U.S. District Court Judge Howard Lloyd dismissed the case against Veoh in San Jose, Calif., saying the video-sharing Web site is not responsible for users who upload copyrighted material.
Io Group sued Veoh more than two years ago, claiming the site violated copyright protection laws by hosting its content without authorization. Lloyd said the site is protected under safe-harbor provisions of the Digital Millennium Copyright Act.
That's because the Web site allows users to upload content without assistance or supervision from Veoh employees and because the company's practices show that it tries to curb copyright infringement and prevent copyrighted material from being uploaded by its users. The provision of the DMCA that protected Veoh in this case releases companies from liability as long as they remove unauthorized content when a copyright holder requests removal.
The ruling gives some encouragement to YouTube, which faces a similar lawsuit.
YouTube's top lawyer, Zahavah Levine, praised the judge for his decision in a statement issued Wednesday.
"It is great to see the court confirm that the DMCA protects services like YouTube that follow the law and respect copyrights," Levine said.
YouTube is fighting a lawsuit brought by Viacom. That suit claims that YouTube has violated Viacom's copyright protections and built its user base by hosting copyrighted material. YouTube has denied the charges and said it takes material down once it has been notified of infringements.