21 December 2010
18 December 2010
An interesting little domain name case that is curious in several respects: first, that it was brought in the courts at all rather than before an administrative panel appointed by one of the UDRP (Uniform Domain Name Dispute Resolution Policy) dispute resolution service providers; secondly, that it was brought in England when none of the parties appears to have anything to do with England, thirdly, that it was brought in the Technology and Construction Court which is part of the Queen’s Bench Division rather than the Chancery Division or even the Patents County Court; and fourthly, the claimant’s cause of action.
In Lifestyle Management Ltd. v Frater  EWHC 3258 (TCC) (10 Dec 2010) the claimants were companies registered in Kenya and the British Virgin Islands while the defendant was in Scotland. The claimants have a website at www.offshorelsm.com which indicates that they provide services “for the international investor and the professional expatriate”. Their trading name appears to be “The LSM Group”. According to Mr. Justice Edwards-Stuart there had been a contract between the LSM Group and the defendant under which the defendant claimed commission from the claimants. A claim, incidentally, that the Group disputes. The judge referred to that contract only to mention that it contained no jurisdiction clause.
Instead of suing the LSM Group, the defendant set up a grudge site bearing a very close resemblance to the home page of the claimants' site setting out confidential extracts of their presentation (or method of presentation) to clients and a photograph of the members of 'LSM’s staff under the domain names offshorelsm.net", "offshorelsm.org" and "offshorelsm.co.uk". The judge found that those websites contained material that was arguably defamatory and was certainly calculated to damage the claimants’ business. The judge said that the defendant had made it quite clear in his emails that he intended to use those websites until he receives the money he claims.
LSM retaliated by bringing a without notice application in the Technology and Construction Court. Despite having concerns about Schedule 4 to the Civil Jurisdiction and Judgements Act 1982 which provides that persons domiciled in a part of the United Kingdom shall be sued in the courts of that part unless the case comes within rules 3 to13 of the Schedule, the judge made an order
“(1) Requiring the Respondent to direct all enquiries to three named websites to a blank page so that a person going onto any of the sites will not see the material presently on it).
(2) Requiring the Respondent to deliver up to the Claimants any confidential client database in his possession.
(3) Restraining the Respondent from making use of any other confidential information of the Claimants.”
LSM had asked for an order requiring the Respondent to relinquish his interest in the disputed domain names or to transfer them to the Claimants but the judge refused to do that without giving the defendant an opportunity to be heard. He therefore adjourned that part of the application to the return date.
Domain Name Dispute Resolution
This is a case that LSM could have brought under the Uniform Domain Name Dispute Resolution Policy (“UDRP”) and the Nominet Dispute Resolution Service (“DRS”). Whenever a person applies to register a top level domain name he or she warrants and represents to the registrar that:
(a) the statements that he makes in his agreement with the registrar are complete and accurate;
(b) to his knowledge, the registration of the domain name will not infringe upon or otherwise violate the rights of any third party;
(c) he is not registering the domain name for an unlawful purpose; and
(d) he would not knowingly use the domain name in violation of any applicable laws or regulations.
The registration agreement makes clear that It is the applicant’s responsibility to determine whether the domain name registration infringes or violates someone else's rights.
The agreement also requires the applicant to submit to a “mandatory administrative proceeding” if a third party complains that the domain name is identical or confusingly similar to a trade mark in which the third party has rights. “A mandatory administrative proceeding” is essentially a documents only arbitration before a tribunal appointed by the World Intellectual Property Organization or other service provider. There are similar provisions in the agreement to register “.co.uk”, “.org.uk” and other country code top level domains in the “.uk” domain space.
Both services are very quick. There is usually a decision within the time the time that would normally be taken from the issue of a claim to the close of pleadings. They are also very cheap: WIPO charges US$1,500 to resolve a generic top level domain name dispute and Nominet £750 to resolve a “.uk” dispute. Also, they are very effective. Nearly all domain name disputes are resolved through the UDRP, DRS or similar dispute procedures. Only a handful have ever been resolved by the civil courts. Further information on domain name dispute resolution can be obtained from our domain name dispute resolution website at www.nipc-domains.co.uk.
Cause of Action
Although the injunction seems designed to restrain a breach of confidence the case appears to have been put as a “tort of using unlawful means to injure another” or as “a form of reverse passing off” (see paragraph  of the judgment) and passing off is the basis upon which the judge seems to have decided the case:
“In my judgment the conduct of the Respondent as disclosed in the evidence before me establishes the threefold requirement of (1) a reputation (or goodwill) required by the Claimants in their domain name"offshorelsm.com", (2) a misrepresentation by the Respondent's use of domain names calculated to lead potential clients of the Claimants into thinking that his three websites are websites of the Claimants and (3) damage to the Claimants (see Clerk and Lindsell on Torts, 20th edition, paragraph 26-03).”
He referred in his decision to British Telecommunications plc v One in a Million Ltd  1 WLR 903, 4 All ER 476,  EWCA Civ 1272 conceding that the facts of this case before him were not the same as those in One in a Million. However, he concluded:
"it seems to me that the essential ingredients of a deceptive use of a company name with an acquired goodwill in order to damage the owner of that name are present here.”
And of course there is the judge’s observation at paragraph  that the content was “arguably defamatory”.
Having decided that he had a breach of confidence and passing off case in front of him it is curious that his lordship did not direct the claimants to his brother Birss with whom he shares a court building or at least the Intellectual Property list of the Chancery Division. CPR 63.13 provides that intellectual property claims must be started in the Chancery Division, the patents county court or a county court where there is also a Chancery District Registry. The Technology and Construction Court is intended for claims that involves issues or questions which are technically complex or where a trial by a TCC judge is desirable (CPR 60.1 (3)). Examples of such cases are set out in paragraph 2.1 of the practice direction for Part 60:
“(a) building or other construction disputes, including claims for the enforcement of the decisions of adjudicators under the Housing Grants, Construction and Regeneration Act 1996;
(b) engineering disputes;
(c) claims by and against engineers, architects, surveyors, accountants and other specialised advisers relating to the services they provide;
(d) claims by and against local authorities relating to their statutory duties concerning the development of land or the construction of buildings;
(e) claims relating to the design, supply and installation of computers, computer software and related network systems;
(f) claims relating to the quality of goods sold or hired, and work done, materials supplied or services rendered;
(g) claims between landlord and tenant for breach of a repairing covenant;
(h) claims between neighbours, owners and occupiers of land in trespass, nuisance etc;
(i) claims relating to the environment (for example, pollution cases);
(j) claims arising out of fires;
(k) claims involving taking of accounts where these are complicated; and
(l) challenges to decisions of arbitrators in construction and engineering disputes including applications for permission to appeal and appeals.”
Moreover the Technology and Construction Court is part of the Queen’s Bench Division and intellectual property cases are assigned to the Chancery Division by s.61 and paragraph 1 (i) of Schedule 1 of the Senior Courts Act 1981.
What’s this case got to do with England?
The problem that does seem to have troubled the judge was whether he had jurisdiction to injunct a tortfeasor in Scotland. As he observed at paragraph :
"As I have mentioned, the Respondent lives in Scotland. Schedule 4 to the Civil Jurisdiction and Judgements Act 1982 provides that persons domiciled in a part of the United Kingdom shall be sued in the courts of that part unless the case comes within rules 3 to 13 of the Schedule.”
“13. Mr Richardson relies on rule 3(c). This provides that a person domiciled in part of the United Kingdom may, in another part of the United Kingdom, be sued . . . in matters relating to tort "in the courts for the place where the harmful event occurred or may occur".
14. Mr Richardson submits, and I accept, that in the circumstances that I have already described potential clients of the Claimants, or companies or organisations who employ such clients and with whom I am told the Claimants enjoy a relationship, may go on to one of the Respondent's websites in the mistaken belief that it is the website of the Claimants - thereby being deceived - and will then be put off by what they find there. This, he submits, is a harmful event within the meaning of rule 3(c) of Schedule 4 of the 1982 Act with the result that the claimants can sue the Respondent in the courts of England and Wales.
15. I have been persuaded on the evidence before me that this submission is a good one. The evidence indicates also that the Respondent is in possession of the Claimants' confidential database of their clients.
16. Accordingly, I am satisfied that this Court has jurisdiction to entertain the application and that interim relief should be granted, against the usual undertakings, in the form that I have set out above.”
Since the claimants are incorporated in the Kenya and the BVI and they offer their services to expats who are by definition “out of” (ex) “the fatherland” (patria) this does not add up to a connection with England.
I do hope the defendant turns up with counsel on the return day because there is so much meat in this case. First of all there is the procedural point as to whether the case should have been brought in the TCC or even England. Next, there is the question of the cause of action and whether or not the judgment is effectively a restriction on freedom of speech. Bestobell Paints Ltd. v Bigg  FSR 421 springs to mind on that point. Then it can perhaps be argued that Scott v Avery 5 HL 811 should be extended to include domain name disputes. And there is bound to be argument on the extent of the ex parte disclosure.
If anyone wants to discuss this case, or indeed domain name disputes or transactions generally, they should call 0800 862 0055 or contact me through this form.
See also Jane Lambert "How to handle a generic top level domain name dispute". NIPC Blog 19 Dec 2010
12 December 2010
"The defendant, someone authorised by him to use his internet connection, or someone who gained access to the defendant's internet connection due to the router to that connections having no or no adequate security was at all material times a user of the peer-to-peer file sharing software known as BitTorrent 6.1.2 which allows the user to share digital media content files on a network with other users."
The relief sought in the requests for judgment included
"a permanent injunction pursuant to the inherent jurisdiction of the Court; ordering the defendant to take reasonable steps to safeguard their internet connection being used, either through the defendant's personal computer and/or third parties taking advantage of the defendant's unsecured wireless connection to repeat the infringement of the claimants copyright in the Work(s)."
"The nature of the allegations made in the Particulars of Claim are such that it seems to me that it would be unfortunate if it were possible to obtain a default judgment without notice using the Request for Judgment procedure in rule 12.4(1) even if the claimant had abandoned all remedies save for the claim for an enquiry as to damages. The Request for Judgment procedure is an essentially administrative procedure and plays an important role in court procedure in the vast majority of cases in which it is used. However these are specialist intellectual property claims raising difficult and potentially controversial legal issues."
04 December 2010
According to the knowledgebase of its website TVCatchup is an “internet television platform” which enables subscribers to watch live television on a computer or mobile device from anywhere in the UK. In ITV Broadcasting Ltd and Others v TV Catch Up Ltd  EWHC 3063 (Ch) (25 Nov 2010) Mr. Justice Kitchin described that company’s activities at paragraphs  to  of his judgment as follows:
“3. The defendant operates a website at www.tvcatchup.com which allows members of the public to watch live UK television, including the claimants' channels, on their computers, iPhones and games consoles. Any member of the public wishing to access the service must first become a member. He can then select one of over 50 channels by pressing on the appropriate icon, whereupon he is taken to a new screen on which the defendant provides a stream of the programme being broadcast on that channel. There is a slight delay before the member sees the programme because the defendant first shows one of its own advertisements. This is how it makes its money.
4. For the purposes of this application, there is no dispute that the defendant's service operates in the following way:
i) ordinary domestic aerials are set up to receive UK free-to-air broadcasts;
ii) these aerials are connected to a cluster of servers, each containing a television tuner card which acts as a decoder; this converts the broadcast signal into an audio-visual data stream which is then sent to second cluster of servers;
iii) the second cluster of servers convert the data stream into a format (called a flash stream) suitable for delivery by the internet; the flash stream is sent to a third set of servers called the streaming servers;
iv) when a member clicks on a channel on the defendant's website, his computer or other device connects to one of the streaming servers and receives a flash stream of all the programming on the channel he has selected.”
ITV Broadcasting Ltd., ITV 2 Ltd. and other terrestrial broadcasters are suing TVCatchup for copyright infringement under s.20 of the Copyright, Designs and Patents Act 1988 as amended by the Copyright and Related Rights Regulations 2003 (SI 2003/2498) to implement art 3 of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 ("the Information Society Directive"). This was an application by TVCatchup for the broadcasters’ claim to be dismissed under CPR Part 24 on the grounds that their action had no real prospect of success.
Put very simply, the defendant’s case that it had done nothing more than provide its subscribers with the equivalent of another television set. What could be wrong with that?
S.20 (1) of the 1988 Act restricts communication of a work to the public to the copyright owner and sub-section (2) defines communication to the public to include (a) the broadcasting of the work; and (b) the making available to the public of the work by electronic transmission in such a way that members of the public may access it from a place and at a time individually chosen by them." TVCatchup was not broadcasting anything. Neither was it making the work available to the public in such a way that members of the public could access it at a place and time individually chosen by them as TVCatchup offered its subscribers real time streaming. End of story, Yes?
Well, “no” actually. As the judge said:
“subsection (2) defines communication to the public as communication to the public by electronic transmission. The definition then identifies two specific ways in which such communication may take place, namely: (a) broadcasting the work and (b) making the work available by electronic transmission on demand. But I do not read the definition in subsection (2) as being limited to these forms of communication. To the contrary, it says in terms that it includes them. In my judgment it also covers all other acts which constitute communication to the public of the work by electronic transmission.”
TVCatchup’s counsel had argued that all communications of broadcasts to the public use the same technology of broadcasting but the significant difference is that “broadcasting” is communication to the public as a whole whereas he offered communication only to individual subscribers. The flaw in that argument, said the judge, was that it confused the protected work with the restricted act. He explained:
“The protected work, the broadcast, is the transmission of visual images, sounds and other information for reception by or presentation to members of the public. The restricted act is the communication to the public by electronic transmission of all of those images, sounds and other information. In the same way, section 17 of the Act prohibits the making of a copy of a broadcast and section 18 prohibits the issuing of copies of the broadcast to the public. There is no requirement that the copy itself must be a broadcast. Indeed, it may be no more than a photograph (section 17(4)).”
Accordingly, his lordship was not persuaded that the claim was bound to fail so he dismissed the summary judgment application.
It is important to stress that the judge did not give judgment to the broadcasters. He simply said that they could win at trial and he has allowed them to continue their action.
The scope of s.20 came up earlier this year in Twentieth Century Fox Film Corporation and Others v Newzbin Ltd  EWHC 608 (Ch),  ECC 13,  FSR 21,  EMLR 17,  ECDR 8 which I took over as counsel at a very late stage earlier this year. As I observed in my reflections on that case, that was the first time that the meaning and full extent of communication right had been fully argued at a trial in the United Kingdom. For professional reasons (not least the duty of confidence that counsel owes her clients) I would rather not discuss in too much detail the arguments that I raised in that case beyond saying that paragraph (15) of the recitals makes clear that the Information Society Directive was adopted in order to give effect to the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty (“WPPT”). Art 8 of the WIPO Copyright Treaty provides for communication to the public:
“Without prejudice to the provisions of Articles 11(1)(ii), 11bis(1)(i) and (ii), 11ter(1)(ii), 14(1)(ii) and 14bis(1) of the Berne Convention, authors of literary and artistic works shall enjoy the exclusive right of authorizing any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access these works from a place and at a time individually chosen by them.”
Art 10 of the WPPT provides for making available of fixed performances to the public:
“Performers shall enjoy the exclusive right of authorizing the making available to the public of their performances fixed in phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.”
Art 3 of the Information Society Directive keeps these two rights separate. Paragraph 1 implements art 8 of the WIPO Copyright Treaty by restricting communication to the public of copyright works to the copyright owner:
“Member States shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.”
Paragraph 2 implements art 10 of the WPPT:
“Member States shall provide for the exclusive right to authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them:
(a) for performers, of fixations of their performances;
(b) for phonogram producers, of their phonograms;
(c) for the producers of the first fixations of films, of the original and copies of their films;
(d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.”
The vice of s.20 (2) of the 1988 Act as amended is that it conflates different articles drawn from separate treaties
“References in this Part to communication to the public are to communication to the public by electronic transmission, and in relation to a work include—
(a) the broadcasting of the work;
(b) the making available to the public of the work by electronic transmission in such a way that members of the public may access it from a place and at a time individually chosen by them."
By so doing, the statutory instrument that amended the 1988 Act has extended the scope of copyright protection far beyond the previous legislation (as the judge seems to have accepted here and as I think he accepted in Newzbin) andt also far beyond the requirements of the Information Society Directive. I would have loved to have argued that point on appeal in Newzbin but as the judge observed in refusing me leave to appeal success on this point would not make any difference to the outcome of the case as I would still have lost on other grounds. I do hope I or others will get the chance to argue it in future cases because I believe that s.20 as it stands gives copyright owners far too much.
Should anyone want to discuss this note with me they can call me on 0800 862 0055 or contact me through this form.