Intellectual Property Rights

Lenz v. Universal Music Corporation

815 F.3d 1145 (9th Cir. 2016)

Facts

Stephanie Lenz uploaded a twenty-nine-second home video to YouTube.
The video showed her young children dancing while Prince’s song “Let’s Go Crazy” played faintly in the background.
Universal Music administered relevant rights in the song.
It sent YouTube a takedown notice under the Digital Millennium Copyright Act (“DMCA”).
YouTube temporarily removed the video.
Lenz submitted a counter-notification, and the video was restored.
She sued Universal under Section 512(f), alleging that it knowingly misrepresented that the video was infringing.
Lenz argued that Universal had failed to consider fair use before sending the notice.
Universal contended that fair use was merely an affirmative defence and did not need to be evaluated beforehand.

Whether a copyright owner must consider fair use before issuing a DMCA takedown notice.
Whether fair use is legally authorised rather than merely excused.
What state of mind is required for liability under Section 512(f).

A DMCA notice must include a statement that the copyright owner has a good-faith belief that the identified use is not authorised by:
the copyright owner;
its agent; or
the law.
Fair use is a use “authorised by law.”
A copyright owner must therefore consider fair use before sending a takedown notice.
The owner need not conduct an exhaustive legal analysis.
A subjective good-faith belief that a use is not fair may be sufficient even if that belief is mistaken.
Liability may arise where the owner knowingly misrepresents infringement or is willfully blind to fair use.

Universal could not lawfully operate through an automatic rule that every unauthorised appearance of a song was infringing.
The statute required consideration of legal authorisation, and fair use was part of that inquiry.
Lenz’s video was short, non-commercial and contained only incidental background music.
These facts made fair use sufficiently plausible that it could not simply be ignored.
The Court did not require Universal to reach the correct legal conclusion in every case.
Copyright law can involve difficult judgments, and the DMCA allows action based on a genuine subjective belief.
The key question was whether Universal had actually formed a good-faith belief after considering fair use.
Evidence regarding its review process created a factual dispute.
A jury could examine whether employees considered the video’s context or simply confirmed that Prince’s song was audible.
The Court also recognised willful blindness.
A rights-holder cannot deliberately avoid considering obvious circumstances and then claim lack of knowledge.
At the same time, negligence or an objectively unreasonable mistake alone would not necessarily establish Section 512(f) liability.
The standard remained subjective to prevent routine takedown disputes from automatically becoming damages actions.
The decision sought to balance rapid copyright enforcement with protection against careless removal of lawful user expression.

The Ninth Circuit held that copyright owners must consider fair use before sending a DMCA takedown notice.
Fair use is legally authorised use.
A mistaken but genuine good-faith assessment may avoid liability, while knowing disregard or willful blindness may not.
Factual issues regarding Universal’s actual consideration remained for trial.
Use this case for: a rights-holder must form a good-faith view that a use is not fair before demanding removal under the DMCA.