Written by Albina Gasanbekova

In Atlantic Recording Corp., et al. v. Spinrilla, LLC, et al., 1:17-cv-00431-AT (N.D. Ga. Nov. 30, 2020), a federal district court ruled that an online streaming provider cannot invoke the safe harbor provisions of the Digital Millennium Copyright Act (“DMCA”) to avoid liability for infringing uploads occurring before the provider met the requisite criteria for such protection.

Spinrilla.com (“Spinrilla”) proclaims that it is “the 800-lb gorilla of free hip-hop mixtapes” and allows DJs with so-called “artist accounts” to upload their own mp3 “mixtapes” for others to stream and download over the internet.  Since its inception in 2013, Spinrilla has become hugely popular, with millions of registered users visiting the website and associated mobile app. 

In February 2017, a group of the largest record companies in the U.S. sued Spinrilla and its founder for copyright infringement, alleging that the defendants permitted its users to upload, stream and download thousands of copyrighted sound recordings without proper licenses.  Relying on 17 U.S.C. § 512(c) — which provides a safe harbor for certain internet service providers who take down infringing works after notice — Spinrilla argued that because it removed each identified sound recording upon receipt of a takedown notice (a fact the record companies disputed), it cannot be liable for unauthorized uses of copyrighted works committed by its customers.  The district court disagreed.

First, as a threshold matter, the court found that Spinrilla had infringed Plaintiffs’ exclusive right of performance of their works by streaming to its users thousands of copyrighted sound recordings directly from its platform.  Spinrilla argued that no direct liability applied because the users were the parties who uploaded the music and requested the streams and therefore the platform did not act with volition when the playback occurred.  While acknowledging that the Eleventh Circuit has yet to consider the defendants’ argument that volitional conduct does not occur when playback is requested by the user, the district court ultimately rejected that argument.  Because the streaming of music online from a platform is a public performance under the Copyright Act, just as is video on demand requested by a viewer using Netflix or Disney+, the platform is not absolved from direct liability simply because the act of streaming occurred at the request of the user.  Spinrilla, by creating “an interactive internet player” that permitted to stream copyrighted music from its website and mobile app, had violated the copyright owners’ undisputed public performance rights.

Second, the district court found that digital streaming providers could not avoid liability by invoking the safe harbor protection granted by the DMCA where they failed to satisfy all of the required elements.  In an effort to avoid liability, Spinrilla asserted the safe harbor immunity under 17 U.S.C. § 512(c), which applies when infringing content is stored on the service provider’s system at the direction of a user of that system.  Generally, to qualify for the safe harbor protection under the DMCA, the service provider must establish that:  (i) defendants properly complied with the DMCA requirements for registration and disclosure of a DMCA “designated agent”; and (ii) defendants have adopted, communicated to users, and “reasonably implemented” a policy for terminating users who are “repeat infringers.”  17 U.S.C. §§ 512(c)(2), (i)(1). 

Spinrilla could not meet either of these requirements.  The district court explained that because Spinrilla first registered a DMCA agent with the U.S. Copyright Office after the infringing acts occurred — specifically, five months after the lawsuit was filed — the safe harbor defense was available to Spinrilla only with regard to its liability (if any) arising after that date.  Moreover, because Spinrilla did not have a repeat infringer policy until after the lawsuit was filed and did not have a proper mechanism for tracking repeat infringers until then, it similarly could not rely on the safe-harbor immunity under 17 U.S.C. § 512(c).  

The decision reaffirms the importance of full and careful compliance with all of the requirements of the DMCA — especially the requirements that the service provider designate a DMCA with the U.S. Copyright Office and implement an effective repeat infringer policy.  The failure to comply with these requirements will be automatically disqualifying, even if the service provider has purported to respond promptly to DMCA take-down notices.  Additionally, service providers should be aware that they likely cannot retroactively cure non-compliance, and thus it is absolutely critical for all service providers to ensure that a repeat infringer policy has been effectively implemented and that its DMCA agent designation is up-to-date and remains valid.