The Court of Rome orders Vimeo to pay € 8.5 million for copyright infringements
On January 10, 2019, the Court of Rome wrote another chapter in the controversial saga concerning the interpretation of liability exemptions applicable to Internet service providers in relation to third-party illegal content or activities. In the RTI v. Vimeo judgment, the court found the hosting provider liable for multiple copyright infringements and ordered it to pay damages amounting to € 8,500,000.
In April 2012, RTI brought a lawsuit against Vimeo before the Court of Rome for alleged copyright and intellectual property rights infringements regarding various audiovisual content. Specifically, RTI claimed that the platform operated by Vimeo had allowed the unauthorized circulation of a large number of videos of programs broadcast by the plaintiff and subject to copyright and intellectual property rights.
Prior to initiating the lawsuit, on July 14, 2011, RTI served Vimeo with a cease and desist letter whereby the latter was notified of the existence of illegal audiovisual content hosted on the www.vimeo.com web portal. This letter mentioned only one of the various items illegally published on the platform, specifying the two URLs where it could be accessed. In response to the letter, Vimeo asked RTI to provide a specific list of the copyrighted content and the relevant URLs in order to precisely identify the content to be removed from the portal. RTI, however, maintained that all relevant information had already been provided in the cease and desist letter. Consequently, Vimeo replied that the content to which the URLs in the letter referred had already been removed and no additional action would be taken.
Subsequently, the expert appointed by RTI ascertained that, in January 2012, the Vimeo platform hosted 230 videos subject to RTI copyright. In light of this, RTI initiated a lawsuit seeking compensation for the damages suffered due to the copyright and intellectual property rights infringements, on the assumption that Vimeo could not benefit from the liability exemptions applicable to hosting providers.
The debate on ISP liability in Italy
The key issue that the Court of Rome had to tackle while hearing the case concerned Vimeo’s liability for the copyright and intellectual property rights infringements committed by third-party users.
The Italian case law on the implementation of the ISP liability exemptions established by Legislative Decree no. 70/2003 (the “E-Commerce Directive”, which implemented Directive 2000/31/EC, also known as the “E-Commerce Directive”) has so far not been very consistent. In fact, some courts (in particular the Court of Rome) have endorsed a stricter standard of liability on certain conditions, while other courts have rejected this option.
The adoption of such diverse standards of liability finds its roots in the specific framing of the role of the ISP, more specifically, the role of hosting providers that was established in the E-Commerce Directive. In fact, at the time, the services operated by ISPs showed a low degree of interaction with content and were very basic compared to their more complex nature today. As such, Recital 42 of the E-Commerce Directive highlighted that the liability exemptions must only apply to ISPs operating services of a merely neutral, passive and technical nature.
The growing complexity of the services in question led Italian courts, also in the wake of the Court of Justice decisions in the Google France and eBay cases, to more carefully investigate the conditions under which hosting providers could benefit from immunity from liability for third-party content and activities. This trend resulted in the rise of two different interpretative options.
According to the first option, under certain conditions, the service operated by hosting providers can no longer be deemed merely neutral, passive and technical in nature. Therefore, the provider becomes “active”, and, while it has no general obligation to monitor, it may nevertheless be required to take down illegal content in accordance with the stricter criteria. The second option is more in line with the law and considers the new features of 2.0 platforms as an inherent part of their functioning, that is, as a consequence of the evolution of the relevant services. Accordingly, ISPs may continue to enjoy the liability exemptions for third-party illegal content or activities despite the narrower relationship they have with the latter.
The opinion of the Court of Rome on the interpretation of liability exemptions
In RTI v. Vimeo, the Court of Rome confirmed its well-established restrictive interpretation of the relevant provisions of the E-Commerce Decree, endorsing the first option as mentioned above.
In fact, the Court found that Vimeo met the requirements of an active hosting provider. According to the Court of Rome, the service operated by Vimeo went far beyond a merely technical, neutral and passive storage of content. The Court’s conclusion considered a variety of factors that may indicate the active nature of the ISP, such as the platform’s higher degree of content sensitivity, including
- the requirement that users must sign up to join the Vimeo user community;
- the operation of a search engine on the web portal;
- the fact that the content uploaded by users was organized, categorized and indexed;
- the delivery of advertisements whose content was related to the keywords inserted by Vimeo users.
According to this viewpoint, these functionalities would not constitute an added value to make the service provided by Vimeo more efficient, but would instead show a degree of interaction with content, which is incompatible with the rationale behind the application of the liability exemptions.
Among other issues, the Court attached great importance to the multi-faceted nature of the platform provided by Vimeo, which, on the one hand merely acted as a hosting provider for free user-generated content, and on the other hand, operated as an on-demand provider for fee-based content available in the “Plus”, “Pro” or “Business” versions of the service.
Therefore, the Court of Rome confirmed that Vimeo had not limited itself to only storing information uploaded by third parties through a merely technical process. Rather, it also carried out a complex organization of content managed with a view to providing users with an autonomous audiovisual product.
Considering this assumption, the Court ruled that an Internet service provider no longer acts in a neutral manner when its technologies and functions enable it to have control or knowledge of the information stored without a personal and direct assessment of the illegal nature of content being necessary.
When is the Isp on notice of illegal content and activities?
Considering the above, the Court focused on whether in this specific case, based on the characteristics of the service provided, Vimeo could be aware of the existence of the claimed infringements and therefore “on notice”. According to the Court of Rome, even if Vimeo had been served with a generic notice that did not mention all the URLs of the content allegedly subject to infringement, the cease and desist letter was still sufficient to trigger Vimeo’s obligation to remove the content published without RTI’s authorization.
In fact, the techniques implemented by Vimeo based on video fingerprinting would have allowed both the removal of the content found to be illegal and the prevention of its publication from the start. Since these techniques were already familiar to and used by Vimeo, it was reasonable to expect that, under the specific circumstances of the case, even a generic notice should trigger an obligation for the ISP to carry out the necessary checks, since it was sufficient to make the provider aware of the illegal nature of the content not specifically mentioned. The Court of Rome, therefore, presumed that, without prejudice to the absence of a general obligation to monitor, an active provider implementing such functions is required to search and remove any allegedly illegal content, and that failure to do so results in ISP liability for not having promptly acted to cease the claimed violations.