More on file sharing - German ISPs must disclose file sharer details

Germany's Federal Court of Justice, the Bundesgerichtshof, has recently held that internet service providers (ISPs) must disclose the name and address of illegal file sharers when requested by copyright owners.

Tonpool, a German independent music distributor sued in respect of a song entitled "Bitte hör nicht auf zu träumen" by Xavier Naidoo, which was downloaded from a file sharing site in 2011. The copyright owner asked ISP Deutsche Telekom for the name and address of the file sharer however Deutsche Telecom failed to provide the information, causing Tonpool to take the issue to court.

 

Until now ISPs in Germany had only been required to share contact details of users who share files commercially or for profit, however now ISPs can be required to disclose details of ordinary users who distribute copyright protected content.

 

Further to my post earlier this week reporting Donald P Harris' pod cast on file sharing, here are some statistics on the German music industry (according to Billboard) which show that, as many of the comments on my last blog post said, people are still willing to pay for music.

The German Music Industry Association (BVMI) has reported a 0.2% increase in overall revenue for the half of 2012. The strongest growth was in album downloads, which jumped nearly 35 % year-on-year so that online music sales now account for just under 20 % of total revenue in the German market, up from 14.4 % over the same period last year.

The BVMI figures do not include revenue from online streaming services - apparently streaming revenue accounted for about 2% of the German music market last year. Unsurprisingly, physical CD sales continue to fall (by 5.4 % in the first half of 2012), however CDs still account for 72 % of overall revenue.

 

To this blogger the small revenue attributed to downloads compared to CDs is indicative of illegal file sharing, but perhaps the Germans are just a CD loving nation?

“A very British miscarriage of justice" ?

Torrent freak reports that Anton Vickerman, the owner of TV streaming links site SurfTheChannel, has been sentenced to four years custody at Newcastle Crown Court  after being found guilty of conspiracy to defraud for “facilitating” copyright infringement under the Criminal Justice Act.  But there the story starts to get interesting: behind the prosecution was FACT, the Federation Against Copyright Theft, the UK based anti-piracy group and FACT Director General Kieron Sharp told reporters "This case conclusively shows that running a website that deliberately sets out to direct users to illegal copies of films and TV shows will result in a criminal conviction and a long jail sentence. The Guardian reported that SurftheChannel had 400,000 users each day at its peak and Vickerman made £35,000 as month from the site. The site hosted no content as such, but linked to both legal and illegal content elsewhere.

However, Mr Vickerman is somewhat upset about the investigation FACT conducted - and he claims FACT, a UK limited company, stepped in when the CPS declined to prosecute, and collected a vast amount of data not only on his own activities, with SurfTheChannel and his personal financial affairs, and also collected data on his wife (who had also been charged but cleared) and on his parents, both pensioners. According to Vickerman, on one occasion a private investigator posed as a prospective house buyer to film inside Vickerman's house.

In a long long blog on his website which begins "My name is Anton Vickerman and I am the proud owner of the now dead video search engine SurfTheChannel.com (STC). By the time you read this I will be starting my new life behind bars after receiving what is expected to be a “loony sentence” from Judge John Evans of Newcastle Crown Court for running my site from 2007 to 2012". Vickermans mounts a very detailed defence for his activities, and highlights what he sees as FACT's failings, although I should point out (as Mr Vickerman does himself) that he even appealed FACT's methods to the Supreme Court (with no joy). There are some fairly extraordinary allegations of shenanigans in the Court of Appeal and by FACT's legal team, as well as a conspiracy between the content industries, the legal profession, the police and the judiciary; but if you have the time and the energy, Mr Vickerman's blog is (at least) interesting, not least as to FACT's proactive approach to the case.

I am grateful to my good friend Cass Williams for alerting me to this link to background on the case on Out-Law here and TorrentFreak's take here http://torrentfreak.com/movie-studios-compiled-scary-private-life-dossier-on-surfthechannel-admin-120815/ , and you can read more on the Guardian here and make up your own minds on Mr Vickerman's musings here http://surfthechannel.com/ .




For comparisons from the UK's criminal courts see the 'Oink' case here  (a 'not guilty' verdict on charges of conspiracy to defraud), the "TV-links" case here (again 'not guilty' after HH Judge Ticehurst ruled that TV-Links was entitled to “mere conduit” protection under Section 17 if the European E-Commerce Directive 2000 and could not be held to account for the infringing material it linked to, and a CDPA claim also failed) and TorrentFreak comments on both here - and the TVShack (Richard O'Dwyer) case here  - and Iona's recent review of the US court's position on linking here 

 Apart from Oink, Do you think they all had the same graphic designer?







UPDATE  David very kindly added a transcript of HH Judge Evans Sentencing Remarks in the comments section - the link is here  and surfthechannel.com is now (when I looked on the 21st August) no longer online.

Copyright law and alcohol prohibition

Today this blogger's attention was caught by a Surprisingly Free podcast in which Donald P. Harris, associate professor of law at Temple University, discussed the regulation of file sharing and compared it with the Alcohol Prohibition era of the 1920s and 30s in the US. It is a fascinating and very thorough discussion of file sharing and the issues faced in enforcing copyright law on the Internet. Harris' arguments are summarised below, however if you have time do listen to the podcast.  

© Kirti Poddar

Copyright owners rightfully object to file sharing, says Harris, because they receive no remuneration from it, however the flip side of the coin is that consumers simply want to share works and take full benefit of the Internet. We have seen numerous efforts by recording industry in particular to prevent file sharing, to no avail. People are file sharing at unprecedented levels. Therefore, Harris suggests that we need to take a lesson from history and in particular the prohibition era when social norms and the law were out of sync.The podcast host suggests that file sharing is comparable to stealing, and asks why we should consider helping file sharers to take from copyright owners.

Harris makes the obvious distinction between tangible and intangible property, being that if you take someone's book you deprive them of that book, but that if you share the book online no-one loses out. He says that society benefits from sharing, so the theft analogy doesn't hold.

Harris goes on to discuss the constitutional cause that provided for copyright law in the US: copyright was designed to benefit society. It was not designed to reward artists. Although there are arguments on both sides, Harris says that going back to the purpose of copyright law in the US helps us understand that file sharing might not be stealing.

Of course the next question is what about the artists? If we allow file sharing we remove the incentive for creation. We need incentives for artists to trade, otherwise not as many works will be made for society to enjoy.

Harris suggests that perhaps although artists need incentives, expanding the term of copyright protection from 14 years to 70 years plus life was excessive. Restricting the term might be one way to retain copyright whilst allowing some forms of file sharing.Harris goes on to consider enforcement. Law suits have been filed, successfully, against both software developers and consumers, but file sharing has not slowed. This he compares to prohibition, when sale and distribution of alcohol was prohibited yet people continued to drink.

There were several different forces behind prohibition, but Harris notes that prohibition is not something that the people ever wanted. The issue was never put to the public vote, and consequently the constitutional amendment was a miserable failure. People continued to drink. The Government imposed stricter penalties but they didn't work.Ironically prohibition soon began to worsen the social problems that it had been intended to cure: disrespect for the law, underage drinking, corruption and gang violence.

So after about 10 years the legislation was reversed and alcohol consumption became legal again. Why? Because the Government had miscalculated level of non-compliance that prohibition would generate.Harris says that although we don't need 100% compliance for the law to work, we need most people to comply with most laws. And by and large people will comply with laws if they think that they are just; if they fit with the public's sense of right and wrong.

Harris argues that it doesn't matter how severe the penalty is: people will not be deterred if they don't feel morally obligated to comply.  This, he says, is the problem with file sharing. Young people in particular do not think that they are doing anything wrong; the law is out of pace with social norms.File sharing raises two important questions:

1. What should we do when we have new technology? Should the law change?

2. If we have laws that do not align with social norms, should we change them?

In response to question 1, Harris says that the Internet has dramatically changed the landscape of copyright and that therefore, intuitively we should change the law so that it works with the Internet. He compares the Internet with photography (who will pay for portraits?), radio (who will pay for music?) and VCRs (who will pay for films?) to make the point that new technology does not mean that artists will no longer make money from their work.

As to the second point, Harris goes back to alcohol prohibition, saying that prohibition teaches us that it might be worth changing laws to make them consistent with social norms. Young people feel no moral guilt for file sharing, he says, and it is going to be difficult to enforce the law or to change social attitudes to file sharing.

So how do we make sure that authors can charge so that they have an incentive to create? Harris has two suggestions. First he suggest imposing copyright levies on copying equipment and blank devices. This is a method already used in many European countries which would enable people to file share having already paid a tax on the types of equipment that are used to file share.

Harris' second suggestion is that a licence fee should be included in ISP fees, so that when you pay for access to the Internet you also pay to use and share content.Having said this, Harris wonders whether providing these legal avenues would make any difference if people believe that they shouldn't pay to share files. He suggests that file sharing should be made legal  for non-commercial use (a term that would need to be defined). He argues that this would simply be similar to allowing copying of CDs at home or taping from the radio. Artists would still have an incentive to create because they make so little from CD sales; artists make most money from live performances and sales of performances.

Harris argues that file sharing is seen by artists as free promotion of their music.So who would lose out? The record industry would. Harris says that if we think of copyright laws as a way first of benefiting society and second of protecting artists we should not be unsympathetic to record industries losing out.Harris closes by saying that it is difficult to strike a balance, and of course we have no way of knowing what the right system is. However he is of the view that, on balance, whilst it would be controversial to legalise file sharing the benefits would outweigh the disadvantages.

What do you think?

Another question: collecting societies and payment thresholds

This blogger is just starting to get a few emails trickling in by way of response to yesterday's request for recommended reading material on copyright protection of algorithms -- and now there's already another request for information.

One of our readers wants to know about the thresholds beneath which copyright collecting societies, citing administrative costs or other reasons, do not make payments to rights holders. It seems that some collecting societies are quite open about their thresholds, while others are a bit coy. There doesn't seem to be a distribution threshold 'league table' and the value of such a table might in any event be dubious, given the different levels of activity, opportunities for economies of scale and local banking and administrative costs of distributing the collected income. Even so, any relevant information and comment is welcomed, particularly if it can be verified (eg links to collecting society web pages, posted as Comments below). Thanks!

Copyright protection and algorithms

This blogger has been asked if he can recommend any good -- and ideally recent -- articles on copyright protection of algorithms. Although he has seen numerous comments, and indeed participated in a number of discussions with friends and colleagues, on this topic, he has always looked at the question from first principles and can't actually point to any articles on either side of the Atlantic that he has read that relate specifically to copyright rather than patent law.

Can any reader suggest some good reading on this topic, from any jurisdiction and in any language, that can be passed on to the person asking for it? If so, can he or she please post it below as a comment or email me here.

Google "demotes" repeat offenders

Google has taken a significant step against online piracy after saying it would alter its search algorithms to favour websites that offered legitimate copyrighted movies, music and television. Google said that beginning next week its algorithms would take into account the number of valid copyright removal notices sites have received and  sites with multiple, valid complaints about copyright infringement may appear lower in Google search results ........ like YouTube for example ..... no, I made the last bit up. 

The move is set against growing disquiet about whether or not "safe harbour" really is appropriate in the digital age - and this initiative is clearly on Google's terms, BUT it is a move forward for content owners. 

Google's Senior Vice President Engineering Amit Singhal said in a post on Google's official blog "We aim to provide a great experience for our users and have developed over 200 signals to ensure our search algorithms deliver the best possible results. Starting next week, we will begin taking into account a new signal in our rankings: the number of valid copyright removal notices we receive for any given site. Sites with high numbers of removal notices may appear lower in our results. This ranking change should help users find legitimate, quality sources of content more easily—whether it’s a song previewed on NPR's music website, a TV show on Hulu or new music streamed from Spotify." 

"Since we re-booted our copyright removals over two years ago, we’ve been given much more data by copyright owners about infringing content online. In fact, we’re now receiving and processing more copyright removal notices every day than we did in all of 2009 — more than 4.3 million URLs in the last 30 days alone. We will now be using this data as a signal in our search rankings. 

Singhal added more detail but also indicated that the search engine would not completely remove alleged infringing sites from searches saying "Only copyright holders know if something is authorized, and only courts can decide if a copyright has been infringed; Google cannot determine whether a particular webpage does or does not violate copyright law. So while this new signal will influence the ranking of some search results, we won’t be removing any pages from search results unless we receive a valid copyright removal notice from the rights owner. And we’ll continue to provide "counter-notice" tools so that those who believe their content has been wrongly removed can get it reinstated. We’ll also continue to be transparent about copyright removals." 

Unsurprisingly, organisations representing content owners in the entertainment sector were pleased with RIAA chairman and CEO Cary Sherman saying "Today Google has announced a potentially significant change in its search rankings that can make a meaningful difference to creators: sites that are the subject of large numbers of copyright removal notices may be ranked lower in search results than before. This should result in improved rankings for the licensed music services that pay artists and deliver fans the music they love. This change is an important step in the right direction – a step we’ve been urging Google to take for a long time – and we commend the company for its action" but added “As Google itself has acknowledged, this is not the only approach, and of course, the details of implementation will matter. Moreover, there are many more actions that we hope Google will take.”  On the other side of the digital divide, The Electronic Frontier Foundation said the new guidelines are too vague, millions of takedown notices later prove to be unfounded and there is no recourse for site owners who have been (wrongly) demoted. 

More on Techdirt here and from CNET here 

http://insidesearch.blogspot.co.uk/2012/08/an-update-to-our-search-algorithms.html

Social media as a tool for litigators: Facebook used to blow Flo Rida's whistle

© Eva Rinaldi

In October 2011 Flo Rida failed to turn up to headline at the Fat As Butter Festival in Newcastle, New South Wales, Australia. As he was supposed to walk on stage the festival was forced to announce: "Flo Rida has slept in and will not be able to make the concert". Understandably, fans were outraged. The festival organisers, Mothership Music Pty Ltd, sued Flo Rida and his manager for breach of contract: they had paid $50,000 for a performance that they had not received and alleged damage to their reputation.

This isn't a copyright case, however from it arise several interesting points of practice which will be relevant to all litigators. Because Mothership was never able to get close enough to Flo Rida to serve the claim on him whilst he was in Australia, it applied to court for alternative means of service. In April of this year Gibson DCJ ordered substituted service by email and by a post on Flo Rida's Facebook page. The court order set out the text to be posted on Facebook.

The Judge referred to the "international reach of Facebook" and to previous case law where service by Facebook has been ordered:

"There have been prior examples of service being effected by Facebook. According to the Sydney Morning Herald ("Australian court serves documents via Facebook" (Nick Abraham, 12 December 2008)), Master Harper, in the ACT Supreme Court, ordered that default judgment could be served on defendants by notification on Facebook, in what the Herald called "first in Australia and perhaps the world". Unfortunately, this decision is not available on LexisNexis or Austlii, so I will have to take the Herald's word for it.

However, in the Federal Magistrates Court (Byrne v Howard [2010] FMCAFAM 509), Brown FM made an order for substituted service via Facebook and other electronic means including email ([17] to [28]). Such an order could conceivably cover Twitter accounts as well as Facebook accounts if that was necessary. Similar evidence was put before the learned magistrate in that case to the evidence that is before me today."

This case shows that service by Facebook is, in Australia at least, becoming an acceptable alternative where traditional methods of serving claims are not possible.

Flo Rida never showed up in Court, so last week the hearing went ahead without him with the Judge awarding damages of $380,000 including $302,000 for loss of reputation arising from breach of contract. Further the judge referred to the impact of social media on the damage to Mothership's reputation as news of Flo Rida's no show spread wide and fast thanks to Facebook, YouTube and Twitter.

We know that the reach of social media is huge however it is interesting to see Courts being so progressive: if Facebook can be used to serve proceedings defendants will find it hard to escape being served.

The idea/expression dichotomy in the virtual world

Last Friday, Electronic Arts (EA) sued Zynga in the US District Court for the Northern District of California, alleging that Zynga's new game, The Ville infringes copyright in EA's The Sims Social. The online games, which are both played on Facebook, involve players creating characters who live, work and interact with each other in the virtual world.
EA has said that The Ville is "unmistakably" similar to The Sims Social and that the games are "largely indistinguishable" to the casual observer, but that the similarities go beyond the superficial. EA have said that Zynga's "design choices, animations, visual arrangements and character motions and actions have been directly lifted from The Sims Social".

Zynga was quick to respond, saying that EA doesn't understand copyright and that it plans to defend its rights. Further, Zynga points out that EA's recently launched SimCity Social is very similar to Zynga's CityVille game.

The question of how much can be copied turns on the idea/expression dichotomy, which says that ideas are not protected by copyright, only expressions of ideas are protected. This is a concept that has been analysed in the world of literature, film and photographs however there is little case law in relation to video games, where the complexity of the games combined with the fact that players have direct input on what the game looks like and how it plays out make the analysis more difficult.

An early case in this area was Atari v Phillips. Atari made Pac-Man, a game that many readers will surely remember. Phillips released a similar game called Munchkin, and were subsequently sued by Atari. In 1982, the court held that Phillips had copied Pac-Man and that it had made alterations that "only tend to emphasize the extent to which it deliberately copied the Plaintiff's work."

The ruling was one of the first to establish how copyright law should apply to video games.

In 1994, the courts found in favour of the copier when Capcom sued Data East alleging its game Fighter's History infringed copyright in Capcom's Street Fighter II. In this case the court held that since Capcom’s characters were themselves based on previously existing stereotypes and martial arts disciplines there was no infringement.

Most recently in Tetris v Xio Interactive (which Eleonora reported on here) the district court of New Jersey said that: "The doctrine is simple to state - copyright will not protect an idea, only its expression - but difficult to apply, especially in the context of computer programs."

The court went on to say that "The style, design, shape, and movement of the pieces are expression; they are not part of the ideas, rules, or functions of the game".

EA has made a very detailed claim, which specifies for instance that The Ville uses the same skin tone colours as Sims Social and that the refrigerators in the virtual houses are so similarly drawn that they overlap nearly perfectly. On that basis it seems likely that Zynga is infringing the expression of EA's game as well as the idea. If the case does make it to court without settling the judgment will offer much needed clarity in this area of the law, and could have a huge impact on the masses of lookalike games on the market.