Editors’ note: An update has been added at the end of this article.

Is it an infringement of copyright to post an excerpt from an online news article — including a link to its source — on a website, a blog, or an online forum? This practice is ubiquitous in online journalism, but its legal status has been in question since the hyperlink was invented.

Righthaven, LLC, a for-profit intellectual property enforcement enterprise, has taken straight aim at the practice of online excerpting and linking through litigation. Founded last year by the publisher of the Las Vegas Review-Journal, Stevens Media, and a group of copyright attorneys, the company has brought more than 230 copyright infringement lawsuits against website owners, bloggers, and even some individuals. All have been charged with posting unauthorized copies of copyrighted newspaper articles that have been assigned to Righthaven for the purposes of litigation.

The Electronic Frontier Foundation (EFF), an online civil liberties group, has denounced Righthaven as one of the new “copyright trolls.”

In response, Attorney Steven Gibson, Righthaven’s founder, says the company is merely “taking a fresh approach to help stem the tide of infringement on the Internet.”

Regardless of who’s right, these two opposing organizations are helping to define the legal use of digital content. The outcome of their legal battles may have important implications for legal rights and responsibilities of news organizations, bloggers, and commentors across Internet.

Cashing in on content

i-c32cb8b1d29c4ed39f31de79a91a5157-Righthaven-Lawsuits-250-thumb-250x161-2967.jpg

Righthaven has more than an approach; it has a business model.

The first 200 or so Righthaven lawsuits have been mostly brought in the District of Nevada, where the company is based, and typically allege that it owns copyright rights in an article published on the website of the Law Vegas Review-Journal. (Those rights were transferred to Righthaven by written agreement with Stephens Media.) The complaints assert that the named defendant or defendants are responsible for copyright infringement resulting from the posting of an unauthorized copy of the subject article, or a portion of the article, on the defendant’s website or other online service.

What makes these suits especially difficult for site owners is that most of them concern articles that have been posted on a defendant’s site by a third party, such as in a comment on the defendant’s blog or online forum. The complaints do not make the distinction between copies posted by the owner of an online site and the user of an online site — they only allege that an unauthorized copy of the article is posted on the defendant’s site and that the defendant is responsible for the infringement.

In general, the operator of a website is exposed to liability for copyright infringement even where the copyrighted work is posted by a user of the site. The Digital Millennium Copyright Act limits the liability of site owners who take advantage of its provisions and remove copyrighted content upon receipt of a “takedown” notice.

But Righthaven’s business model is to target websites that have not taken advantage of the so-called safe harbor provision in the DCMA. Significantly, Righthaven does not request that the articles be removed prior to filing suit.

Who pays

The defendants in Righthaven lawsuits for the most part have been individual website owners and relatively small institutions — often non-profits. The company has also been targeting the actual posters of copyrighted articles in some of its recent complaints.

One prominent exception to this pattern is the lawsuit filed against the Drudge Report, a leading conservative news aggregation website. On February 17, Drudge settled with Righthaven for an undisclosed sum.

Similarly, the group filed a lawsuit on February 24th against Citadel Broadcasting Co., owner of a major radio network, over the posting of a copyrighted photograph on the website of one of its stations.

According to one of several websites that track Righthaven lawsuits, the company follows the filing of a complaint with a demand for damages ranging from $75,000 to $150,000, and pressures for a quick settlement.

In addition to damages, Righthaven often seeks the transfer of the defendants’ domain names. This is an unusual demand that critics have charged is questionable under the law and designed to intimidate unsophisticated defendants and add to the pressure to quickly settle.

Early Success

i-0583527624b7ee5a5661f23bcdfe785f-copyright all rights-thumb-250x157-2969.jpg

Numerous defendants appear to have succumbed to Righthaven’s settlement demands, for amounts that may be as small as the mid- to low-four figures. Because the terms of settlements typically are confidential, the amounts actually paid in the settlements are in most cases not a matter of record.

On the day the Drudge case ended, the Righthaven Lawsuits website (not affiliated with the copyright company) noted that 104 Righthaven cases had closed, presumably by settlement. The site estimated that Righthaven has earned in excess of $365,000 in revenue, based upon an estimated $3,500 per case.

Some defendants have failed to respond to Righthaven complaints, which has allowed the company to begin filing motions — first, for the entry of a default, then for the entry of a default judgment. A default judgment is an enforceable court order for the payment of the amount of damages awarded by the court. These cases have the potential to yield a greater return for Righthaven than those that have settled thus far, and may include other legal relief that Righthaven has requested, such as the turnover of the defendant’s domain name.

On February 10, Righthaven made its first motion for a default judgment. It demanded $150,000 in damages for infringement — the maximum amount of statutory damages allowed under U.S. law for willful infringement of a single work — $1,500 in attorney fees, and $350 in costs. In addition to financial damages, it also requested a permanent injunction and an order turning over the defendant’s domain name to Righthaven.

The court has yet to rule on Righthaven’s request, but it is unlikely that anything near the maximum of statutory damages will be awarded. Judges have considerable discretion is awarding statutory damages, ranging from the minimum amount of $750 per work to the maximum requested by Righthaven. But where the defendant can show that it was not aware of the infringement, that figure can be reduced to as little as $200.

Standing up for their Rights

Not all of the Righthaven defendants are settling or failing to answer. Some have raised a variety of defenses, including the copyright “fair use” doctrine, with some success.

In Righthaven v. Realty One Group, a blogger who posted an eight-sentence excerpt from a Las Vegas Review-Journal article, including a link, obtained a dismissal on the grounds of fair use. The court ruled that the use of the excerpt was fair as a matter of law — that is, without the need for further fact-finding.

The ruling noted among other things that the blogger copied only the factual portion of the article, not the reporter’s commentary, and thus the blogger’s use “does not satisfy a reader’s desire to view and read [the entire article including] the author’s original commentary and thereby does not dilute the market for the copyrighted work.”

The court also noted that the blogger had included a link to the source of the article containing the full text.

The Righthaven v. Realty One Group decision is a significant ruling in that it may influence Nevada District judges assigned to other cases in which Righthaven is alleging that only a portion of an article was posted. But many of the lawsuits involve the posting of entire articles. Fair use is a lot more difficult argument to make when an entire work has been appropriated.

From Fair Use to Implied License

i-9332b1f07fdc3020c76f078c27fe7b81-200px-Question_copyright.svg-thumb-200x286-2971.png

Nevertheless, in Righthaven v. Klerks — a case involving the posting of an entire article — the operator of an online forum successfully used the fair use defense in moving to reopen the case after a default had been entered for failure to answer. Klerks asserted that he had not been properly served in the case.

The court ruled that as a preliminary matter, Klerks had shown that fair use was a “sufficiently meritorious” defense to justify reopening the case, even though the fact that the entire article was used was a factor weighing against a fair use finding.

Klerks also raised what the court called a potentially more meritorious defense: Implied license. A license to use a copyrighted work may be implied where the conduct of the copyright holder is such that the party using the work may justifiably infer that there is consent to the use.

The court in Klerks v. Righthaven pointed to the fact that the newspaper publisher “encouraged people to save and share the article with others without restrictions, and permitted users to ‘right-click’ and copy the article from its website.” The ruling added, there was a “plausible argument” for an implied license, “especially in light of the established and accepted custom of users freely and openly sharing certain information posted on the Internet.”

That is a broad statement indeed, and one that should concern content owners whose intent in making their work available online is selective sharing, not permission for wholesale and unrestricted copying.

As with the issue of fair use, the final resolution of the implied license issue must await further proceedings in the case.

EFF to the Defense

In the fall of last year, the EFF moved on from denouncing Righthaven as a copyright troll to inviting Righthaven defendants to seek the organization’s legal assistance. The copyright troll accusation has resurfaced in the arguments that the EFF has made in two of the several cases in which it has become involved: Righthaven v. Democratic Underground and Righthaven v. Center for Intercultural Organizing (CIO).

In one of its filings in Righthaven v. Democratic Underground, the EFF described Righthaven’s complaint as the action as “a particularly abusive instance of a broad and aggressive strategy” by a “sham” plaintiff.

Righthaven has responded in kind. In a filing in that same case, it referred to the EFF as “vexatious” and “vituperative.” In an affidavit filed in the CIO dispute, Righthaven accusing the EFF of having “aggressively litigated” the cases in which it is involved by “driving up litigation costs through extensive motion practice and discovery efforts.”

Will the judges find these respective accusations relevant to the underlying issues in the litigation? Or view them as mere attempts at adversarial well-poisoning? That much remains to be seen.

Ed. note: On March 22, the court ruled in favor of CIO on the issue of fair use; see the update at the end of the article for details.

But it is clear that the EFF intends to disrupt Righthaven’s business model. Any litigation in which the EFF becomes involved is likely to be hard-fought on both sides.

Righthaven Takes Its Show on the Road

i-c429030fd7ffd035bbc5902421f34a31-righthaven-thumb-300x70-2973.jpg

The fair use rulings in the District of Nevada may have slowed Righthaven down a bit. It appears that the company may have temporarily suspended filing additional lawsuits in that district.

However, Righthaven has now partnered with MediaNews, the publisher of the Denver Post. In December, Righthaven filed a single complaint with respect to content from that newspaper in the District of South Carolina, and on January 20, it started filing a series of complaints in the District of Colorado.

Notably, the outgoing CEO of MediaNews, Dean Singleton, is also the chairman of the Associated Press. The AP has previously taken a strong position against excerpting news stories.

From a procedural perspective, filing new lawsuits in other federal districts is a smart move. Judges in the other federal districts are not obliged to follow the District of Nevada rulings that are adverse to Righthaven, nor would they be required to follow any adverse ruling on appeal from the U.S. Court of Appeals for the Ninth Circuit. (Colorado is in the Tenth Circuit; South Carolina is in the Fourth Circuit.)

More revenue, more responsibility

Even if Righthaven is reasonably successful overall in its litigation campaign on behalf of its present and future newspaper clients, as a practical matter it is unlikely to put a dent in the practice of re-posting online news content and linking to its source.

What it may achieve is a de facto licensing scheme that will restore some small amount of the revenue loss suffered by its client newspapers due to declining subscription and advertising sales. How large or small that revenue stream will be depends upon how the courts view the fair use, implied license, and other issues raised in the case. In any event, sorting out those issues in the Righthaven cases may provide needed guidance on the use of online news content.

Meanwhile, the immediate lesson for website operators, blog owners, and other service providers that allow users to submit content to their sites is that they should take advantage of the protection of the DMCA safe harbor provisions. Like flu shots, seat belts, and bicycle helmets, the DMCA can provide low-cost protection from damages for infringement caused by third parties.

For content owners, there may also be important lessons in how the judges in the Righthaven lawsuits address the issue of implied license. At a minimum, content owners should review any license terms in their website terms of use. Making clear what uses are expressly licensed may forestall arguments that there is a much broader, implied license to distribute their content.

UPDATE: On Friday, March 18, Judge James Mahan, who is presiding over Righthaven’s lawsuits against the Center for Intercultural Organizing, announced that he would dismiss the charges on the grounds of fair use. The lawsuit involves the posting of an entire article from the Las Vegas Review-Journal on CIO’s website. According to a news article in the Las Vegas Sun, Judge Mahan indicated the following in a ruling from the bench (i.e., without a written opinion):

  • that CIO was using the article for educational purposes and not to raise money;
  • that the article was primarily factual as opposed to creative;
  • that its use did not harm to the market for the article;
  • that Righthaven was remiss for not notifying CIO in advance of the lawsuit;
  • that the copyright in the article, once transferred to Righthaven by the Las Vegas Review-Journal, was entitled to lesser protection under the Copyright Act;
  • and finally, that the use of the copyright in the article — presumably, as the basis for a lawsuit — has a chilling effect on free speech and doesn’t advance the purposes of copyright.

In response to a statement by Righthaven’s attorney indicating that the company intended to appeal, the judge commented: “I realize this is going to be appealed. I tell litigators ‘that’s why God created San Francisco.’” That’s the location of the Ninth Circuit Court of Appeals, where the Righthaven v. Center for Intercultural Organizing case is likely headed next.

Copyright symbol image by Mike Blogs via Flickr. The “Delink Righthaven” graphic was created by kbingh.

Jeffrey D. Neuburger is a partner in the New York office of Proskauer Rose LLP, and co-chair of the Technology, Media and Communications Practice Group. His practice focuses on technology and media-related business transactions and counseling of clients in the utilization of new media. He is an adjunct professor at Fordham University School of Law teaching E-Commerce Law and the co-author of two books, “Doing Business on the Internet” and “Emerging Technologies and the Law.” He also co-writes the New Media & Technology Law Blog.

Related