It has been a bad week for the supporters of three strikes copyright policies in Europe. Although at some point last year the panorama looked good for them with the enactment of the Digital Economy Act, it seems like recent legal developments will make it considerably harder for a comprehensive disconnection programme to take off.

Yesterday the Patents County Court in England and Wales delivered a damning ruling against ACS:Law, those of Anonymous fame. Andrew Crossley, the principal actor in ACS:Law, had found a nice little business niche by becoming associated with Media CAT Ltd, a UK firm claiming to be various porn films. ACS:Law would try to find people who were downloading those films at any given time through torrent sites, and then would issue the alleged infringers with harassing letters asking them to settle out of court. In many cases, people would pay up to £700 GBP just to have the allegations go away, even if untrue. In the case of Media CAT Ltd v Adams & Ors [2011] EWPCC 10, Media CAT accused several people of infringing pornographic material. This probably would have been dismissed in a normal fashion at an early stage, but the added publicity from the Anonymous stunt last year meant that ACS:Law was under closer scrutiny. Instead of dismissing the case in February 2011, Judge Birss QC continued proceedings, asking Media CAT to demonstrate that it was a copyright society and that it truly represented the copyright interest of the offended parties in the UK. In an earlier ruling, Judge Birss opined that Media CAT had no standing to bring the proceedings, and even considered issuing an order against Media CAT sending out more harassing letters, but instead asked them to attempt to join the copyright orders to continue proceedings. In other words, Judge Birss found out that the entire business model of ACS:Law rested on fictitious ground, and asked them to put up or face the consequences. The defendants in the case claimed that they would be seeking wasted costs against Media CAT and ACS:Law, as they had engaged in various dubious practices punishable by civil procedure, including hopeless claim, failure to join copyright owners, negligent correspondence, and abuse of process.

Judge Birss’ ruling makes for a refreshing and eye-opening reading. It became clear that Andrew Crossley had engaged in a profit agreement with Media CAT, who didn’t even have copyright representation of the pornographic films in the first place. Under this agreement, Crossley would engage in a letter-writing campaign to extort money from Internet users using copyright infringement as an excuse, and he would claim 65% of the total money obtained with each letter. Because most people did not respond, it was a win-win situation for them. Birss QC states:

“As I found in my previous judgment (paragraph 99) Mr Crossley/ ACS:Law had a very real interest in avoiding judicial scrutiny of the cause of action because of the revenues from the letter writing campaign. In my judgment the combination of Mr Crossley’s revenue sharing arrangements and his service of the Notices of Discontinuance serves to illustrate the dangers of such a revenue sharing arrangement and has, prima facie, brought the legal profession into disrepute. It may be better placed under the revenue sharing heading in this judgment but it is, prima facie, improper conduct in any event.”

Why is this relevant for three strikes, you may ask? Well, in his previous judgement, Birss QC looked closely at Norwich Pharmacal Orders (NPO), the evidence orders used to obtain the IP addresses of alleged infringers from internet service providers. Judger Birss cut directly to the problem of IP-based evidence, even assuming that someone at the address had actually infringed. He stated:

“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.

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.

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.”

These are to me very clear problems that everyone opposed to three-strikes has always postulated. The evidence is not reliable, moreover, it is not particularly indicative of damages.

Another event has served to further erode the potential deployment of three strikes in Europe. This involved the ongoing case of Scarlet v Sabam in the European Court of Justice. The case was brought by the Belgian Society of Authors, Composers, and Publishers (Sabam) against ISP Tiscali (which later changed its name to Scarlet). Sabam wanted Tiscali to install filtering software in its network which would allegedly curb illicit filesharing in P2P networks. The first ruling in the District Court of Brussels agreed with the claimants based entirely on expert reports about the feasibility of deploying filtering systems, the decision was appealed, but the Brussels Court of Appeals referred the case to the ECJ. Now the Advocate General has produced an opinion which states that “a measure ordering an internet service provider to install a system for filtering and blocking electronic communications in order to protect intellectual property rights in principle infringes fundamental rights”. The press release comments:

“Advocate General Cruz Villalón considers that the court order thus constitutes a general obligation which, it is intended, will be extended in the longer term on a permanent basis to all internet service providers. In particular, the Advocate General points out that the court order would have a lasting effect for an unspecified number of legal or natural persons irrespective of whether they have a contractual relationship with Scarlet and regardless of their State of residence. The system must be capable of blocking any file sent by an internet user who is one of Scarlet’s customers to another internet user – who may or may not be one of Scarlet’s customers and who may or may not live in Belgium – where that file is thought to infringe a copyright managed, collected or protected by Sabam. It must also be capable of blocking receipt by an internet user who is one of Scarlet’s customers of any file infringing copyright which has been sent by any other internet user. Moreover, the court order would apply in abstracto and as a preventive measure, which means that a finding would not first have been made that there had been an actual infringement of an intellectual property right or even that an imminent infringement was likely.”

This is potentially huge news. If the ECJ was to follow this opinion, then it would become almost impossible to have any sort of filtering and/or three strikes system that might result in blocking an internet connection, as these would be too broad and might therefore infringe fundamental rights of unspecified third parties. It seems that if the evidence is suspect (NPOs), and the filtering systems infringe fundamental rights, then three strikes would have no legal standing in Europe.

Hopefully, the tide will continue to turn against this ill-conceived notion that disconnecting people from the Internet will stop piracy.


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