When you see babies jamming out to Prince on YouTube, do you ask "is this fair use?" According to 9th Cir., you should.

Handed down this week by the 9th Circuit, Lenz v. Universal Music Corp. held that the Digital Millennium Copyright Act (DMCA) “requires copyright holders to consider whether fair use applies before sending a takedown notification”, and that “failure to do so raises an issue of whether the copyright holder had formed a subjective good faith belief that the use was not authorized by law.” 

In Lenz, a mother placed on Youtube a 29 second video entitled “Let’s Go Crazy #1” that showed her toddler son bopping around to the song “Let’s Go Crazy” by Prince.  Universal, acting as Prince’s publishing administrator, concluded Prince’s music was the focus of the video, based on the title of the video; the fact that the music was clearly identifiable (as opposed to muddled background noise); and Ms. Lenz’s question to her son as to what he thought of the music.  Based on that conclusion, Universal sent a DMCA takedown notice to Youtube, which (as is required by the DMCA) included a representation that Universal had a good faith belief that Lenz’s use of the Prince song was not authorized by the copyright owner, its agent, or the law.  After a few cycles of takedown and put-back notices submitted to Youtube by Lenz and Universal, Lenz filed suit alleging that Universal had violated Section 512(f) of the DMCA by knowingly making a misrepresentation of a good faith belief that Lenz’s video was infringing. 

Responding to an interlocutory appeal of the district court’s denial of cross-motions for summary judgment, the 9th Circuit determined that fair use is “not just excused by law, it is wholly authorized by law[,]” and therefore a copyright holder “must consider the existence of fair use before sending a takedown notification under Section 512(c)” of the DMCA.  Citing its prior decision in Rossi v. Motion Picture Ass’n of Am. Inc. (391 F.3d 1000 (9th Cir. 2004)), the Court went on to note that a “copyright holder need only form a subjective good faith belief that a use is not authorized,” and ruled that there was an issue of fact as to “whether Universal’s actions were sufficient to form a subjective good faith belief about the video’s fair use or lack thereof.”  Further, the Court also held that plaintiffs may seek recovery of nominal damages incurred if it is determined that a copyright holder has knowingly made a misrepresentation in violation of Section 512(f). 

In summary, Lenz teaches that before submitting a DMCA takedown notice, a copyright holder should take fair use considerations into account in the course of forming an opinion as to the infringing nature of material that is the subject of the notice in order to avoid exposure to allegations of (and potentially damages for) misrepresentation under Section 512(f).   


David Rickerby

Outside counsel with an in-house mindset. Practical, strategic, solution-oriented expertise in the licensing of software and other intellectual property. Client/customer focused and practicing with the belief that negotiating a good license requires understanding the nuances of your business and your long-term business objectives. Significant experience in: * High value, mission critical, unusual, and complex licensing and joint venture arrangements; * Open source software use, compliance, and related business strategies; * Emerging Medical and EMR software systems, and the cloud computing, big data, data mining, privacy, security, and interface issues they raise; * Outside counsel to established public companies on complex high value IP centric deals and latest trends in software, technology, commercial and contractual law; * Issues in venture backed companies where the technology is critical and intellectual property is prime currency; and * Negotiation of all types, with an interest in negotiation strategy. Additional areas of expertise: Mergers & Acquisitions: counseling on the successful transition of high value intellectual property in merger and sale scenarios; joint venture creation; post merger cross licensing. Antitrust: distribution arrangements, patent and channel strategies implicating antitrust concerns. VAR and OEM Agreements, Complex Joint Ventures, Patent Licensing, University Licensing, Distribution Agreement, Reseller Agreements, Start up law, Venture Capital