guidelines-amendment-rules-2018

[12] change.org