Updated on 5/19/08 with comment from RealPlayer (see below)

Users of YouTube and other video-sharing sites could face $750 per clip penalties if they have watched a video that was uploaded without the copyright holder's permission.

Copyright infringement in the United States strict liability offense. What this means, is that users are liable when they illegally copy works, even if they're not aware that this is wrong, or that the work is protected by copyright.

As an example, let us consider the popular video sharing website YouTube.

Every week, 6 days after the show airs, HBO uploads the most recent episode of "Real Time with Bill Maher." However, within a few hours of the show's TV broadcast, a number of other users upload copies that they have recorded with their computers.

When a user visits YouTube, and searches for "Bill Maher", he will see a large number of results - some of which will be for official content uploaded by HBO, and the vast majority of which is for copyrighted content illegally uploaded by other users.

According to a strict reading of the copyright laws, and discussions with legal scholars, users could unknowingly be liable if they click on the wrong YouTube link. The fact that they're not aware that a video was illegally uploaded is irrelevant. All that matters is that they clicked on a link, and watched the video.

For BitTorrent websites like The Pirate Bay, where the vast majority of the files are illegal, it is at least semi-reasonable to expect most users to know that they are engaged in an illegal act. However, for sites like YouTube, where both legal and illegal content are available on the same platform, it is significantly trickier. How exactly, are the less-tech savvy amongst us supposed to determine if a file is legal to watch?

Copytraps

The issue of unintentional home user liability is the subject of a recent paper by Ned Snow, a law professor at the University of Arkansas. In "Copytraps", Professor Snow argues that copyright law unfairly exposes end users to significant liability, for actions which they have no reason to believe are illegal.

Professor Snow puts forth the following example: A user visits Google, and searches for the name of a band they like. One of the first results takes them to a website, named "legal-music-downloads.com". Once there, the user hands over her credit card, and pays $.99 per song to this unknown website. Now, imagine that "legal-music-downloads.com" is in fact a fraudulent website run by a couple guys in Eastern Europe. They download files from BitTorrent, and then illegally re-sell them to American consumers.

As Prof. Snow describes, the fact that the end user thought she was participating in a legal purchase is irrelevant. All that matters is that she has copied (downloaded) a copyrighted work, which was not sold through legitimate means. This user could be liable for up to $750 per song.

This may sound crazy, but it's completely possible under the existing system. Yes, the RIAA and MPAA have for now, gone after people who were sharing files. However, there is nothing in the law forcing them to stick to just those users. They are legally permitted to go after downloaders too.

Experts respond

To make sense of this, I turned to a few other experts in copyright law. First, I spoke with Corynne McSherry, a staff attorney at the Electronic Frontier Foundation. McSherry told me that the scenarios I outlined were not beyond imagination, and quite possible under existing copyright law.

As an example of copyright holders going after downloaders, she pointed to a 2006 attempt by the Embroidery Software Protection Coalition to get the identities of all the participants of an online embroidery discussion forum. In support of their claims, the Coalition compared the stitchers' online screeds to "terrorist activities" and accused them of posting slanderous statements "that marched across the Internet bulletin boards and chat groups similar to Hitler's march across Europe."

The Embroidery Coalition, following tactics similar to the RIAA and MPAA, threatened grandmothers with lawsuits for downloading copyrighted embroidery patterns from the Internet. These little old ladies were given the choice of either paying a few hundred dollars, or facing a lawsuit.

Luckily, the lawyers at the EFF were able to get the Coalition to back down, but this does at least prove that left unchecked, copyright law can be used to go after the end users.

The EFF's McSherry told me that the penalties in copyright law were "not like many other areas of the law where you have to show harm." Thus, illegally copying a song that is sold for $.99 at the iTunes store can still lead to a $750 per song fine. McSherry labeled this as "completely disproportionate" and said that because of this, "for regular people, who don't have thousands of dollars, the inclination is to settle (the cases), rather than to fight."

YouTube users at risk

While Professor Snow focuses on the example of lying websites, I am personally far more interested in liability for users of major sites like YouTube.

Sherwin Siy, an attorney with Public Knowledge, told me that my YouTube fears might be overblown. Siy points to a difference between downloading a video, and streaming it. He told me that "arguing that a buffer copy (for a streaming view) is a duplication, that's even more of an uphill (battle), and the potential awards might not be worth the attorneys fees." He added that "merely watching a video on your screen, authorized or not, isn't going to be an infringement if you're not publicly performing or copying it."

Siy also noted that copyright law does allow for a reduced $200 per work penalty for infringement, if the pirate can prove that they had no reason to believe that they were infringing.

Updated:

Siy clarified his point in a followup email: "For instance, if my local network TV affiliate were to broadcast an infringing copy of a TV show, and I were to watch it at home, I would definitely not be liable. The copytraps idea might come into play had I (however innocently) taped or DVR'd the broadcast."

While Siy makes some good points, I will have to disagree with him on the issue of viewing vs. downloading. There are many off the shelf tools that allow users to download YouTube videos. The most widely deployed of these is RealPlayer, which automatically makes allows the user to make a local copy of every YouTube video that a user watches. YouTube has no way of knowing if someone is streaming or downloading a video - as it's simply a case of transferring bits over a wire. If the RIAA or MPAA ever subpoenaed YouTube's logs, they wouldn't be able to differentiate these users either.

YouTube's Position

A few years ago, a number of major firms started threatening Linux end-users with patent lawsuits. In response, one or two Linux companies to shield their customers from such lawsuits. That is, buy Linux from us, and we'll cover any potential legal bills.

Thinking along these lines, I reached out to YouTube to get their perspective. I wanted to know if they would offer to foot the bills of users who were sued after watching a video on their site. I also wanted to find out if YouTube has ever disclosed a list of infringing viewer IP addresses to a copyright holder.

YouTube's spokesperson ignored my actual questions, and instead told me that:

We prohibit users from uploading infringing material, and we cooperate with all copyright holders to identify and promptly remove infringing content as soon as we are officially notified. As a company that respects the rights of copyright holders, we expect to continue to take the lead in providing state of the art DMCA tools and processes for all copyright holders.

While the liability for end users remains unclear, there is certainly the potential for some nasty lawsuits, should the copyright owners decide to go down that path. In a conversation with me, Prof. Snow described a scary future with Copyright Trolls who delay sending takedown letters to websites, so that the number of infringing users (who the company can later go after) will increase.

A scary future indeed.

Update: Jeff Chasen, a VP at RealPlayer contacted to let me know that I had erred in my original blog post. He told me that:

RealPlayer does not automatically download or make local copies of videos from YouTube. RealPlayer 11 gives users the option of downloading the video they are watching, but it requires that the user click a button to initiate the download. No copies or downloads occur until a user explicitly takes an action.

I do stand by my original point though, which is that YouTube (and any copyright holder who gets a list of the views/downloads via a subpoena) has no way to tell when a user is watching a video, and when a user is downloading them via a single-click RealPlayer tool.