Theft or Fair Use? Judge in YouTube Viral-Video Case OKs ‘Transformative’ Works

Court finds in favor of Equals Three Studios for 18 of 19 disputed Jukin Media clips

Google’s YouTube is rife with people ripping off videos they didn’t create, and the site has an elaborate system designed to help creators protect their intellectual property.

But there are gray areas involving the “fair use” doctrine of copyright law that have led to lawsuits, such as the spat between Ray William Johnson’s Equals Three Studios and viral-video aggregator Jukin Media.

Jukin, best known for its “FailArmy” mishaps-and-pratfalls franchise, had accused Equals Three of misappropriating dozens of clips for its YouTube comedy show. In November 2014, Equals Three sued Jukin, arguing that the material in question was covered under fair use and alleging Jukin’s YouTube takedown notices deprived it of ad revenue.

This week, a federal judge ruled in the case — and sided with Equals Three for all but one of the contested Jukin videos in the lawsuit.

“Equals Three’s use of Jukin’s videos is admittedly commercial. Nevertheless, the commercial nature of the use is outweighed by the episode’s transformativeness,” Judge Stephen V. Wilson of the U.S. District Court for the Central District of California wrote in the Oct. 13 decision.

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What makes the use “transformative” is not clear-cut, the judge noted: “Determining whether Equals Three’s episodes parody Jukin’s videos is a difficult and nuanced task.” But Judge Wilson ruled that even if Equals Three’s episodes are not parodies, the episodes comment on or criticize Jukin’s videos and are therefore allowable under fair use.

For example, the Equals Three episode “Drunk Babies” uses part of Jukin’s video “Groom drops bride.” The usage is OK because the show’s host comments on the clip (saying “shit, he literally body-slammed his new bride” and snarking that it proves you get “way too excited” if you wait to have sex until marriage), Judge Wilson ruled. (Pictured above: an Equals Three episode that used Jukin-licensed clip “Burning My Hair Off.”)

Meanwhile, on Friday the 2nd Circuit Court of Appeals upheld a lower court’s decision that Google’s book-scanning service, which indexes millions of books to make their contents publicly searchable, was transformative and covered under fair use.

And last month the 9th Circuit Court of Appeals ruled that a woman’s 29-second YouTube video of her two kids dancing to Prince’s “Let’s Go Crazy” was a fair use, which Universal Music Corp. should have considered before issuing a takedown notice.

A rep for Equals Three called this week’s ruling “a significant victory for content creators everywhere.”

“Whether you’re watching a ‘Let’s Play’ video by PewDiePie, a Pokemon sketch by Smosh or a song parody by Bart Baker, fair use affects the entire online-video ecosystem,” the rep said.

Asked for comment, a Jukin Media rep said in an emailed statement, “We are happy that the court’s decision recognizes that Equals Three’s unauthorized use of Jukin’s videos is not always fair use. We are, however, carefully reviewing the remainder of the court’s decision and considering the best approach for continuing to enforce the rights of thousands of individuals who find themselves helpless when companies like Equals Three decide not to pay individuals for their intellectual property.”

According to court documents, Jukin employs a team of 11 employees to scour the Internet for viral videos and secure licensing rights to them.

Judge Wilson found only one of the 19 viral videos from Jukin — “First person to buy iPhone 6 in Perth drops it on live TV when pressured by reporters” — was not transformative in Equals Three’s use. In the Equals Three segment “Sheep to the Balls,” the host’s comments on the video were “general, broad points that were not directly aimed at criticizing or commenting on the video,” he wrote.

Watch both the original iPhone 6 video licensed by Jukin, and the Equals Three “Sheep to the Balls” episode, which excerpts the iPhone clip at the 1:47 mark:

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