However, they are still liable and can absolutely be sued civilly for an improper takedown notice. But the penalty probably wouldn't extend beyond a monetary payment.
Their inability to route that information to the right person should not be a valid defense or else incompetence becomes a business advantage.
I don't mean to sound trite but hasn't it pretty much been proven to be already?
Look at things like the Equifax situation. A competent team performing security reviews and fixing and maintaining things would cost money. Repeat for N data breaches. And that's just software security -- it doesn't consider even more serious cases like those of infrastructure failures (bridge collapses, levee failures, dams breaking etc.) that have more important consequences.
I agree with what I believe was the main point you were making which is that SEGA should not be excused here. I just think businesses have come to view competence as being expensive and so it's optional, and that this seems to be somewhat okay with people until it directly affects them.
In a just court, that argument would be thrown out. But courts aren't always just, unfortunately.
What a time to be alive.
It's weird, when you can write a program to do something in your name and as your agent, and then claim "it totally wasn't me, lol".
OK, we've established that delegating to an algorithm doesn't provide an impenetrable shield. Now it's just a question of how irresponsible you have to be for the court to go against you.
Now, is there any difference between the injured parties who are affected by your false positives when that rate is 1% versus 75%? For the subset of assessments affecting the injured party, your false positive rate is effectively 100%. Why should they bear your burden?
An algorithm can be used to identify prospects for takedown notices. If you choose not to vet those prospects, then any mistakes are on you. If you can drive down the false-positive rate low enough, you might choose to accept the costs every time you falsely accuse someone and turn the algorithm loose anyway. But if you can't absorb the costs of the algorithm's mistakes, don't rely on the algorithm.
"This process is inherently subjective, so creating perfect software while properly protecting our copyrights would be impossible. We determined that the false positive rate would be quite low, and had no intention of pursuing action against any invalid claims."
No, it's not.
(There's a couple of points in a DMCA notice that are certified under penalty of perjury, but they aren't the 9bes that are likely to be be false on a false one in the first place.)
Has anybody in the history of the DMCA ever been successfully convicted of perjury for misusing it?
The difference between theory and practice is that in theory, they are the same thing.