Capitol Records v. Vimeo

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In Capitol Records, L.L.C. v. Vimeo, L.L.C., the U.S. Court of Appeals for the Second Circuit held that the “safe harbor” provisions of Section 512 of the federal Copyright Act covered state law claims against an online service provider for infringement of pre-1972 sound recordings.1 The evidentiary basis for this conclusion was slender. At the heart of the decision was the court’s surmise that Congress must have intended to cover state law “copyright,” because a contrary interpretation would undermine the policy objectives of the Digital Millennium Copyright Act (DMCA). In reaching its decision, the court apparently misread the Copyright Act and misunderstood both the nature of state law protection for pre-1972 sound recordings and the trade-offs that underlay the DMCA. We submit that this holding of Vimeo should not be followed by courts in other circuits, however sympathetic its policy underpinnings may be.2 It is doubtful that Congress considered state law “copyright” claims in passing the DMCA, or that it meant to include them under § 512. As a policy matter, it probably should have done so. But had it done so, Congress almost certainly would have said so explicitly, and would have altered other provisions of the DMCA to achieve a fairer result for owners of rights in pre-1972 sound recordings than the Second Circuit did. Congress could, for example, have protected pre-1972 sound recordings under § 1201 et seq., or otherwise provided those recordings with greater protection under the Copyright Act.3 The court’s focus on only one policy objective of the DMCA led it to interpret the Copyright Act in an implausible manner that benefits online service providers (OSPs), at the expense of owners of pre-1972 sound recordings, and the unique position of those recordings under copyright law. The central issues in this case that concern pre-1972 sound recordings are more appropriately under Congressional purview, as the Second Circuit should have recognized. And indeed, Congress should act to resolve these issues, particularly now, in view of the conflicting treatment of state law claims between Vimeo (concerning the safe harbor in § 512 of the Copyright Act)4 and the Ninth Circuit’s sweeping conclusion in Perfect 10, Inc. v. CCBill, L.L.C.5 that state law intellectual property claims are barred by § 230 of the Communications Decency Act (CDA).6 Accordingly, we recommend legislation to address this issue and to resolve other problems and inconsistencies that have arisen due to the peculiar situation of pre-1972 sound recordings and federal copyright law, as discussed below. In Part I, we discuss the legal status of pre-1972 sound recordings as necessary background to evaluating the Second Circuit’s decision in Vimeo. Part II discusses that decision in greater detail, and Part III explains the flaws in the court’s rationale. In Part IV, we address the Second and Ninth Circuits’ contradictory views concerning the treatment of state law claims against OSPs under § 512 of the Copyright Act and § 230 of the CDA. In Part V, we explain that it is up to Congress to change the role of pre-1972 sound recordings in the federal copyright scheme, and argue that the time is ripe for Congress to exercise that power. We conclude in Part VI.