Monday 28 February 2011

iinet avoid infringement liability in Oz

The Australian Federation Against Copyright Theft (AFACT) has lost its appeal against Australian ISP iiNet. In the absence of specific legislation in Australia, AFACT, representing the TV and movie industries, had argued that net companies had an obligation under Australian copyright laws to take a proactive role in policing online piracy and that the Australian ISP was responsible for illegal content downloading by its users. The acts of copyright infringement in issue in the case were copies of films illegally accessed by iiNet users using the BitTorrent system of file sharing. Under the Australian Copyright Act an intermediary that authorises the infringing conduct is also liable for infringement. To be liable for authorisation, a party must sanction, approve or countenance the infringement. This will depend on the extent (if any) of the relationship with the infringer, its power to prevent the infringement and whether it took any reasonable steps to prevent or avoid the infringement (1).

Australian courts had previously found that Kazaa was liable for ‘authorising’ infringement (2) and clearly content owners were hoping that the courts would extend copyright law to include a duty on ISPs to monitor and filter unlicensed content on their networks, and/or to find that that a failure to do so would make them guilty of authorising. A majority of the three judge appeal panel in the Full federal Court dismissed the appeal from a lower court’s decision (Justce Cowdroy) holding that even though iiNet was dismissive of copyright infringement complaints, that fact alone did not mean it was liable for authorizing infringement. All 3 justices in the appellate court found that in appropriate circumstances it was appropriate to disconnect customers (one even outlined a potential termination strategy). In a dissenting judgment, Justice Jagot held iiNet liable for authorising users’ acts of copyright infringement and that the trial Judge had erred in holding that the relevant test was whether iiNet had provided the ‘means’ of infringement.

AFACT still have the right of further appeal to the Australian High Court. iiNet CEO Michael Malone welcomed the ruling, saying "Today's judgment again demonstrates that the allegations against us have been proven to be unfounded. We urge the Australian film industry to address the growing demand for studio content to be delivered in a timely and cost effective manner to consumers, and we remain eager to work with them to make this material available legitimately". In response to the judgment AFACT’s Executive Director Neil Gane told reporters "it cannot be right" that an ISP takes no responsibility for copyright infringements on its network.

Interestingly Google recently announced a number of new initiatives it says will help combat copyright infringement online, including a new promise of 24-hour turnaround on takedown requests, and preventing terms associated with piracy from appearing in its "autocomplete" search results – including terms associated with BitTorrent and utorrent, RapidShare and Megaupload. As the ‘dumb pipes’ start to look more and more clever the protection of ‘safe harbour’ provisions must surely look more and more unfair to content owners. Google recently concluded a deal with ISP Verizon where it seems Verizon agreed to prioritise certain internet traffic, Google also told the music industry that they could remove pirated material IF they got paid, and auction site eBay agreed to police their own site for London 2012 Olympics tickets – all signs that perhaps the dumb pipes aren’t that dumb after all.



Roadshow Films Pty Limited v iiNet Limited [2011] FCAFC 23

Who owns your voicemails? Phone-hacking Steve Coogan and Andy Gray

News of the World and private investigator Glenn Mulcaire are alleged to have intercepted the mobile-phone voicemails of football commentator Andrew Gray and comedian Steve Coogan. Civil proceedings have begun and the Met are considering whether to bring criminal proceedings.

Mulcaire wanted to rely on the privilege against self-incrimination in the civil proceedings – refusing to disclose information that had the potential to incriminate him in criminal proceedings. However, s. 72 of the Senior Courts Act 1981 provides that the privilege of self-incrimination does not apply in proceedings concerning the infringement of intellectual property rights. So are the voicemails intellectual property or not?

On Friday Mr Justice Vos held in [2011] EWHC 349 (Ch) that the definition of ‘intellectual property’ in the Senior Courts Act included any technical or commercial information that can be protected as such by action and therefore did include the claimants’ allegedly intercepted voicemail messages. Consequently Mulcaire was not excused by the privilege against self-incrimination from answering questions in the civil proceedings.

It is expected that the defendants will appeal as they have done in the parallel Nicola Phillips proceedings.

Could the claimants simply have relied on the argument that Mulcaire had in any case infringed copyright in sound recordings by recording and transcribing the voicemails? Copyright in sound recordings is owned by their ‘producer’, who is ‘the person by whom the arrangements necessary for the making of the sound recording are undertaken’. Would this be Steve Coogan and Andrew Gray – or would it be Vodafone?

Saturday 26 February 2011

A Copyright Battle of Epic Proportions?

A Japanese company, Sotsu Co., is assessing whether Floraland, a Chinese amusement park has infringed copyrights it manages by displaying a huge representation of a Gundam robot, which features in the Japanese anime series "Mobile Suit Gundam."

Apparently, the 30th anniversary of the comic series was celebrated in Japan with the display of an 18-meter Gundam robot replica. The replica was later moved to a location near Bandai Co, a toy-making unit of Namco Bandai, which manufactures toys based on Mobile Suit Gundam.

The Wall Street Journal reports that tourists in China alerted Sotsu to the existence of an extremely similar 15-meter Gundam robot replica.

Is this another instance of shanzai?

Friday 25 February 2011

Be a copyright activist!

In a speech today WIPO Director General Francis Gurry set out his vision for the future of copyright:

History shows that it is an impossible task to reverse technological advantage and the change that it produces. Rather than resist it, we need to accept the inevitability of technological change and to seek an intelligent engagement with it. There is, in any case, no other choice – either the copyright system adapts to the natural advantage that has evolved or it will perish. Adaptation in this instance requires, in my view, activism.

I am firmly of the view that a passive and reactive approach to copyright and the digital revolution entails the major risk that policy outcomes will be determined by a Darwinian process of the survival of the fittest business model. The fittest business model may turn out to be the one that achieves or respects the right social balances in cultural policy. It may also, however, turn out not to respect those balances. The balances should not, in other words, be left to the chances of technological possibility and business evolution. They should, rather, be established through a conscious policy response.
He set out three guiding principles: neutrality to technology, simplifying copyright and a coherent policy response (including a key role for internet intermediaries, global licensing and inviting ‘pirates’ to share responsibility for the threat to the financial viability of culture).

Parasites in the FileSoup

The CPS decided yesterday not to continue with the prosecution of George Cartledge and Stephen Lanning, who had been charged with conspiracy to infringe copyright over their involvement in BitTorrent site FileSoup, the Telegraph and TorrentFreak report. A CPS spokeswoman said: ‘The Crown Prosecution Service advised the Court today that it is neither necessary nor appropriate to continue to pursue this matter in a criminal court.’

At the foot of the articles are strings of comments typical of those on file-sharing forums. As usual they have little good to say about the film and music industries, which are apparently populated by fat cats. A rational response to these comments might be to point out that most people in these industries aren’t earning a fortune. Yes, there are a few rich people, but so are there tycoons in the toilet-roll business and magnates in the marmalade industry.

But is it appropriate to read such comments literally? Here’s a selection:

psimin says, ‘i download free films and music if possible as i own my computer . the film or music industry has no say what i do with my computer, these greedy parasites if they had their way would also have us the public bowing down to them ! as far as im concern they are just scum that lord it over people , TOUGH !’

‘Good,’ thinks quinn, ‘success for the ordinary Folks over the Fat Cats who are still living in the past.’

unkledysfunktional argues, ‘If the spivs in the film and music industries charged a reasonable price for their wares, there would be no problem – however they're greedy fat cats and personally I'm having a good laugh that the case fell through.’

‘Amazing isn't it,’ Grumpytom complains, ‘they actually expect people to buy that crap, they think it has either merit or value. Talk about believing your own propaganda! Are they on drugs or something? (rhetorical)’

To Rob8rcakes, those who pursued the case are ‘greedy, over-zealous asswipes’.

‘fuck you hollywood !!!!’ proclaims gorehound.
The loathing that many pirates demonstrate for people in the film and music industries has a furious vitriolic intensity. What drives this extremism? After all, these industries are providing the entertainment that these people spend so much of their lives consuming. The endless repetition of these sentiments has a pathological, even psychotic quality. Perhaps they need to be considered from a psychological rather than a legal perspective.

Here’s a hypothesis: overwhelmed by the glut of content on P2P networks, file-sharers have lost control of their lives. Impotent with rage, they bite the hand that feeds them. They have made themselves the slaves of media-consumption – and who better to blame than the parasites, the scum, the spivs, the fat cats who ‘lord it over’ their screens?

Thursday 24 February 2011

Australian ISP iiNet off the hook

The Federal Court of Australia today dismissed an appeal in Roadshow Films Pty Limited v iiNet Limited [2011] FCAFC 23, so finding the ISP iiNet not liable for authorizing the copyright infringements of its customers.

The judgment says that iiNet ‘demonstrated a dismissive and, indeed, contumelious, attitude to the complaints of infringement’, but held that an ISP that doesn’t suspend an infringer’s account is not liable for future infringements unless right owners have first (a) provided a verifiable level of evidence for infringements in their notices, (b) undertaken to reimburse the ISP for its costs in investigating infringements and (c) undertaken to indemnify the ISP if customers’ services are suspended in error.

The claimants may appeal to the High Court.

Wednesday 23 February 2011

Copyright confusion

An article by James Boyle in today’s FT is a good example of how people get the wrong end of the stick when debating copyright. While copyright is not the most exciting subject to some, to others it arouses such passion that clear thinking goes by the board.

Boyle’s article criticizes a piece co-authored by Scott Turow in the NYT. Turow’s piece argues that the building of theatres in Elizabethan London with their admission fees allowed playwrights to make a living from writing, which cultivated a wave of brilliant dramatists. Copyright, it says, has similarly allowed creative people to make a living from their work.

But this is what Boyle hears:
‘The argument is so strange it is hard to know where to begin. The problem is not simply that Shakespeare flourished without copyright protection for his work. It is that he made liberal use of the work of others in his own plays in ways that would today almost certainly generate a lawsuit. Like many readers, I found myself wondering whether Shakespeare would have survived copyright, never mind the web. Certainly, the dense interplay of unidentified quotation, paraphrase and plot lifting that characterizes much of Elizabethan theatre would have been very different; imagine what jazz would sound like if musicians had to pay for every fragment of another tune they work into a solo.’
Turow is making a point about how it helps if creative people can make a living out of their work, whether through selling tickets (in the case of Elizabethan playwrights) or copyright (from the 18th century). Boyle tries to undermine the argument by commenting on whether 21st-century copyright law would have presented stylistic problems for Shakespeare. That may be an interesting question but it’s not what Turow is driving at.

James Boyle is on the panel of the Hargreaves Review, which has called for evidence about copyright from ‘the widest possible range of interests’, so no doubt some of the views will not necessarily accord with the panel’s. The first challenge in the apparently overwhelmingly exciting copyright debate is to start by actually hearing what the other person is saying.

What happens to works when they fall into the public domain?

Mark your diaries. Here's advance notice of a seminar on the topic of "What happens to works when they fall into the public domain?", at which the thoroughly engaging Professor Paul J. Heald, of the University of Georgia Law School, will be presenting some of his thoughts and -- more importantly -- the fruits of some of his own research.

This seminar, organised under the auspices of the 1709 Blog, will be held on Wednesday 23 March, from 5.30pm to 7.00pm, at a venue to be confirmed but somewhere within Central London. If you're thinking of attending, please email me here and let me know (using the subject line 'Heald Seminar') so that I can try, as far as possible, to ensure that the number of people attending bears some correspondence to (i) the number of chairs available and (ii) the quantity of the refreshments.

Monday 21 February 2011

usedSoft case on sale of "second hand" software downloads for ECJ

Via Huťko´s IT & IP legal blog comes this story about a freshly referred case from the First Senate of the German Bundesgerichtshof in Oracle v usedSoft (I ZR 129/08). This reference deals with the resale of downloaded software and the ECJ has been asked to clarify the legal position of software which has been sold not physically but online. There is no attached number or any mention on Curia's website so far.

According to an English-language press release from usedSoft,
"...the ECJ will now decide, presumably within one or two years, whether software which was transmitted to the buyer online may also be traded as used. ...
However, the future decision by the ECJ will have little impact on the trade with used software because the legal circumstances regarding trade with “used” software are largely clarified. As the BGH declared in its press release today: “According to Art. 5(1) of  directive 2009/24/EC [on the legal protection of computer programs], the reproduction of a computer program does not, in the absence of specific contractual provisions, require the authorisation of the rightholder ” 
Sabine Leutheusser-Schnarrenberger, German Federal Minister of Justice, also confirmed in September 2010 that trade with “used” software is essentially legal. Legal uncertainty exists only with respect to software which has been sold online. Courts in Munich and Hamburg have handed down similar decisions in recent years. The RC Munich, for example, ruled in April 2008 “that the sale or vending of single Microsoft software licences previously granted within the framework of volume licence agreements is fundamentally possible as an effective transaction even without the consent of Microsoft.” ".
The 1709 Blog will watch future developments with interest.

Pros and cons: piracy and the Culture Flat Rate

Piracy is not, to me at least, a very appealing subject. It is, however, by a long way, the most important copyright issue of our time.

Two recent reports remind us of the scale of the problem. ‘An Estimate of Infringing Use of the Internet’ (previously noted on this blog) estimates that 23.76% of internet traffic is copyright-infringing material. Since the report lumps porn in with non-infringing material, it is not unlikely that 1/3 of the internet is dedicated to copyright infringement.

Meanwhile the IFPI’s Digital Music Report 2011 notes such statistics as

— 76% of music obtained online in the UK in 2010 was unlicensed
— Nearly one in four active internet users in Europe visit unlicensed sites monthly
— This is in spite of wide availability of legal music sites (400+ services licensing more than 13 million tracks)
— 2004–2010: recorded music revenues declined by 31%
— New artists and smaller businesses have been hardest hit, e.g. 2003–2010: debut album sales in the global top 50 fell 77%

We have yet to see whether the Digital Economy Act will make a dent in these figures. But what if the current trend continues? An alternative is the ‘Culture Flat Rate’: non-commercial copying on the internet is legalized, paid for by a levy on internet access.

Of course, this solution presents some problems, but are any of them as big as the statistics above? In Germany, the Culture Flat Rate is advocated by the Green Party and last month the Association of the German Music Industry lined up ten arguments against it. However, Leonhard Dobusch has taken the trouble to rebut each one.

Given that this solution would require major changes to EU and perhaps international law and, governments being governments, this would take a long time to implement (in contrast to the speed at which the internet moves) perhaps it is worth giving this option serious consideration sooner rather than later, just in case…

Further reading: ‘The World is Going Flat(-Rate)’ and ‘New Momentum for Culture Flat-Rate in NL and DE’ by Volker Grassmuck

Hong Kong opts for private enterprise whistle-blowing

David Allison (Laracy & Co., Hong Kong) has drawn my attention to this link to a recent development on his patch which, as he puts it, "raises some interesting questions". As he explains:
"Hot on the heels of various amendments to the Copyright Ordinance in 2010 (which provides for increased criminal sanctions for business end-user infringement), a press release from the Hong Kong Customs and Excise Department notes that there is now a bounty payable to "whistleblowers" who inform Customs about copyright infringement in their organizations. There is a further bounty payable if the information leads to a conviction.

While the issue of employees informing on their employers is interesting in itself (surely you would only do this if you were looking to leave your current employer — unless of course you are a particularly civic-minded individual) the really interesting part is the funding of the whole scheme. It transpires that the Hong Kong Copyright Licensing Association (HKCLA) and the Hong Kong Reprographic Rights Licensing Society (HKRRLS) are funding the scheme, which is then administered by Hong Kong Customs".
David is curious to know what readers think about private licensing bodies funding the government to do their work.  He concedes that it is of course it is in the licensing bodies' best interests do take this initiative since high profile convictions would certainly increase compliance and boost the number of licences sought – but he just has a rather uneasy feeling about private funding of public enforcement.

This blogger's feeling is that, irrespective of the industry concerned and the intellectual property right infringed, the time has come for a great deal more private funding of public enforcement.  With the best will in the world, police and customs can't stem the tide of trade in infringing goods all by themselves, and importers and infringers aren't kind enough to give due notice in writing of times and dates when they are planning to infringe, together with an appended list of rights infringed.  If the rights owners in question were not those attached to the copyright-based industries but to, for example, the proprietary pharma sector seeking information on imports of fake and potentially fatal medicines, would we not applaud such initiative?

Friday 18 February 2011

The fundamental freedom of furnishings

The ECJ has received a copyright-law reference from Germany’s Bundesgerichtshof, the IPO reports. Case C-5/11 – Titus Alexander Jochen Donner (?) – is a dispute about furnishings that are copyright-protected in Germany and sold to German customers, but manufactured and distributed from Italy. The Court has been asked for a preliminary ruling on Article 4(1) of the Copyright Directive, namely: ‘Member States shall provide for authors, in respect of the original of their works or of copies thereof, the exclusive right to authorise or prohibit any form of distribution to the public by sale or otherwise.’

The question:

“Are Articles 34 and 36 TFEU governing the free movement of goods to be interpreted as precluding the criminal offence of aiding and abetting the prohibited distribution of copyright-protected works resulting from the application of national criminal law where, on a cross-border sale of a work that is copyright protected in Germany
—that work is taken to Germany from a Member State of the European Union and de facto power of disposal thereof is transferred in Germany,
—but the transfer of ownership took place in the other Member State in which copyright protection for the work did not exist or was unenforceable?”

Comments are requested by 24 February. After sitting down to watch Copyright v Freedom to Provide Services in the decoder card cases, here comes Copyright v Free Movement of Goods.

Tuesday 15 February 2011

The Year of the Intermediary

On the internet, intermediaries occupy – literally – a central position. They are playing increasingly prominent roles everywhere from political revolution in Egypt to the feverish exchanges of the twittering classes. At other times they are the vehicles for infringement of intellectual property rights.

The UK government, it seems, has a special relationship with Silicon Valley and its intermediaries. While David Cameron has set Google as the homepage of his copyright policy, Google is home for his chief spin doctor, Steve Hilton, married to Google vice-president Rachel Whetstone. And David couldn’t wait to be friends with Facebook, though it began to look like a one-way relationship when Facebook refused to take down the ‘Raoul Moat you Legend’ page.

However, one of the core principles of the Conservative party’s Big Society is social responsibility, and that includes the internet. How much longer can society continue to turn a blind eye to mindless disrespect on the internet for the rights of those who are making creative contributions?

The European Commission is interested in knowing if intermediaries could be doing more:

‘…the currently available legislative and non-legislative instruments are not powerful enough to combat online infringements of intellectual property rights effectively. Given intermediaries’ favourable position to contribute to the prevention and termination of online infringements, the Commission could explore how to involve them more closely.’
2011 promises a packed programme of intermediary legal events. They address various types of legal responsibility (liability, injunctions, three-strikes law) and the different implications each of these has for different types of intermediary (ISPs and websites).


A Communication on the E-Commerce Directive is due following last year’s consultation. This will revisit the legislation that exempts intermediaries from liability for third-party illegal content where they are hosting or ‘mere conduits’, and prevents them from being placed under a general obligation to monitor information they transmit or store.

The ECJ will be interpreting the Directive in L’Oréal v eBay (Case C‑324/09), deciding whether sites can be liable for any infringements for which they haven’t received a take-down notice. The advocate general has already given his opinion, saying that ‘if A has been discovered infringing trade mark X by listing an offer on the electronic marketplace in September, I would not exclude that the marketplace operator could be considered having actual knowledge of information, activity, facts or circumstance if A uploads a new offer of the same or similar goods under trade mark X in October.’


—against websites

‘As to the scope or contents of an injunction to be given against an intermediary,’ the AG continued, ‘I do not see that EU law would impose any specific requirements beyond efficacy, dissuasiveness and proportionality.’ In practice, for a site like eBay, he suggested injunctions have the same scope as liability (same user infringing same trade mark), which, curiously, seems to make injunctions superfluous. ‘Reasonable measures to reveal the true identity of a user hiding behind several user identifications may be required from the service provider: this would not constitute an obligation of general monitoring forbidden by Article 15(1) of Directive 2000/31 but an acceptable obligation of specific monitoring.’ It seems implicit that a site would have to do this ‘specific monitoring’ anyway to retain the Hosting Defence and avoid liability?

Where does specific monitoring end and general monitoring begin and what precisely are the objections to ‘general monitoring’ anyway? We are already used to our communications undergoing computerized monitoring in the form of anti-virus software – is privacy a genuine concern or just an excuse rehearsed by those who have something to hide?

—against ISPs

The ECJ may get to the bottom of such questions in relation to injunctions against ISPs in SABAM v Scarlet Extended (C-70/10). In this case the question is whether an injunction can require an ISP to filter all traffic to identify and block unauthorized copyright content. The hearing took place on 13 January, and the Content and Carrier blog expects the opinion of the advocate general by mid April, so a judgment might just be squeezed into 2011.

In the UK the Digital Economy Act’s s. 17 site-blocking injunction is under scrutiny – judicial review to see if it is legal; Ofcom to check it can be done.

Usenet-indexing site Newzbin, which was found liable for copyright infringement last year, went into administration, failing to pay damages, and popped up again as Newzbin2 hosted in Sweden. A court will be deciding whether the claimants can have an injunction under s. 97A CDPA requiring BT to block the site.

Meanwhile, injunctions against intermediaries of all kinds are also the subject of legislative review in the ongoing consultation on the Enforcement Directive. Although the Directive does not cover injunctions relating to copyright infringement, which are covered by Article 8(3) of the Copyright Directive, the Commission’s Staff Working Document takes the opportunity to consider them anyway and raises a number of issues:

—Some Member States have failed to grasp that injunctions may be granted against intermediaries without liability being implied.
—There is no established jurisprudence on cross-border injunctions.
—There is confusion over whether injunctions can apply to future, unspecified infringements (which has given rise to the questions in L’Oréal and SABAM).


The judicial review of the Digital Economy Act will consider whether ISPs can be placed under obligations to notify subscribers about their alleged infringements and perhaps suspend their accounts. The court will be measuring the Act against EU laws – which are moving goalposts given the consultations.

There is substantial overlap in the scope of these judgments and consultations and it will be interesting to see how they influence one another. It looks like the intermediaries for our communications will continue to be one of the subjects of our communications for some time to come.

Sunday 13 February 2011

Are you an ordinary internet user? Do you use what you find online? If so, read on ...

Are you Mr?Ms  Average? If so,
 this survey is just for you!
1709 Blog team member Aurelia tells us that Simone (a colleague of hers who hails from Italy) is doing some research for his PhD. His goal is to survey people who are casual technology users (i.e. not devoted geeks, nerds and obsessives) about their ideas of how creative works like pictures, music and writing are used on the internet. Says Aurelia, "It would be very helpful if you could take just a few minutes and fill out Simone's survey at".

This would be useful not only for Simone but also for those good folk at Creative Commons who do try to get their terms to reflect the way people use materials online, their expectations and their aspirations.

Simone provides a little further explanation of this legal/sociological survey, which is entitled "Copyright in the digital age: attitudes, social perception and level of awareness".
"The questionnaire takes approximately 15 minutes to complete; it is online and completely  anonymous (we do not ask your name and we do not record your IP address; so please relax and sincerely answer the questions). The results of this research will be included in my Ph.D. thesis and
made available with an open access/copyleft approach. Every person's participation is important in order to accomplish my research, so I hope that you will be able to dedicate the time to answer the survey. It would also be very useful and appreciated if you could share this announcement with your friends and colleagues".
Now's the chance for all you casual and non-addicted twitterers, facebookers and bloggers to do Simone a favour -- tell your friends!

Friday 11 February 2011

Map Those Treaties

Treaties, treaties, treaties.  Keeping track of all the different, an often overlapping, copyright treaties can be quite the task.  Who’s signed it? When?  What’s included?  It’s a lot of information to sort through.  But it’s just gotten easier, at least for copyright treaties to which the United States is a partner.

Puneet Kishor has put together “Copyright Treaties With the US,” a wonderful map viz that gives an interactive picture of the major international copyright treaties.  The map features a list of 17 options ranging from “Show all” to “None” and including five incarnations of Berne, several WIPO treaties, and of course the WTO TRIPs agreement.

Clicking on a treaty option brings up an array of blue circles across the map.  Each circle represents a country or territory that matches the chosen option.  Users can get more information by clicking on the circles.  Here’s a screen shot of the “Unclear” option for an example.


Since the map is designed to show treaty relations with the United States, the United States does not get a clickable circle on any of the options.  As Puneet explained, “The US can’t have a treaty with itself.”

Puneet developed the map to meet his own needs while doing research on different copyright regimes and the concept of an “international copyright.”  He had located the information he needed in Circular 38a, but found it’s pdf format less than ideal.  The interactive map was born.

Recognizing the huge potential of usefulness to others, he’s made the map available via his website under CC0, waiving his rights in the work.  As someone who’s tried to make a similar map in the past with Paint and color coding, I know I’ll be referring to this new resource often.

Thursday 10 February 2011

Nana-na-boo-boo, You Can’t Sue Me

imageWilcox v. Career Step, the case is a few months old now, but it hasn’t been mentioned on this blog yet and is worth a look.

The main heart of the Wilcox case is a dispute over ownership of copyright between the author of a medical coding course, Ms. Wilcox, and an online course distributor, Career Step, that offered the course and helped pay for its development and may have employed Ms. Wilcox.  However, these work-for-hire and ownership questions are not the interesting item from the recent decision.

In addition to suing Career Step, Ms. Wilcox also sued a number of individuals and colleges who received the course from the Career Step.  Some of these colleges that were sued are state-run, public institutions.  And one of these state-run, public institutions, West Virginia Community and Technical College, challenged the suit on grounds of sovereign immunity under the 11th Amendment of the US Constitution.  That motion to dismiss was granted.

The 11th Amendment prohibits law suits against a state by citizens of another state unless the state has consented to be sued or a federal law permits the suit.  West Virginia Community and Technical College is considered to be an arm of the state of West Virginia because it is controlled by and receives most of its funding from the state.  The court held that West Virginia did not consent to be sued and that there was no federal law to change the standard 11th Amendment rule.  Thus, the court granted West Virginia Community and Technical College’s motion to dismiss the copyright claims against it.

This case is unusual for a few reasons.  First, this case is going on in the District Court for the District of Utah.  This is not one of the common places for a copyright infringement suit, such as the Eastern District of New York or the Central District of California.

Second, a sovereign immunity claim in a copyright infringement suit is, I believe, a very novel defense.  (Readers can please correct me if they know of other similar cases.)  And, the success of the defense raises questions for the future of interactions between copyright holders and public education.

The United States has a large number of public universities, colleges and technical training schools, as well as an extensive public K-12 system.  If state-run institutions have immunity from copyright infringement suits, do they have a free license to ignore copyright law and infringe content as much as they would like? 

What about secondary liability concerns for things like file-sharing?  A growing number of universities, both public and private, have instituted programs and partnerships with big content to deter file-sharing on their campuses.  If state-run universities can claim sovereign immunity protection, will they have no need for these programs?  Will state universities become sanctuaries for file-sharing students?

The White House has announced recently that IP Czar Victoria Espinel is suggesting new copyright laws.  Will these include a copyright infringement exception to the 11th Amendment?

Decision dismissing claim against West Virginia Community and Technical College

First decision in case addressing a number of joinder and dismissal claims

Wednesday 9 February 2011

Questions that Media CAT leaves hanging in the air…

In yesterday’s judgment in Media CAT Ltd v Adams, His Honour Judge Birss QC said that the case raised the following issues:

i) Does the process of identifying an IP address in this way establish that any infringement of copyright has taken place by anyone related to that IP address at all. The technical issues raised by Mr Davey (and Mr Stone) relate to this point. [See para 7 of the judgment.]

ii) Even if it is proof of infringement by somebody, merely identifying that an IP address has been involved with infringement then encounters the Saccharin problem. It is not at all clear to me that the person identified must be infringing one way or another. The fact that someone may have infringed does not mean the particular named defendant has done so. Perhaps the holder of the account with the ISP has a duty to assist along the lines of a respondent to another Norwich Pharmacal order but that is very different from saying they are infringing. [See paras 27–31 of the judgment.]

iii) The damages claimed deserve scrutiny. If all that is proven is a single download then all that has been lost is one lost sale of one copy of a work. The sort of sum that might represent would surely be a small fraction of the £495 claimed and the majority of that sum must therefore be taken up with legal costs. If so, a serious question of proportionality arises but again this has not been tested. Clearly if the defendant has infringed on a scale as in the Polydor case then would be a very different matter but there is no evidence of such infringement here.
TorrentFreak says that the judgment has implications for the Digital Economy Act as right owners will be relying on similar processes to identify infringements before sending out reports to ISPs. However, it would not be correct to say that the architects and implementers of the Digital Economy Act have been oblivious to questions of evidence.

Ofcom’s draft code states: ‘For the notification process to be credible, effective and fair for consumers it is essential that the allegations of copyright infringement are evidentially robust and accurate … We are also proposing that Copyright Owners must act on an Ofcom direction to take specified steps in relation to the maintenance or enhancement of the evidence gathering procedures.’ The Patents County Court says that it has not yet investigated whether Media CAT’s processes were adequate but insisted that it would be perfectly able to do so. Ofcom is also presumably able to carry out such an assessment. However yesterday’s judgment certainly emphasizes the need to justify why a particular process of identifying an infringer may be considered sufficiently reliable and what evidence a right owner will have to produce to convince the appeals body that a subscriber has infringed copyright. Presumably the detection process wouldn’t need to be 100% watertight, but reliable on the balance of probabilities?

Last week, Ofcom was asked to investigate whether the DEA’s s. 17 site-blocking provision is practically feasible and the copyright provisions of the Digital Economy Act are also to be judicially reviewed, so these are just a few more questions to which a plausible response may be required.

See the Telegraph here for another angle.

Tuesday 8 February 2011

Media CAT saga: now for the obituary

The popular media in the UK have reported extensively on the termination of the unpopular proceedings -- call them bullying, copyright trolling, public opinion blunder or what you will -- brought by Media CAT, as represented by Andrew Crossley (ACS:Law), against 26 of the large number of defendants who were alleged to have infringed copyright in porn films by means of illicit file-sharing (see eg BBC, ZDNet, Guardian).  Today, in Media C.A.T. Limited v Malcolm Adams, Katherine Taylor, Hooper, Mitchell Chance, Miss Gonzalles Romeo, Mark Jimack, Miss Maria Shewan, Keith Wood, William Wickam, Sean Allen, Christopher Beck, Dave Cundall, Danny Cowan, Glyn Bentley, Pana Begum, Peter Armitage, Allan Billington, James Bryant, Julia Abbott , Christopher Birkett, M Brunt, Gareth Bacon, Wayne Bacon, Michelle McGlade, Elaine Cox, David Bick [2011] EWPCC 006 Judge Colin Birss QC, in the Patents County Court, delivered the last word on the subject:
"114.      On 26th January I received a letter from ACS:Law.  It included copies of documents relating to the firm’s retainer with Media CAT on the basis that I had asked to see them.  In fact I had not asked to see them, the defendants had and I had not ordered them to be produced, ACS:Law had volunteered.  In any event the letter also states that Media CAT has ceased trading as it has become insolvent and that ACS:Law is no longer instructed save to perfect consent orders already notified to the court.  The letter concludes with a statement that the claimant has asked Mr Crossley to notify the court that it has ceased all activities and will not at any time in the future be sending letters or pursuing anyone in relation to the alleged infringements of copyright.  Also ACS:Law will close permanently on 31st January 2011 and there will be no successor practice".
The judgment is a good deal longer and more interesting than one might imagine.  It explains the status of the mysterious Media CAT and considers whether the court might have been able to make a novel order, requiring Media CAT to stop writing any further letters demanding £495 a shot in settlement of the alleged infringement claims (or having them sent on its behalf) at least until they had returned to court with a properly pleaded Particulars of Claim which could be considered.  It also shows how well-equipped the Patents County Court is to handle litigation of this nature in a fair and responsible manner.

ACS:Law judgment

I feel sure that some readers can't wait to get their hands on this - so here it is - the ACS:Law judgment!

A fable of copyright communication

While the spotlight has been on possible problems with the UK’s IP framework, the High Court has been mopping up some copyright problems that have nothing to do with the legal framework, but everything to do with human beings: in particular, how they manage and communicate about their intellectual property.

Looney v Trafigura [2011] EWHC 125 (Ch) isn’t a copyright law case as such (nor does it feature Bugs Bunny or superinjunctions) – the issue was whether Trafigura was entitled to terminate its contract with Kieran Looney. Where copyright comes in is that it was an important part of why Trafigura wanted to part company with Looney.

Looney was providing Trafigura with a performance management programme, charging out his time at £3 million a year. Participants in his programme signed a ‘Materials Agreement’ saying that his materials were only to be used as expressly licensed in writing.

But Trafigura didn’t seem to be handling the materials as Looney wished.

Trafigura’s CFO made smaller copies of the materials, which would be easier to carry when travelling: Looney asked him to hand them over. And when the CEO told employees at a training session to email 90-day plans to him, Looney objected and the CEO had to tell employees to destroy documents. Subsequently Looney spent quite a lot of his rather expensive time drilling the managers and employees on his IP rights and how his materials should be disseminated.

In the judge’s view, the Materials Agreement was not ‘sufficient to alert the recipients to, say, the existence of a bar on creating online templates.’ If a judge has trouble understanding your contract’s small print, then it must be unrealistic to expect others to have taken it on board and be putting it into practice.

When the COO asked Looney to summarize what they weren’t allowed to do with the materials, Looney ‘rather unhelpfully’ (in the judge’s view) instructed the COO to refer his question to his in-house lawyer. If Looney couldn’t easily express how things stood with his IP, how could he expect others to get his drift?

The story illustrates that in the digital age, those who care about their intellectual property either need to relax a little or they should learn how to communicate their rights and permissions EXTREMELY CLEARLY (and nicely) … so that even judges know what they want.

Sunday 6 February 2011

Decoder cards and the Euro-licence

Although the Advocate General’s opinion in the decoder card cases covers a number of important copyright law points, probably the most striking conclusion is the contract-law point, which has potentially far-reaching consequences in the way rights are licensed in Europe.

FAPL licenses the right to broadcast Premier League games to different broadcasters in different territories. Because the broadcasts are delivered by satellite, the only way of ensuring that each licensee’s broadcast is limited to its territory is to stipulate in the licence that the licensee makes sure that its decoder card is only available in its territory.

The AG says that this contractual term is incompatible with Article 101(1) TFEU because the term has an anti-competitive objective and no exemption applies. She argues that no exemption is possible on the basis of protection of industrial and commercial property because this partitioning of the market is not to protect the right of commercial exploitation (if a Greek card is sold in the UK, FAPL still gets paid – that’s debatable, isn’t it? The Greek broadcaster gets paid but doesn’t FAPL just get a licence fee for the exploitation in Greece?), rather it is to optimise exploitation (FAPL gets more from selling lots of separate licences than one big licence).

The AG acknowledged that the importing of Greek decoder cards might result in FAPL no longer licensing rights in Greece. ‘In this regard,’ she said, ‘it would appear relevant in particular whether alternative marketing models can be developed, as the Commission demands…’ This sounds like an allusion to the Commission’s idea that copyright in the EU could be only licensable in Europe as a whole.

If the ECJ follow the AG, then the effects of this new licensing model will be felt beyond Europe. To begin with, if people start exporting the Greek NOVA card all over Europe presumably it will give viewers access not only to football but to everything else on that service (see illustration). Most of the NOVA Sports + Value package is US TV (in English).

Presumably the effect of having one European territory (and one EU copyright) would be to lead to consolidation of broadcasting among a handful of pan-European broadcasters – which may satisfy economic logic but may not be conducive to nurturing the cultural diversity that is Europe.

Thursday 3 February 2011

Decoder cards: the Advocate General’s opinion

In 2006 the customers of a number of English pubs – the Red White and Blue, the Pig & Whistle, Earls, the Crabtree Inn and London House – settled down to watch the footy. Little did they know that this apparently innocent activity was to give rise to a staggering number of complex legal questions. These were referred in the cases FAPL v QC Leisure and Karen Murphy v Media Protection Services. Today Advocate General Kokott has given her opinion. She began by explaining the background:
‘Football Association Premier League … grants its licensees the exclusive right to broadcast and economically exploit the matches within their broadcasting area, generally the country in question. In order to safeguard the exclusive rights of other licensees, they are at the same time required to prevent their broadcasts from being able to be viewed outside the broadcasting area … Undertakings import decoder cards from abroad, in the present cases from Greece and Arab States, into the United Kingdom and offer them to pubs there at more favourable prices than the broadcaster in that State. The FAPL is attempting to stop that practice.’
The Advocate General’s proposed answers to the questions referred are:

1. Question 1 in Case C‑403/08:
Being ‘designed’ or ‘adapted’ within the meaning of Article 2(e) of Directive 98/84/EC means the manufacture or modification of equipment with the intention of providing access to a protected service in an intelligible form without the authorisation of the service provider. Where a conditional access device is made by or with the consent of a service provider and sold subject to a limited authorisation to use the device only to gain access to the protected service in particular circumstances, that device does not therefore become an ‘illicit device’ within the meaning of Article 2(e) of Directive 98/84 if it is used to obtain access to that protected service in a place or in a manner or by a person outside the authorisation of the service provider.

2. Question 3 in Case C‑429/08:
Article 3(2) of Directive 98/84 does not preclude a Member State from invoking a provision of national law that prevents use of a conditional access device in the event of breach of contractual agreements concerning the accessibility of programmes in certain Member States, following the provision of false names and/or addresses in the acquisition of the access device, or the use, for commercial purposes, of an access device intended for private or domestic use.

3. Question 4 in Case C‑403/08:
(a) The question whether works have been reproduced in whole or in part must be answered by means of an interpretation of Article 2 of Directive 2001/29/EC.
(b) Acts of reproduction occur where frames of digital video and audio are created within the memory of a decoder, as those frames constitute part of the broadcast author’s own intellectual creation.
(c) The display of a broadcast on a screen also constitutes reproduction.

4. Question 5 in Case C‑403/08:
Transient copies of a work created on a television screen linked to the decoder box have independent economic significance within the meaning of Article 5(1) of Directive 2001/29, whereas transient copies created in a decoder’s memory do not.

5. Question 6 in Case C‑403/08:
A copyright work is not communicated to the public by wire or wireless means, within the meaning of Article 3(1) of Directive 2001/29, where it is received or viewed as part of a satellite broadcast at commercial premises (for example, a bar) or shown at those premises, free of charge, via a single television screen and speakers to members of the public present in those premises.

6. Question 7 in Case C‑403/08:
The right to communicate copyright works by satellite under Article 2 of Directive 93/83/EC includes the right also to receive and watch that broadcast abroad.

7. Questions 6 and 7 in Case C‑429/08 and Questions 7, 8(c) and 9 in Case C‑403/08:
(a) Freedom to provide services under Article 56 TFEU (previously Article 49 EC) precludes provisions which prohibit, on grounds of protection of intellectual property, the use of conditional access devices for encrypted satellite television in a Member State which have been placed on the market in another Member State with the consent of the holder of the rights to the broadcast. It is irrelevant whether such devices were procured and/or enabled in the other Member State by the provision of a false name and false residential address. An individual agreement to use decoder cards only for domestic or private use also does not affect that conclusion.
(b) Freedom to provide services does not preclude national rules which allow the holder of rights to a broadcast to object to its communication in a pub, provided that the restriction of freedom to provide services stemming from the exercise of that right is not disproportionate to the share of the protected rights to the broadcast.
(c) It is irrelevant for the purposes of the present references for preliminary rulings whether the provision of national law infringes freedom to provide services because it applies to programmes included in a broadcasting service provided from a place in the United Kingdom but not from any other Member State.

8. Question 10 in Case C‑403/08 and Question 8 in Case C‑429/08:
Where a programme content provider enters into a series of exclusive licences each for the territory of one or more Member States under which the broadcaster is licensed to broadcast the programme content only within that territory (including by satellite) and a contractual obligation is included in each licence requiring the broadcaster to prevent its satellite decoder cards which enable reception of the licensed programme content from being used outside the licensed territory, such licence agreements are liable to prevent, restrict or distort competition. They are therefore incompatible with Article 101(1) TFEU; it is not necessary to show that such effects have actually occurred.

Guardian report here.

FT report here.

Wednesday 2 February 2011

The Work of Art in the Age of Digital Reproduction

Visual artists, it seems, are avoiding making heavy weather of the Hargreaves Review. The DACS website has a succinct questionnaire where they can quickly express their views. That survey, which closes on 6 February, takes no longer than 15 minutes to complete and covers not only the Hargreaves Review but also the EU consultation on the Artist’s Resale Right!

In view of the market for original art works, perhaps some artists may find themselves saying copyright law is neither a help nor a hindrance…

The Artist’s Resale Right

It is this market for original works that is affected by the Artist’s Resale Right – the right for a visual artist or their heirs to receive a royalty when a work is resold. The Resale Right Directive says the right ‘forms an integral part of copyright’, which seems to sound better in French: ‘Le droit de suite fait partie intégrante du droit d’auteur.’ It has, after all, nothing to do with copying, apart from the fact that it only applies to works that are in copyright.

The Resale Right is, as has recently been demonstrated on this blog, a relatively contentious piece of EU law from a UK perspective. Before the introduction of the Directive, the right had existed in most European countries but not all – most notably the UK, which made Britain an internal-market-distortingly attractive place to sell art. As a transitional concession, the royalty is not currently payable in the UK on sales of works by deceased artists but it will be from next year. Since implementation of the Directive in the UK, artists have had a choice of collecting societies, DACS and ACS (and ARA) – ACS being established to mitigate the possible anti-competitive effects of a collecting society monopoly.

Balloon dogs

Meanwhile on the other side of the Pond, sculptor Jeff Koons has been generating considerable jollity by sending a cease and desist letter to a gallery/shop that sells balloon dog bookends, saying that they are violating his IP rights in his Balloon Dog Sculpture. Park Life are standing their ground, saying, ‘As virtually any clown can attest, no one owns the idea of making a balloon dog and the shape created by twisting a balloon into a dog-like form is part of the public domain . . . any similarities between the Balloon Dog Bookend compared with the Balloon Dog Structure are driven by the wholly unprotectable idea of depicting the shape of a balloon dog in a solid form.’ Perhaps the qualifying word ‘virtually’ indicates the presence of a few dissenting clowns.

Does Koons’s originality consist only of making that shape solid or could he own the copyright in the shape itself? US copyright protection subsists in original works of authorship including sculptural works. If clowns’ balloon dogs are not sculptures, then could the shape of Jeff Koons’s sculptures be original from a copyright perspective?


Park Life describes itself as ‘a retail bookstore and art gallery featuring art and design products’. This suggests that the balloon dog bookends were being sold as art objects.

Physical-object art doesn’t just attract a Resale Right. Because it is physical and often unique, it may have a strong relationship with its physical context. Artists like Koons belong to the objet trouvé tradition. Their creativity is often about taking a commonplace object and putting it in a different context, designating it as ‘art’. Does the act of re-contextualizing an object count towards copyright protection? Is what you have to say about your artwork or the fact it is in a gallery relevant, meaning that selling the shape as an art object has a bearing on whether there is an infringement? If not (as seems likely), much modern art starting with Duchamp seems to fail to be protected by copyright.

Beyond copyright

But even if copyright and economics don’t count context as part of a work of art, that doesn’t mean it isn’t (moral rights do care about context).

Walter Benjamin argued in The Work of Art in the Age of Mechanical Reproduction that mechanical reproduction has changed the social function of art from ritual to political. Reproduction, he said, challenges the here-and-nowness, the ‘aura’, the authority of the original work. Perhaps the field where mechanical reproduction has made least difference is visual art (people still value the genuine original article)? However, the reason for valuing these original works may be less about their ‘auras’ as their investment value (which mechanical reproduction increases because the works’ genuineness can’t be mechanically reproduced).

Building on Benjamin, it could be argued that before mechanical reproduction, art and its context were often inextricable, and not just visual art. Bach wrote for Sunday-morning mass, Michelangelo painted the ceiling of the Sistine Chapel, plays were written to amuse kings, poems for lovers etc etc. Mechanical reproduction, on the other hand, means an artist/author has less control over where or when his work is consumed – the work becomes a disembodied commodity that can be traded and copied. However, more recently, user-generated content is increasingly being created within the context of online communities. The significance of a photograph on Facebook may be less about its artistic qualities as the point someone is trying to make with it. Where economics does not make it necessary, it may not be imperative to sustain the myth that works of art exist in vacuum-packed isolation.

Tuesday 1 February 2011

As "digital theft" grows, can the content empire strike back?

A new survey in the US commissioned by NBC Universal shows that 23.8% of global Internet traffic involves "digital theft," with the BitTorrent file-sharing protocol accounting for 11.4% of this figure. Brand and trademark monitoring firm Envisional's analysis of the top 10,000 peer-to-peer swarms found that 99.24% of non-pornographic material being traded was copyrighted material. It also found that "infringing cyberlocker sites" accounted for 5.1% of global Internet traffic, while "infringing video streaming sites" made up 1.4% of global traffic.

With that statistic in mind, it still seems surprising to this writer that nearly 100,000 North Americans have been sued for suspected copyright infringement on file-sharing networks over the past twelve months according to details of a study published by TorrentFreak. Again, the majority are alleged to have utilised BitTorrent, although some users of eDonkey were also targeted. The 99,924 defendants were sued as part of a total of just 80 lawsuits, which seek the identities of the many "John Doe" defendants from their various Internet service providers. Some 70,914 case are active and the porn industry is now having to take steps to protect its hitherto much admired internet economic model - nearly all of the recently-filed cases target alleged downloaders of adult content although the mainstream movie industry is actively represented too, against users who have illegally downloaded feature films such as "The Hurt Locker"

Torrentfreak say “through these mass lawsuits the copyright holders are trying to obtain the personal details of (mostly) BitTorrent users who allegedly shared their material online. Once this information is handed over, they then offer the defendant the opportunity to settle the case for a few hundred up to a couple of thousand dollars, thereby avoiding a full trial and potentially even bigger financial penalties”. I find myself reminded of comments from my blog on ACS:law last week (25th January) when Torrentfreak comments “One of the main points of critique is that the copyright holders have no intention of going to a full trial against each of the defendants. They are out to get a settlement, which means that the (possibly weak) evidence will never be tested in court. Two weeks ago the EFF filed an amicus brief in which it asked an Illinois judge to quash subpoenas issued in pay-up-or-else lawsuits involving alleged illegal file-sharing of pornography, with EFF Intellectual Property Director Corynne McSherry saying “Copyright owners have a right to protect their works, but they can’t use shoddy and unfair tactics to do so,” adding “We’re asking the court to protect the rights of each and every defendant, instead of allowing these copyright trolls to game the system.”

It also appears that Google has responded pressure from the entertainment industries by implementing active censors for “piracy related” terms including BitTorrent, torrent, utorrent, RapidShare and Megaupload from its instant and autocomplete services. BitTorrent Inc., RapidShare and Vodo have all spoken out against “commercial censorship”. Among the list of forbidden keywords are “uTorrent” and “BitTorrent” and these keywords will no longer be suggested by Google when the first letter is entered, nor will they show up in Google Instant and all combinations of the word “torrent”