English High Court orders BT to block Newzbin2

Yesterday Mr Justice Arnold handed down his decision in Twentieth Century Fox Film Corp & ors v British Telecommunications plc [2011] EWHC 1981 (Ch), ordering the UK's incumbent ISP to block access to the pirate Newzbin2 site. Newzbin was a commercial web site that facilitates access to pirated films, music, games and books on Usenet. In a decision of 29 March 2010, the High Court had held that the site owner was infringing copyright by making pirated files available to the public from newsgroups, by authorising infringements by downloaders from Usenet and by engaging in a common design to infringe with the site's users (Twentieth Century Fox Film Corp & ors v Newzbin Limited [2010] EWHC 608 (Ch)). The site disappeared, only to pop up again hosted outside the UK as Newzbin2, allegedly under new management.

The MPA Studios accordingly sued BT under section 97A of the UK's Copyright, Designs and Patents Act 1988 for an order requiring the blocking of access by BT's subscribers to that site. Yesterday Arnold J gave the victory to the studios, effectively ordering BT to add Newzbin2 to the list of sites it blocks using its Cleanfeed service. Culture Minister Ed Vaizey tweeted his view that this would benefit the creative industries.

This decision must smooth the path to a voluntary site blocking regime in the UK - much to the Minister's relief.

ECJ decision on trade marks gives boost to GR

Yesterday the Court of Justice of the European Union handed down its decision in a reference from the UK High Court: L’Oréal & ors v eBay International AG and ors (Case C‑324/09). Although a trade mark case, it has great significance for the Graduated Response in Europe.

The trade mark owners objected to the sale of unlicensed products on eBay and eBay’s use of their marks as Google adwords. The Court answered 10 complex questions posed by Arnold J following his decision of 22 May 2009 ([2009] EWHC 1094 (Ch)), most of them relating to the nature of trade mark infringement online.

The final question related to Article 11 of the IP Enforcement Directive 2004/48/EC, which provides that: “Member States shall … ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right, without prejudice to Article 8(3) of Directive 2001/29/EC." 

This provision extends to all holders of IP rights the injunctive remedy against intermediaries (such as ISPs) accorded to copyright holders under Article 8(3) of the 2001 Copyright Directive.

The Court of Justice held that Member States must provide for the grant of injunctions against intermediaries to prevent future infringement, not merely to terminate specific, existing infringements. The measures that an intermediary could be required to undertake could not amount to an obligation of general monitoring, which would be contrary to Article 15 of the Electronic Commerce Directive 2000/31/EC. However, it could involve suspending the user’s access:

141 … if the operator of the online marketplace does not decide, on its own initiative, to suspend the perpetrator of the infringement of intellectual property rights in order to prevent further infringements of that kind by the same seller in respect of the same trade marks, it may be ordered, by means of an injunction, to do so.

It is difficult to imagine that the Court would come to a different conclusion in relation to the equivalent provision in the Copyright Directive. The effect is to give a boost to EU right holders seeking to agree Graduated Response systems with ISPs. They can now say with credibility that if the ISPs will not agree to a voluntary system, they can effectively force them to operate such a system through the courts.

The fact that the UK seems to have failed to implement Article 11 of the IP Enforcement Directive is another matter (though from his judgment it does not seem as if Arnold J will let that stand in his way). The UK clearly did implement Article 8(3) of the Copyright Directive in section 97A of the Copyright, Designs and Patents Act 1988. Judgment in the pending action by the MPA studios against British Telecom for such an injunction was delayed in anticipation of this very decision of the Court of Justice.

Major US ISPs agree to Graduated Response

On 6 July 2011 the representatives of the US film industry (both majors and independents) and the US record industry reached agreement with the leading Internet service providers on the "Copyright Alert System", a voluntary Graduated Response scheme to tackle illegal file-sharing. The agreement envisages two educational messages or "alerts", followed by two messages which require acknowledgement by the subscriber. Following a fifth detected infringement, one or two "Mitigation Measures Copyright Alerts" will be sent, the last notifying the subscriber that, after a period of up to 2 weeks, technical measures will be applied to his Internet access account. The participating ISPs are AT&T, Verizon, Comcast, Cablevision and Time Warner Cable. The parties have set up a "Center for Copyright Information", which will administer the scheme.

The technical measures comprise reduction of transmission speeds, reduction to the lowest available broadband service, imposition of a landing page requiring contact with the ISP or the completion of some kind of copyright education process, "temporary restriction of the Subscriber's internet access for some reasonable period of time" - or an equivalent measure devised by the ISP.

The scheme is carefully conceived to avoid any suggestion that it will result in disconnection or the disclosure of subscriber names or addresses - though the latter will remain possible through discovery proceedings. The ISPs will provide anonymised lists of notice recipients on a monthly basis. Interestingly, the system provides for confidential scrutiny of the technical procedures used by right holders to generate notices and envisages the possibility of an independent review (against a refundable $35 fee) of the application of "mitigation measures" under conditions of anonymity for the subscriber. In other words, the agreement has been designed to prevent errors and injustices - and bad PR.

Clearly the agreement builds on the exhaustive UK dialogue with ISPs which ultimately led to the Digital Economy Act 2010. In turn, the elaborate provisions for independent review of alerts may inspire the design of the appeal procedure in other countries. As a voluntary scheme, the Copyright Alert System may enter into operation a little more smoothly than the DEA.