Landmark ISP liability case decided in Australia

skippy

What did you say Skippy? ISPs are not liable for the infringement committed by their customers?

As was mentioned last week, we have been expecting an important ruling with regards to internet service provider (ISP) liability from Australia.  Behold Roadshow Films Pty Ltd v iiNet Limited [2010] FCA 24.  This is a case of tremendous importance because it is one of the first skirmishes in the brewing struggle between content owners and intermediaries (I use the term intermediaries on purpose, as the wider dispute encompasses companies such as Google).

iiNet is an Australian internet provider, which was sued by Australian film producer Roadshow Films, part of the Village Roadshow conglomerate.  However, the real power behind the suit was the weight provided by several Hollywood studios, including Warner, Columbia, 20th Century, and Sony Pictures.  The question at the heart of the proceedings was whether an ISP is to be held liable for the copyright infringement committed by its customers.  Call me cynical, but it seems like the film studios chose Australia as the first place to test this theory because Australian copyright law holds secondary infringement as direct infringement.  In other words, anyone making available copyright works will be held similarly liable, whether they do so directly or indirectly.

This is a lengthy and complex ruling, but it is remarkable that it has fallen upon a judge that seems to get the importance of the ruling in the wider context, and also who got the technical complexities involved.  Cowdroy J has managed to wade through the technical issues with exceptional clarity, and has produced a ruling that should become an instant classic.  The judge accurately identifies that the case hinges on two simple questions.  Have the iiNet customers infringed copyright directly?  The answer is yes.  Has iiNet authorised the copyright infringement of its users by failing to take steps to stop it from happening? Here the answer is no. The reasoning behind the negative answer is set out clearly:

“12. Firstly, in the law of authorisation, there is a distinction to be drawn between the provision of the ‘means’ of infringement compared to the provision of a precondition to infringement occurring. The decisions in Moorhouse, Jain, Metro, Cooper and Kazaa are each examples of cases in which the authorisers provided the ‘means’ of infringement. But, unlike those decisions, I find that the mere provision of access to the internet is not the ‘means’ of infringement. There does not appear to be any way to infringe the applicants’ copyright from the mere use of the internet. Rather, the ‘means’ by which the applicants’ copyright is infringed is an iiNet user’s use of the constituent parts of the BitTorrent system. iiNet has no control over the BitTorrent system and is not responsible for the operation of the BitTorrent system.
13. Secondly, I find that a scheme for notification, suspension and termination of customer accounts is not, in this instance, a relevant power to prevent copyright infringement pursuant to s 101(1A) [...]
14. Thirdly, I find that iiNet simply cannot be seen as sanctioning, approving or countenancing copyright infringement. The requisite element of favouring infringement on the evidence simply does not exist. The evidence establishes that iiNet has done no more than to provide an internet service to its users. This can be clearly contrasted with the respondents in the Cooper and Kazaa proceedings, in which the respondents intended copyright infringements to occur, and in circumstances where the website and software respectively were deliberately structured to achieve this result.
15. Consequently, I find that the applicants’ Amended Application before me must fail.”

This conclusion is both astute and well informed, as it takes into account the very clear distinction between an internet service provider, and the producer of software designed specifically to authorise copyright infringement, such as Kazaa.  Cowdroy J goes in detail through some of the most relevant aspects of the technology, namely the intricacies of Bittorrent transactions, and also whether the identification of customers is reliable.  To me one of the most important parts of the ruling is that we get a very clear legal explanation of the Bittorrent protocol:

“70. To use the rather colourful imagery that internet piracy conjures up in a highly imperfect analogy, the file being shared in the swarm is the treasure, the BitTorrent client is the ship, the .torrent file is the treasure map, The Pirate Bay provides treasure maps free of charge and the tracker is the wise old man that needs to be consulted to understand the treasure map.
71. Whilst such an analogy grossly oversimplifies the situation it will suffice for present purposes. It demonstrates that all of the constituent parts of the BitTorrent protocol must work together before a person can access the file sought. In this judgment the Court will refer to all the constituent parts together as the ‘BitTorrent system’.
72. Such analogy also demonstrates that a number of deliberate steps are required to be taken by a person to bring about the means to infringe the applicants’ copyright. The person must download a BitTorrent client like Vuze, seek out .torrent files related to copyright material from websites, and download those .torrent files and open them in their BitTorrent client. Thereafter, the person must maintain connection to the internet for as long as is necessary to download all the pieces. The length of this downloading process will depend on the size of the file, the number of peers in the swarm and the speed of those peers’ internet connections.”

The other remarkable part of the ruling is that we get a very detailed insight into the technology involved in the detection of repeat infringers.  The applicants use a Bittorrent client called DtecNet, which singles out infringing torrents identified by the content owners, and starts downloading from the participant sharers in the swarm.  The agent downloads a full copy of the file to establish that this is indeed an infringing copy, and then identifies IP addresses in the iiNet network.  The agent would then download one piece of the full file from a specific IP address, and would continue to download a piece every 24 hours from the same address.  This technical operation was able to establish that there were indeed iiNet customers sharing infringing files repeatedly, but here is where one of the most interesting findings takes place.  Cowdroy J accurately points out that the infringement is much less widespread than previously beieved, and particularly, seemed to express doubt as to the efficiency of matching IP addresses with specific customers.  Another interesting technical issue that came to bear on the liability issue was the fact that the applicants were trying to paint a picture that a large portion of an infringer’s broadband use would be dedicated to illegal filesharing, while the evidence was to the contrary.

Turning to the legal aspects, one of the most important questions in the ruling is whether each time a user connects to the internet it should be considered as a fresh count of making the work available to the public, or whether the first action, namely downloading the .torrent file and seeding it, would be one single count.  Cowdroy J opines:

“310. [..] The Court finds that it is the wrong approach to focus on each individual piece of the file transmitted within the swarm as an individual example of an ‘electronic transmission’. The BitTorrent system does not exist outside of the aggregate effect of those transmissions, since a person seeks the whole of the file, not a piece of it. In short, BitTorrent is not the individual transmissions, it is the swarm. It is absurd to suggest that since the applicants’ evidence only demonstrates that one piece of a file has been downloaded by the DtecNet Agent from each iiNet user (in some cases more than one, but not many more), the applicants cannot prove that there have been ‘electronic transmissions’ by iiNet users of the applicants’ films. But it is equally absurd to suggest that each and every piece taken by the DtecNet Agent from an iiNet user constitutes an individual ‘electronic transmission’ infringement.
311. The correct approach is to view the swarm as an entity in itself. The ‘electronic transmission’ act occurs between the iiNet user/peer and the swarm, not between each individual peer. One-on-one communications between peers is the technical process by which the data is transferred, but that does not mean that such level of detail is necessarily what the communication right in s 86(c) focuses upon. While the DtecNet evidence cannot prove directly that an iiNet user has ‘electronically transmitted’ a film to the swarm (it can only show that the data has been ‘electronically transmitted’ to the DtecNet Agent acting as a peer in the swarm) the evidence is sufficient to draw an inference that in most cases iiNet users have done so. “

There are many other legal aspect treated, most of them are specific to Australian copyright law.  The most relevant from an international perspective, and one that has been highlighted elsewhere, is that the ruling seems to seriously attack the viability of three-strikes approaches to copyright infringement.  Firstly, there is a lengthy discussion about the legal reliability of evidence obtained by agents acting on behalf of the copyright owners, when by definition those agents are licensed by the owner to undertake actions that would otherwise be infringing, namely, collect copies from the internet.  Secondly, there is the troublesome issue of how such evidence should be suspect in the first place.   Cowdroy J says:

“631. [...] the Court finds that it would not be appropriate to construe the safe harbour provisions such that there is an expectation on the [ISP] to terminate its subscribers at the request of a person who does not swear to the truth of his statement, and is an employee of an organisation whose precise legal status vis-à-vis the relevant copyright owners and exclusive licensees is not at all clear. Allegations of copyright infringement are serious charges which are potentially defamatory. Further, AFACT (the Australian copyright enforcement agency) enjoys no status as an authority invested with power to issue legally enforceable directions.”

This paragraph should be printed out and handed out to the Lords currently discussing the Digital Economy Bill (wink, wink, ORG).  We cannot possibly build a system of punishment that relies entirely on suspect accusations without any legal recourse.  The very principles of fairness and due process of law are at stake here.

What a refreshing ruling from Down Under.  Unfortunately, another copyright case from the land where women glow and men plunder has overshadow this more important development.

I just smiled and gave me a vegamite sandwich.

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There ain't such thing as privacy

1984 is so last century.

A world without privacy has often been depicted as part of a dystopian nightmare in various works of speculative fiction.  Yet when we are suddenly thrust upon a world where the very notion of privacy seems to be melting before our very eyes, the public’s response is not one of shock, but rather of celebration.  At the heart of the modern privacy debate we cannot ignore the inescapable conclusion that people are perfectly happy to forego their privacy in exchange for something else.  Privacy advocates warn us that we are sleepwalking into the dystopia, yet I am not sure that is the right word, I am sometimes afraid that we are running towards it with open arms.

These thoughts occurred to me as I was reading the remarkable story of how to catch an iPhone thief, where a man from Los Angeles was able to track down the person who stole his iPhone through a combination of geolocation technology, Web 2.0 apps, public databases, search engines, and Streetview. The story reminded me of the phone thief at the opening of Clay Shirky’s “Here Comes Everybody”, as it follows a powerful narrative of comeuppance and justice being served.  We all have had something stolen, and these stories tell us that from time to time the perpetrator will be found, and the goods returned to their rightful owner.

While the iPhone thief story is delightful in its conclusion, I was left with a sour taste in my mouth while reading it.  Was anyone else disturbed by the privacy implications of the tale?  The amount of information available via public search is quite simply staggering.  Imagine the same story, but exchange the guy looking for the iPhone with a stalker, or an employer trying to find more information about their employees, or any other less palatable scenario. From the overwhelmingly positive nature of comments on the blog, and from the comments on Twitter, my guess is that I am in a minority here, hence this rant.

As long as we have our smart phones, gadgets, and search engines, we do not give a damn about privacy.  We freely give away gazillions of data through Facebook so that we can play Farmville.  As long as our iPhone works, we ignore the fact that it can be used to track all of our movements.  Privacy is dead, and we do not care.

Look in the mirror, Big Brother is you.

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The iPad: revolution, revulsion, or just silly?

"I hope they don't notice"

Oh dear, so Apple has released a new product, and the techie blogosphere has gone crazy.  The early verdict seems negative, with various people pointing out the many features that it does not have, but to me Hitler sums it up nicely when he says that it is an over-sized iPod (Downfall videos, still funny).  And not to mention the fact that the name has brought about much smirking and the inevitable comparisons with female sanitary products (check out this prophetic video from MadTV). To me the is no dilemma, I never buy first generation of any technology.  Problem solved.

Given the many problems with the iPad, I guessed that not even the hardened pro-Apple brigade would be defending it, but I was wrong.  The problem apparently is that we are suffering from future shock, according to one commentator.  Errr… no, we just do not like the product.  I am surprised that someone still takes Toffler seriously, let alone have the temerity to argue that we are collectively in shock of the awesomeness of the new product, so all the negative vibes are just people in denial.  Computing is inherently broken and Saint Steve has come to solve it, he is just way ahead of the curve on this one and we will eventually be using iPads.  No thank you, I’ll stay with my Android phone and my iPod Touch, thank you very much.

Then there is this monumentally arrogant piece.  The author talks about a generational divide between the Old Worlders and the New Worlders, a distinction as wrong and artificial as that “digital native”  nonsense.  The author first tells us that the iPad is part of a revolution in computing, and that we must simply put up with all of its short-comings in the name of “the ideal”.  Then it gives a lot of examples where technologies changed radically, and sets straw men critics and then knocks them down.  “They” wanted to keep the floppy!  No, “they” didn’t.  I hate this type of argument, it is the same lazy fallacy spouted by goons all over the internet: “they laughed at Galileo!” they say as if that will immediately validate their ideas.  Well, yes, they also laughed at Bozo the Clown…

To me the choice is simple.  Does the gadget do what I want it to do, or does it not?  If the answer is negative, I’ll just wait.  Is it possible that the naysayers are wrong?  Sure, the iPad might really be the revolution they say it will be.  Personally I will not buy one until they solve some of the issues.  I don’t want a big iPod Touch, I’m happy with mine.

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Is deep-packet inspection a criminal offence?

"These are not the packets you are looking for"

Things are heating up in the fight against piracy in the UK.  Virgin Media has announced that it will use deep packet inspection (DPI) software to analyse whether its customers are sharing copyright infringing material.  Privacy International has brought this practice to the attention of both the European Commission and the Information Commissioner, who are looking into the affair.  But most interestingly, Privacy International has also threatened to report Virgin Media to the Metropolitan Police for contravening the Regulation of Investigatory Powers Act (RIPA, yes, the acronym does sound like a flesh-eating dinosaur, or a killer robot).

It seems clear that Virgin’s DPI system is similar to our old friend Phorm, and the European Commission has already made it clear that it considers such technologies as interception, and that clear customer consent is required in such cases.  I would not be surprised if they have similar objections against Virgin Media’s software.

However, the claim that deep packet inspection might constitute a criminal offence is much more interesting from a legal perspective.  RIPA establishes a criminal offence for the interception of telecommunications.  It defines interception like this:

“For the purposes of this Act, but subject to the following provisions of this section, a person intercepts a communication in the course of its transmission by means of a telecommunication system if, and only if, he—

(a) so modifies or interferes with the system, or its operation,
(b) so monitors transmissions made by means of the system, or
(c) so monitors transmissions made by wireless telegraphy to or from apparatus comprised in the system,

as to make some or all of the contents of the communication available, while being transmitted, to a person other than the sender or intended recipient of the communication.”

There are several elements here, but the most important one is that some or all of the communication must be made available to non-intended receivers, and that such communication must have been interfered with or monitored.  Here is where we need to analyse in more detail what is considered deep packet inspection in order to ascertain if it fulfils the cited definition.  Internet transmissions are not a monolithic set of bits, they are broken up into packets of information; Internet packets (or IP packets), consist of two elements, the header (which describes the information contained in the packet), and the payload (the information itself).  Most packet inspection only looks at the header, and therefore it does not know what type of data may be contained in the payload.  Deep packet inspection looks at the packet information itself to determine if it may match a certain objectionable data profiles, such as viruses, worms, spam, or denial-of-service attacks.  DPI does not look at the semantic meaning of the data, but looks for data profiles, so DPI will in theory know that what you are looking is a picture, but it will not know that you are looking at a lolcat or a Picasso.  However, the uniqueness of information is such that it would be easy to build profiles of usage data that could have serious privacy implications.

Modern DPI systems claim to be able to provide both security and privacy, but as with Phorm, we might be faced with slippery-slope arguments.  Virgin claims that the data is anonymous, and that “CView works at a core-network level, and simply analyses, entirely anonymously, the percentage of data that flows across the network that is copyrighted and being shared unlawfully”.  Nonetheless, a strict reading of the definition in RIPA would lead one to believe that DPI fulfils that definition, and therefore it could be considered interception, and hence a criminal offence.  Nonetheless, the language of the relevant section in RIPA is very broad, so it is hard to determine if the Crown Prosecution and the courts would agree.

What seems clear is that Virgin may have a lengthy legal dispute in its hands if it insists on using DPI.  While they have not stated it, Virgin might be taking this decision in order to pre-empt any potential legal threats as content owners insist more and more on making ISPs liable for illegal content shared in their networks. It will be interesting to see if other ISPs follow Virgin’s lead.

Update: John Halton has usefully pointed out that the Lawful Business Practice Regulations 2000 might apply here. Interesting!

Update 2: And in an inevitable two fingers to surveillance, PirateBay announces its own VPN service.

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Letters from the ISP front

"They are getting closer, I can hear their lawsuits at night"

Anyone who has been paying attention to the War on Piracy will have noticed that the emphasis has shifted from the user to the internet service provider.  As content owners discovered that attempts to enforce their rights against users backfired and/or had no noticeable effect, they began returning to the strategy of trying to make the service providers liable for the infringement committed by their customers.

The first barrage in the war took place when content owners managed to get Irish ISP Eircom to promise that it would disconnect repeat offenders.  Then an Australian copyright conglomerate (representing several U.S. content giants) sued iiNet for copyright infringement incurred by its customers, and we should get a ruling next week.

These lawsuits however are only a small part of the global strategy.  As it has been repeatedly posted here and elsewhere, the end-game for the content providers is of course to make ISPs liable through the inclusion of three-strikes clauses into copyright law.  New Zealand and France have attempted to do just that with mixed results, and in the UK we are currently experiencing a similar threat through the Digital Economy Bill.  But it is in ACTA where the final battle will take place.  The inclusion of three-strikes provisions in a wide-ranging bilateral agreement between some of the most developed countries in the world will almost undoubtedly spell the end of intermediary indemnity, and more importantly, it might well spell the end of ISPs as we know them.

Update: And to complicate things even more, Virgin Media says that it will use deep-packet inspection software to monitor potential infringing material.

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The Public Domain Manifesto

The COMMUNIA project has published The Public Domain Manifesto. I reproduce the preamble:

“Le livre, comme livre, appartient à l’auteur, mais comme pensée, il appartient—le mot n’est pas trop vaste—au genre humain. Toutes les intelligences y ont droit. Si l’un des deux droits, le droit de l’écrivain et le droit de l’esprit humain, devait être sacrifié, ce serait, certes, le droit de l’écrivain, car l’intérêt public est notre préoccupation unique, et tous, je le déclare, doivent passer avant nous.” (Victor Hugo, Discours d’ouverture du Congrès littéraire international de 1878, 1878)

“Our markets, our democracy, our science, our traditions of free speech, and our art all depend more heavily on a Public Domain of freely available material than they do on the informational material that is covered by property rights. The Public Domain is not some gummy residue left behind when all the good stuff has been covered by property law. The Public Domain is the place we  quarry the building blocks of our culture. It is, in fact, the majority of our culture.” (James Boyle, The Public Domain, p.40f, 2008)

The public domain, as we understand it, is the wealth of information that is free from the barriers to access or reuse usually associated with copyright protection, either because it is free from any copyright protection or because the right holders have decided to remove these barriers. It is the basis of our self-understanding as expressed by our shared knowledge and culture. It is the raw material from which new knowledge is derived and new cultural works are created. The Public Domain acts as a protective mechanism that ensures that this raw material is available at its cost of reproduction – close to zero – and that all members of society can build upon it. Having a healthy and thriving Public Domain is essential to the social and economic well-being of our societies. The Public Domain plays a capital role in the fields of education, science, cultural heritage and public sector information. A healthy and thriving Public Domain is one of the prerequisites for ensuring that the principles of Article 27 (1) of the Universal Declaration of Human Rights (‘Everyone has the right freely to participate in the cultural life of the community, to enjoy the arts and to share in scientific advancement and its benefits.’) can be enjoyed by everyone around the world.

The digital networked information society has brought the issue of the Public Domain to the foreground of copyright discussions. In order to preserve and strengthen the Public Domain we need a robust and up-to-date understanding of the nature and role of this essential resource. This Public Domain Manifesto defines the Public Domain and outlines the necessary principles and guidelines for a healthy Public Domain at the beginning of the 21st century. The Public Domain is considered here in its relation to copyright law, to the exclusion of other intellectual property rights (like patents and trademarks), and where  copyright law is to be understood in its broadest sense to include economic and moral rights under copyright and related rights (inclusive of neighboring rights and database rights). In the remainder of this document copyright is therefore used as a catch-all term for these rights. Moreover, the term ‘works’ includes all subject-matter protected by copyright so defined, thus including databases, performances and recordings. Likewise, the term ‘authors’ includes photographers, producers, broadcasters, painters and performers.”

I encourage you to read it and sign it.

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Update on Costa Rican sugar trade row

I recently wrote about a story that appeared in BoingBong and Michael Geist’s blog about Costa Rica being forced by the United States to pass maximalist IP legislation through the imposition of sugar import restrictions.  Diego Delfino of the excellent site 89 Decibleles has posted a response to my claims.  I take well Diego’s point that my own research was limited, and he provides much more detail than I was able to uncover.  In particular, Diego found two very good articles in La Republica and El Financiero which shed some light in the dispute.  I found the Financiero article specially useful.  In the relevant section, it reads:

“For his part, Marco Vinicio Ruiz, Minister of Comex, said this did not mean that the share was lost throughout the year, as when the problem is fixed it will be reactivated. Furthermore, these are only the quotas for CAFTA, the sugar industry has also a consolidated share in the World Trade Organization (WTO), which is larger. According to estimates by Ruiz, CAFTA quota amount 11,000 tonnes, while domestic production is 250,000 tonnes.”

This seems to corroborate part of my research, namely that the USTR already allocated quotas to Costa Rican sugar for 2010, and these ones seem completely unaffected.  Diego’s research confirms an element that I had not been able to corroborate from the original stories, and that is that Costa Rica is indeed suffering from some form of sanction.  However, it is important to point out that this seems to be a surplus quota connected to CAFTA which does not affect all sugar exports.  This seems logical, as Costa Rica is not yet part of CAFTA because it has failed to implement the treaty.  We might argue that this is an imposition, but it is not.  Costa Rica signed the agreement, and in order to receive the added trade benefits, it must fulfil all of the obligations contained in the agreement, which include amending its IP legislation to comply with the terms of the bilateral trade agreement. The main question, which was the subject of the BoingBong and Geist articles, is whether the United States has threatened Costa Rica with sanctions if it does not pass IP legislation.  To this the answer still seems to be negative, as there is still no evidence that this is the case.  Sugar exports are definitely being affected, but this is the surplus that the country would be able to export as part of CAFTA, and will not be able to do so because, technically, Costa Rica is not part of CAFTA yet.  This does mean that sugar exports are currently linked to parliament passing IP legislation.  In a way, it is true that there is a connection, but not the one that is implied by the original sources. I would like to qualify the above comment.  My initial post should not be considered as a criticism against Michael Geist and Cory Doctorow, two people I greatly admire.  My concern is that the two cited headlines assumed that the U.S. was doing something, while I found little evidence behind the motives, hence the post.  I would also like to thank Diego Delfino for his excellent post and for keeping me in the right track.  It is good to be reminded that one should perform thorough research when one is trying to debunk someone else’s reports.  Bloggers often criticise mainstream journalists for failing to meet stringent research standards, when we often incur in the same fault.

Update: The story has been more widely circulated than I thought. Techdirt has mentioned it, and after hundreds of comments, nobody cared to check its accuracy.  I guess that being at the bottom of the blogosphere ecology does not help get the news out.

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Edinburgh ORG meeting reminder

Quick reminder that the Open Rights Group is holding a meeting in Edinburgh this Sunday:

How to talk to your MP and get them to change the Digital Economy Bill (Edinburgh)
Sunday, January 24, 2010 from 2:00 PM – 5:00 PM (GMT)

Gain the confidence to talk and write to your MP

  • Rehearse talking to your MP one on one
  • Find out what MPs will ask you
  • Learn how to write to your MP and get a response
  • Meet other people campaigning against disconnection without trial in the Digital Economy Bill

Open Rights Group wants to help you get your voice heard: by helping you to talk to your MP.

Booking an appointment with your MP and saying what you think is easier than you might think.

And talking to your MP is the most effective way to make sure Parliament knows how unpopular and bad disconnection without trial really would be. In this short session, you can try out talking to your ‘MP’ or watch someone else having a go, and learn how to get your points across in a way that an MP will understand.

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The war on storage?

As usual, xkcd makes an excellent point:

With sizes of up to 64GB contained in a tiny card the size of a coin, I wonder why the content industries are not concentrating more on such storage devices, and continue to insist that the war on piracy is an online endeavour.  When I can copy my entire music collection and place it in a small USB key, or a MicroSD card, P2P seems like a hassle.

PS:  Andrew, I copied the Alt text this time :)

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How did OiNK get away?

"I'm not criminally liable for secondary infringement, officer!"

It was supposed to be the British equivalent of high-profile cases such as PirateBay and the Jamie Thomas trial.  It was supposed to act as a clear deterrent to a new generation of file-sharers against widespread copyright infringement.  Instead, Alan Ellis, the founder of torrent tracking site OiNK has been acquitted of the charges of conspiracy to defraud.  How did this case turn from sure thing to nightmare for the music industry?

OiNK was not your typical torrent tracker site. Websites such as PirateBay, Isohunt, and TorrentReactor are free to use and available to the wider public.  OiNK was a free-of-charge closed service, available only by invitation from an existing member, which could be obtained by paying $5 USD.  The site also operated through donations, which amounted to a staggering $300,000 USD.  OiNK’s statistics are impressive, it boasted 200,000 registered users, and it facilitated the exchange of 21 million files. I am going to go out on a limb here and claim that most of those files were infringing copies.

So, it is clear that OiNK was in the wrong, and the fate of Mr Alan Ellis was sealed, right? Not really.  The problem seems to have been that prosecutors chose to charge Mr Ellis with conspiracy to defraud, instead of anything related to copyright infringement.  This meant that they had to prove Mr Ellis was trying to defraud his customers, when it was clear that he was offering a service, and his clientèle knew fully well what they were getting into.  No fraud then.

Why didn’t the prosecution try for copyright infringement offences?  For example, s107 CDPA establishes criminal offences for various copyright infringement acts made “in the course of business”.  As Mr Ellis was clearly profiting handsomely from his services, it could be argued strongly that he was infringing copyright for commercial gain.  Or can it?  The main problem with torrent sites is precisely that no infringing copies are kept on the servers, and that the trackers act simply as facilitators.  Using a real-world analogy, torrent sites are more akin to bar lounges where illicit goods change hands.  Nonetheless, s107 also covers secondary infringement offences, such as communicating infringing copies to the public, which one might think is precisely what a torrent site does.  However, the wording of UK copyright law is problematic in this respect, as it seems entirely drafted with physical copyright infringement in mind.  For example, s108 CDPA says:

“108.-(1) The court before which proceedings are brought against a person for an offence section 107 may, if satisfied that at the time of his arrest or charge-
(a) he had in his possession, custody or control in the course of a business an infringing copy of a copyright work, or
(b) he had in his possession, custody or control an article specifically designed or adapted for making copies of a particular copyright work, knowing or having reason to believe that it had been or was to be used to make infringing copies,
order that the infringing copy or article be delivered up to the copyright owner or to such other person as the court may direct.”

This clearly assumes that criminal commercial infringement will take place through some physical medium, and seems to preclude facilitating online acts.  It seems then that prosecutors were not sure to obtain a conviction through copyright infringement.  OUT-Law makes a good point that the best way to proceed was to pursue OiNK for authorising copyright infringement, which is a civil offence for secondary infringement (see s24(2) CDPA).

Good news for OiNK may be bad news for the rest of us, as I am afraid that the music industry may use this verdict to push for stronger copyright protection in the upcoming Digital Economy Bill.  It is clear that some torrent sites operate at the very fringes of acceptable behaviour.  As some independent musicians have pointed out in an interesting Guardian blog article, torrent sites may be guilty of not doing enough to curb infringement.  If legislators are presented with an idea of a virtual Wild West where everything goes, we may be in for a rough awakening when the Bill eventually gets through Parliament.

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