Viacom And YouTube Exchange Barbs As $1-Billion Lawsuit Goes Public

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The exchange comes as previously sealed court documents in the case are made public as a New York judge decides whether to issue a ruling without going to trial.

Viacom, in the lawsuit, has charged that YouTube executives were aware that copyright infringement was taking place on its Web site and did nothing to stop it. The company charges that clips from such Viacom-owned shows such as "South Park," "SpongeBob SquarePants" and "MTV Unplugged" were illegally posted on YouTube, according to a BBC News report.

YouTube has taken the position that all videos are automatically copyrighted when they are created and that it's up to the content owners to notify a site about unauthorized materials, according to a Dow Jones story. Federal law protects online aggregators from copyright claims as long as infringing material is removed when the content owner notifies the Web site operator.

But Viacom charges that YouTube records, including company emails, show that the company was aware that there was copyrighted material on its Web site and did nothing about it, a "willful blindness strategy" that eliminates any protection it had under the Digital Millennium Copyright Act (DMCA).

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The documents also indicate that Viacom executives were interested in acquiring YouTube in 2006, one year before it filed the lawsuit. Google acquired YouTube for $1.65 billion in October 2006.

Thursday YouTube chief counsel Zahavah Levine charged in a blog posting that Viacom is trying to have it both ways. "For years, Viacom continuously and secretly uploaded its content to YouTube, even while publicly complaining about its presence there," Levine said.

Levine said that Viacom went so far as to "rough up" videos to make them look stolen or leaked. "Viacom's efforts to disguise its promotional use of YouTube worked so well that even its own employees could not keep track of everything it was posting or leaving up on the site. As a result, on countless occasions Viacom demanded the removal of clips that it had uploaded to YouTube, only to return later to sheepishly ask for their reinstatement. In fact, some of the very clips that Viacom is suing us over were actually uploaded by Viacom itself," he wrote.

Viacom responded in its own statement Thursday, stating that "YouTube was intentionally built on infringement and there are countless internal YouTube communications demonstrating that YouTube's founders and its employees intended to profit from that infringement.

"Google bought YouTube because it was a haven of infringement. Google knew that YouTube's popularity depended on infringing materials with several senior Google executives warning that YouTube was a 'rogue enabler of content theft.' Instead of complying with the law, Google willfully and knowingly chose to continue YouTube's illegal practices," the Viacom statement said.

"No case has ever suggested that the DMCA immunizes rampant intentional infringement of the sort Google and YouTube have engaged in," the statement said.