YouTube wins case against Viacom (again)

Posted by Kent Walker, Senior Vice President & General Counsel, Google
 
Cross-posted from the Official YouTube Blog 

Today is an important day for the Internet. For the second time, a federal court correctly rejected Viacom’s lawsuit against YouTube. This is a win not just for YouTube, but for the billions of people worldwide who depend on the web to freely exchange ideas and information.

In enacting the Digital Millennium Copyright Act, Congress effectively balanced the public interest in free expression with the rights of copyright holders. The court today reaffirmed an established judicial consensus that the DMCA protects web platforms like YouTube that work with rightsholders and take appropriate steps to remove user-generated content that rightsholders notify them is infringing.

The growing YouTube community includes not only a billion individual users, but tens of thousands of partners who earn revenue from the platform — from independent musicians and creators to some of the world’s biggest record labels, movie studios, and news organizations. Today’s decision recognizes YouTube as a thriving and vibrant forum for all these users, creators and consumers alike. Today is an important day for the Internet.


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It’s time to take action against patent trolls and patent privateering

Posted by Matthew Bye, Senior Competition Counsel

Today, we submitted comments together with BlackBerry, EarthLink and Red Hat to the Federal Trade Commission and Department of Justice on the growing harm caused by patent assertion entities (more widely known as patent trolls).

We’ve been encouraged by recent attention on the problem of trolls, which cost the U.S. economy nearly $30 billion a year. Trolls are hurting consumers and are increasingly going after small businesses, hampering innovation and reducing competition.

Our comments today also focus on a worrisome trend: some companies are increasingly transferring patents to trolls—and providing incentives to assert those patents against their competitors. These transfers can raise rivals’ costs and undermine patent peace.  

This trend has been referred to as “patent privateering”: a company sells patents to trolls with the goal of waging asymmetric warfare against its competitors.

Trolls use the patents they receive to sue with impunity—since they don’t make anything, they can’t be countersued. The transferring company hides behind the troll to shield itself from litigation, and sometimes even arranges to get a cut of the money extracted by troll lawsuits and licenses.

Privateering lets a company split its patent portfolio into smaller sub-portfolios “stacked” on each other, increasing the number of entities a firm must negotiate with and multiplying licensing costs. This behavior unfairly raises competitors’ costs, ultimately driving up prices for consumers.

It also undermines incentives for companies to work together towards “patent peace” through good-faith negotiation and cross-licensing. If cross-licensing is nuclear deterrence for patents, then privateering has the opposite effect, facilitating patent proliferation and aggression.

We’re asking other companies to work with us to develop cooperative licensing agreements that can help curb privateering. We’re also encouraged that the FTC and DOJ are paying attention to this critical issue, and we hope they will continue to study how abusive troll litigation and patent privateering are harming innovative industries.


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