A video of a dancing baby has led to a landmark decision regarding the handling of internet videos.

As part of the ruling in the Lenz v. Universal case, US Judge Jeremy Fogel ruled that content holders must consider the fair use premise before sending takedown notices to video sites.

Fair use allows a person legally to use a piece of copyrighted material if the product is used for a short period of time and is not used for any commercial purposes.

Civil rights groups have long complained that the premise is not taken into account when copyright owners issue takedown notices under the US Digital Millennium Copyright Act (DMCA).

"Given the 'shoot first and ask questions later' approach some content owners take to the DMCA notice process, improper takedowns of non-infringing fair uses are all too common," said the Electronic Frontier Foundation.

"We are very pleased that Judge Fogel has put content owners on notice: ignore fair use at your peril."

The ruling stemmed from the case of a mother who posted a clip on YouTube of her baby son dancing to the tune of the Prince song Let's Go Crazy.

The clip was later removed from YouTube when Universal filed a takedown claim under the DMCA.

The woman then filed suit against Universal, alleging that the video constituted fair use and that Universal had thus wrongly ordered the video to be taken down.

"In order for a copyright owner to proceed under the DMCA with 'a good faith belief that use of the material in the manner complained of is not authorised by the copyright owner, its agent or the law' the owner must evaluate whether the material makes fair use of the copyright," Fogel said in his ruling.

"The DMCA already requires copyright owners to make an initial review of the potentially infringing material prior to sending a takedown notice.

"Indeed, it would be impossible to meet any of the requirements of Section 512(c) without doing so."