Taking each allegation in turn, the court first addressed whether certain videos uploaded by Vimeo employees were "stored at the direction of a user." It was undisputed that ten of the 199 videos at issue in the suit were uploaded by individuals who were or became Vimeo employees. Capitol argued that Vimeo employees served as an editorial voice for the site and pointed out that the web pages displaying the videos indicated that the video was posted by a Vimeo employee. As a result, Capitol argued, the ten employee-uploaded videos could not be characterized as being "stored at the direction of a user" but instead were at the direction of Vimeo through common law agency principles. The court found that based on the existing evidence it was unclear whether the employees were storing the videos in their capacity as Vimeo employees or as "users" within the meaning of the statute and therefore a triable issue of fact had been raised precluding summary judgment for Vimeo on those videos.

Capitol also argued that because Vimeo permits users to download videos on the website, that it does not provide "storage" under § 512(c). The court rejected this argument because Capitol could not point to any case law that held or suggested that a service provider must be denied DMCA protection if it allowed users to download content.

Capitol claimed that Vimeo had actual or red flag knowledge of infringement because Vimeo employees:

Specifically, employees interacted in the above ways with 55 of the videos at issue, which all featured plaintiffs' copyrighted music. Capitol argued that these interactions were evidence that Vimeo had actual or red flag knowledge of infringement. While the court declined to hold that these interactions automatically compelled the conclusion that Vimeo, through its employees, was aware of facts and circumstances that would make it objectively obvious to a reasonably person that the videos were infringing, the court also declined to accept Vimeo's argument that it met its burden of proving it did not have actual or red flag knowledge. The court found that there was a triable issue of fact on whether the employee interactions with the 55 videos constituted actual or red flag knowledge, and denied summary judgment as to those videos.

Capitol also argued that Vimeo should not be protected by the safe harbor because it engaged in willful blindness, and pointed to deposition testimony where Vimeo employees referenced ignoring videos containing copyrighted music. While the court acknowledged that the willful blindness doctrine may be applied in appropriate circumstances to demonstrate knowledge or awareness of specific instances of infringement under the DMCA, it rejected Capitol's arguments because the examples it cited to did not relate to the videos in suit.

The court next noted that to obtain safe harbor protection a service provider must not receive a financial benefit directly attributable to the infringing activity.

Capitol argued that Vimeo had a monitoring program that it used to enforce the content restrictions and communicate with users regarding content and policy questions. Although there was evidence that Vimeo employees communicated with users and suggested at times that it would tolerate the uploading of copyrighted material, the court found that the monitoring program did not in practice exert substantial influence over the content of the uploaded material.

Capitol also argued that Vimeo had substantial influence over users' activities by its inducement of infringement, specifically that:

The court rejected each of these arguments, finding that Capitol pointed to limited anecdotal evidence which did not show that Vimeo had a substantial influence over user activities that was widespread and comprehensive.

Lastly, the court noted that the 512(c) safe harbor provision requires the service provider to expeditiously remove infringing material upon notification of claimed infringement. On three occasions Capitol sent Vimeo takedown notices, and Vimeo removed the videos within three and a half weeks for the first notice and on the same day for the remaining two notices. The court found that the takedowns that occurred on the same day as Vimeo received the notices constituted expeditious removal. Likewise, the court found that three and a half weeks to comply with the first DMCA notice was also expeditious given that the notice identified approximately 170 videos to be removed.