MLS Copyright Lawsuit Dismissed

Read the full decision: Stross v. Redfin Corp., No. A-15-CA-00223-SS, 2016 WL 4718197 (W.D. Tex. Sept. 6, 2016)

A Texas federal court directed an MLS subscriber to raise his complaint about another subscriber’s allegedly unauthorized use of his photos to the MLS, rather than raise the issue in Federal court. The court held that the subscriber lacked standing to sue to enforce the MLS rules for the alleged improper use of photos. But the court also acknowledged that the purported improper use of the photos may have been protected from copyright infringement claims under the Digital Millennium Copyright Act.

A licensed Texas real estate broker and architectural photographer, Alexander Stross (“Stross”) participated in a multiple listing service owned and operated by the Austin Board of REALTORS® (“MLS”). Stross filed a copyright infringement lawsuit against MLS participant Redfin, alleging Redfin’s display of more than 1800 of his photos on its website was in violation of one or more of the MLS’s VOW rules and, therefore, such display exceeded the scope of the license granted to Redfin by the MLS for such display. Stross never notified the MLS about the Redfin’s alleged MLS rule violations.

Redfin raised two defenses: first, that it complied with its license to use the photographs; and second, that it was shielded from liability by the safe harbor provision of the Digital Millennium Copyright Act (“DMCA”). The DMCA safe harbor protects websites from copyright infringement, subject to the site’s compliance with certain requirements. NAR filed an amicus curiae brief in support of the Redfin’s argument that the DMCA safe harbor protected it from liability because that conclusion is significant to the operation of IDX and other real estate websites that may contain listing content provided by other MLS participants. Learn more about the DMCA safe harbor and how to protect yourself from infringement liability.

The MLS’s rules provide that by submitting listing content to the MLS a subscriber grants the MLS a license to use the listing content “for any purpose consistent with the facilitation of the sale, lease and valuation of property.” The MLS rules also permit a participant to “promptly” notify the MLS if the participant believes another participant is violating the rules, to enable the MLS to enforce its rules.

The Court ruled that Stross lacked standing to sue Redfin for its alleged violation of MLS rules, and instead noted that Stross’s proper remedy for such violations was to notify the MLS. Accordingly, the court entered judgment in favor of Redfin without addressing Redfin’s claim that it was entitled to the protection of the safe harbor provisions of the DMCA. In a footnote, however, the court noted that it found Redfin’s argument that it was entitled to the protection of the DMCA “persuasive.” This is important because it is consistent with the position that the DMCA will apply to allow real estate IDX websites to avoid liability for copyright infringement for material appearing on such websites without their knowledge by compliance with the DMCA safe harbor requirements.

Stross v. Redfin Corp., No. A-15-CA-00223-SS, 2016 WL 4718197 (W.D. Tex. Sept. 6, 2016). [This is a citation to a Westlaw document. Westlaw is a subscription, online legal research service. If an official reporter citation should become available for this case, the citation will be updated to reflect this information].

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