05 March 2013

Injunctions against ISPs Part V: EMI Records Ltd and Others v British Sky Broadcasting Ltd and Others





It is perhaps eccentric if not downright ungrateful to promote a different business model for the music and motion picture industries having rebuilt my practice on advising and representing defendants to copyright infringement claims by trade associations in those industries but a flower is a great deal cheaper than an intellectual property lawyer and not necessarily less effective.  Before considering Mr.Justice Arnold's judgment in EMI Records Ltd and Others v British Sky Broadcasting Ltd and Others  [2013] EWHC 379 (Ch), [2013] WLR(D) 86 it is perhaps worth watching Amanda Palmer's video on The Art of Asking and pondering her message which I have reproduced from the TED website:
"Don't make people pay for music, says Amanda Palmer: Let them. In a passionate talk that begins in her days as a street performer (drop a dollar in the hat for the Eight-Foot Bride!), she examines the new relationship between artist and fan.
Alt-rock icon Amanda Fucking Palmer believes we shouldn't fight the fact that digital content is freely shareable -- and suggests that artists can and should be directly supported by fans."
Anyway back to the judgment.

This was an application by members of BPI, the British music industry trade association, for injunctions under s.97A of the Copyright, Designs and Patents Act 1988 against the 6 main internet service providers of the United Kingdom to block access to 3 file sharing websites, namely KAT, H33T and Fenopy.   Although the BPI members were formally the only applicants, the application was supported by a number of other organizations representing other groups of rights holders including the Motion Picture Association of America which returned the favour that the BPI had done for the MPAA in Twentieth Century Fox Film Corp and others v British Telecommunications Plc  [2011] RPC 28, [2011] EWHC 1981 (Ch), [2012] 1 All ER 806, [2012] Bus LR 1471 of filing a witness statement in support of the application.

Unlike Twentieth Century Fox's application against BT and Dramatico Entertainment's against BSkyB which I blogged in "Copyright: Twentieth Century Fox Film Corp. v British Telecommunications Plc" (3 Aug 2011), "Injunctions against ISPs" and "Injunctions against ISPs Part III: Dramatico Entertainment Ltd and Others v British Sky Broadcasting Ltd. and Others" 21 Feb 2012 respectively, the BPI issued a Part 8 claim form instead of the usual Part 7 form and applied for directions.   Readers who do not already understand the significance of the choice of a Part 8 Claim form are referred to CPR Part 7 How to Start Proceedings - The Claim Form and CPR Part 8 Alternative Procedure for Claims.   The judge explained at paragraph [9] that:
"The Claimants adopted that approach for two reasons. First, in the hope that it would be possible in the intervening period for the Claimants to agree the terms of the orders sought with the Defendants. That hope has been realised: each of the Defendants has agreed the terms of the orders sought and none of the Defendants opposes the grant of such orders provided that the Court is satisfied that (i) it has jurisdiction to make such orders and (ii) it is appropriate to do so. Secondly, in order to seek directions from the Court as to whether or not the Claimants should be required to try to serve the applications on the operators of the Websites."
This was a sensible procedure which should have saved a lot of money as his lordship considered the applications on paper - though nothing like as much money as might have been saved by relying simply on a flower.

Mr Justice Arnold granted the injunction.   The claimants were as described in Dramatico [para 12]. Bit torrent technology was also as described in that case [paragraph [13]].  The judge summarized his judgment under s.97A as follows at paragraph [21]:
"Section 97A of the 1988 Act empowers the High Court "to grant an injunction against a service provider, where that service provider has actual knowledge of another person using their service to infringe copyright". In order for this Court to have jurisdiction to make the orders sought by the Claimants, four matters must be established. First, that the Defendants are service providers. Secondly, that users and/or the operators of the Websites infringe copyright. Thirdly, that users and/or the operators of the Websites use the Defendants' services to do that. Fourthly, that the Defendants have actual knowledge of this."
He considered each of those questions in turn.

1. Are the defendants service providers?  As he stated  at paragraph [5] of  Dramatico Entertainment Ltd and Others v British Sky Broadcasting Ltd and Others,  [2012] EWHC 1152 (Ch), [2012] 3 CMLR 15 the learned judge had no doubt that the defendant internet service providers were service providers within the meaning of regulation 2 of the Electronic Commerce (EC Directive) Regulations 2002, SI 2002/2013, and hence within the meaning of section 97A of the 1988 Act and none of the Defendants suggested otherwise.

2. Do users and operators of the websites infringe copyright?   As  in Dramatico Mr. Justice Arnold held that both the users of the file sharing websites and the websites themselves infringed the BPI members' copyrights: the users by reproducing and communicating copyright works to the public without the copyright owners' consent and the website operators by communicating those works to the public, authorizing reproduction and joint tortfeasance.   In this regard Mr Justice Arnold's analysis of the law relating to authorization between paragraph [52] and [70] is particularly useful because it helps distinguish cases like  Twentieth Century Fox Film Corp and Others v Newzbin Ltd [2010] EWHC 608 (Ch), [2010] ECC 13, [2010] FSR 21, [2011] Bus LR D49, [2010] EMLR 17, [2010] ECDR 8 where Mr Justice Kitchin held that there had been authorization from those like C.B.S. Songs Ltd and ors v Amstrad Consumer Electronics Plc [1988] 1 A.C. 1013. Relevant factors, according to the judge, included the relationship between the parties, the means used to infringe, inevitability of infringement, degree of control and steps taken to prevent infringement.  Further, the factors considered in relation to authorization led to the conclusion that 
"the operators of the websites induce, incite or persuade their users to commit infringements of copyright, and that they and the users act pursuant to a common design to infringe. It is also relevant in this regard that the operators profit from their activities. Thus they are jointly liable for the infringements committed by users."
3  Do the users and/or operators of the websites use the defendant ISPs' services to infringe?  Following his earlier decisions in BT and Dramatico the judge held that they did though he did consider a reference by the Austrian Supreme Court to the Court of Justice of the following questions in C314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH. :
1. Is Article 8(3) of the Directive to be interpreted as meaning that a person who makes protected subject matter available on the internet without the right holder’s consent is using the services of the access providers of persons seeking access to that protected subject matter?
2. If the answer to the first question is in the negative, are reproduction for private use and transient and incident reproduction permissible only if the original reproduction was lawfully reproduced, distributed or made available to the public?
3. If the answer to the first and second question is in the affirmative, and an injunction is therefore to be issued against the user’s access provider in accordance with Article 8(3) of the Directive, is this compatible with Union law, in particular with the necessary balance between the parties’ fundamental rights?
4. If the answer to the third question is in the negative, is it compatible with Union law to require an access provider to take specific measures to make it more difficult for its customers to access a website containing material made available unlawfully if those measures require not inconsiderable costs and can easily be circumvented without any special technical knowledge?
4. Do the defendant ISPs have actual knowledge?  There was ample evidence before the court that the claimants had notified the ISPs of their subscribers' and the website operators' activities so the answer to that question was "yes",

All injunctions are discretionary and the judge held at paragraph [90] that the onus is on the applicants to satisfy the court that a blocking order is appropriate and proportionate.   The approach that the judge had applied in Golden Eye (International) Ltd & Anor v Telefonica UK Ltd  [2012] RPC 28, [2012] EWHC 723 (Ch) which the Supreme Court had approved in  Rugby Football Union v Viagogo Ltd  [2012] 1 WLR 3333, [2012] UKSC 55, [2012] WLR(D) 342 had been as follows:
"… First, the Claimants' copyrights are property rights protected by Article 1 of the First Protocol to the ECHR and intellectual property rights within Article 17(2) of the Charter. Secondly, the right to privacy under Article 8(1) ECHR/Article 7 of the Charter and the right to the protection of personal data under Article 8 of the Charter are engaged by the present claim. Thirdly, the Claimants' copyrights are 'rights of others' within Article 8(2) ECHR/Article 52(1) of the Charter. Fourthly, the approach laid down by Lord Steyn where both Article 8 and Article 10 ECHR rights are involved in Re S [2004] UKHL 47, [2005] 1 AC 593 at [17] is also applicable where a balance falls to be struck between Article 1 of the First Protocol/Article 17(2) of the Charter on the one hand and Article 8 ECHR/Article 7 of the Charter and Article 8 of the Charter on the other hand. That approach is as follows: (i) neither Article as such has precedence over the other; (ii) where the values under the two Articles are in conflict, an intense focus on the comparative importance of the specific rights being claimed in the individual case is necessary; (iii) the justifications for interfering with or restricting each right must be taken into account; (iv) finally, the proportionality test – or 'ultimate balancing test' - must be applied to each."
(See also my post "Norwich Pharmacal Orders: Golden Eye and Others v O2 28" Apr 2012.

The judge concluded at paragraph [107] :
"The orders are necessary and appropriate to protect the intellectual property rights of the Claimants (and other copyright owners). Those interests clearly outweigh the Charter Article 11 rights of the users of the Websites, who can obtain the copyright works from many lawful sources. They even more clearly outweigh the Article 11 rights of the operators of the Websites, who are profiting from infringement on an industrial scale. They also outweigh the Defendants' Article 11 rights to the extent that they are engaged. The orders are narrow and targeted ones, and they contain safeguards in the event of any change of circumstances. The cost of implementation to the Defendants will be modest and proportionate."
The trouble with s.97A injunctions is that the persons who suffer from those orders - namely the ISPs' subscribers and the website operators - are rarely in a position to make representations to the court in respect of whether such orders should be made in the first place or as to the scope of those orders. There are obvious reasons for that. They risk being sued for copyright infringement since they would have to admit to file sharing, operators of file sharing websites may be outside the jurisdiction and many consumers  might never hear of the proceedings. Yet to cut off access to a website in a free country like ours is a very strong thing, particularly if it is done without reference to the persons affected.   One of the principles of natural justice is audi alteram partem - hear the other side.   It has to be suspended in some circumstances as in a "without notice" application for a search order or freezing injunction.   But even in those cases the suspension is temporary.   The problem of s.97A order is that the departure from this important principle of natural law is permanent.

Mr.; Justice Arnold recognized the difficulty himself in Golden Eye when he invited submissions from Consumer Focus but that cannot be done in every case.  Now the music industry has property rights like everyone else but should they be protected in this way?   In “Digital Opportunity A Review of Intellectual Property and Growth” Prof. Hargreaves suggested alternative business models for the music industry.   One such alternative is Amanda Palmer's above.

Should anyone wish to discuss this post, s.97A orders or copyright law in general he or she can call me on on +44 (0)20 7404 5252 or send me a message through my contact form.   I am no longer alone but have 4 excellent colleagues who can discuss this topic one of whom Tom Dillon is much more experienced in this area of law than I am (see my article "Moving to London" 5 March 2013). I can also be followed on Facebook, Linkedin, twitter and Xing.

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