Court Adopts a Double Scienter Requirement for Establishing Violations of Section 1202(b) of the Digital Millennium Copyright Act

In Victor Elias Photography, LLC v. Ice Portal, Inc., 2022 U.S. App. LEXIS 22472 (11th Cir. Aug. 12, 2022), the Eleventh Circuit adopted a “double scienter requirement” for copyright infringement under 17 U.S.C. § 1202(b) of the Digital Millennium Copyright Act (“DMCA”). This standard requires a copyright owner to demonstrate that an alleged infringer had knowledge not only of its conduct, but also of the likelihood that the conduct would result in copyright infringement. A unanimous appellate panel affirmed a district court’s granting of summary judgment in favor of the defendant, finding that although the copyright owner proved intentional removal of copyright management information without its permission, the plaintiff failed to establish that the defendant knew such removal would likely result in copyright infringement.

Plaintiff Victor Elias Photography, LLC (“Elias”) produces copyright-registered photographs that it licenses to hotels and resorts to use for marketing on their websites and with third-party booking agents. In order to protect its rights in its photographs, Elias embeds copyright management information in the metadata of the image files, which identifies it as the copyright owner and makes it easier to search for the images online. Defendant Ice Portal, Inc., a division of Shiji (US), Inc. (“Shiji”), assists hotels in providing images of their properties to online travel agents, like Expedia and Travelocity. As part of this process, Shiji uses software to optimize the photographs, which sometimes results in the removal of embedded metadata.

After finding unauthorized uses of its photographs online, Elias brought suit against Shiji alleging that Shiji’s removal of the identifying metadata from Elias’s photographs violated § 1202(b) of the DMCA. The district court granted summary judgment in favor of Shiji, finding that Elias failed to provide sufficient evidence to meet the statute’s knowledge requirement. Specifically, the trial court determined that Shiji’s removal of the embedded metadata was not likely to result in copyright infringement and that the defendant was not aware that copyright holders used metadata as a search tool for finding infringement online. Elias appealed the decision to the Eleventh Circuit, challenging the district court’s interpretation of the statute and arguing that it had produced sufficient evidence to establish a triable issue of fact.

On appeal, the Eleventh Circuit was required to interpret § 1202(b) of the DMCA, an issue of first impression for the court. Section 1202(b) provides that a person may not “intentionally remove or alter any copyright management information” or distribute a work “knowing that the copyright management information has been removed or altered” without the copyright owner’s permission. Additionally, the statute requires that a person must know or have “reasonable grounds to know, that [such actions] will induce, enable, facilitate, or conceal” copyright infringement.

In an opinion authored by Judge Virginia Covington, visiting from the Middle District of Florida, and joined by Judges Newsom and Marcus, the Eleventh Circuit held that § 1202(b) includes a “double scienter requirement.” In order to establish a violation of the statute, a plaintiff must show that the defendant knew or had reason to know two distinct elements. First, the defendant must know that the copyright management information was removed or altered without the copyright owner’s permission. Second, the defendant must know that the removal of this copyright management information will assist or result in copyright infringement.

On appeal, Elias contended that the district court had misinterpreted the standard for the second scienter requirement. Elias urged the appellate court to adopt a lower standard in which the defendant need only know that the removal or alteration of copyright management information will make infringement “possible or easier to accomplish.” The Eleventh Circuit rejected this interpretation and instead embraced the higher standard previously adopted by both the Second and Ninth Circuits, in Mango v. Buzzfeed, Inc., 970 F.3d 167 (2d Cir. 2020), and Stevens v. CoreLogic, Inc., 899 F.3d 666 (9th Cir. 2018). Relying upon the plain language of the statute, the Eleventh Circuit determined that the use of the word “will” in the second scienter requirement means that a defendant must know or have reason to know that its actions will likely result in copyright infringement, as opposed to merely knowing that infringement might occur.

Applying the holding to the case at bar, the Eleventh Circuit affirmed the lower court’s granting of Shiji’s motion for summary judgment. As evidence of the defendant’s knowledge, Elias attempted to rely upon Shiji’s prior participation in an arbitration that involved claims under the DMCA as well as infringing uses of Elias’s photographs by third parties that similarly had the metadata stripped. Nevertheless, the Eleventh Circuit found these arguments unavailing. Factual differences between the prior arbitration and the present litigation undermined Elias’s claims that that Shiji had the necessary knowledge of how its removal of metadata would contribute to copyright infringement. Further, Elias failed to link Shiji and its software to the alleged third-party infringers. The court concluded that it was equally likely that the third parties removed the copyright management information without Shiji’s involvement by, for example, taking screenshots of Elias’s photographs. The Eleventh Circuit ruled that the evidence presented by Elias was insufficient to create a genuine issue of material fact to maintain its claims of copyright infringement.

The Eleventh Circuit took care to note that its interpretation of § 1202(b) does not require proof that copyright infringement has occurred or that it is certain to occur. Rather, a copyright owner must simply demonstrate that the alleged infringer knew or should have known that copyright infringement is the probable result of its unauthorized removal or alteration of copyright management information.

Posted by Jennifer Sandlin.

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