Capitol Records, Inc. v. MP3Tunes, LLC, 821 F.Supp.2d 627 (S.D.N.Y. 2011)

(1) Capitol Records, which owns copyrights in sound recordings, musical compositions, and images of album cover art, sued MP3Tunes, an online music storage service provider whose website allows users to store music files in their personal online music “lockers." On MP3Tunes, users can search for and transfer songs to their lockers. (2) The Court held in favor of MP3Tunes. The Court found that MP3Tunes qualified for safe harbor under DMCA, except when the songs were transferred from certain unauthorized websites. In this regard the Court noted that “if enabling a party to download infringing material was sufficient to create liability, then even search engines like Google or Yahoo! would be without DMCA protection. In that case, the DMCA’s purpose — innovation and growth of internet services — would be undermined." (3) However, the Court also noted that MP3Tunes had actual knowledge of its users had stored and continued to have access to the infringing works, and it materially contributed to its users’ infringement when it failed to remove the infringing songs after receiving takedown notices.