Exhibit E

EXHIBIT E
Case 1:11-cv-20427-KMW Document 684-5 Entered on FLSD Docket 10/06/2014 Page 1 of 3

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Lenz v. Universal Music Corp., No. C07-3783JFRS, 2008 WL 4790669, at *2 (N.D. Cal. Oct.
28, 2008). The particular context of the facts alleged in Lenzs complaint, according to the
court, represented that extremely rare case in part because obvious fair uses were rife on
YouTube. Id. Here, Warner only uses its robots on pirate sites offering full-length motion
pictures and television programs for mass public distribution. Kaplan Decl. 6. There is no
colorable argument that such uses are ever a fair use. See BMG Music v. Gonzalez, 430 F. 3d
888, 889-91 (7th Cir. 2005) (downloading full-length entertainment content not fair use); A&M
Records, Inc. v. Napster, 239 F.3d 1004, 1014-19 (9th Cir. 2001) (same). Here, Hotfile does not
even claim (much less proffer evidence) that any of the counterclaim files was a fair use.
Hotfiles standard would turn every mistaken DMCA notice into an actionable knowing
misrepresentation because it is known in advance that any system will result in some errors.
This is an argument for constructive knowledge and is incompatible with the 512(f) statutory
standard. E.g., Rossi, 391 F.3d at 1005 (rejecting constructive knowledge standard).
As Rossi recognizes, many methods can support a subjective good faith belief. In Rossi,
the MPAA did not download files before sending a DMCA notice. Rossi v. Motion Picture
Assn of Am., Inc., Civ. No. 02-00239 BMK, 2003 U.S. Dist. LEXIS 12864, at *2-3 (D. Haw.
Apr. 29, 2003). Rossi argued as Hotfile does here that Defendants were not justified in
sendinga notice, or at the very least there is a triable issue of fact regarding justification,
because Defendants failed to conduct an investigation to determine whether Plaintiffs website
actually infringed on any copyrights before sendingthe notice. Id. at *8. The district court
rejected this argument, noting that the Court cannot find [] any provision in the DMCA which
requires a copyright holder to conduct an investigation to establish actual infringement prior to
sending a notice to an ISP. Id., at 8-9. The Ninth Circuit concurred. 391 F.3d at 1003-05.
Notably, Hotfile offers no evidence that a fully manual or human review system would
have produced fewer errors than Warners system. And there is no suggestion that it would.
Mot. at 2 (Hotfile acknowledges that mistakes happen even with fully manually systems).
Hotfiles counterclaim proves the point. Hotfiles human review by teams of lawyers still
resulted in Hotfile including among the counterclaim files works that are owned by Warner.
Mot. at 1. That was just simple human error. Likewise, many of the counterclaim files (the
LeakID files) were in fact subject to a process calling for human review (two levels of human
review) and yet there were errors as a result of human mistakes. Kaplan Decl. 20.

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Hotfile, without evidence, questions the LeakID process because some apparent mistakes were
seemingly obvious. Opp. at 12-14. But that is why it is called human error. Even responsible
and diligent people make mistakes, particularly with high-volume repetitive tasks, such as the
hundreds of thousands of notices Warner has had to send to Hotfile. There is simply no basis for
the Court to find that any system of locating infringing links online would produce fewer errors
than Warners system and Hotfile certainly does not provide any evidence to that effect.
2

II. NO EVIDENCE SUPPORTS HOTFILES CLAIM THAT WARNER HAD
KNOWLEDGE OF SPECIFIC ERRORS.
A. No Evidence Supports Hotfiles Claim that Warner Knowingly Deleted
JDownloader.
Hotfile repeatedly asserts that Warner knew all along that JDownloader links were
normally or typically posed on pages containing Warner content, but took no steps to
prevent the deletion of the JDownloader links on such posts. Opp. at 5-6, 12. The cited
deposition testimony from Warners representative, however, does not say that at all. Kaplan
testified that it was Hotfiles counterclaim that brought to Warners attention that, once in a
while, an infringer posting links to Warner content would also post a link to JDownloader
alongside infringing Warner content, thus causing it to be removed when Warner removed
infringing posts. See Yeh Ex. R (Kaplan dep.) at 181:10-181:18; 225:13-21 (noting conclusion
of research after the fact of the counterclaim). Warner first learned of this when investigating
Hotfiles counterclaim in this case. Id. It did not have that information when sending the notices
at issue. Indeed, when Warner learned, it modified its system to prevent takedowns of
JDownloader. Yeh Ex. R (Kaplan dep.) at 186:7-16. The actual facts are not in dispute.

2
To the contrary, automated processes are commonly used in the analogous context of civil
discovery. Rule 26 requires attorneys to certify in good faith that discovery responses are
complete and correct (Fed. R. Civ. Proc. 26(g)(1)), yet courts regularly endorse the use of
automated document search and retrieval programs, effectively recognizing that such automated
programs can provide the basis for a good faith belief. See, e.g., Zubulake v. UBS Warburg LLC,
229 F.R.D. 422, 432 (S.D.N.Y. 2004) (To the extent that it may not be feasible for counsel to
speak with every key player to identify relevant documents, [i]t may be possible to run a
system-wide keyword search). Indeed, there is recognition that sophisticated automated review
processes are moreaccurate than human review. The Sedona Conference, The Sedona
Conference Best Practices Commentary on the Use of Search and Information Retrieval Methods
in E-Discovery, 8 Sedona Conf. J. 189, 199 (2007) (noting myth that manual review by humans
constitutes the gold standard by which all searches should be measured, citing study that
automated searching is substantially more accurate and complete due to incidence of human
error).

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Case 1:11-cv-20427-KMW Document 684-5 Entered on FLSD Docket 10/06/2014 Page 1 of 3

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