Viral DRM LLC v. Lepetyuk
- Jacquelyn Corley
- 3:24-cv-00746
- U.S. District Court · Northern District of California
- 8
In Viral DRM v. Lepetyuk, Judge Corley granted default judgment on one claim for $3 and denied it on three others for lack of standing.
Viral DRM LLC obtained a $3 default judgment plus post-judgment interest on its claim concerning false copyright counternotifications. Its copyright-infringement and watermark-related claims were denied and dismissed without leave to amend for lack of standing. Yaroslav Lepetyuk was in default after the court struck her answer.
What happened
In Viral DRM LLC v. Lepetyuk, Viral DRM alleged that Yaroslav Lepetyuk copied its copyrighted videos from YouTube and uploaded infringing versions to her channel. Lepetyuk initially answered but later stopped participating, so the court struck her answer and entered her default.
The court examined whether Viral DRM had the right to bring each claim. It found that Viral DRM’s agreements with two copyright holders did not give it the exclusive rights needed to sue for copyright infringement, and the record did not establish its relationship to the owner of the watermarks. The court did find that Viral DRM could pursue its claim concerning allegedly false Digital Millennium Copyright Act counternotices.
Judge Corley granted default judgment on that counternotice claim and awarded Viral DRM $3 in nominal damages plus post-judgment interest. She denied default judgment on the copyright-infringement and watermark-related claims, dismissed those claims without leave to amend for lack of standing, and denied leave to add the videographers as nominal plaintiffs.
The detailed version
- Viral DRM LLC v. Lepetyuk · No. 3:24-cv-00746
- Jacquelyn Corley
- Mar. 14, 2025
Background
Viral DRM LLC alleged that Yaroslav Lepetyuk downloaded and copied Viral DRM’s copyrighted materials from YouTube and re-uploaded infringing versions to her YouTube channel, Open Your Eyes. Lepetyuk initially appeared and answered the complaint, but later stopped responding to court orders and would not participate. The court struck her answer and entered her default.
Viral DRM moved for default judgment. During the hearing, the court questioned whether Viral DRM had standing—the legal right to bring the claims—and ordered it to provide its licensing agreements. The court later issued an order requiring Viral DRM to explain why it had standing.
Standing for the Copyright and Watermark Claims
For a copyright-infringement claim under 17 U.S.C. § 501(b), the plaintiff must be the legal or beneficial owner of an exclusive copyright right. An assignment or exclusive license can transfer such a right, but a nonexclusive license cannot. The court reviewed Viral DRM’s agreements with Jonathan Petramala and Michael Brandon Clement. Those agreements gave Viral DRM exclusive agency rights to manage and administer content, search for infringement, register copyrights, authorize attorneys to negotiate settlements, issue takedown notices, and file claims on behalf of the copyright owner. The agreements also allowed Viral DRM to display, store, transmit, and distribute the works as needed. But the copyright holders retained ownership, and the agreements did not give Viral DRM the exclusive right to authorize others to reproduce, distribute, or display the videos.
The court concluded that Viral DRM therefore lacked standing to sue under § 501(b). It also concluded that Viral DRM had not shown standing for its claims under 17 U.S.C. §§ 1201 and 1202 concerning removal or falsification of copyright-management information, including Live Storms Media’s watermark. The agreements submitted to the court did not mention Live Storms Media, and the record did not clearly establish the relationships among Live Storms Media, Viral DRM, the videographers, and the works at issue.
Section 512(f) Claim and Default Judgment
Section 512(f) of the Digital Millennium Copyright Act allows a claim for damages based on a material misrepresentation in a copyright counternotification. The court found that Viral DRM had standing for this claim because it provided licensing agreements with Clement and Petramala, showed that Clement submitted the takedown notices as Viral DRM’s Digital Rights Manager, and submitted copies of the counternotifications.
The court granted default judgment on the § 512(f) claim. It found that the claim was adequately pleaded, Viral DRM submitted reliable supporting evidence, and the factors used to evaluate default judgment favored entry of judgment. The court did not award the requested $7,500, however. It found no evidence that YouTube restored the videos because of the counternotifications or that Viral DRM suffered actual harm as a result of them. The employee time described in Clement’s declaration concerned preparing the takedown notices, not responding to the counternotifications.
The court awarded nominal damages of $1 for each of the three false counternotifications, for a total of $3, plus post-judgment interest at the federal rate. The opinion states that Viral DRM waived any claim for prejudgment interest, attorney’s fees, and costs.
Disposition
The court granted default judgment on Viral DRM’s § 512(f) claim and awarded $3 in nominal damages plus post-judgment interest. It denied Viral DRM’s motion for default judgment on the claims under §§ 501(b), 1201, and 1202, dismissed those claims without leave to amend for lack of standing, and denied leave to amend to name the videographers as nominal plaintiffs. A separate judgment was to follow.
Read the full 8-page opinion on CourtListener, the free public archive maintained by the Free Law Project.