Viacom: Google, YouTube Founders Willfully Ignored Infringement

With the release of court filings in the three-year old copyright infringement suit between Viacom (s VIA) and YouTube (s GOOG), we’ve seen the video share site argue that it is not liable for infringing videos uploaded to its site, as it claims protection under the safe harbor provision of the Digital Milennium Copyright Act (DMCA).

But in Viacom’s filing for a partial summary judgment, it makes the case that the site’s founders — and later executives of acquirer Google — turned a blind eye to copyrighted material in an effort to drastically grow the site’s user base. And since YouTube’s founders were aware of infringement and chose to do nothing about it, Viacom argues that the company is liable under the Supreme Court’s Grokster decision, which found that a site operating with the intent of infringing should not be protected by the DMCA.

Using internal emails that were passed between YouTube founders Chad Hurley, Steve Chen, and Jawed Karim, Viacom paints the picture of YouTube as a young company whose leaders were willing to grow its user base at any cost. For instance, the filing states that Chen urged his associates in one email to “concentrate all of our efforts in building up our numbers as aggressively as we can through whatever tactics, however evil.” The comment notably contrasts with future purchaser Google’s “don’t be evil” mantra — but more importantly, that attitude set the stage for a number of decisions that the YouTube founders made to grow at the expense of rights holders that it was infringing on.

YouTube didn’t always ignore the sensitive copyright issue. At one point during the summer of 2005, for instance, the site’s founders removed “some of the most obvious infringing video from YouTube to give the impression of copyright compliance,” the Viacom filing claims. However, they also chose to leave a good deal of infringing content up, believing that enabling users to search for less high-profile content was worth the risk. According to the filing, Chen wrote in an email, “That way, the perception is that we are concerned about this type of material and we’re actively monitoring it. [But the] actual removal of this content will be in varying degrees. That way . . . you can find truckloads of . . . copyrighted content . . . [if] you [are] actively searching for it.”

And at one point, YouTube founder Jawed Karim even uploaded infringing content to the site himself, which drew some criticism from Chen. In an email, Chen acknowledged, “We’re going to have a tough time defending the fact that we’re not liable for the copyrighted material on the site because we didn’t put it up when one of the co-founders is blatantly stealing content from other sites and trying to get everyone to see it.”

But for the most part, Viacom argues that the founders mainly did nothing about the copyright issue, even though internally they knew it was driving a large portion of their traffic. In an email exchange between the founders, Chen estimated that 80 percent of the site’s traffic was driven by pirated videos, and opposed taking them down proactively because, “if you remove the potential copyright infringements . . . site traffic and virality will drop to maybe 20% of what it is.”

While Viacom tries to make the case that YouTube’s founders knew the extent of the infringement taking place and chose to do nothing about it, it argues that Google was also well aware of the site’s infringement issues at purchase. As part of Google’s due diligence into YouTube, financial advisor Credit Suisse analyzed the site’s content and estimated that more than 60 percent of video views appeared on premium content, but YouTube only had a license for about 10 percent of those videos, according to Viacom.

Furthermore, Viacom claims that Google not only acquired YouTube despite those problems, but it chose initially to take the same approach as YouTube’s founders by ignoring copyright issues. Rather than screen videos prior to putting them on the site, as Google had done with its own video site, Google Video, it allowed YouTube to continue operating without any pre-emptive enforcement policies in place.

All this, Viacom argues, suggests that YouTube and Google should not be protected by the DMCA. Like Grokster, the company argues, “Google and YouTube were not just innocent and unwitting accomplices to infringement perpetrated by YouTube users. Defendants operated YouTube with the unlawful objective of using infringing material to explosively build their user base and become the dominant video website on the Internet.”