ACS:Law - at last, a hearing

UPDATE: For professional reasons I won't be commenting on this case for the time being. Please feel free to continue to comment on this post, but don't feel insulted if I do not respond.

After my recent post on ACS:Law's failure to obtain default judgments in some of their claims. Another judgment Media C.A.T Limited v Alan Billington [2010] EWPCC 18 of the patents county court has been pointed out to me.

The facts of the particular case are not particularly crucial. The Defendant, an Aaron Billington, complains amongst other things that there is no "Alan Billington" and that he did not receive a "response pack" (which comes with the Claim Form and which includes a form for acknowledging service). Although he does not say so, there also seems to be a complaint that ACS:Law did not follow good pre-action practice.

What is interesting is that the judge reviewed cases pending before the court (27 in all) and has ordered that a hearing for directions be held at 10:30am on 17th January 2011. At the hearing the court can decide how the cases should be dealt with. Clearly if you are (or know someone who is) one of the defendants and there's a reasonable defence to the claim, or the sum claimed is larger than the claimant is entitled to, then it would be a very good idea to attend the hearing and have your (or their) voice heard.

Although courts do have a power to make orders on their own initiative, without being asked to do so by the parties, many courts do not seem to use this power as much as, perhaps, Lord Woolf envisaged when he created the civil procedure rules. The hearing proves to be interesting as it may give a much broader picture of how ACS:Law are progressing their cases and it may also help the court to tidy up what sounds (from the last judgment anyway) like something of a mess even from a purely technical perspective. Mildly good news I think.

ACS:Law come unstuck

Earlier this month ACS:Law suffered a set-back in their campaign against alleged copyright infringement through peer-to-peer file sharing. ACS:Law (or more pedantically, their clients) had tried to obtain judgments in default against 8 defendants, but failed for a variety of reasons in each case. The judge in the Patents County Court criticised the nature of their claim and the way in which the applications were brought — reported as Media C.A.T Limited v A (and others) [2010] EWPCC 17.

Default judgment is a speedy way for claimants to obtain judgment without a trial. In most cases a defendant served with a claim form and particulars of claim is supposed to acknowledge service and then file a defence. If not acknowledgement or defence is forthcoming the claimant can ask the court to give it judgment in default.

This is where ACS:Law start to come unstuck. In 3 of the cases a defence had been filed in court. So default judgment does not apply. In a further 3 of the cases there was no evidence on the court file that the claim form and particulars of claim had been served on the defendant. It is ordinarily the court's job to serve these documents, but there's no presumption that it has. In my practice I have come across situations where some administrative mistake has been made and the court has failed to do so. Whatever the reason, it is bad practice to issue requests for default judgment without checking with the court that no defence has been filed. A slap on the wrist for ACS:Law in my view. As the judge said "The requests for judgment should never have been filed."

There is an easy way and a not so easy way to ask the court for a default judgment. The easy way simply requires the claimant to file a request to the court. The defendant does not have to be informed of the request and will ordinarily know nothing about it. The not so easy way requires a formal application, with evidence, to the court, which must be served on the defendant, who will therefore have an opportunity to defend against it.

The "easy way" is only available where the claim is for one or more of: a specified amount of money, an amount of money to be decided by the court, delivery of goods where the claim form gives the defendant the alternative of paying their value (CPR 12.4). In each case, the claim was not only for damages for copyright infringement (including additional damages for flagrant infringement), interest and costs but also for:

"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)."

Ooops. That doesn't appear to comply with CRP 12.4. The judge thought not. ACS:Law ought to have made a formal application rather than merely filed a request and that would have alerted the defendants to the possibility of default judgment and given them an opportunity to respond. The judge had serious doubts as to whether, in peer to peer file sharing cases, default judgment ought to be given on request without a formal application. He said:

In all these circumstances, a default judgment arrived at without notice by means of an essentially administrative procedure, even one restricted to a financial claim, seems to me to be capable of working real injustice.

Most interesting for me are the criticism that the judge made of the way in which the case was pleaded (one assumes by ACS:Law, but certainly on their behalf).

• The particulars of claim stated that the claimant "represents" the owner of copyright in the films that were the subject of the claim. Only the owner of the copyright or a licensee (and for a non-exclusive licensee only if certain conditions are met) has a right to sue for copyright infringement. Thus the pleadings were defective.
• The allegations relate to unsecured internet connections. It is unclear whether the owner of (say) an open wifi can be held responsible for copyright infringement effected using that connection.
• The claimant's plea was that the defendant was guilty of "allowing" copyright infringement, which, as the judge put it, "is simply wrong". The term used by the act is "authorising", which is rather different.

and more of the same. In short: even accepting all of ACS:Law's allegations, they do not appear to have a proper case. To succeed they would at least have to amend their claim, assuming they have a case at all.

A health warning: this decision is made by a county court. It is not, strictly speaking, binding on any future court. It does however illustrate the extremely dubious nature of the claims being put before the court by ACS:Law and will, I hope, encourage defendants to be more confident in resisting them. The list of defects in the pleadings might make a useful basis for an application to strike out against the claimant.

Hat tip to Philippe Bradley for pointing this case out to me.

Image rights: England v Germany and Philip Woolas's mug

Matt Wardman of the Wardman Wire asks an interesting question on the mySociety:public mailing list. He had created a couple of mug designs poking fun at the former MP Phillip Woolas and submitted them to the online platform Spreadshirt. According to his blog post they refused to accept the designs, saying:

These designs or products most likely infringe legal regulations. If not then the content is considered offensive, discriminatory or glorifies violence.

Now of course the designs were offensive — in the sense that someone could be offended by them — that really was the idea. If there were a law against being offensive Private Eye could never be published. Spreadshirt's Terms and Conditions say nothing to forbid offensive material; nor could the designs possibly seen as discriminatory (except perhaps against MP's who lose election courts) or glorifying violence. What of the "legal regulations" that Spreadshirt thought might be infringed.

A later response gave some clarification:

"Unfortunately we could not admit them for your shop because they infringe on the personal rights of Phil Woolas. These basically state that any image with his photo or name on it that does specifically refer to his person must be authorized by him. "

Such an unqualified statement of law must be rubbish, at least in any civilised society. If it were true then editors would find it virtually impossible to illustrate their newspapers and most of their budgets would be spent on clearing image rights with those depicted.

English law doesn't recognise an image right per se. The use of a person's image is not entirely free. For example if I take a photograph of you, you may be able to prevent me from using it:

• in a way that is defamatory of you — as in Tolley v J S Fry Ltd [1931] AC 333, where an amateur golfer successfully sued for libel when his image was used in a chocolate advert since it carried an implication that he had been paid for the advertisement and was therefore not maintaining his amateur status;
• to pass off your business as mine — this extends as far as using the image of a celebrity to falsely imply that they endorse my business, as Talksport did when the edited an image of Eddie Irvine holding a mobile phone into one holding a radio labelled "Talksport" in Edward Irvine Tidswell Ltd v Talksport [2002] EWHC 367 (Ch);
• in breach of trademark — assuming of course that you have trademarked your image and that my usage amounts to an infringement of that mark;
• in breach of confidence — if I received the photograph in confidence and my use of it is a breach of that confidence
• in a way that infringes your right to privacy derived from Article 8.1 of the European Convention on Human Rights(assuming I obtained the photograph in confidence) — in a case (Campbell v MGN [2004] UKHL 22) brought by Naomi Campbell against the Mirror for the publication of photographs of her going to a Narcotics Anonymous meeting, the House of Lords extended the action for breach of confidence to cover intrusions into an individuals private life;

There is also the Data Protection Act 1998. If the photographs are processed by computer (as they are by spreadshirt in this case) then they must also be “personal data”. If so, then they may only be processed if one of the conditions in Schedule 2 to the act are met. Processing for the purposes of journalism, literature and art is excluded from an obligation to comply with most of the data protection principles (by section 32) which makes life very much easier for newspapers. For use of photographs which is not journalism, literature or art, paragraph 6 of Schedule 2 would have to be relied on which requires that:

The processing is necessary for the purposes of legitimate interests pursued by the data controller or by the third party or parties to whom the data are disclosed, except where the processing is unwarranted in any particular case by reason of prejudice to the rights and freedoms or legitimate interests of the data subject.

Unfortunately there has been little consideration of this aspect of the Data Protection Act. In many cases the act is pleaded, but the eventual decision hangs on some other branch of the law. For example in Campbell's case.

It seems to me that neither of the mugs could possibly be defamatory (“Phillip Woolarse” doesn't come close), no-one coudl think that the mugs implied that Mr Woolas endorsed the Wardman Wire or that they were really the same business as him. The photographs were taken from election leaflets, criticised by the election court, and so are hardly an invasion of Mr Woolas's privacy and, arguably, they are “art” and so defensible against a Data Protection Act 1998 claim.

So much for England, but spreadshirt is German based. Now as an English lawyer, I known next to nothing about German law, but as I understand it the German KunstUrhG (law on the copyright of works of visual arts and photography) recognises a right known as Recht am eigenen Bild, usually glossed as “right in their own image” which I will refer to as “image right”. Section 22 of the KunstUrhG prohibits the distribution or public exhibition of the image of an individual without that individual's consent. A right to control over the use of one's image is also derived from Article 2 of the German Basic Law.

To an English lawyer's eyes this seems, at least at first sight, to give an excessive degree of control by an individual over the use of their image, and also to be a serious impairment of the freedom of speech. But German law is much more nuanced than that, not least because Article 5 of the Basic Law guarantees a right to freedom of expression.

Section 23 of the KunstUrhG makes a number of sensible exceptions, including one for images of people from the sphere of contemporary history (Bereiche der Zeitgeschichte). Until recently the German courts divided contemporary public figures into two groups: absolute figures of contemporary society (absolute Person der Zeitgeschichte) — those who stand out from the rest of society for example because of their political or social position, such as major political figures; and relative figures of contemporary society (relative Person der Zeitgeschichte)— those in whom there is public interest only due to a single event, such as victims of a notorious crime.

Section 23(1) is subject to section 23(2) which prevents distribution or display which harms the legitimate interests of the person portrayed (or after their death, the legitimate interests of their family). But section 23(2) aside, the absolute/relative classification would have meant that absolute figures of contemporary society had little protection against the use of photographs in a way that invaded their private lives unless they could show that a specific legitimate interest had been harmed.

The German law was found to be contrary to Article 8 of the European Convention on Human Rights in von Hannover v Germany brought by Princess Caroline of Hanover. The German Federal Court dropped the absolute/relative distinction (VI ZR 51/06) and held that the proper approach in all cases was to consider the balance between an individual's article 8 (basic law article 2) rights as against the interests of free speech under article 10 (basic law article 5). This approach has been endorsed as constitutional by the Federal Constitutional Court in a decision [link to English version] which usefully summarises a lot of the background.

Even after Princess Caroline's victory in the European Court of Human Rights, not everything has gone her way. Although the German courts agreed to prevent the distribution of some pictures of her, they permitted others. They have upheld the principle that sometime the interests of journalism, even where that is merely for entertainment rather than purely for information, outweighs the rights of an individual to their image. Princess Caroline is pursuing further action before the European Court of Human Rights.

My apologies for that long digression into German law (or what little I understand of it). In short: Spreadshirt's statement about image rights is rubbish even in German law. It seems to me extremely unlikely that using a picture of a Member of Parliament taken from an election leaflet that was the subject of a notorious and important trial could fall foul of the German image right as I have explained it. Spreadshirt staff may be forgiven for not realising that (if they are based in Germany) but for knowing that Mrs Thatcher (who cast a long long shadow) was a public figure.

Matt Wardman also wondered whether there might be a problem with copyright in the original election leaflet. The short answer is that

• copyright subsists in election leaflets just as in almost everything else (there is no special exception for them);
• copying the image is therefore a potential infringement, unless there is some defence available;
• there is no “fair use” defence in English law, contrary to the situation in the United States;
• there might be a defence of fair dealing for the purposes of criticism or review (to be found in section 30 of the Copyright Designs and Patents Act 1988, on the basis that the images on the mugs are a critical work, criticising the election leaflets which brought about Mr Woolas's downfall and that they are fair because they only use a small part of the offending leaflet;
• there might also be (and in this case there really ought to be) a public interest defence.

Copyright exceptions are so open textured that it is very difficult to be certain as to any of these, but I suspect any copyright suit would look very stupid.

Final draft of ACTA is out - nothing to see here

Thanks to the Patently-O blog on the subject, I learn that the Final Draft of the Anti-Counterfeiting Trade Agreement (ACTA) has been released. The EFF's web page on the subject has some background.

Earlier drafts contained a great deal of "pick and mix" material which still up for debate between the parties. The Final Draft suggests that those differences have been ironed out (though since the deliberations have been in secret I do not know the details).

My skim read suggests that there is not much in the treaty that would require the UK government to change our copyright law either in substance or as to the procedures used to enforce it. That does not mean that ACTA won't be used as an excuse (or opportunity depending on your outlook) to make changes, but there is a sufficient amount of flexibility in the treaty and a sufficient number of weasel words, that there should be no need for it to do so.

The Patently-O blog post does a good job of summarising the feel of the treaty. My own further thoughts follow.

Measures of damages

Article 2.2(2), which survives from earlier drafts, is particularly unreasonable. It starts uncontroversially enough:

Each Party shall provide that in civil judicial proceedings, its judicial authorities shall have the authority to order the infringer ... to pay the right holder damages adequate to compensate for the injury the right holder has suffered as a result of the infringement.

in other words damages should be compensatory and aim to compensate the injured for the wrong done to them — the usual position in English law. The treaty goes on:

In determining the amount of damages for infringement of intellectual property rights, its judicial authorities shall have the authority to consider, inter alia, any legitimate measure of value submitted by the right holder, which may include the lost profits, the value of the infringed good or service, measured by the market price, the suggested retail price.

Now just how bad this is depends on quite what effect "shall have the authority to consider" will have. Logically merely because a court may consider something, does not automatically mean that the court will pay much attention to it. In practice a legislative requirement to consider a factor will often mean that a court feels obliged to give that factor more weight than it would otherwise do.

What is so odd about that is that "market price" and "suggested retail price"may be a very long way from a good measure of the actual loss suffered by a rights holder. For physical goods, production costs may make up a large part of that price, but even for digital goods, the loss effected by infringement will almost always be less than the actual price because not everyone will have been prepared to buy at that price.

It is also very unusual to have a law that requires a court to consider one of the party's evidence as to damages, but not the other. The usual practice is for the court to have one or more objective measures for awarding damages and for the parties to submit evidence as to what those damages should be.

Since, strictly speaking, an English court certainly has the authority to consider any measure of damages put forward by either of the parties, this particular article should require no change to English law.

More damages

Article 2.2(3) obliges that party's to the treaty to implement one of 3 mechanisms for establishing damages for copyright infringement. All parties would have to chose one of:

• pre-established damages (that is some fixed measure that the court can apply mechanically
• presumptions for determining the amount of damages — in other words a pre-established mechanism for computing the amount
• additional damages — that is extra damages over and above those used to compensate

Section 97(2) of the UK's Copyright Designs and Patents Act 1988 already provides for additional damages. So there is no need for change here.

In my last post on ACTA I pointed out that the United States does have a rather draconian form of statutory damages, but only awarded to those who had the presence of mind to register their copyright — surprisingly many do not. At first sight it looks like the US will have to remove that precondition or implement one of the other options for pre-computing damages.

As I said then, it seems odd to me that copyright owners should be put in a better position than most other classes of claimant in civil proceedings (who have to prove their loss in the normal way and who are generally entitled to compensation for their loss and that's all). Rights in real property are not protected in this way. Similarly, someone carelessly injured and left quadriplegic (to use an emotive example) would have to prove all their loss and would expect to obtain no more. Why should IP be so special?

Costs

Article 2.2(5) requires parties to allow courts to award the winner their costs in copyright proceedings. That seems uncontroversial from the English point of view, where "costs follow the event" but the usual US rule is that each party bears their own costs. Copyright is special. 17 USC 505 allows the prevailing party to be awarded their costs and attorney's fees, but this is restricted by which requires that the copyright be registered at the time of the infringement (or soon after where the infringement takes place shortly after publication) as a prerequisite of costs recovery. Again the US may be forced to relax this requirement as a consequence of ACTA.

Summary

There's lots more in the treaty. The criminal provisions are probably already compatible with UK law, though they are triggered by "wilful" copying on a "commercial scale", rather than the various specific situations set out in places like Section 107 of the Copyright Designs and Patents Act 1988. There are all sorts of requirements for the parties to the treaty to work together to eliminate IP infringement and even (in article 3.4) a requirement to engage in pro-IP propaganda (one wonders at a time of budget cuts why we need to spend money on this but...). As far as I can see there's not much in the treaty that needs to directly impinge on our law. What our government chooses to do in response is another matter.

Libellous freedom of information responses

For those that have yet to encounter it WhatDoTheyKnow (“WDTK”) is a website that helps members of the public make requests under the Freedom of Information Act. It displays the request and any subsequent communication (that was made via the site) between the person making the request and the public body in question. Anyone else may add comments, known as “annotations” at any stage of a request.

Like most other websites to which members of the public may contribute, WDTK has to be concerned about libellous contributions. As they note although they are forced to hide only a small proportion of the total number of requests, doing so still represents a significant effort for their volunteers. Most of the issues of libel arise either in the original request, or in subsequent correspondence including annotations made by third parties. But there is a more difficult problem where the libel is contained in the FOI response itself.

Consider the recent case of McLaughlin v Lambeth [2010] EWHC 2726 in which one of the alleged libels was contained in a “briefing report” prepared by the local authority and sent to the Department of Education. If a member of the public made a successful FOI request via WDTK for that report, WDTK's software would automatically republish it on their site. The Claimants in McLaughlin might well ask WDTK to remove the disclosed material — what then is WDTK supposed to do?

The difficulty is the classic chilling effect. WDTK are in no position to decide whether the briefing report is libellous, or whether their publication of it is defensible under some general libel defence — for example under public interest “Reynolds” qualified privilege. Unlike the commercial news media, who can take a view that profit made from publication is offset by the occasional loss of a libel suit and have the funds to insure against defamation claims, WDTK is a charity funded, volunteer run site. They are in no position to take the risk which means they cannot as robustly defend the public interest in freedom of information as they would like.

There is an absurdity about this since if one FOI request is successful then (because of the “applicant blind” approach) so ought a subsequent one. If I can obtain the briefing report under FOI, then so can you. It is unclear whether WDTK could display a message stating that a particular response had been removed because it was libellous, but that anyone can request their own copy by clicking on a particular link which would then send a fresh request to the authority. Such an approach might be a “publication” of the libel, depending on how one reads some rather old authorities.

The common law might recognise this absurdity and decide that publication of FOI responses was a form of qualified privilege. There is a line of old authorities that the publication of a fair and accurate copy of (or extract from) any register kept pursuant to statute and which by law the public are entitled to inspect attracts the defence of qualified privilege. For example publication of a copy of a county court judgment would attract common law qualified privilege. The reason for this defence was explained by Lord Esher MR in Searles v Scarlett [1892] 2 QB 56:

“The law provides that the register shall be a public document which anybody may consult for this purpose. That being so, the publisher of such a list ... is only doing for the public what they may do for themselves, and is only giving that information to the public and to tradesmen which the legislature has thought it right they should have.”

That reasoning appears to be equally applicable to republication of an FOI request. It is true that the cases are all concerned with documents or registers that the public is entitled to inspect, rather than request, but it seems to me that the right to email a public body and have a document sent in response is a very similar one and the common law reasoning could be extended if a court were properly persuaded to do so.

All this is not of much use to WDTK. The last thing they would wish to do is to litigate this question. What is interesting to lawyers is rarely rewarding to their clients. It would be much better if the question were settled by statute. Most of the old common law forms of qualified privilege of this type have been given statutory force by section 15 of the Defamation Act 1996. If any of you have the ear of government you might suggest that the addition of an exception for the publication of information released under the Freedom of Information Act (and similar legislation) should be added to part II of Schedule 1 of the Defamation Act 1996. If I am right that the common law covers this situation anyway, all such a change would so is enact in statutory form a defence which already exist.

Of course a wider reform of the law of defamation is also desirable, but failing that, this would be a useful improvement.

Government: the DEA can't be used for disconnection

Today’s big news about the Digital Economy Act is that TalkTalk have been granted permission to apply for judicial review of some of its provisions. For those unfamiliar with the process, judicial review requires two stages: first permission to apply and then the review itself. The grounds of review are varied and complex. For the legal geek the statement of facts and grounds [PDF] makes interesting reading.

What has not been discussed widely so far is the government's response to the don't disconnect us petition on the Number 10 petitions website, which includes the following statement:

“ The Digital Economy Act includes a number of measures to tackle the problem and we expect these to be successful in significantly reducing online copyright infringement. However this is an area of rapid technological change and developing consumer behaviour. The Act therefore includes a reserve power to introduce further “technical” measures if the initial measures do not succeed. These technical measures would limit or restrict an infringers’ access to the internet. They do not include disconnection.”

Are the government right? Section 124G(3) of the Communications Act 2003 (introduced by section 9 of the Digital Economy Act 2010) defines a ”technical measure“ to be one of four things:

(3)A “technical measure” is a measure that— (a)limits the speed or other capacity of the service provided to a subscriber; (b)prevents a subscriber from using the service to gain access to particular material, or limits such use; (c)suspends the service provided to a subscriber; or (d)limits the service provided to a subscriber in another way.

Clearly (a), (b) and (d) can be used for various kinds of blocking or throttling and certainly not for disconnecting a subscriber. It is (c) that is the interesting provision. The word “suspend” carries with it a strong implication of transience and not permanence. A natural reading of section 124G does appear to mean that a subscriber cannot be disconnected permanently from access to the internet and to that extent the government appear to be right.

It is unclear whether (if ever) the Number 10 petitions site actually produces useful results or a change in policy. Certainly the usual response is very much along the lines of “your petition has been noted and filed and now we will ignore it”. Here the government's response relies on an overly literal reading of the petitions title. The intent was clearly to protest at the possible removal of access to the internet whether temporarily or permanently. Six months without internet access could be a serious outcome for some.

Of course the act has been so worded that technical measures are directed at a particular service provider. The “evil pirates” will simply sail over to a new service provider well in advance of any supsension of their serve. Such a transfer could even be provided by a service provider for the benefit of their customers (perhaps automatically?). It is those on long fixed term contracts with their ISP's who will may actually suffer. Quite possibly (though I have no statistics on this) those most innocent of the way the internet works.

One positive outcome of the petitions is that, if at a later stage the government try to introduce legislation that does permit permanent disconnection, we will certainly remind them of their response.

Database right: proving infringement

A recent decision in the Patents County Court — Beechwood House Publishing v Guardian Products [2010] EWPCC 12 concerns the database right. We haven't seen very many database right cases, so I thought it was worth a short comment.

The claimant, who I shall call by their trading name "Binley's" maintain and sell a database of the names and addresses of people associated with GP practices (such as doctors and nurses) which is then sold to companies that wish to use the addresses for direct marketing. It costs, according to Binley's, roughly £110,000 a year to keep the database up to date.

In order to detect any infringement of their database right, Binley's include in their database a number of what they call "seeds". These are bogus entries, giving the address of Binley's staff. When any post is received addressed to a seed address, Binley's can then presumably check the source against their list of clients to check that the marketing comes from someone authorised to use their database.

In about August 2007 Binley's received a letter addressed to a seed. The letter was from Guardian Products (the first defendant) who had obtained their mailing database from the second defendant (Precision Direct Marketing Ltd) who had in turn obtain it from an organisation called Bespoke Database Organisation Ltd (or BDOL for short). Quite why BDOL were not also defendants is unclear. Perhaps they had already reached a settlement with Binley's but we do not know. But it was accepted that BDOL's database contained the offending seed.

Binley's sued the defendants for infringement of their database right. Presumably on the ground that the defendants must have "extracted" — which means (in English law at least) "the permanent or temporary transfer of [the contents of the database] ... to another medium by any means or in any form" (see regulation 12 of the Copyright and Rights in Databases Regulations 1997).

One assumes that Binley's felt their case was pretty strong, so they made an application for summary judgment. A summary judgment application is not a trial, to succeed Binley's needed to persuade the judge that the defendants had "no real prospect" of defending the claim.

On this point Binley's failed. The problem was, from the judge's point of view, that all the evidence he had was:

• Binley's database contained one or more seeds
• One of those seeds had turned up in BDOL's database

Clearly this was evidence of some copying, but extraction from a database is only unlawful if the extraction is all or a substantial part of the contents of the database (see regulation 16). It might seem highly improbable that the offending seed was the only item copied. Indeed the judge thought that it was "highly probable" the there had been the extraction of a substantial part, that that was not enough to grant summary judgment.

Binley's had not given evidence of the proportion of seeds in their database. Its evidence was there were "a few" but Binley's had refused to give a more precise figure, possibly for commercial reasons. If they had, that might have allowed some assessment of the degree of extraction and therefore whether it was not substantial.

Summary judgment was refused.

What is interesting about this case is that it may be very difficult in practice to prove merely by examining a database's contents that it has been copied from another, especially where the data is relatively regular and commonplace such as names and addresses, without recourse to seeds or some other form of watermarking. The more seeds or watermarking, the easier the task, but at the cost of poisoning the database owner's product with irrelevant or false information.

In some cases other evidence will be available that demonstrates extraction, but here the first defendant appears to have had no direct knowledge of how its database had been created (since it originated in BDOL). In such a situation a database owner may have difficulty proving that the extraction of a substantial part has taken place.

Note that a decision of the Patents County Court sets no precedent. Its value is merely illustrative, but I feel it is interesting nonetheless.

Absence

My apologies for the long absence from blogging. I have been unable to do so for personal reasons, but I hope to resume in the near future.

ACTA is out

A draft (in PDF form) of ACTA, the Anti-Counterfeiting Trade Agreement, has been released by the European Commission. This is the first time any of us have been allowed "officially" to see a draft of the treaty as hitherto negotiations have been conducted in secret. As governments often remind us — if you have done nothing wrong you have nothing to hide — why the secrecy?

Inspired by leaked versions, the treaty has excited much opposition. For example from La Quadrature du Net, the EFF and many others. Michael Geist gives a very thorough analysis on his blog site for those inclined to dig deeper.

If you read the draft you will see that it is marked up with numerous possibilities, indicating differences of opinion between the national delegations. The draft coyly avoids telling us which those delegations might be, but a recently leaked draft may give a clue. I am fairly confident that an analysis of the various parties positions can be crowd-sourced so that we all know where to apply pressure.

This multiple choice nature of the draft makes it hard to analyse whether it is really good or bad or indeed what effect it will have at all. This is particularly so where there are two possible drafts: one stating what parties to the treaty "may" do (which means they need not) or "must" do (which means they certainly will). For example Article 2.2(2) on damages.

I leave a thorough analysis to others who have rather more time than I do, but a couple of points strike me as being of particular interest to the digital/internet environment:

Damages

The normal rule in English civil proceedings is that the damages are compensatory and intend to put you back in the position you would have been if the defendant had done no wrong (or not breached a contract or whatever). In some circumstances a claimant might be able to force a defendant to disgorge any gain they have made without a good lawful reason, or even to pay over any profits they have made as a result of their actions.

In the world of intellectual property this limitation does not operate. Many jurisdictions allow more compensation on top. For example s97(2) of the Copyright Designs and Patents Act 1988, a court may award "such additional damages as the justice of the case may require", having particular regard not only to any benefit gained by the defendant but also to the "flagrancy" of the infringement. In the United States 17 USC 504 allows a copyright owner, where they have registered their copyright, to elect to receive "statutory damages" rather than actual damages and profits, at a minimum of $750 (but up to $30,000) per work infringed. The ludicrous effect of such damages is well known.

ACTA's proposed article 2.2(2) proves that the parties may or shall (which to be later determined) maintain a system of pre-established damages much like that of the US, as well as presumptions for determining the amount of damages. Such a presumption might be that the damages suffered for copying N works each of which would have made (if sold) a profit of p would be Np. Such a sum would almost always be more (probably much more) than the actual loss. There may (or shall) also be a provision for "additional damages".

It is quite possible that rights industries could make more money this way than they would if there were no infringement which would be a surprising outcome in any other field of law.

Criminal liability

Copyright infringement may be a criminal offence in the UK in essentially two circumstances: first where it is done in the course of business and second where it is done "to such an extent as to affect prejudicially the owner of the copyright" (I am simplifying this somewhat). Article 2.14 of ACTA suggests there should be criminal liability for infringement on a commercial scale, which is defined to include "significant wilful". I am unclear on what "wilful" means (perhaps readers can help) but that looks to me to increase the range of criminal liability.

Online infringement

The headline part of ACTA for me ought to be section 4 which concerns enforcement "in the digital environment". With the passage of the Digital Economy Act 2010 it may be we have seen the last of new attempts to legislate in this field in the UK for a few years. It may be that ACTA makes little difference to us except to provide the government of the day with political cover to push things a little further.

Article 2.18 requires that parties make available enforcement procedures that include "expeditious remedies to prevent infringement and remedies which constitute a deterrent to further infringement". So to protect and deter. The detail that results from this general requirement could be almost anything because the draft includes two main options, and many sub-options, that range from a less intrusive system of copyright control than we have in the UK to a system that goes much further. I find it difficult to give any kind of useful summary — if such a thing is even possible.

There are options to protect intermediate service providers though these may be predicated on the provider either taking proactive steps to prevent infringement (but not including monitoring) or responding properly to requests to block/take-down material or both. There are also provisions that may require legal protection of effective technological measures, though to what extent they will go further than those already imposed on us is unclear.

Conclusion

There's an awful lot more in there. I look forward to reading a wider analysis and to seeing what response the various campaigning organisations now adopt. Overall the treaty seems to be a mixture of unnecessary repetition of existing treaty arrangements (such as TRIPS or WCT) and overly draconian provisions. In my view the best outcome would be for the treaty to be abandoned, but I realise that is unlikely, so it might be time to focus more on the detail.

New amendment gives copyright owners a blank cheque for web censorship

Imagine that, in the Summer of last year, you had been following the MP's expenses scandal and heard that The Telegraph was publishing a rather less redacted version that MP's were prepared to give us. Interested, you navigated your way to www.telegraph.co.uk only to find it was not responding. After some searching around and asking friends you discover that the website has been blocked by most major UK ISP's. It seems a junior official in Parliament had asked them to block The Telegraph for copyright violation.

Just this could happen as a result of amendment 120A to the Digital Economy Bill that was passed yesterday in the House of Lords. Being strictly accurate (and I am a stickler for accuracy) I don't think that Parliament going after The Telegraph is likely any time soon for reasons I will explain at the end of this post, but the reasons for that are political not legal and that should worry all of us.

Why?

What is this all about? The copyright industry (which I will call "the BPI" for short) would like a way to make ISP's block internet access to servers that are involved in wholesale copyright violation. Trying to go after the owners of the servers is difficult, either because they are convicted criminals or because they are a mega corporation that will thumb their noses at the BPI and fight tooth and nail against any effort to take them down. How much easier to get ISP's to do the job.

I believe (and I think most copyright lawyers agree with me) that the courts could be persuaded to develop a general form of order requiring an ISP to block access to unlawful content. They have already done this with so-called "Norwich Pharamcal" orders that are used to ask innocent third parties (like ISP's) to divulge the names of the guilty. If there was any doubt, section 97A of the Copyright Designs and Patents Act 1988 makes it quite clear that the courts have the power to do this.

What seems to be bugging the BPI is that a court order costs money and they (the BPI) will have to pay for it. What they want is to be able to get the orders they want for free, or rather at someone else's expense. Amendment 120A does the job. The killer bit is this wording:

(4) Where—
(a) the Court grants an injunction under subsection (1) upon the application of an owner of copyright whose copyright is infringed by the content accessible at or via each specified online location in the injunction, and
(b) the owner of copyright before making the application made a written request to the service provider giving it a reasonable period of time to take measures to prevent its service being used to access the specified online location in the injunction, and no steps were taken,
the Court shall order the service provider to pay the copyright owner's costs of the application unless there were exceptional circumstances justifying the service provider's failure to prevent access despite notification by the copyright owner.

ISPs will feel forced to block on request

What this means is that a copyright owner can send a notice to an ISP asking them to block access to a website. The ISP has a choice: either they block the site, or they wait to see if a court will make an order to block it. If they wait, they pay the costs. There's going to be a really strong temptation just to block without asking any questions, rather than go to court and risk what will amount to a fine.

Its much worse than that. The written request doesn't need to explain why the website should be blocked. It can just be a bald instruction "block this site", or perhaps a list of websites to block like that supplied by the Internet Watch Foundation>. The ISP won't find it easy to "ask questions" because it will have nothing to work with. There is also nothing to stop the BPI sending huge numbers of requests, swamping the ISP so that a conscientious ISP that does not want to blindly block everything will find it prohibitively expensive to do so.

Furthermore, the website won't usually be run by anyone with a contractual relationship with the ISP. This is not a "block your customers" type of order but a "block someone on the internet" one. The ISP won't have any customer relations incentive not to block, nor will they have any way (in general) of recovering their costs from the website owner.

In most cases the only safe way for an ISP to proceed will be to just block everything they are told to block. What is to stop the BPI routinely requesting a block whenever there is anything they vaguely dislike? Nothing. There is no penalty for sending an unjustified written requests. The request does not have to say that anything in particular is wrong, its just a request after all. If I were the BPI I'd just churn these out wholesale and cherry pick which to actually enforce, relying on the spread of fear, uncertainty and doubt to get my own way.

No redress for the innocent

What about website owners? There's no requirement in the amendment to tell the owner of the website that a request has been made to an ISP. The owner/operater will usually first find out they have been blocked by the ISP after it has happened. Aside from persuading all ISP's in the UK to unblock you (perhaps by promising to pay their costs if they eventually are ordered to block) there is nothing you can do about it. There won't have been a court order, so there's no appeal.

Even if you, as a website owner, hear about the request from some well-meaning ISP, you may not know what it is exactly that you are accused of. Like Joseph K's legal team in The Trial you will have to deduce what you are charged with doing. How anyone can think that is fair or reasonable defeats me.

If an ISP is persuaded to resist a request to block your site and you then intervene in subsequent court proceedings brought by the BPI, the case could go on a long time — copyright cases can be quite complicated. Maybe there are important issues of law at stake that will take the matter to the Supreme Court and back. The result an enormous costs bill. Who will have to foot it if you lose? Ordinarily, the ISP. You can see why an ISP is going to require a lot of persuading not to just roll over and do what its told.

The court will be bypassed

The amendment is stuffed full with good intentions. There's a whole list of things a court would have to take into account before making an order, all of which would be things a court would probably take into account anyway. Courts really don't need to be told to take into account "the importance of preserving human rights, including freedom of expression, and the right to property" for instance — they are required to do so by the Human Rights Act 1998 — which suggests that the amendment was not drafted by someone with any knowledge of legal practice more's the pity.

But all these good intentions are quite irrelevant because the new law gives the BPI huge leverage before anyone gets near a court. The court process may be scrupulously fair, but which ISP is going to routinely risk getting there?

Well there's plenty more that's wrong with the amendment, for example what on earth is a "location on the internet" (IP address, URL, DNS domain...)? Did anyone who knows anything about computer networking get asked about this before it was tabled (I assume: no)? But I think that is enough for me to complain about in one post. I hope you get the general idea. Sadly the politicians involved don't.

Conclusion

The Telegraph case is unlikely. Not because the legal conditions aren't made out - it is certainly true "a substantial proportion of the content accessible at or via" the part's of the Telegraph's site where all those barely redacted expenses claims where displayed infringed copyright, so there's certainly a basis for a claim. The Telegraph is in the position of having an alternative outlet to air its grievances (the paper version) and enough money to fight the government over it and to offer to indemnify any UK ISP that is nervous about it. By contrast the House of Commons was running scared in the middle of 2009 and its officials were probably sane enough to try to avoid the huge scandal associated with blocking the newspaper.

But the blocking of a newspaper, a major site like youtube, or indeed any other site (insert your favourites in here) is by no means implausible. Newspapers regularly republish information quoted in other newspapers, much of which may infringe copyright. Where a site is overseas and won't make so much of a fuss about blocking in the UK, it all becomes more likely.

My last blog on the topic of the Bill complained of a similar power that would allow the government to block sites it didn't like such as wikileaks. Subsequent amendments blocked that hole, but now we have a new provision that lets private individuals as well as the government shut down sites, with wikileaks still a prime target. Politicians of all parties need to think very seriously about whether they really want to give the BPI this amount of power.