Trading Rights for 'likes'—sublicenses on Social Media Platforms

• Jurisdiction: United States,Federal
• Citation: Vol. 45 No. 3
• Publication year: 2020
• Author: Vera Golosker
• topic: Business of Law,Contracts,Intellectual Property,Copyright law,Technology

Trading Rights for 'Likes'—Sublicenses on Social Media Platforms

Vera Golosker

Metro-Goldwyn-Mayer Studios

INTRODUCTION

Content creators can increase exposure and sales by posting their work on social media platforms.¹ But, what rights to the work do they grant in the process? This article will review the recent decisions on embedded content sublicenses, examine the terms of use of some of the most popular social media sites, and provide best practices for platforms and content creators.

CASE SUMMARIES

Sinclair v. Ziff Davis and Mashable, Inc.: Users Grant Instagram a Sublicense to Public Content

In Sinclair v. Ziff Davis and Mashable, Inc., a professional photographer, Stephanie Sinclair, sued the media and entertainment platform, Mashable, Inc., for copyright infringement.² Mashable initially offered to license one of Sinclair's photographs entitled "Child, Bride, Mother/Child Marriage in Guatemala" for $50 to use in an online article profiling female photographers.³ After Sinclair, who owns an exclusive copyright to the photograph, rejected the company's offer, Mashable instead embedded her photo in the article, providing a hyperlink to the photo Sinclair had posted on her public Instagram account.⁴

The Instagram Terms of Use indicate that by posting content, the user "grant(s) to Instagram a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to the Content" subject to the user's privacy settings."⁵ Instagram's Data Policy states that public content is subject to use by other users through Instagram's application programming interface ("API"), which enables others to embed the content.⁶

The court initially granted Defendants' motion to dismiss.⁷ Judge Kimba Wood of the Southern District Court of New York ruled that Instagram had the right to sublicense the photograph per the platform's terms of use to anyone who uses Instagram's API.⁸ Plaintiff had authorized the sublicense to Instagram by posting the photograph publicly.⁹

But, Judge Wood later granted Sinclair's motion for reconsideration, holding that Defendant must prove evidence of Instagram sublicensing the photo to Mashable.¹⁰ So, while Plaintiff photographer unequivocally granted Instagram the right to sublicense the content according to the Court, the case has been reopened to determine whether Instagram in fact sublicensed to the Defendant publication.¹¹

McGucken v. Newsweek LLC: Insufficient Evidence of Instagram Granting Sublicense to Dismiss Plaintiff's Claim

The motion for reconsideration decision in Sinclair relied on another New York District Court case, McGucken v. Newsweek LLC, which required the Defendant publication to establish it had a sub-license from Instagram.¹² Plaintiff Elliot McGucken posted a photograph of an ephemeral lake in Death Valley, California on his public Instagram account.¹³ Newsweek published an article about the lake, entitled "Huge Lake Appears in Death Valley, One of the Hottest, Driest Places on Earth" and embedded McGucken's Instagram post in the online article.¹⁴ Plaintiff sued for copyright infringement, and Newsweek moved to dismiss, arguing that it had a valid sublicense since McGucken posted the photograph publicly.¹⁵

Judge Katherine Polk Failla agreed with Judge Wood that the content creators who post on Instagram grant the platform a right to sub-license: "[i]ndeed, insofar as Plaintiff contends that Instagram lacks the right to sublicense his publicly posted photograph to other users, the Court flatly rejects that argument. The Terms of Use unequivocally grant Instagram a license to sublicense Plaintiff's publicly posted content."¹⁶

However, Judge Failla stated that there was not enough evidence at this stage to show that Instagram granted a sublicense to the publication in its Terms of Use.¹⁷ Instagram's Data Policy contemplates such use, stating that users may share any of the content made publicly available.¹⁸ Its Platform Policy clearly indicates one of its purposes: "to help broadcasters and publishers discover content, get digital rights to media, and share media using web embeds."¹⁹ But, according to the court, "[w]hile the various terms and policies foresee publications embedding user's content, the terms do not expressly grant sublicenses to those who embed content."²⁰ In fact, the Platform Policy includes an instruction to comply with any requirements or restrictions imposed by the content owners, and prohibits providing or promoting content that violates intellectual property rights.²¹

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The McGucken court acknowledged that it may be possible to read the terms and policies to grant a sublicense to embedders, but at the motion to dismiss stage, all reasonable inferences favored the photographer.²² The Sinclair and McGucken cases remain to be settled or reach a judgment.²³ What the cases make clear is that a content creator who publicly posts on Instagram grants the platform a right to sublicense the work.²⁴ Though, as discussed below, Facebook, which owns Instagram, will be changing its Platform Policy in August 2020,²⁵ which may affect future decision regarding sub-licenses to partnering platforms.

Circuit Split

Courts are currently split on how merely linking to content from another server affects the intellectual property rights of content creators.²⁶ The Ninth Circuit held that embedding content does not infringe on the copyright of the original poster if the defendant does not host the content on its own server.²⁷ But, in 2018, a New York district court rej ected this "server test," holding that embedding a photograph constituted an infringing display.²⁸ The Second Circuit has not rendered an opinion on the matter.²⁹

As discussed below, other platforms likewise have users agree to terms of service that grant the sublicensing right, and content creators must be aware of the copyright tradeoffs of social media exposure.

TERMS OF SERVICE OF SOCIAL MEDIA PLATFORMS

DeviantArt—Terms of Service

DeviantArt is an online community that features artwork.³⁰ While DeviantArt also has the right to sublicense content, its terms emphasize the protections for content creators. DeviantArt limits its license for the sole purpose of enabling the site to make artists' work available therein. Other than linking to the artist's work via its platform, Devi-antArt expressly requires a third party to obtain permission from the copyright owner of the original work, as discussed below.

DeviantArt's Terms of Service grant the site a license to reproduce, distribute, and publicly display user's content "[f]or the sole purpose of enabling [DeviantArt] to make [user's] Content available through the Service."³¹ While its license also includes the right to sublicence to any other person or company, that right is "subject to the terms and conditions of this Agreement."³² Therefore, an argument is feasible that the right to sublicense is limited to the purpose of making the content available through the Service (e.g., if DeviantArt owners sell the company and sublicense user's content to continue displaying it on the site).

The terms note that "third parties will be able to copy, distribute, and display [users'] Content using readily available tools...although other than by linking to [users'] Content on DeviantArt, any use by a third party of [users'] Content could violate paragraph 4 of...