The Big Story: Congress must keep startups in mind while reviewing the DMCA. The House Judiciary Committee held a hearing this week about § 512 of the Digital Millennium Copyright Act (“DMCA”)—a critical area of the law for startups which provides a balanced and certain framework for addressing allegations of online copyright infringement. As we have explained, if Congress were to consider any revisions, it is essential they carefully weigh how important § 512 is to startups. While much of the Committee’s hearing ignored those needs, there were indications some lawmakers and witnesses are still mindful of startups and the users and Internet-enabled creators who rely on them.

Section 512 embodies a carefully-crafted balance which remains valuable, providing certainty that is especially relevant to today’s startups. It lays out the notice-and-takedown and safe harbor framework, so startups that comply with provisions of § 512 are not automatically liable for alleged infringement by their users which they have no involvement in or knowledge of.

This week’s hearing addressed a recent report from the Copyright Office, which unfortunately suggested changes in the law that would substantially alter the current balanced framework and make it much riskier for startups and small service providers to host user-generated, creative content. Most of the hearing was consistent, as lawmakers appeared to agree a change may be warranted—partially motivated by “techlash”—and expressed lopsided interest in the concerns of certain, traditional copyright owners. That mindset is alarming, because, as we detailed in our comments to the Judiciary Committee, any changes to § 512 could have an outsized and negative impact on startups and smaller service providers.

While much of this week’s hearing seemed to focus on large platforms and traditional rightsholders, there were indications that some lawmakers are continuing to consider the needs of startups and the Internet users and Internet-enabled creators who rely on them. Rep. Stanton acknowledged that changes to § 512 could create barriers to entry, noting that “uncertainty due to changes in the law, not being able to afford litigation on copyright infringement, can cause new and smaller businesses not to compete altogether.” Likewise, one of the witnesses, Jonathan Band—Counsel for the Library Copyright Alliance—explained how adopting changes from the Copyright Office’s report could have serious unintended consequences. Even purportedly “minor” changes could amount to a de facto requirement that all companies deploy filtering technology to identify potential infringement—a requirement that would not be a big problem for larger platforms, “but for smaller platforms it would be a very serious issue.” In the same vein, another witness, Public Knowledge Policy Counsel Meredith Rose correctly noted that the impulse to legislate based on what larger platforms can do—for example, requiring all service providers to affirmatively search and filter for allegedly infringing content—would “create unfair or unreasonable expectations for smaller websites . . . that host user generated content.”

It is unclear whether or how Congress may proceed with any modification to § 512, but hopefully lawmakers will keep startups in mind, and preserve the current balance and certainty in the law that enables nascent companies to launch, grow, and thrive.