After $6M and 17 Years Fighting the Record Labels’ Copyright Lawfare, the Court Awards Vimeo $16k in Costs–Capitol Records v. Vimeo

The record labels sued Vimeo for user-caused copyright infringement in 2009. The case is still ongoing in 2026. How old is this lawsuit? If it were a person, it would be GenZ and thus older than every Gen Alpha person on earth.

This case was part of a broad-based copyright owner litigation campaign that included Viacom v. YouTube and UMG v. Veoh. All of these lawsuits were designed to permanently shut down the video hosting category by finding a hole in the Section 512(c) online safe harbor so that copyright owners could sue UGC sites even if they didn’t send individual takedown notices. YouTube settled, Veoh went broke, and Vimeo soldiered on (and on and on…).

In January 2025, Vimeo scored a major win in the Second Circuit. When the dust settled, the court summarizes: “Vimeo ultimately achieved complete victory on all of Plaintiffs’ claims after many long, hard-fought years spent litigating this dispute.”

Vimeo sought a 505 attorneys’ fee shift for its $6 million in defense costs over 17 years. The court denies the request, but awards it a token $16,000 in costs.

The court summarizes its thinking:

As Vimeo itself has previously recognized, this case raised “many difficult or new” issues….An award of attorneys’ fees to Vimeo, however, would not serve the purposes of the Copyright Act. Plaintiffs asserted reasonable claims that raised novel, complex questions of law, and they litigated those claims reasonably and in good faith. This case also presents little need for either compensation or deterrence.

What were those novel issues?

This case raised many issues of first impression, including, but not limited to, the legal framework governing when a service provider is deemed to have actual or constructive (also called “red flag”) knowledge of infringement, the circumstances in which willful blindness is a proxy for knowledge, the factual showing necessary for a plaintiff to establish the foregoing, and whether the DMCA’s safe harbor provisions applied to sound recordings fixed prior to February 15, 1972.

Those issues felt more novel back in 2009. The court acknowledges the case’s venerability, saying:

the legal standards governing, and the factual showing required to receive, DMCA safe harbor protection had not been addressed by the Second Circuit when Plaintiffs filed suit in 2009….

Even following Viacom, the evidentiary showing necessary to present or defeat a safe-harbor defense under the DMCA was not settled law, particularly with respect to the question of actual or red flag knowledge of infringement.

Vimeo pointed out that the record labels could have avoided this case entirely by sending proper 512(c)(3) takedown notices. The court is unmoved:

there is no statutory requirement that a plaintiff exhaust its notice-and-takedown remedies against a defendant before bringing suit under the Copyright Act….

As the Second Circuit noted, the notice-and-takedown provisions merely “augment[ed] the arsenal of copyright owners” by creating an alternative remedy. And because the limitation on liability conferred by the DMCA is qualified, rather than absolute, there remains a place for good-faith lawsuits under the Copyright Act to test whether a service provider is entitled to that immunity. From a rightsholder’s perspective, the two remedies are far from the same: unlike a claim brought under the Copyright Act, a DMCA takedown notice does not provide a rightsholder with monetary relief for past infringement or injunctive relief against future infringement, both of which Plaintiffs sought in this action. Penalizing a rightsholder for seeking a remedy available to it under the Copyright Act—without an exhaustion requirement—would not serve the Act’s purposes.

The court did award Vimeo $16k in costs because it prevailed in the most recent Second Circuit appeal.

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Did the record labels really have colorable arguments when they first filed this lawsuit? Well, yes, in the sense that the DMCA is a long and complicated safe harbor filled with ambiguities. Major copyright owners planned to test all of the ambiguities–and are still working on that agenda nearly 30 years later.

However, the copyright owners’ real agenda was never to clarify the ambiguities in good faith. Instead, their goal is, and always was, to tacitly amend the DMCA safe harbor in court to secure terms they did not and could not get from Congress via legislative deal-making–most notably, to let copyright owners bypass the DMCA’s central notice-and-takedown architecture so that they could sue UGC services over user-caused copyright infringement without sending individual takedown notices. The copyright owners have been willing to risk many millions of dollars to obtain that backdoor amendment in court, and they really don’t care about the consequences for the defendants they steamroller or bankrupt in the process. To me, this is exactly why a 505 fee shift would have been the only fair outcome here. If the copyright owners are going to gamble some of their fortune on securing legislative amendments via impact litigation, they should bear the full costs of that strategy.

Instead, the fee shift denial implicitly legitimizes the copyright owners’ lawfare strategy against the DMCA online safe harbors. There is surely one or more lessons about the proper design of immunities and safe harbors buried in this case study somewhere.

Case Citation: Capitol Records, LLC v. Vimeo, LLC, 2026 WL 2606633 (S.D.N.Y. Sept. 3, 2026)