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Tuesday, 27 May 2014

Newzbin: "unlawful means" conspiracy claim upheld

Twentieth Century Fox Film Corporation and other companies v Harris and others [2014] EWHC 1568 (Ch), a Chancery Division for England and Wales decision of Mr Justice Barling a couple of weeks ago, is the latest (will it be the last?) bit of the Newzbin saga to hit the British courts.

All of the claimant companies, members of the Motion Picture Association of America, owned copyright in many films and television programmes. These proceedings arose from two earlier actions -- Newzbin 1 and Newzbin 2,  on which see this Katpost here.  Newzbin 1 was a copyright claim concerning the operation of a website by Newzbin Ltd for the purpose of making unlawful copies of copyright works available to its users, in which the court held that there had been extensive infringement of the claimants' copyrights.  Newzbin 2 involved the 'reincarnation' of the offending website as a similar website operating outside the jurisdiction. Here the court made an order requiring the major UK internet service providers to take steps to prevent subscriber access to the reborn site. The claimants, having become increasingly convinced that Harris, the first defendant, was actively involved in the operation of the later website, brought proceedings against him and persons and companies linked to him. According to the claimants:
(i) between mid-December 2009 and the end of November 2012 Harris had been the driving force behind mass deliberate infringements of the claimants’ copyrights;  
(ii) the various corporate defendants were Harris's corporate creatures, being owned and/or controlled by him, and  
(iii) he had used those companies for the purposes of channelling to himself or for his benefit the revenues earned from those infringing activities, as well as for syphoning off funds from Newzbin and thwarting the claimants’ ability to recover costs and compensation for the infringement by Newzbin of their copyrights, the entitlement to which had been established by the earlier proceedings.
According to Harris and the other defendants:
(i) although Harris had been the sole director and owner of Newzbin from December 2009 to May 2010, he had no intention to infringe copyright and did not believe that infringing activity was occurring until the first Newzbin judgment;

(ii) Harris had had nothing to do with the setting up or running the Newzbin2 website, which had been operated by hackers who had stolen data from the Newzbin1 website in order to do so and

(iii) there had been no conspiracy between the defendants.
What's more, argued Harris, in making him a party to the proceedings, the claimants were re-litigating matters against a new defendant whom they ought to have joined in the original trial and this was an abuse of process.

Barling J allowed the film companies' claim.

(i) There was no evidence from which it could be properly concluded that there had been sufficient material available to the claimants in Newzbin 1 and Newzbin 2 to justify holding that they ought reasonably to have joined Harris as a defendant in Newzbin 1 at any stage and there was no substance in the argument that commencing these proceedings against Harris was an abuse of process.

(ii) Harris was a joint tortfeasor with Newzbin in respect of the Newzbin 1 copyright infringing operations. He also masterminded and directed all Newzbin's actions in the period in question, including those that had been found to constitute infringing conduct. If ever there was a clear case of a company director intending, procuring and sharing a common design to commit an infringement with the company, this was it. Much the same applied to Newzbin 2, where he was either the sole tortfeasor or a joint tortfeasor.

(iii) All four elements required for an "unlawful means" conspiracy had been made out. These were (i) a combination of two or more persons; (ii) to take action which was unlawful in itself; (iii) with the intention of causing damage to a third party; and (iv) damage being caused to the third party.

Barling J's judgment is 178 paragraphs long,

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