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Copyright protection warning for Web 2.0 start ups

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Web 2.0 Expo The Electronic Frontier Foundation (EFF) has given Web 2.0 media sharing start-ups some non-technical advice: run your ideas past a lawyer first to stay on the right side of copyright law.

Execs and investors are exposing themselves to potential prosecution for violation of copyright from copyright owners under the Digital Millennium Copyright Act (DMCA) through both their business idea and their site's architecture, according to the EFF.

Speaking in the shadow of Viacom's $1bn prosecution of Google over copyrighted content on YouTube, the EFF told start-ups working with pictures, music, and other potentially copyrighted works to call their lawyers "soon".

"One of the big mistakes I see in this space is failure to engage legal counsel soon enough. Often these involve business issues - like how do you want users and employees to interact on the site," staff attorney Fred von Lohman said.

The choice of whether to offer buzzy features like mash-ups or to profit from other people's content on the server may also have a bearing on a company's legal exposure. "Techies will tell you it [server-side computing] is about efficiencies, the reality is lawyers will tell you to think hard about it," von Lohman said.

While you might think executives running sites that suck in other people's content have most at risk, von Lohman pointed out that investors are also in the firing line. He cited EMI and Universal's decision to drag Bertelsmann through the US courts over its $100m investment in the old Napster, which they claimed helped the P2P site infringe on their works.

That case has only just cleared the court, five years after the offending Napster closed and went into liquidation, with Bertelsmann paying the labels more than $60m.

According to von Lohman, ISPs, search companies, and web hosts do have certain protections under the DCMA against prosecution over copyright. Essentially, those defenses come down to: not having any knowledge the offending content exists on their site, acting responsibly to remove it, having a policy on individuals that repeatedly post material, and not profiting from other protected works.

As more sites like Blogger, Flickr, or YouTube combine search and hosting, though, von Lohman argued it's becoming harder to say whether they are legally safe. Companies lose their protection and are open to prosecution if they have knowledge of infringing works on their site, they are benefiting financially, and had the ability to control what was posted or removed.

Unfortunately for tiny start-ups hosting music, pictures, or similarly protected content, the options are not easy. "One way you can be sure is if you have lots of employees looking at the site. A big issue is what did you know? The more intimate the knowledge you have the more risk is created," von Lohman said.

He claimed one reason Google does not place ads next to video pages on YouTube is so it's not seen to be directly benefiting from infringing video. He added Google would likely argue in its Viacom case it did not have the power to prevent posting or to remove content, but that it acted once it had been alerted.

Separately, Google chief executive Eric Schmidt yesterday told the Web 2.0 Expo that Viacom's prosecution is without merit and a simple "negotiating tactic". He wasn't clear about what Viacom is trying to negotiate. ®

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