On February 15, 2018, U.S. District Judge Katherine B. Forrest rejected defendants’ motion for partial summary judgment in a case involving the embedding of an image online and called into question the applicability and rationale behind the 2007 ruling by the Ninth Circuit Court of Appeals in Perfect 10 v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007). The Server Test advanced in Perfect 10 had underpinned the growth of websites offering content that used images stored on other websites through in-line linking, framing and embedding − coding techniques that permit the display of content served from other sources. Judge Forrest’s decision created turmoil for website operators who frequently used embedded images on their sites. Recognizing such turmoil and the uncertainty for online publishers caused by the ruling, on March 19, 2018, Judge Forrest certified her Opinion for Interlocutory Appeal.

Background

For a factual recitation of the underlying issues and an explanation of Judge Forrest’s decision, refer to our prior article on Goldman v. Breitbart News Network et al., SDNY Case No.17-CV-03144.

In essence, plaintiff Justin Goldman had commenced suit against Breitbart and other media outlets for copyright infringement for publishing articles featuring a photograph taken by Mr. Goldman on July 2, 2016 (the Photo). The Photo had been uploaded to Mr. Goldman’s Snapchat story, then went viral, passing through several social media platforms, including Twitter. The defendants allegedly prominently featured the Photo by embedding it in a Tweet on their respective websites. None of the defendants’ websites had copied or saved the Photo on their own servers. The Photo had been visible in the articles only through a technical process known as embedding.

The defendants, in moving for partial summary judgment, urged the Court to define the scope of the “display right” in terms of the Server Test advanced by the Ninth Circuit in Perfect 10. Judge Forrest, however, rejected the Server Test as the correct application of the law with regard to the facts in Goldman and further expressed skepticism that the court in Perfect 10 correctly interpreted the display right of the Copyright Act.

The Motion for Certification and the Decision

Following Judge Forrest’s decision, the defendants moved for certification of the Court’s Opinion for interlocutory appeal under 28 U.S. 1292(b) and to stay the proceedings pending resolution of any interlocutory appeal of the Order.

Section 1292(b) provides:

(b) When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals which would have jurisdiction of an appeal of such action may thereupon, in its discretion, permit an appeal to be taken from such order, if application is made to it within ten days after the entry of the order: Provided, however, That application for an appeal hereunder shall not stay proceedings in the district court unless the district judge or the Court of Appeals or a judge thereof shall so order. [Emphasis added.]

The plaintiff opposed the motion and argued that the three-part framework under section 1292(b) (as emphasized above) was not satisfied. First, the plaintiff argued that there was no controlling question of law that applied to this case. Rather, the plaintiff believed that the Court’s decision did not adjudicate whether the Server Test as actually applied in Perfect 10 was overruled here, but instead addressed whether the facts in this case were applicable under the law applied in Perfect 10.

The plaintiff then argued that there could be no substantial difference of opinion since the issue was not whether Perfect 10 or the Server Test were good law, but rather whether the facts here were applicable.

Finally, the plaintiff argued that a reversal of the Court’s Order would only result in a departure of half of the remaining defendants and therefore would not materially advance the ultimate termination of the litigation.

The Court, however, found that certification is appropriate here for several reasons:

• First, the Court “recognized the parties’ representations that its February 15, 2018, Opinion, finding defendants liable for violating the display right under §106(5) of the Copyright Act, has created tremendous uncertainty for online publishers.” Specifically, the Court noted that insofar as the subject embedded image was hosted on Twitter, the frequency with which embedded images are “retweeted” made “the resolution of this legal question” important “beyond this case.”
• The Court further explained that “while there are remaining issues to be determined, the key issue in this case − whether there is copyright liability under the display right where one publisher ‘embeds’ an image hosted on a third-party server – has already been decided.”
• The Court then reasoned that “a reversal on appeal would result in the dismissal of several defendants and narrow the issues for those defendants who would remain.” Thus, it would “materially advance the ultimate termination of this litigation.”

Analysis

The defendants have 10 days from Judge Forrest’s certification to file a petition with the Court of Appeals under F.R.A.P. Rule 5, requesting permission for an interlocutory appeal. The petition must include (1) the facts necessary to understand the question presented, (2) the question itself, (3) the relief sought, (4) the reasons why the appeal should be allowed and is authorized by a statute or rule and (5) the Opinion and Judge Forrest’s Order granting permission. The Petition is expected to be filed shortly.

Depending on the Second Circuit’s decision on whether to accept the interlocutory appeal and the ultimate decision it renders on the applicability of the Server Test to embedded content, a conflict between the Second and Ninth Circuit Courts could arise, pressing the issue closer to being brought before the Supreme Court. In the interim, millions of websites that use linking as part of their model and those photographers and content providers who are seeking a new avenue to seek compensation wait in limbo to see what happens.