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Social Media Eyes Embeds as Courts Mull Copyright Limits (2)

July 2, 2020, 10:31 AMUpdated: July 2, 2020, 5:25 PM

A New York federal district court has been scratching at a decade of informal consensus that embedding posts from social media platforms like Instagram can’t infringe copyrights.

The lingering legal uncertainty—plus a desire to keep rightsholders using the services—could prompt platforms to act first by introducing technical tools to let users disable embeds before courts clarify the law, attorneys said. Facebook has already said it is weighing such a capacity, which some sites including YouTube have already implemented.

Facebook Inc. recently clarified that the terms of service for its Instagram app don’t grant permission to embed copyrighted work elsewhere. The move came days after the U.S. District Court for the Southern District of New York said Instagram’s terms of service don’t grant Newsweek a sublicense to a photographer’s post.

The same court in 2018 became the second in less than a year to outright reject a broadly accepted 2007 Ninth Circuit ruling suggesting online publishers can embed rightsholders’ posts without incurring liability. If the Newsweek case or another pending Southern District embed case against Mashable eventually reach the Second Circuit, that court could drive a wedge between itself and the Ninth Circuit on whether embeds can ever violate copyrights.

“Instagram, right now, is binary: Public or private. And that’s ‘damned if you do damned if you don’t’ if you’re a photographer because you want publicity for your work, but you want people to license it.” copyright attorney Michael D. Hobbs of Troutman Pepper Hamilton Sanders LLP said. “My suspicion is that there would be something of a business decision and business resolution that would allow users to opt-out of embedding.”

Facebook is “exploring options to give people more control over embeds,” the company recently said in a statement.

Server Test

The U.S. Court of Appeals for the Ninth Circuit ruled in 2007 in Perfect 10, Inc. v. Google Inc. that a website or platform doesn’t infringe by displaying a copyrighted work if it’s never stored in the displayer’s server. While embedding social media posts differs in ways from the functionality of Google Images searches at issue in that case, it also results in display of content embedders don’t control as an embed code facilitates display of linked platform content.

Rightsholders have assailed that “server test,” considering it a technicality allowing embedders freely profit from their work. They want courts to reject the server test and platforms to recognize their rights.

“I think in terms of embedding, that whole legal fiction of the server test needs to go away,” National Press Photographers Association counsel Mickey Osterreicher said.

The Ninth Circuit’s logic was almost universally accepted for a decade by several district courts, according to a paper by Columbia University copyright professor Jane C. Ginsburg and student Luke Ali Budiardjo. Other circuit courts haven’t directly weighed in; the Seventh Circuit appeared to accept the premise in 2012 without outright endorsing it outright.

The rule isn’t challenged particularly often in lower courts either. But Ginsburg said big tech companies that benefit from the server rule reside in the Ninth Circuit, which may contribute to the rule’s apparent predominance.

But the server test has appeared more vulnerable in recent years as two district courts rejected it. The Northern District of Texas in 2017 and the Southern District in 2018 explicitly noted flaws in the server test’s logic and its “inconsistency with statutory text,” Ginsburg and Budiardjo wrote. Both cases settled, with the Second Circuit declining to hear an interlocutory appeal in the New York case.

Technology companies had “increasingly relied on the rule’s shield” to build successful content and entertainment models, the authors said. Twitter and TikTok, for example, explicitly grant third-parties copyright licenses to embed user posts. Neither immediately responded to requests for comment.

But regardless of the server test, some platforms may want to reconsider not just their users’ desire for content but also the interests of professional content providers, attorneys say.

“It’s bad PR for them to have users get sued for using their embedding tool, and it’s also bad PR for photographers to have their work ripped off,” copyright professor James Grimmelmann of Cornell University said of Instagram. “If either party is miserable, the other is too.”

Heading for A Split?

While the preliminary rulings in the pending Newsweek and Mashable cases didn’t rule on the server test, the court could address it later in litigation. Either could provide a path to allow the Second Circuit to create a split between the two leading copyright circuits.

“It would be nice to have reconciliation of the state of the law on this, Hobbs said. “Deciding this all through lawsuits is a very expensive way of resolving these matters.”

Each publisher argued Instagram’s terms of service effectively granted third-parties permission to embed posts, as Instagram reserved the right to sublicense user posts. Newsweek didn’t even raise the server test in its motion to dismiss but could do so later in the case.

The judge in the Mashable case initially agreed Instagram’s terms gave embed permission and in April dismissed photographer Stephanie Sinclair’s suit against the online tech news publication.

But in early June, the judge in the Newsweek case said the magazine failed to demonstrate a sublicense from Instagram to escape photographer Elliot McGucken’s suit, finding the terms at least ambiguous enough to let the case proceed.

The Mashable judge agreed June 24 when she revived Sinclair’s case upon her motion to reconsider in light of the Newsweek ruling and Facebook statement.

The server rule is “ripe for adjudication” in the New York court, copyright attorney Kimberly Almazan of WithersWorldwide said. In the meantime, she’d advise third-party publishers to take down embeds that might infringe.

“I don’t necessarily think the server rule makes total sense,” she said. “If these third party embedders are the ones actually displaying the content and reaping the benefits, I don’t think there’s a reason they shouldn’t be liable.”

(Updated with additional reporting. Earlier version corrected law firm in fifth paragraph.)

To contact the reporter on this story: Kyle Jahner in Washington at kjahner@bloomberglaw.com

To contact the editors responsible for this story: Roger Yu at ryu@bloomberglaw.com, Keith Perine at kperine@bloomberglaw.com

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