Stephanie Lenz v. Universal Music Corp., 815 F.3d 1145

Background

In 2007 Lenz uploaded a 29-second home video of her children dancing to Prince’s “Let’s Go Crazy” to YouTube; Universal (Prince’s publisher) sent a DMCA takedown listing the video among 200+ URLs and stated a good-faith belief the use was not authorized by the law.
YouTube removed the video; Lenz submitted counter-notices and the video was ultimately restored after procedural dispute; Lenz sued under 17 U.S.C. § 512(f) for knowing material misrepresentation in the takedown notice.
Universal’s YouTube-monitoring procedure focused on whether a Prince composition was “the focus” or made “significant use” of a video; its staff did not expressly apply the four fair-use factors of 17 U.S.C. § 107.
The district court denied summary judgment for both parties on Lenz’s § 512(f) claim; the Ninth Circuit reviewed de novo and addressed whether § 512 requires consideration of fair use and whether triable issues exist about Universal’s subjective good-faith belief.
The Ninth Circuit held that fair use is “authorized by the law” under § 512(c)(3)(A)(v), copyright holders must consider fair use before issuing takedown notices, and a triable issue exists whether Universal formed the requisite subjective good-faith belief that Lenz’s video was not authorized by law.
The court also held plaintiffs may recover nominal damages under § 512(f); the panel denied rehearing and partially concurred/dissented on whether summary judgment should have been granted for Lenz.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether § 512(c)(3)(A)(v) requires consideration of fair use before a takedown	Lenz: fair use is an authorization under law; copyright owners must evaluate fair use before issuing notices	Universal: fair use is merely an affirmative defense/excuse and need not be considered prior to notice	Held: Fair use is "authorized by the law" under § 107 and must be considered before a takedown notice is sent
Standard for the § 512(c)(3)(A)(v) “good faith belief” and proof of misrepresentation under § 512(f)	Lenz: Universal did not consider fair use and thus lacked a good-faith belief; liable under § 512(f)	Universal: § 512 uses a subjective standard; if it subjectively believed infringement it satisfied the statute despite not explicitly applying § 107 factors	Held: The statutory standard is subjective; liability requires a knowing material misrepresentation, but whether Universal actually formed a good-faith belief is a jury question here
Whether willful blindness theory applies to show knowledge under § 512(f)	Lenz: Universal willfully avoided assessing fair use and can be liable on willful blindness theory	Universal: no evidence it subjectively believed there was a high probability of fair use or deliberately avoided learning it	Held: Willful blindness could apply in principle, but Lenz failed at summary judgment to raise a genuine issue on the required two-prong willful blindness test
Recoverable damages under § 512(f)	Lenz: may recover nominal and other damages incurred (including costs/fees)	Universal: plaintiff must show actual monetary loss	Held: § 512(f)’s “any damages” allows recovery of nominal damages; plaintiff need not prove substantial pecuniary loss at this stage

Key Cases Cited

Rossi v. Motion Picture Ass’n of Am. Inc., 391 F.3d 1000 (9th Cir. 2004) (§ 512(c)(3)(A)(v) good-faith belief uses a subjective standard)
Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (Sup. Ct. 1984) (fair use means a noninfringing use)
Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754 (Sup. Ct. 2011) (two-part willful blindness test for knowledge)
Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19 (2d Cir. 2012) (willful blindness may demonstrate knowledge under DMCA contexts)
UMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006 (9th Cir. 2013) (service providers cannot willfully avoid obtaining specific knowledge)
Celotex Corp. v. Catrett, 477 U.S. 317 (Sup. Ct. 1986) (summary judgment burdens and burdens of production)