The ruling comes after the court withdrew its December 2011 opinion and agreed to Universal’s request for a panel rehearing.
Despite the tougher standards for ISPs dictated by last year’s Viacom v YouTube decision, the new panel reaffirmed that Veoh did not substantially influence the activities of its users or engage in purposeful conduct that would make it liable for inducing infringement.
In a footnote, the court added that Universal’s request to find a number of venture capital companies named in the lawsuit secondarily liable was problematic.
“We remain concerned about the possibility of imposing secondary liability on tangentially involved parties, like Visa and the Investor Defendants, while those accused of direct infringement receive safe harbor protection,” said the judgment.
It continued: “Were we to hold that Veoh was protected, but its investors were not, investors might hesitate to provide the necessary funding to companies like Veoh, and Congress’ purpose in passing the DMCA would be undermined.”
Michael Elkin of Winston & Strawn represented Veoh, and Steven Marenberg of Irell & Manella represented Universal.
