Dave Winer has an interesting take on the Digg/09 F9 brouhaha that is perceptive not only because he agrees with me about the ‘who can own a number‘ red herring but also because he notes the marketing and legal bind a pure user-generated content site is in when it comes to enforcing the DMCA.
The story so far: someone hacked a decryption key and every one was having great fun disclosing the key (search the term ’09 F9’ and you will get an idea of the magnitude of this). User-generated content sites, such as Digg, are great places for this sort of thing. but when the owners of Digg received a DMCA C&D letter, Digg began taking all the offending posts down.
This prompted what has been described as a ‘user revolt’ and Digg reversed itself and is no longer taking down posts containing the key. It is characterizing this as a principled stand, and if this provokes a bet-the-ranch lawsuit, then, in its words, it will go down fighting the good fight (no comment). So now Digg has voluntarily left the DMCA safe harbor.
As Dave discusses, the owner of a site that primarily consists of user-generatred conent is in a quandary. DMCA, in one way of looking at it, was intended to get the ISP out of a customer-relations problem by allowing it (forcing it, in effect) to take a hostile act against what was perceived as an infinitesimally small percentage of customers. What happens when a large percentage of (until recently, loyal) customers are using the site to commit what is arguably an overt illegal act. The choice may be between being sued by powerful copyright owners and alienating many customers (in a market where there are no shrotage of competitors).
Now, it may be the case that Digg’s risk here is manageable. The decryption key, we are told, is obsolete, and perhaps the key’s owner is not motivated to sue Digg out of business. But the general problem is this. As Dave points out, not only might be a certain percentage of the users in user-generated content world, be actively hostile to copyright, they have a proprietary sense with regard to sites that consist mostly of UGC (not that YouTube split the Google money with them). The UGC site owner is caught between a rock and a hard place. Dave suggests one possible approach.

Sounds funny to say it that way but it makes sense, especially after you read this decision holding that the purported owners of the Marilyn Monroe persona, cannot enforce their rights in New York, because a post-mortem right of publicity did not exist at the time of Marilyn Monroe’s death, and the testator can only devise that which exists at the time of death.
Best title by WSJ’s law blog: “Goodbye Norma Jean (And to Your Right of Publicity)”

EFF provides the background law for the dissemination of an alphanumeric decryption code for a DRM product. A timeline of how the key spread would be of value.
Digg’s experience will make an interesting case study in how to manage risk in the era of user-generated content (and the disconnect between what a CEO believes he/she needs to say to their customers, and what a lawyer would have them say).
More coverage: IHT: ‘A Lesson In Mob Rule On The Web.”
UPDATE: News.com on how various websites responded to DMCA letters from AACS, owners of the decryption key in question.