Pinterest’s amended terms still leave users exposed

Pinterest (I am going to be a little lazy in this post and refer to “Pinterest” when discussing both the site and its creator, Cold Brew Labs) has been in the spotlight quite a bit lately due to its terms of service as well as content creators’ concerns that their content is being shared without their permission on the service by its enthusiastic users. I wrote about the copyright implications in my post titled “Is Pinterest a den of copyright thieves?” and about the potential liability users face in a subsequent post titled “Pinterest’s hidden threat to its users“. Pinterest announced updates to its terms recently and the new terms go into effect next week. Unfortunately the new terms still leave users exposed to potentially substantial liability simply by using the service.”

Current terms (published on 29 March 2011)

Much of the focus on Pinterest’s new terms of service (which go into effect on 6 April) is on the original content license users grant to Pinterest which includes the right to “sell” “Member Content”. The two key clauses here are the definition of “Member Content” and the original license clause which state the following (I highlighted the problematic terms in bold):

“Member Content” means all Content that a Member posts, uploads, publishes, submits or transmits to be made available through the Site, Application or Services.

and

We may, in our sole discretion, permit Members to post, upload, publish, submit or transmit Member Content. By making available any Member Content through the Site, Application or Services, you hereby grant to Cold Brew Labs a worldwide, irrevocable, perpetual, non-exclusive, transferable, royalty-free license, with the right to sublicense, to use, copy, adapt, modify, distribute, license, sell, transfer, publicly display, publicly perform, transmit, stream, broadcast, access, view, and otherwise exploit such Member Content only on, through or by means of the Site, Application or Services. Cold Brew Labs does not claim any ownership rights in any such Member Content and nothing in these Terms will be deemed to restrict any rights that you may have to use and exploit any such Member Content.

The effect of these provisions was to enable Pinterest to commercially exploit Member Content published on the site on the basis that users grant Pinterest. This license is granted automatically and the way Pinterest attempts to ensure that users are legally authorised to grant this license is through this acknowledgement or warranty:

You acknowledge and agree that you are solely responsible for all Member Content that you make available through the Site, Application and Services. Accordingly, you represent and warrant that: (i) you either are the sole and exclusive owner of all Member Content that you make available through the Site, Application and Services or you have all rights, licenses, consents and releases that are necessary to grant to Cold Brew Labs the rights in such Member Content, as contemplated under these Terms; and (ii) neither the Member Content nor your posting, uploading, publication, submission or transmittal of the Member Content or Cold Brew Labs’ use of the Member Content (or any portion thereof) on, through or by means of the Site, Application and the Services will infringe, misappropriate or violate a third party’s patent, copyright, trademark, trade secret, moral rights or other proprietary or intellectual property rights, or rights of publicity or privacy, or result in the violation of any applicable law or regulation.

This sort of warranty is a common mechanism in website terms and short of having each user prove they are entitled to post each item to the service (totally impractical), this is how site providers tend to protect themselves from a user submissions perspective.

One of the significant challenges in these terms is that users are potentially liable for substantial damages simply by using the service. This is as a result of the liability clauses in the terms. I won’t go into this in detail here as I have already done so in my post titled “Pinterest’s hidden threat to its users” which I recommend you read before continuing with this post.

Paul Jacobson / Pinterest

The new terms (6 April 2012)

The new terms deal with content a little differently. Firstly, the definition will change to “User Content”. This isn’t as well defined as “Member Content” is in the current terms. It is defined or framed as follows (I highlighted the relevant sections):

Your content. Pinterest allows you to pin and post content on the Service, including photos, comments, and other materials. Anything that you pin, post, display, or otherwise make available on our Service, including all Intellectual Property Rights (defined below) in such content, is referred to as “User Content.” You retain all of your rights in all of the User Content you post to our Service.

Framing “User Content” this way does two things. It streamlines the definition of User Content and it explicitly states that users retain the rights they have in the content they post. This means that Pinterest has no ownership claim over your stuff which you post to the site or, implicitly, anyone else’s. This also addresses a very common misperception we see in media coverage of site terms of use: Pinterest doesn’t claim to own your content. In fact, I don’t recall ever seeing site terms where a provider claims ownership of user content. The problem lies more in how broad the license is that users grant these service providers. The license users grant Pinterest is the following (I’ve highlighted some interesting provisions):

  • How Pinterest and other users can use your content. Subject to any applicable account settings you select, you grant us a non-exclusive, royalty-free, transferable, sublicensable, worldwide license to use, display, reproduce, re-pin, modify (e.g., re-format), re-arrange, and distribute your User Content on Pinterest for the purposes of operating and providing the Service(s) to you and to our other Users. Nothing in these Terms shall restrict Pinterest’s rights under separate licenses to User Content. Please remember that the Pinterest Service is a public platform, and that other Users may search for, see, use, and/or re-pin any User Content that you make publicly available through the Service.
  • How long we keep your content: Following termination or deactivation of your account, or if you remove any User Content from your account or your boards, Pinterest may retain your User Content for a commercially reasonable period of time for backup, archival, or audit purposes. Furthermore, Pinterest and other Users may retain and continue to display, reproduce, re-pin, modify, re-arrange, and distribute any of your User Content that other Users have re-pinned to their own boards or which you have posted to public or semi-public areas of the Service.

What is noticeable is that the new terms omit the reference to “sell” and the new license is not irrevocable or perpetual. It is still royalty-free and “sublicenseable” so Pinterest is not liable for any royalties payable for publishing User Content and can sub-license the content to another party. This latter requirement may be intended more to enable the service to function more than a desire to move content around. Any other party that republishes the content as part of the overall service would need the right to do so. This may include Pinterest’s hosting provider, 3rd party services and so on.

A related term in the new terms is “Pinterest Content” which is framed as follows:

Pinterest Content. Except for User Content, the Service itself, all content and other subject matter included on or within the Service, and all Intellectual Property Rights in or related to the Service or any such content or other subject matter (“Pinterest Content”) are the property of Pinterest and its licensors. Except as expressly provided in these Terms, you agree not to use, modify, reproduce, distribute, sell, license, or otherwise exploit the Pinterest Content without our permission.

A big change in the new terms is the introduction of an Acceptable Use Policy which more fully addresses how users can make use of the service. Two of the prohibitions include posting any User Content that –

infringes any third party’s Intellectual Property Rights, privacy rights, publicity rights, or other personal or proprietary rights

and

contains any information or content that you do not have a right to make available under any law or under contractual or fiduciary relationships

The new terms define “Intellectual Property Rights” as follows:

Definition of Intellectual Property Rights. When we refer to “Intellectual Property Rights” in these Terms, we mean all patent rights; copyright rights; moral rights; rights of publicity; trademark, trade dress and service mark rights (and associated goodwill); trade secret rights; and all other intellectual property and proprietary rights as may now exist or hereafter come into existence, and all applications for any of these rights and registrations, renewals and extensions of any of these rights, in each case under the laws of any state, country, territory or other jurisdiction.

The new terms make it pretty clear that users are only to publish content they have the rights to publish, whether this be under a license granted by the content creator (most Creative Commons licensed content, for example, would probably be fine) or where there are copyright infringement exceptions (I wrote about this in my first post titled “Is Pinterest a den of copyright thieves?“). The terms also include fairly extensive provisions intended for content owners and which detail Pinterest’s interest in protecting their rights, preventing efforts to circumvent the so-called “no pin” tag content owners can use to block efforts to pin their content as well as to report any copyright infringement.

What Pinterest hasn’t changed much are its liability protection clauses. As with the current terms, the new terms include an indemnity clause which states the following:

You agree to indemnify and hold harmless Pinterest and its officers, directors, employees and agents, from and against any claims, suits, proceedings, disputes, demands, liabilities, damages, losses, costs and expenses, including, without limitation, reasonable legal and accounting fees (including costs of defense of claims, suits or proceedings brought by third parties), arising out of or in any way related to (i) your access to or use of the Services or Pinterest Content, (ii) your User Content, or (iii) your breach of any of these Terms.

The terms also include a liability limitation clause which reminds users that “THE ENTIRE RISK ARISING OUT OF YOUR ACCESS TO AND USE OF THE SERVICES, PINTEREST CONTENT, AND USER CONTENT REMAINS WITH YOU AND YOU USE THE SERVICES AT YOUR OWN RISK” (among other things).

Actually there is one significant change from the old indemnity clause to the new one. The old (or current) clause requires users to “defend” Pinterest. That change relieves users of the potential responsibility for filing court papers in Pinterest’s defence should it be sued. What the new indemnity clause doesn’t do is relieve users of the potential responsibility for any damages Pinterest may be ordered to pay, any costs it may incur or other penalties which flow from claims lodged against Pinterest in respect of –

  • “your access to or use of the Services or Pinterest Content”;
  • “your User Content”; or
  • “your breach of any of these Terms”.

There is one important omission in the indemnity. The indemnity doesn’t require your “use of the Services or Pinterest Content” to be unlawful or to infringe a 3rd party’s rights, necessarily. It potentially includes a situation where your use of the “Services or Pinterest Content” is legitimate and Pinterest’s isn’t. This could be possible if your use is regarded as a “fair use” (this has a specific legal context, see below) and Pinterest’s may not be because it’s a commercial service, for example.

What does this all mean for you?

The bottom line is that you should only pin stuff to Pinterest which you are licensed to pin or which you can pin under a copyright exception like “fair use” as applied in the State of California (these terms are governed by the “internal substantive laws of the State of California”). Any other publication or use of the service and content published on Pinterest could be a violation of someone Intellectual Property Rights and a breach of the terms of service. If Pinterest is sued for that and you are the unlucky user who did the infringing, you could be on the hook. This could be regardless of whether you acted lawfully when you used Pinterest.

In other words, heed the liability limitation clause’s admonition:

YOU ACKNOWLEDGE AND AGREE THAT, TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE ENTIRE RISK ARISING OUT OF YOUR ACCESS TO AND USE OF THE SERVICES, PINTEREST CONTENT, AND USER CONTENT REMAINS WITH YOU AND YOU USE THE SERVICES AT YOUR OWN RISK.