NEW YORK--The four largest record labels are unhappy with the way the courts have interpreted the Digital Millennium Copyright Act in recent years and may need to ask Congress for changes, according to Jennifer Pariser, the attorney who oversees litigation for the Recording Industry Association of America.

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The DMCA is just not providing the kind of protection against online piracy that Congress intended, Pariser said at a conference here on Thursday.

"I think Congress got it right, but I think the courts are getting it wrong," Pariser said during a panel discussion at the NY Entertainment & Technology Law Conference. "I think the courts are interpreting Congress' statute in a manner that is entirely too restrictive of content owners' rights and too open to [Internet] service providers.

"We might need to go to Congress at some point for a fix," Pariser added. "Not because the statute was badly drafted but because the interpretation has been so hamstrung by court decisions."

Following the panel, Pariser clarified that nobody at the RIAA has asked anyone on Capitol Hill for action and there's no plan to do so in the near future. But Pariser is among the first high-ranking entertainment executives to acknowledge that the battle to protect copyrights online, at least in the courts, has gone against content owners.

The DMCA is supposed to balance the rights of content producers with those of Web service providers. The law limits the liability of service providers for copyright violations committed by their users--provided they obey certain guidelines. For example, a service provider must remove infringing content quickly after being notified by a copyright owner and must boot users who repeatedly post pirated material.

Another requirement involved is known as "red-flag knowledge." Service providers can't have direct participation in infringement of course but also must not have knowledge or a reason to know of direct infringement.

This "red flag" requirement is at the core of where the courts have fallen down, says Pariser as well as others on the side of content owners. In the three most notable copyright cases on this issue, the judges have seemingly chopped away at the red-flag requirement, rendering it almost meaningless, say content owners.

In 2007, Viacom--the conglomerate behind MTV, Paramount Pictures, and Comedy Central--alleged in a $1 billion copyright suit that YouTube and parent company Google encouraged users to post unauthorized video clips copied from movies and TV shows. Viacom argued that the vast amounts of pirated video on the site--prior YouTube's development of a content filter--made it obvious to anyone of the copyright violations on the site. Viacom's lawyers also pointed to e-mails they claim shows YouTube managers were well aware that their service was loaded with infringing materials.

That kind of knowledge isn't enough to violate the red-flag requirement, according to District Judge Louis Stanton. A service provider must have knowledge of specific violations, and YouTube has always said that it is impossible for the company to determine whether a clip of a movie or TV show was uploaded illegally by some teen in his basement or it was posted for promotional reasons by a studio business managers and completely legal.

The judge in Universal Music Group's copyright suit against Veoh, as well as the judge in EMI vs. MP3tunes.com, issued similar findings. The courts have now determined the burden of policing the Web for infringing materials is the content owner and not the service provider.

Content companies think it is unfair for them to be required to spend resources on scouring the Web when their pirated work helps service providers make money. What they complain about almost as much is that after they notify a service provider of an infringing song or movie clip and they're removed, new copies appear almost immediately.