Court Tosses Lawsuit That Said MMS Was An Illegal File Sharing Network

A few years ago, we wrote about a really ridiculous lawsuit filed by (then) regular Techdirt commenter Max Davis against all of the mobile operators: AT&T, Verizon Wireless, Sprint and T-Mobile. Davis runs a company, called Luvdarts, that creates silly "content" for multimedia messaging (MMS) on phones, and also had big dreams of setting up some sort of collective licensing system by which the telcos would all pay him a fee for every MMS sent. When the telcos showed no interest in such a pointless plan, he sued, arguing that they were just like file sharing networks, because users were able to "forward" the MMS content his company created without any problem. Two years ago, that case was dismissed, with the court being pretty clear that it had no chance. Davis actually sent over a press release about his own loss, talking about how happy he was with this result and that he was going to appeal.

That appeal has happened and... second verse, same as the first. The appeals court made short work of this lawsuit, dismissing it in a quick and clean 10 page opinion. To say the court was not impressed would be an understatement. The court repeatedly points out that Luvdarts appears to be pushing completely novel legal interpretations of vicarious and contributory infringement with no basis whatsoever. Basically, the company insists, first, that individuals passing along MMS messages makes the operators liable. That was quickly tossed out because of protections against secondary liability.

Luvdarts's principal argument is that the Carriers are liable for the infringement committed by third parties over their networks under either vicarious or contributory copyright liability. As the Supreme Court has observed, the Copyright Act does not explicitly render a third person liable for another person's infringement.

Luvdarts argued that the operators failure to implement a system to block such forwards proves liability, and the court points out that this is ridiculous.

In this case, Luvdarts concedes that the Carriers presently have no way of supervising the use of their networks for copyright infringement. Instead, Luvdarts's complaint alleges only that the Carriers could “establish[]. . .a system” that would give them the right and ability to supervise the infringing activity. Luvdarts argues that this allegation is sufficient to survive a motion to dismiss. Luvdarts fails to cite any authority to support this proposition, which runs contrary to our precedent. In Napster, this court held that “right and ability to supervise” should be evaluated in the context of a system’s “current architecture.” Napster Inc., 239 F.3d at 1024. Moreover, as we noted in Perfect 10, Inc. v. Amazon.com, Inc., resting vicarious liability on the Carriers’ failure to change their behavior would tend to blur the distinction between contributory liability and vicarious liability. 508 F.3d 1146, 1175 (9th Cir. 2007) (“[I]n general, contributory liability is based on the defendant’s failure to stop its own actions which facilitate third-party infringement, while vicarious liability is based on the defendant’s failure to cause a third party to stop its directly infringing activities.”). For example, under contributory liability the Carriers’ failure to implement a digital rights management system may be used as circumstantial evidence of “the object of promoting” infringement. See Grokster, 545 U.S. at 936–37. But under vicarious liability, it cannot substitute for an allegation of a capacity to supervise. Luvdarts's failure to allege that the Carriers have at least something like a capacity to supervise is fatal to a claim of vicarious liability.

On top of that, Luvdarts tried to claim contributory (not vicarious) infringement, arguing that these MMS systems were similar to Napster, Grokster or Limewire. In part, this is because Luvdarts sent the telcos a list of every bit of "content" they offer, and demanded they be blocked from being forwarded. Again, the courts don't see it (because there's nothing to see):

Luvdarts fails to allege that the Carriers had the requisite specific knowledge of infringement. Luvdarts's conclusory allegations that the Carriers had the required knowledge of infringement are plainly insufficient. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”).

In the alternative, Luvdarts argues that the “notices” it sent to the Carriers, referenced in the complaint, sufficed to establish actual knowledge of infringement. However, these notices failed to notify the Carriers of any meaningful fact. The notices were 150-page-long lists of titles, apparently just a transcription of every title copyrighted by Luvdarts, which indicated that they wanted “accountability” for the unauthorized distribution of those titles for the period from May 2008 to November 2009. These notices do not identify which of these titles were infringed, who infringed them, or when the infringement occurred. The Digital Millennium Copyright Act of 1998 (“DMCA”), by which the notices purport to be governed, clearly precludes notices as vague as the notices here. 17 U.S.C. § 512 (DCMA takedown notice requires the producer to provide “[i]dentification of the material that is claimed to be infringing or to be the subject of infringing activity and that is to be removed or access to which is to be disabled, and information reasonably sufficient

This is yet another useful ruling in that it highlights that service providers need to have specific knowledge of infringement, and that "general knowledge" is clearly not enough.

Of course, I believe this is only one of two such lawsuits filed by Luvdarts against the same basic companies. In the other one, they seem to be claiming that there's some sort of antitrust violation in that these MMS providers haven't implemented the filters that this lawsuit says they're not required to implement. I can't imagine that one going very far either.

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