Many New York platforms prioritize responding quickly to takedown requests to avoid Digital Millennium Copyright Act (DMCA) copyright infringement liability. Quick action matters, but it is not the only issue courts consider. Courts also look at how a platform generates revenue and how much control it has over infringing content.
When a platform profits from infringing material or influences how that content appears, safe harbor protection may not apply. This risk often affects growing platforms that combine monetization, moderation, and content promotion.
Understanding this risk helps explain why some platforms lose protection even when they follow takedown procedures. In many cases, these issues surface after copyright owners discover that infringing material is not only being hosted, but is also driving revenue or being actively promoted by the platform.
When Financial Benefit and Control Eliminate DMCA Safe Harbor
Another way to lose DMCA safe harbor has nothing to do with how fast you take content down. Instead, it focuses on how you generate income and the level of control you have over infringing activity.
Under DMCA section 512(c), a service provider loses safe harbor protection if these two conditions exist:
- It receives a financial benefit directly attributable to infringing activity. The platform is directly profiting in a meaningful way from copyright infringement.
- It has the right and ability to control that activity. The platform does more than passively host user content.
Both elements must be present. When they are, DMCA safe harbor protection can vanish.
What Counts as a Financial Benefit Directly Attributable to Infringement?
Courts seek a genuine connection between infringement and revenue. They do not require proof that infringement represents the platform’s only income source.
Instead, courts ask whether infringing content helps drive money into the business.
Examples that often raise concern include:
- Subscription or membership fees tied to infringing use. When users primarily pay to access unauthorized content, courts may view that revenue as tied to infringement.
- Advertising revenue driven by infringing traffic. When infringing content attracts views that generate ad revenue, courts may see a clear financial link.
- Business models built around unauthorized copyrighted content. Platforms that rely on infringement to attract users face the highest risk.
The closer the link between infringement and revenue, the more vulnerable the platform becomes.
What “Right and Ability to Control” Means Under the DMCA
Control requires more than the basic ability to remove or block content. Nearly every platform can remove content, and that alone does not defeat the DMCA safe harbor.
Courts look for signs that a platform shapes or directs infringing activity. The question is whether the platform acts like a neutral host or something more.
Factors courts often consider include:
- Prescreening or active curation of user submissions. Reviewing content before publication can suggest a greater level of involvement.
- Providing detailed guidance on content creation. Editorial direction about layout, appearance, or subject matter may show control.
- Featuring or promoting specific user content. Highlighting infringing material can indicate active steering.
- High-level control over what appears on the service. Shaping the type of content allowed can affect how courts view neutrality.
No single factor decides the outcome. Courts examine the overall level of influence. At some point, a platform stops looking like a passive host and begins to resemble a co-architect of the content environment.
A platform’s actions after receiving a DMCA copyright infringement notice can affect this analysis. Continuing to promote or monetize the content may undermine safe harbor protection.
Why This Matters for Platform Design
Many modern platforms blend moderation, recommendation algorithms, and monetization. That approach makes business sense, but it also creates legal risk.
Problems arise when:
- Infringing content drives engagement and revenue. Performance metrics can quietly reward infringement.
- Platform systems steer users toward infringing material. Algorithms and staff decisions can influence visibility.
Plaintiffs may claim that the platform actively profited from and facilitated DMCA copyright infringement, thereby removing safe harbor protection. Thoughtful platform design can reduce copyright risk and preserve DMCA protections.
Practical Steps to Reduce Exposure
Platforms can take the following steps to reduce risk while still supporting growth:
- Avoid revenue strategies tied to infringing content. Monetization should not depend on unauthorized material.
- Document neutral promotion criteria. Content-agnostic rules help show neutrality.
- Separate editorial decisions from infringement tolerance. Popularity should not excuse risk.
- Review high-performing content regularly. Strong performance can signal high exposure.
Safe harbor exists to protect intermediaries that host user content without shaping infringement. It does not protect platforms that knowingly profit from and influence infringing activity. These steps help align business operations with the limits of DMCA section 512(c).
Jones IP Law Can Help You Address Financial Benefit and Control Risks
Many platforms only consider financial benefits and control after a problem arises. A lawsuit, demand letter, or sudden loss of safe harbor protection often brings these issues to light. By that point, design choices and revenue models may already limit the options available.
Jones IP Law works with New York businesses to spot these risks before they turn into disputes. Attorney Michael Jones has spent his career advising both copyright owners and online businesses on how intellectual property law applies to digital platforms and content-driven services.
Michael has represented clients in intellectual property matters before federal courts, the U.S. Court of Appeals for the Federal Circuit, the International Trade Commission, and administrative tribunals. Before entering private practice, he also served as a volunteer assistant attorney general. In that role, he worked on matters involving data security and emerging technology.
A substantial portion of Michael’s DMCA practice involves representing copyright owners, artists, photographers, and other creatives whose work is monetized or promoted online without permission. That enforcement experience directly informs how financial benefit and control issues are analyzed when safe harbor protection is challenged.
Michael’s experience allows DMCA safe harbor concerns to be evaluated in a practical, real-world way, informed by both enforcement and compliance matters. If your platform hosts user-generated or AI-assisted content, we can help you identify risks tied to DMCA copyright infringement. We can also help you develop a plan to protect your business before those risks grow.
Contact Jones IP today to learn how Jones IP Law can assist you in navigating DMCA law and compliance.
Disclaimer: This article is provided for general informational purposes only and does not constitute legal advice. Reading this article does not create an attorney-client relationship. DMCA issues are highly fact-specific, and legal obligations and risks may vary depending on the circumstances. You should consult a qualified attorney regarding your specific situation.
