The 9th U.S. Circuit Court of Appeals' ruling in Mavrix Photographs v. LiveJournal “will be a lifeline to content creators who are being destroyed by mass infringement online,” Mavrix lawyer Peter Afrasiabi of law firm One e-mailed us Monday. A three-judge 9th Circuit panel ruled Friday that Digital Millennium Copyright Act Section 512 safe harbor provisions don't shield LiveJournal from infringement lawsuits in some instances because the company's cadre of volunteer moderators had a significant amount of control over the nature of user-generated content posted on the social media platform (see 1704100040). “LiveJournal, like so many online businesses, encourages users to upload content they don’t own so LiveJournal can display it and reap advertising revenues,” Afrasiabi said. “Then they try to hide behind the DMCA safe harbors to avoid liability for known infringements. This decision is an important first step in putting an end to that business model.”

Moderators can be considered to have enough knowledge of copyright infringement on a website to undermine an ISP’s Digital Millennium Copyright Act Section 512 safe harbors, the 9th U.S. Circuit Court of Appeals ruled in Mavrix Photographs v. LiveJournal. Paparazzi company Mavrix sued in 2014 over posts on LiveJournal’s “Oh No They Didn’t!” gossip blog that contained its photos of Beyonce and other celebrities. LiveJournal argued it qualified for DMCA safe harbor protections because it didn’t have direct knowledge of the infringing blog posts. Mavrix contended LiveJournal’s team of volunteer moderators, who had the power to review blog posts for compliance with the platform’s terms of service, would have been aware of the infringing content. U.S. District Court in Santa Ana, California, ruled in 2014 that LiveJournal qualified for safe harbor protections because the blog posts were user generated and not solicited by the platform. The 9th Circuit disagreed. “The moderators performed a vital function in LiveJournal’s business model,” said Judge Richard Paez for the three-judge panel. “There is evidence in the record that LiveJournal gave moderators express directions about their screening functions, including criteria for accepting or rejecting posts. Unlike other sites where users may independently post content, LiveJournal relies on moderators as an integral part of its screening and posting business model.” Judges Morgan Christen and Harry Pregerson also heard the case. Posts “are at the direction of the user if the service provider played no role in posting them on its site or if the service provider carried out activities that were 'narrowly directed' toward enhancing the accessibility of the posts,” Paez ruled. "The ONTD moderators manually review submissions and publicly post only about one-third of submissions. The moderators review the substance of posts; only those posts relevant to new and exciting celebrity gossip are approved. The question for the fact finder is whether the moderators’ acts were merely accessibility-enhancing activities or whether instead their extensive, manual, and substantive activities went beyond the automatic and limited manual activities we have approved as accessibility-enhancing.” The 9th Circuit remanded the case to the district court for a jury trial using their safe harbors threshold test. “That moderators reviewed those submissions shouldn’t change the analysis,” said Electronic Frontier Foundation Legal Director Corynne McSherry in a Saturday blog post. “The DMCA does not forbid service providers from using moderators.” Many “online services have employees (or volunteers) who review content posted on their services, to determine (for example) whether the content violates community guidelines or terms of service,” McSherry said. “Others lack the technical or human resources to do so. Access to DMCA protections does not and should not turn on this choice.” LiveJournal and Mavrix didn’t comment.

Twitter dropped a lawsuit against the Department of Homeland Security and Customs and Border Protection after a summons seeking to unmask an account user critical of the government was withdrawn, the company said in a Friday filing. Twitter lodged the complaint the previous day with U.S. District Court in the Northern District of California, citing constitutional free speech protections (see 1704060070) in protecting the identity of user @ALT_uscis. In the Friday filing (in Pacer), Twitter said DOJ informed the company that CBP withdrew the summons. DHS didn't comment. In a statement, American Civil Liberties Union attorney Esha Bhandari, who represents @ALT_uscis, said the "speed with which the government buckled shows just how blatantly unconstitutional its demand was in the first place." She said the anonymity the First Amendment guarantees is vital when people criticize government. In a tweet, @ALT_uscis thanked Twitter and the ACLU "for standing up for the right of free anonymous speech."

Twitter is suing the Department of Homeland Security and U.S. Customs and Border Protection, which are trying to force the company to reveal the identity of Twitter user @ALT_USCIS that criticized departmental officials and the Trump administration, the company said in a Thursday complaint filed with U.S. District Court in the Northern District of California. "The rights of free speech afforded Twitter's users and Twitter itself under the First Amendment of the U.S. Constitution include a right to disseminate such anonymous or pseudonymous political speech," Twitter's complaint said. It said DHS and CBP shouldn't compel the company to reveal the user's identity "without first demonstrating that some criminal or civil offense has been committed." The company said CBP delivered a March 17 administrative summons, demanding the firm unmask the account. Twitter wants the court to declare the summons "unlawful and unenforceable." A DHS spokeswoman emailed that it doesn't comment on pending litigation.

Copyright Office interpretation of Section 111 of the Copyright Act isn't backed by plain text or consistently applied, FilmOn X said in a petition (in Pacer) for rehearing en banc filed Tuesday with the 9th U.S. Circuit Court of Appeals. It said the 9th Circuit's March 21 decision that it isn't a cable system and thus eligible for a compulsory license for broadcast programming (see 1703210023) doesn't offer a workable legal standard for eligibility for a Section 111 license. It said the court's "highly deferential treatment [of Copyright Office viewpoints] invades both Congress' power to enact law and the court's duty to interpret that law." FilmOn pointed to statutory licenses given AT&T's U-Verse and Verizon Fios but not to it as examples of inconsistency in granting of statutory licenses. The ruling "mildly endorses" the CO view that a cable system is inherently localized, but it ignored evidence FilmOn restricts retransmission to local communities and thus should be eligible for such a license, it said. Counsel for the appellants, a collection of broadcasters and programmers, didn't comment Wednesday.

The FTC and Amazon agreed to withdraw appeals of a federal court decision last year saying the company illegally charged parents for in-app purchases made by children who didn't have parents’ informed consent (see 1604270013). Commissioners voted 2-0 to withdraw the FTC appeal, the agency said in a Tuesday news release. Amazon had appealed the ruling that it violated the law, and the FTC appealed the court’s decision to deny an injunction stopping the website from similar conduct in the future. Ending the litigation allows Amazon to start providing refunds for about $70 million in eligible in-app charges made between November 2011 and May 2016, the FTC said. “This case demonstrates what should be a bedrock principle for all companies -- you must get customers’ consent before you charge them,” said Consumer Protection Bureau acting Director Thomas Pahl. Amazon didn’t comment.

Arris violated California consumer protection laws on false advertising and unfair competition when it shipped SURFboard SB6190 cable modems with a “serious defect” that makes them susceptible to “high spikes in network latency,” alleged a complaint (in Pacer) filed Friday in U.S. District Court in San Francisco seeking class-action status. California resident Carlos Reyna bought his SB6190 last year through Amazon, based on Arris statements that it was “a reliable cable modem” that would “perform as represented,” including “that it provided the ‘fastest speeds’ and the ‘most reliable connection’" to the internet, said the complaint. Since his purchase, Reyna “has repeatedly suffered abnormally high network latency and unreliable Internet connectivity, and continues to do so,” it said. Had Reyna known the modem was “defective,” he wouldn’t have bought it, it said. The modems “were not of the same quality as those generally acceptable in the trade,” nor were they “fit for the ordinary purposes of fast and reliable Internet connectivity for which the goods are used,” said the complaint. The SB6190s also “were not adequately contained, packaged, and labeled,” nor did they “conform to the promises and facts stated on the container and label,” it said. Arris “breached the implied warranty of merchantability, which by law is provided in every consumer agreement for the sale of goods,” the complaint said. Arris representatives declined comment Monday.

Mobile phone supplier BLU Products sells LTE devices in the U.S. and around the world that violate LG Electronics patents, LG alleged Monday in a motion (in Pacer) in U.S. District Court in Wilmington, Delaware, for permission to file a complaint under seal. LG for about a year has “repeatedly contacted” BLU to offer to license the phone supplier its “portfolio of standards-essential patents” on “fair, reasonable, and non-discriminatory terms,” said the motion. Portions of the complaint refer to confidential letters and a nondisclosure agreement LG sent BLU that are “not available through a public source,” said the motion. LG “would be harmed if this information became widely known,” it said. The squabble involves five patents "that have been declared as essential to the LTE standard," LG said in a Monday statement announcing the filing of an identical complaint against BLU at the International Trade Commission. "These are the first complaints LG has filed against another phone manufacturer," the company said. They were filed "because BLU, the largest seller of unlocked smartphones in the United States, has ignored all of LG's attempts to discuss a license to LG's intellectual property," it said. "LG is determined to enforce its intellectual property rights." BLU representatives didn’t comment Monday.

The Supreme Court has denied a petition for a writ of certiorari Monday from Universal Music Group's Capitol Records, EMI and other record labels seeking a review of the 2nd U.S. Circuit Court of Appeals' 2016 ruling against the labels' claims that Vimeo ignored infringing content posted to its website. The 2nd Circuit ruled that pre-1972 recordings included in videos are covered by safe harbor provisions in Digital Millennium Copyright Act Section 512 (see 1606160071). ABKCO Music & Records and RIAA backed labels' petition in amicus briefs. RIAA said the 2nd Circuit's ruling “upends the law on which the music industry has come to rely.” UMG and Vimeo didn't comment. The Supreme Court separately heard oral argument Monday in the TC Heartland v. Kraft Foods Group Brands patent venue law review case (see 1703270053).

AT&T won't directly or indirectly communicate or seek out competitively sensitive information from any multichannel video programming distributor, except for a lawful purpose, under the draft settlement (in Pacer) between it and DOJ filed Thursday in U.S. District Court in Los Angeles. The settlement -- which would end a 2016 lawsuit calling AT&T-owned DirecTV the ringleader of an information-sharing cabal of MVPDs trying to negotiate with regional sports network SportsNet LA (see 1611020034) -- also requires that the company institute an antitrust training and compliance program for executives and workers involved in content carriage negotiations, and name an antitrust compliance officer. In a statement, acting Assistant Attorney General-Antitrust Division Brent Snyder said, “When competitors email, text, or otherwise share confidential and strategically sensitive information with each other to avoid competing, consumers lose." AT&T in a statement said it was "pleased to have resolved the matter to the satisfaction of all parties."