Web Host Law Demands Expert Advice

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Web Host Law Demands Expert Advice
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Rawlson O’Neil King, theWHIR.com
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July 22, 2004 — (WEB HOST INDUSTRY
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REVIEW) — Hosting providers increasingly must consider the
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ramifications of their legal duties and obligations. New media,
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including the Internet, has created a volatile environment that can
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open up service providers to a wide range of legal vulnerabilities, and
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any responsible hosting provider should insulate itself from civil or
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criminal action.
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A hosting provider can protect itself
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through the implementation of a cautious program that fully defines its
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obligations and limits its liabilities. Hosting firms should seek
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advice in drafting binding contracts, acceptable usage policies and
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service level agreements, so that these documents, which define user
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behavior, conform to satisfactory legal standards.
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Larger hosting firms should also consider
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retaining legal counsel in order to evaluate the shifting mountains of
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existing and pending case law and legislation that will impact their
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businesses.
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It is important to consider legal
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opinions, since they provide informed guidance concerning how the law
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will impact a firm’s operating environment. Many disagreements have
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arisen concerning differing inter-jurisdictional interpretations of the
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law. Legal opinions help businesses under the details and implement
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strategies for compliance.
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For example, in the US, safe harbor
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provisions within the Digital Millennium Copyright Act of 1998 protect
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service providers from liability claims, but require them to respond to
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copyright infringement claims.
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Under the act, service providers
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designate and register an agent with the US Copyright Office to receive
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and respond to complaints of copyright infringement. Compliance with
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the DMCA’s service provider safe harbor requires that the host be able
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to receive complaints and take down offending material according to
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published guidelines.
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To avoid liability for infringing
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user-posted, or third-party-posted content, the service provider must
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“expeditiously” act to remove or block access to content that users
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properly allege is infringing their rights. Service providers must also
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take action if they have actual knowledge or if infringement is clearly
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“apparent.”
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The provider must take reasonable steps
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to promptly notify users who post copyright-infringed material that
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they have moved to block it. If a user who posted the material sends a
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proper “counter-notification” to the provider stating that the removal
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of material was due to a mistake or misidentification of the material,
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the provider then must provide a copy of the counter-notification to
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the alleged copyright owner who sent the original notice.
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Unless the party claiming to own the
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infringing material then notifies the provider that it has filed a
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court action seeking to restrain the alleged infringement, the provider
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must replace or unblock the material not less than 10 or more than 14
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business days after receiving the counter-notification.
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Under the American system, service
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providers like ISPs and Web hosts are compelled to perform a
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surveillance function. Though this type of system has been proposed, it
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does not yet exist in Canada. In fact, a recent Canadian Supreme Court
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decision stated that service providers could not be held liable for the
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copyright infringement of their subscribers in any circumstance, even
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if a cached copy of an infringing work was held on local servers.
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The court stated in the recent decision
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that “the creation of a cache copy is a serendipitous consequence of
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improvements in Internet technology, is content neutral … and ought
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not to have any legal bearing on the communication. Caching is dictated
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by the need to deliver faster and more economic service and should not,
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when undertaken only for such technical reasons, attract copyright
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liability.”
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Previously, a Canadian lower court
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decision stated that providers should not be responsible for their
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subscribers’ actions generally, but creating locally stored versions of
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copyrighted content could trigger liability. The top court overturned
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this decision, making the copyright environment in Canadian cyberspace
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diametrically different from that in the United States.
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As a result of such drastic and shifting
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differences in legal environments (Canada might still legislate a
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copyright regime similar to the American one detailed above), it is
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essential that hosting companies keep abreast of decisions and new
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legislation by consulting with expert legal counsel.
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