Viacom Drops a $1 Billion Nuke on Google

They said that Google’s acquisition of YouTube would be the act that saved it from the fate of Napster – lawsuit oblivion.

And they may have been wrong, if today’s $1 billion lawsuit is a sign of things to come. Viacom, the plaintiff, has been on a warpath against YouTube lately. Unlike Fox’s behind the scenes chats with the Wall Street Journal to get the message across that they were displeased with the Google/YouTube, Viacom has chosen the frontal assault: Massive takedown notices and now the simple request for $1 billion in damages.

Lawsuits like these are statements. The RIAA did it last year by suing AllofMP3 for $1.65 trillion for copyright violations. And there is actual law to back these up. U.S. copyright law allows statutory damages of $750 to $150,000 per violation. In this case, Viacom argues that there have been over 1.5 billion views of 160,000 Viacom clips. Each of those 1.5 billion views is a potential copyright violation.

Viacom really stirred things up in its statement about the lawsuit:

There is no question that YouTube and Google are continuing to take the fruit of our efforts without permission and destroying enormous value in the process. This is value that rightfully belongs to the writers, directors and talent who create it and companies like Viacom that have invested to make possible this innovation and creativity.

After a great deal of unproductive negotiation, and remedial efforts by ourselves and other copyright holders, YouTube continues in its unlawful business model. Therefore, we must turn to the courts to prevent Google and YouTube from continuing to steal value from artists and to obtain compensation for the significant damage they have caused.

John Murrell calls this a “knife fight” and I think he’s dead on. There’s no way this gets settled with Google paying any actual damages. Google will be furiously working to sign a deal with Viacom to get this lawsuit to go away and a licensing deal in place. They’re on a very slippery slope right now, with the Napster carcass lying limp at the bottom.