Three Notice Failures in Copyright Law

Abstract

In Notice Failure and Notice Externalities, Peter Menell and Michael Meurer explore how notice failures resulting from the fuzzy boundaries of intellectual property entitlements produce negative externalities for developers of new resources, particularly in the information technology sector, where the problem of uncertain patent scope is widely recognized. This article takes a different tack on notice failures and their costs. Shifting focus from resource development to rights enforcement, specifically online anti-piracy enforcement, it considers the nature, effects, and means of correcting three instances of notice failure in copyright law. The first two instances — “red flag” knowledge under the Digital Millennium Copyright Act (DMCA) and ex parte domain name seizures under the Prioritizing Resources and Organization for Intellectual Property (PRO-IP) Act — involve a legislative failure to appreciate that notice is necessary for the production of predictable and fair legal outcomes. The third instance of notice failure — injunctions against nonparty online intermediaries in civil “pirate site” cases — involves a judicial failure to appreciate that notice alone does not give courts jurisdiction over strangers to the litigation before them. Each of these notice failures is associated with a different aspect of copyright enforcement in the digital environment. All of them raise operating costs and increase legal risk for a wide range of online intermediaries, including search engines, cloud storage services, social media platforms, domain name registrars, payment processors, ad networks, and content delivery networks (CDNs).

Keywords: copyright, infringement, due process, DMCA safe harbors, online piracy, property seizures, nonparty injunctions, intermediary liability

JEL Classification: D81, K00, K11, K41, K42