Liability of Intermediaries Carthy Thesis

i

Copyright Enforcement in

the Digital Era and the

Role of Internet

Intermediaries

LL.M.

2011

Laura Carthy

ii

SUMMARY OF METHODOLOGIES USED AND MAJOR

FINDINGS

I was motivated to complete this thesis having a deep interest in the Intellectual

Property and Technology Law areas. This is due to my undergraduate qualification

in Information and Communication Technology which I obtained here in Trinity

College in the School of Computer Science and Statistics. Researching this thesis

has allowed me to synergise both my technology and legal knowledge and to gain

a broad and in-depth understanding of digital piracy, both from a technical and

from a legal perspective. Particularly as I have grown up in the Internet age and

am an avid consumer of digital culture, I find digital copyright and the plethora of

issues that it throws up, enthralling. I watched with interest as the EMI v UPC case

unfolded in the autumn of 2010 and felt that the ramifications of this case

warranted an in depth analysis.

In March 2011, in furtherance of my research, I commenced a legal internship

with the Internet Service Providers Association of Ireland. This is the

representative industry association for Internet intermediaries in Ireland. As part of

my role here I have followed the issue of digital copyright very closely both at a

national and European level. It has given me indispensible industry insight into the

on-going reviews and recent developments in this area, and has enabled a much

broader understanding of the issues than one could possibly grasp in a purely

academic position.

I attended the Annual Conference on European Copyright Law in Brussels in May,

where I met such copyright experts as Mihály Ficsor, Alain Strowel, Jonathan

Griffiths and Frank Macrez to name a few. I met and have since liaised with the

lead counsel for the litigation team of Scarlet in the highly anticipated case of

Scarlet v SABAM which is currently before the CJEU, Thomas de Meese. I

observed with interest as each of these esteemed academics and practitioners

presented on the most contemporary developments in Europe in the realm of

copyright.

iii

In June I attended the ALAI (Association littéraire et artistique international)

annual conference entitled Expansion and Contraction of Copyright: Subject

Matter, Scope and Remedies where I volunteered with the Irish Copyright

Licensing Agency and the Copyright Association of Ireland. This highly

informative conference included speakers such as Mr Justice John Cooke, Mr

Justice Peter Charleton, solicitor Helen Sheehy, Professor Robert Clark and

representatives from Google, WIPO, HADOPI and the European Commission.

Specific presentations were delivered in relation to the enforcement of rights in the

digital era honing in on the graduated response regime and the alternative solution

of private agreements with Internet intermediaries. With my industry experience I

could constructively analyse and critique the information which was imparted to

me, in order to draw my own conclusions, which are evident in this paper.

The Department of Enterprise, Jobs and Innovation announced on 9th of May that

it was to begin a public consultation for the review of the Copyright and Related

Rights Act, 2000. The Copyright Review Committee held a public meeting here in

Trinity College Dublin on the 4th

of July which I attended and observed the

contributions of all of the stakeholders present. I also attended an event run by the

IIEA where senior copyright counsel for Google, Fred von Lohmann, delivered a

powerful presentation entitled Protecting Innovation While Protecting Copyright.

This detailed how copyright policy should be adapted for the digital age stressing

the necessity to embrace the technological advances which we are currently

experiencing all around us, with new business models and flexible laws which can

be adapted to the online environment.

As I had anticipated when I chose this topic for my thesis, legislative reform

resulting from the fallout of the UPC decision is now on the agenda in this

jurisdiction. The Government presented draft wording for a Statutory Instrument

in May in order to bring Ireland into line with its European counterparts in

complying with the E-Commerce Directive. I have followed this suggested

amendment very closely and liaised with industry representatives and copyright

lawyers in relation to same. I have conducted extensive research on this entire area

iv

of jurisprudence in order to present my analysis and my major findings have been

as follows:

The current legislative conditions are unsatisfactory in this jurisdiction in

relation to digital piracy. The attempts of rightsholders to enforce their

copyright against individual infringers through means currently available

has proven burdensome and insufficient and they have thus turned their

focus toward Internet intermediaries seeking a more active role on their

part.

Internet intermediaries have a defence of „mere conduit‟ under the E-

Commerce Directive. However European law provides that rightsholders

should be in a position to obtain injunctions against intermediaries whose

facilities are used by third parties to infringe copyright.

Under the principles of EU law, any such injunction must be subject to

certain safeguards. It must be proportionate and effective and have regard

for the fundamental rights of third parties. A body of case law is

developing in this area in Europe providing much-needed further

guidance, particularly the opinion of the Advocate General in Scarlet v

SABAM. The full judgment of the Court of Justice of the European Union

in this case should be available in the autumn.

European case law differentiates between hosting providers, access

providers and index and search providers and the courts have treated each

category very differently. Those intermediaries who play a neutral role

will generally enjoy the protection of the „mere conduit‟ safe harbour,

while the more active intermediary will not.

A number of national measures have been enacted in some Member States,

and indeed worldwide, to combat copyright infringement by means of a

graduated response. It has been established, through a body of European

jurisprudence, that such a scheme must be made on a statutory basis, with

judicial oversight and procedural safeguards, and a private agreement

between the parties will not suffice.

v

The current proposals from the Department of Enterprise, Jobs and

Innovation of an amendment to the Copyright and Related Rights Act

2000 by way of Statutory Instrument is unsatisfactory. It is broadly

worded and provides little guidance to the judiciary. It will not serve to

alleviate the situation in Ireland and the manner in which the consultation

has been carried out, separately to the broader review of the 2000 Act, is

disappointing. Reform which may bring about a real solution to the

problem is required and this would necessitate input from the Oireachtas

and collaboration of all stakeholders involved.

vi

ACKNOWLEDGEMENTS

I would like to extend many thanks to my supervisor, Mr Paul Coughlan, for his

insightful comments and much appreciated guidance throughout the year. I would

also like to thank my colleagues at ISPAI for offering their thoughts and

observations, and most importantly for their banter, which has provided many a

diversion, keeping me sane while completing this thesis. I am indebted to all of my

friends and family members who have supported me in many and varied ways

over the course of the past year.

vii

AUTHOR’S DECLARATION

“I hereby declare that this project is completely representative of my efforts alone.

Where use has been made of other people‟s work, it has been fully acknowledged

and referenced accordingly. This thesis has not been submitted as an exercise for a

degree at this or any other University. I agree that the Library may lend or copy

this thesis upon request.”

Signature_________________________

Date_________________________

viii

CONTENTS

Summary of methodologies used and major findings ii

Acknowledgements vi

Author’s declaration vii

Contents viii

Table of Cases x

Table of Legislation xii

Chapter 1 Introduction 1

Chapter 2 European Framework

2.1 Background 4

2.2 Directive 2000/31/EC 4



Chapter 3 European Copyright Jurisprudence – A Pattern

Developing

3.1 Introduction 13

3.2 Indexing and Searching 13

3.2.1 Newzbin (UK) 13

3.2.2 The Pirate Bay (Sweden) 16

3.2.3 The Pirate Bay and Mininova

(Netherlands) 18

3.2.4 RapidShare (Germany) 19

3.3 Hosting Providers 21

3.3.1 Google Adwords 21

3.3.2 Google Video 22

3.3.3 L‟Oréal and Ebay 23

3.4 Internet Access Providers 24

3.4.1 Telenor (Denmark) 25

3.4.2 Ziggo (Netherlands) 25

3.4.3 Belgacom and Scarlet (Belgium) 26

3.4.4 UPC (Austria) 27

3.4.5 UPC (Ireland) 27

Chapter 4 Options Available for Intermediary Action and

Striking a Balance

4.1 What in theory can an ISP do and can it work? 29

4.1.1 DNS Blocking 29

ix

4.1.2 IP Blocking 30

4.1.3 Filtering 31

4.1.4 Graduated Response 31

4.2 Striking a Balance – Proportionality and

Effectiveness 32

Chapter 5 Ireland – A Chronology of Case Law

5.1 Introduction 35

5.2 Norwich Pharmacal 35

5.3 Graduated Response 36

5.4 The Pirate Bay 37

5.5 Data Protection Implications 38

5.6 UPC 43

5.6.1 Background 43

5.6.2 Attitude of UPC 43

5.6.3 Possible Solutions 44

5.6.4 Fundamental Right to Privacy 45

5.6.5 Authority of the Court 45

5.6.6 European Obligations 49

Chapter 6 National Measures against Piracy on the Internet

6.1 Introduction 52

6.2 UK – Digital Economy Act 2010 52

6.3 France – HADOPI 60

Chapter 7 Ireland

7.1 Consultation on Amendment to Copyright

and Related Rights Act 2000 64

7.2 A Closer Look 66

Chapter 8 Conclusion 73

Bibliography 75

x

TABLE OF CASES

AUSTRALIA

Roadshow Films Pty Ltd v iiNet Ltd (No3) [2010] FCA 24

AUSTRIA

Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft

mbH v UPC Telekabel Wien GmbH Unreported 17 May 2011 (HW(Vienna)).

BELGIUM

Belgian Anti-Piracy Federation v Belgacom Unreported 8 July 2010 (RvK

(Antwerp))

SABAM v SA Tiscali [2007] ECDR 19

SABAM v Tiscali Unreported January 28, 2010 (App (B))

DENMARK

Telenor (tidligere DMT2 A/S og Sonofon A/S) v IFPI Danmark 27 May 2010

(Højesterets)

FRANCE

Decision no 2009-580 of June 10th 2009 of the French Constitutional Council

Google Inc. v Compagnie des phares et balises 21 March 2011 (Cour d‟Appel de

Paris)

Google Inc. v Bac Films, the Factory 21 March 2011 (Cour d‟Appel de Paris)

Google Inc. v Bac Films, the Factory, Canal + 21 March 2011 (Cour d‟Appel de

Paris)

Google Inc. v Les Films de la Croisade, Goatworks Films 21 March 2011 (Cour

d‟Appel de Paris)

GERMANY

GEMA v Rapidshare AG Unreported 12 June 2009 (LG (Hamburg))

Rapidshare AG v Capelight Pictures Unreported 22 March 2010 (OLG

(Düsseldorf))

IRELAND

EMI Records (Ireland) Ltd & Ors v Eircom Ltd & Anor [2005] IEHC 233

EMI Records (Ireland) Limited v Eircom Plc [2009] IEHC 411

EMI Records & Ors v Eircom Ltd [2010] IEHC 108

EMI Records (Ireland) Ltd & Ors v UPC Communications Ireland Ltd [2010]

IEHC 377

xi

NETHERLANDS

Brein v Mininova B.V. Unreported August 26, 2009 (DC (Utrecht))

Brein v Ziggo Unreported July 19, 2010 (RB (Den Haag))

SWEDEN

Public Prosecutor v Neij Unreported April 17, 2009 (TR (Stockholm))

Neij v Public Prosecutor Unreported November 26, 2010 (HR (Stockholm))

UNITED KINGDOM

British Telecommunications Plc & Anor, R (on the application of) v The Secretary

of State for Business, Innovation and Skills [2011] EWHC 1021

Norwich Pharmacal Company and Ors v Commissioners of Customs and Excise

[1973] UKHL 6

Twentieth Century Fox and others v NewzBin Limited [2010] EWHC 608

EUROPEAN COMMUNITY REPORTS

Joined Cases C236/08 – Google France SARL, Google Inc. v Louis Vuitton

Malletier SA, C237/08 Google France SARL v Viaticum SA, Luteciel SARL, and

C238/08 Google France SARL v Centre National de recherche en relations

humaines (CNRRH) SARL, Pierre-Alexis Thonne, Bruno Raboin, Tiger SARL

[2011] ECR (page number unavailable at time of writing)

Case C-324/09 L'Oréal SA, Lancôme parfums et beauté & Cie SNC, Laboratoire

Garnier & Cie, L'Oréal (UK) Limited v eBay International AG, eBay Europe

SARL, eBay (UK) Limited, Stephan Potts, Tracy Ratchford, Marie Ormsby, James

Clarke, Joanna Clarke, Glen Fox, Rukhsana Bi [2011] ECR (page number

unavailable at time of writing)

Case C-324/09 L'Oréal SA, Lancôme parfums et beauté & Cie SNC, Laboratoire

Garnier & Cie, L'Oréal (UK) Limited v eBay International AG, eBay Europe

SARL, eBay (UK) Limited, Stephan Potts, Tracy Ratchford, Marie Ormsby, James

Clarke, Joanna Clarke, Glen Fox, Rukhsana Bi, [2011] ECR (page number

unavailable at time of writing), Opinion of Advocate General Jääskinen

Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et

éditeurs (SABAM)

Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et

éditeurs (SABAM), Opinion of Advocate General Cruz Villalón.

xii

TABLE OF LEGISLATION

EU LEGISLATION

Directives

Directive 95/46/EC of the European Parliament and of the Council of 24 October

1995 on the protection of individuals with regard to the processing of personal

data and on the free movement of such data.

Directive 2000/31/EC of the European Parliament and of the Council of 8 June

2000 on certain legal aspects of information society services, in particular

electronic commerce, in the Internal Market

Directive 2001/29/EC of the European Parliament and of the Council of 22 May

2001 on the harmonisation of certain aspects of copyright and related rights in the

information society

Directive 2002/20/EC of the European Parliament and of the Council of 7 March

2002 on the authorisation of electronic communications networks and services

Directive 2002/58/EC of the European Parliament and of the Council concerning

the processing of personal data and the protection of privacy in the electronic

communications sector

Directive 2004/48/EC of the European Parliament and of the Council of 29 April

2004 on the enforcement of intellectual property rights

Directive 2009/140/EC of the European Parliament and of the Council of

25 November 2009 amending Directives 2002/21/EC on a common regulatory

framework for electronic communications networks and services, 2002/19/EC on

access to, and interconnection of, electronic communications networks and

associated facilities, and 2002/20/EC on the authorisation of electronic

communications networks and service

xiii

NATIONAL LEGISLATION

Ireland

Primary Legislation

Copyright and Related Rights Act, 2000

Data Protection Act 1988

Data Protection Amendment Act 2003

Secondary Legislation

SI 68/2003 European Communities (Directive 2000/31/EC) Regulations 2003

SI 16/2004 European Communities (Copyright and Related Rights) Regulations

2004

United Kingdom

Copyright Designs and Patents Act 1998

Digital Economy Act 2010

Sweden

Act on Copyright in Literary and Artistic Works 1960 as amended

Germany

Law on Copyright and Neighboring Rights (Copyright Law) 1965 as amended

France

Act No. 92-597 of 1 July 1992 on the Code of Intellectual Property

Law No. 2006-961 of 1 August 2006 on Copyright and Related Rights in the

Information Society

1

Chapter 1 Digital Copyright Infringement

1.1 Introduction

Internet service providers (ISPs) could probably not exist if the law did not protect

them from liability for abuse committed by their users to some extent. How much

protection should they be afforded though is one question that the judiciary and

stakeholders alike are struggling to answer. In the world of digital piracy, it is

difficult to strike a balance between the competing rights of the intellectual

property rights holders, consumers and intermediaries alike. I use the term

intermediaries because the wider dispute encompasses not only ISPs, in the sense

that they provide access to the Internet, but includes companies providing other

internet services, such as YouTube and Google. The core of the debate is how to

reconcile the fundamental rights of Internet users such as freedom of expression

and privacy, and exclusive rights such as copyright.

Ideally, the wrongdoer alone would be at the receiving end of any hypothetical

lawsuit, but this is difficult in reality because of the very nature of the Internet and

how it operates. The cost of access to the courts to obtain the kinds of injunctions

necessary for this has proven to be an obstacle to the rightsholders. When one

compares the costs of obtaining these injunctions with the recompense obtained,

this method of enforcement would appear futile. Frustrated, rightsholders have

turned their attentions toward access providers. They seek injunctions against the

service provider to block websites, filter traffic on their networks, or implement

what is commonly referred to as a “three strikes” system resulting in the eventual

disconnection of the Internet account of a repeat infringer. Feeling that their

industry is under threat, rightsholders will seek to do everything possible to

conquer the battle that is digital piracy.

Traditionally ISPs have been cooperative in a passive-reactive fashion, but recent

trends in some jurisdictions illustrate a shift in this approach to a more active

methodology. This shift in trend however brings with it a risk of transforming

intermediaries into a private extra-judicial copyright police. These more active

methods may be the subject of private agreements between the rightsholders and

2

the ISPs. Nonetheless they ought to be subject to certain safeguards. Some

schemes are created by well thought out legislation as is the case in the UK. In

legislating for copyright infringement, the legislature must be aware of the risks of

undermining the limited liability regime provided for in European law and must

not be so heavy handed in its laws as to be disproportionately burdensome on the

intermediaries. It is vital that costs of implementation and other factors are given

serious consideration in order to maintain an environment where ISPs operating in

Ireland can remain competitive, particularly as the economy struggles to regain

stability. Even more importantly, a real regard must be had for the privacy of the

individual Internet user. The drafters must simultaneously however have regard for

the rights of the creators of original artistic and creative works.

In what is one of the most eagerly anticipated cases in this area of interest

currently before the Court of Justice of the European Union, the Advocate General

published his long awaited opinion in April last. This undoubtedly came as a great

relief to ISPs since it was concluded that a measure ordering an ISP to filter or

block electronic communications in order to protect intellectual property rights in

principle infringes fundamental rights. The industry awaits the final judgment with

baited breath as the CJEU finally begins to fill in the gaps that have existed in

providing guidance to national courts on such matters until now. The opinion of

Advocate General Cruz Villalón places the legal concept of proportionality centre

stage in the debate. Any kind of injunction sought by rightsholders against ISPs

must satisfy a proportionality test before they will be granted.

In this jurisdiction such a lack of guidance has been particularly evident.

Furthermore, it has been highlighted that there exists a gap in our national

copyright laws leaving us in a position where we are out of line with our European

counterparts. Where European law requires a Member State to ensure that a

rightsholder is in a position to seek an injunction against a third party who

provides facilities which are used to infringe copyright, the Copyright and Related

Rights Act, 2000 fails to do so according to Charleton J in his controversial

judgment of EMI v UPC in October 2010. Subsequent persistent lobbying from

rightsholders and particular political motivations have resulted in a proposed

3

legislative amendment by way of Statutory Instrument to the aforementioned Act.

Regrettably the wording of this proposed amendment is extremely broad and

provides little or no direction to the judges presiding over what will inevitably

result in a watershed of litigation. Even more unfortunate is the fact that this

consultation has been carried out concurrent to and separate from a broader

consultation in relation to potential amendments to the current legislation to

promote innovation in Ireland. Public policy however is beyond the scope of this

thesis and one must focus on the law, as it stands now, and how it may stand upon

the adoption of such a Statutory Instrument.

This thesis examines the existing European and national framework in relation to

copyright and copyright enforcement, with emphasis on the ways in which these

have been adapted, albeit inadequately in some instances, to cope with the rapid

digitisation of society. Amendments made or proposed to such legislation,

particularly in regard to the Internet are also scrutinised. The motivation behind

this thesis is primarily the recent events arising as a result of the on-going discord

between record companies and the internet service providers in this jurisdiction.

The relevant cases are analysed in detail, along with the various hurdles posed to

the judiciary. Specific national measures which have been or are in the process of

being implemented in France and the UK are examined and their respective

advantages and shortcomings are identified. Importantly I will address the

essential issue of the on-going consultation regarding the proposed Statutory

Instrument and its implications for all of the stakeholders involved.

4

Chapter 2 European Framework

2.1 Background

The existing European framework which sets the scene for copyright enforcement

and intermediary responsibility imparts two primary themes which resonate time

and again in any debate or case involving illegal file sharing and copyright theft on

the Internet. These are the premise of “mere conduit” or the safe harbour regime as

it is sometimes referred, and the injunctions system which enunciates the

possibility for rightsholders to obtain an order against an ISP for the prevention of

any infringement which is occurring on their network. There are three Directives

detailed in this chapter which build the structure within which an ISP operates

today.

2.1 Directive 2000/31/EC

Directive 2000/31/EC is titled „on certain legal aspects of information society

services, in particular electronic commerce, in the Internal Market‟ hereinafter

referred to as the E-Commerce Directive or ECD.1 This provides for the limited

liability regime of ISPs and bestows the necessary protections upon intermediaries

enabling them to operate without the fear of potential liability for the actions of

their customers. The framers of the ECD have struck a very tenuous balance in its

provisions and any interference with these provisions could potentially increase

the burdens for legitimate commerce, creating a negative impact on innovation,

distorting competition and undermining consumers‟ fundamental rights to privacy

and free flow of information.

The ECD makes a number of defences available to intermediaries who either

provide the “mere conduit” through which copyrighted material is transmitted,

host content or cache information. The first of these defences specifies the

conditions which must be satisfied in order to preclude the imposition of liability

on a “mere conduit” intermediary and is set out in article 12 as follows:

1 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain

legal aspects of information society services, in particular electronic commerce, in the Internal Market.

5

1. Where an information society service is provided that consists of the

transmission in a communication network of information provided by a

recipient of the service, or the provision of access to a communication

network, Member States shall ensure that the service provider is not liable

for the information transmitted, on condition that the provider:

(a) does not initiate the transmission;

(b) does not select the receiver of the transmission; and

(c) does not select or modify the information contained in the

transmission.

2. The acts of transmission and of provision of access referred to in

paragraph 1 include the automatic, intermediate and transient storage of

the information transmitted in so far as this takes place for the sole

purpose of carrying out the transmission in the communication network,

and provided that the information is not stored for any period longer than

is reasonably necessary for the transmission.

3. This Article shall not affect the possibility for a court or administrative

authority, in accordance with Member States' legal systems, of requiring

the service provider to terminate or prevent an infringement.

Article 13 sets out the caching defence as follows:


transmission in a communication network of information provided by a

recipient of the service, Member States shall ensure that the service

provider is not liable for the automatic, intermediate and temporary

storage of that information, performed for the sole purpose of making more

efficient the information's onward transmission to other recipients of the

service upon their request, on condition that:

(a) the provider does not modify the information;

6

(b) the provider complies with conditions on access to the

information;

(c) the provider complies with rules regarding the updating of the

information, specified in a manner widely recognised and used by

industry;

(d) the provider does not interfere with the lawful use of

technology, widely recognised and used by industry, to obtain data

on the use of the information; and

(e) the provider acts expeditiously to remove or to disable access to

the information it has stored upon obtaining actual knowledge of

the fact that the information at the initial source of the transmission

has been removed from the network, or access to it has been

disabled, or that a court or an administrative authority has ordered

such removal or disablement.

2. This Article shall not affect the possibility for a court or administrative

authority, in accordance with Member States' legal systems, of requiring

the service provider to terminate or prevent an infringement.

Article 14 provides for the defence of hosting:


storage of information provided by a recipient of the service, Member

States shall ensure that the service provider is not liable for the

information stored at the request of a recipient of the service, on

condition that:

(a) the provider does not have actual knowledge of illegal activity

or information and, as regards claims for damages, is not aware of

facts or circumstances from which the illegal activity or

information is apparent; or

7

(b) the provider, upon obtaining such knowledge or awareness, acts

expeditiously to remove or to disable access to the information.

2. Paragraph 1 shall not apply when the recipient of the service is acting

under the authority or the control of the provider.

3. This Article shall not affect the possibility for a court or

administrative authority, in accordance with Member States' legal

systems, of requiring the service provider to terminate or prevent an

infringement, nor does it affect the possibility for Member States of

establishing procedures governing the removal or disabling of access to

information.

Article 15 expressly requires that an intermediary should not be required to

implement any general monitoring measures:

1. Member States shall not impose a general obligation on providers, when

providing the services covered by Articles 12, 13 and 14, to monitor the

information which they transmit or store, nor a general obligation actively

to seek facts or circumstances indicating illegal activity.

2. Member States may establish obligations for information society service

providers promptly to inform the competent public authorities of alleged

illegal activities undertaken or information provided by recipients of their

service or obligations to communicate to the competent authorities, at their

request, information enabling the identification of recipients of their

service with whom they have storage agreements.

The prohibition in article 15 of the ECD to impose general monitoring obligations

on ISPs as well as the conditional liability regime in articles 12 to 14, are rooted in

the Council of Europe‟s Convention for the protection of human rights and

fundamental freedoms.

8


Directive 2009/29/EC is titled „on the harmonisation of certain aspects of

copyright and related rights in the information society‟ hereinafter referred to as

the Copyright Directive.2 The motivations behind this Directive were to respond to

the challenges provided by the Internet and to adapt the copyright framework to

the digital environment.

The Directive affords a mandatory exemption of transient or temporary copying

for technological purposes which was inserted as a result of lobbying by large ISPs

and telecommunications companies who were concerned by the prospect of

liability and felt that the safe harbour provisions in the E-Commerce Directive

were not sufficient. According to some commentators these provisions may not

have been necessary to begin with, and ironically have come to place even more of

a burden on service providers which would otherwise have been the case due to

the implementation of a standalone injunctive right for rightsholders to secure

injunctions against service providers. 3

Article 5(1) allows for temporary acts of reproduction which are fundamental to

the functioning of the Internet and states as follows:

1. Temporary acts of reproduction referred to in Article 2, which are

transient or incidental [and] an integral and essential part of a

technological process and whose sole purpose is to enable:

(a) a transmission in a network between third parties by an

intermediary, or

(b) a lawful use

2 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the

harmonisation of certain aspects of copyright and related rights in the information society. 3 Trevor Cook and Lorna Brazell, The Copyright Directive: UK Implementation (Jordans, 2004), at 95.

9

of a work or other subject-matter to be made, and which have no

independent economic significance, shall be exempted from the

reproduction right provided for in Article 2.

Recital 33 further explains this

The exclusive right of reproduction should be subject to an exception to

allow certain acts of temporary reproduction, which are transient or

incidental reproductions, forming an integral and essential part of a

technological process and carried out for the sole purpose of enabling

either efficient transmission in a network between third parties by an

intermediary, or a lawful use of a work or other subject-matter to be made.

The acts of reproduction concerned should have no separate economic

value on their own. To the extent that they meet these conditions, this

exception should include acts which enable browsing as well as acts of

caching to take place, including those which enable transmission systems

to function efficiently, provided that the intermediary does not modify the

information and does not interfere with the lawful use of technology,

widely recognised and used by industry, to obtain data on the use of the

information. A use should be considered lawful where it is authorised by

the rightholder or not restricted by law.

The Copyright Directive contains a number of provisions in relation to the

possibility of injunctions against ISPs. This Directive was issued one year after the

Copyright and Related Rights Act, 2000 came into force in this jurisdiction. It was

believed that the Directive had been correctly transposed and that the wording of

article 40(4) provided a possibility for the granting of injunctions, for example to

block a website such as the Pirate Bay. This would prove not to be the case, as will

be seen in the ensuing chapters.

Recital 59 of the Copyright Directive states the following:

In the digital environment, in particular, the services of intermediaries may

increasingly be used by third parties for infringing activities. In many

10

cases such intermediaries are best placed to bring such infringing

activities to an end. Therefore, without prejudice to any other sanctions

and remedies available, rightholders should have the possibility of

applying for an injunction against an intermediary who carries a third

party's infringement of a protected work or other subject-matter in a

network. This possibility should be available even where the acts carried

out by the intermediary are exempted under Article 5. The conditions and

modalities relating to such injunctions should be left to the national law of

the Member States.


Directive 2004/48/EC is titled „on the enforcement of intellectual property rights‟

hereinafter referred to as IPRED.4 The European Commission recently published

its report5 on the application this Directive, in preparation for its eventual

amendment, in order to adapt it to “the new challenges inherent in a modern

Digital Society.”6 The report states that the Directive was not drafted with the

challenges posed by the increase in opportunity for infringement offered by the

Internet in mind.

IPRED created a framework for harmonised enforcement of intellectual property

rights throughout Europe. The report sets out specific areas in relation to the

digital environment which may be in need of clarification, particularly regarding

the liability of intermediaries and the workability of injunctions. This is

particularly concerning to ISPs due to the possibility of injunctions “aimed at

prohibiting the continuation of the infringement” against intermediaries whose

services are being used by a third party to commit such infringements, as provided

for in articles 9 and 11 of the directive.

4 Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the

enforcement of intellectual property rights. 5 European Commission, Report from the Commission to the European Parliament, the Council,

the European Economic and Social Committee and the Committee of the Regions on the

application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004

on the enforcement of intellectual property rights available at http://eur-

lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0779:FIN:EN:PDF (visited 8 April 2011). 6 Ibid.

11

Article 9(1) provides for interlocutory injunctions against those whose services are

being used by a third party to infringe copyright:

Member States shall ensure that the judicial authorities may, at the request

of the applicant:

(a) issue against the alleged infringer an interlocutory injunction

intended to prevent any imminent infringement of an intellectual

property right, or to forbid, on a provisional basis and subject,

where appropriate, to a recurring penalty payment where provided

for by national law, the continuation of the alleged infringements of

that right, or to make such continuation subject to the lodging of

guarantees intended to ensure the compensation of the rightholder;

an interlocutory injunction may also be issued, under the same

conditions, against an intermediary whose services are being used

by a third party to infringe an intellectual property right;

injunctions against intermediaries whose services are used by a

third party to infringe a copyright or a related right are covered by

Directive 2001/29/EC;

(b) order the seizure or delivery up of the goods suspected of

infringing an intellectual property right so as to prevent their entry

into or movement within the channels of commerce.

Article 11 sets out the framework for injunctions:

Member States shall ensure that, where a judicial decision is taken finding

an infringement of an intellectual property right, the judicial authorities

may issue against the infringer an injunction aimed at prohibiting the

continuation of the infringement. Where provided for by national law, non-

compliance with an injunction shall, where appropriate, be subject to a

recurring penalty payment, with a view to ensuring compliance. Member

States shall also ensure that rightholders are in a position to apply for an

injunction against intermediaries whose services are used by a third party

12

to infringe an intellectual property right, without prejudice to Article 8(3)

of Directive 2001/29/EC.

The Commission is proposing to conduct an impact assessment pursuant to article

187 and a questionnaire

8 was circulated to Member States earlier in the year

focussing on some issues which they feel are in particular need of addressing. This

consultation period ended on the 31st of March and we are now awaiting the

resulting analysis. Whilst article 18 does require an assessment of the impact of the

Directive at this time, a critical economic analysis of the impact has not been

possible due to late transposition in some Member States, and without sufficient

evidence of the necessity of this revision there is no justification for amendment at

this time. Such premature amendments could potentially have considerable impact

on ISPs.

7 Article 18 states that “Three years after the date laid down in Article 20(1), each Member State

shall submit to the Commission a report on the implementation of this Directive.” 8Council of the European Union, Working Document 6141/11 Brussels 4 February 2011, available

at http://register.consilium.europa.eu/pdf/en/11/st06/st06141.en11.pdf (visited 26 July 2011).

The questions posed by the Council pertaining specifically to intermediaries were as follows:

Is there a need to introduce a common definition of intermediaries in the Enforcement

Directive?

Does your law contain specific provisions on injunctions against intermediaries, or do such injunctions have to be requested under the general rules? If there are specific

provisions, what are these and are they used often?

Is there a need to clarify in the Enforcement Directive that not only permanent injunctions

are available against intermediaries but also interlocutory injunctions? Should other

provisional or precautionary measures be available against intermediaries?

Taking into account that certain measures are available against intermediaries even when

they cannot be held liable for the infringing acts, is there a need to clarify the standing of

an intermediary in IP infringement proceedings? Can an intermediary be deemed an

“unsuccessful party” when an injunction is issued against it without establishing its

liability for the infringement (e.g. relating to cost issues)?

Should intermediaries (transport service providers, Internet platforms, ISPs) be involved to a greater extent in the prevention or termination of IP infringements? If yes, what ways

would you deem appropriate?

13

Chapter 3 European Copyright Jurisprudence --- A Pattern Developing

3.1 Introduction

The term ISPs encompasses not only Internet Access Providers who provide the

“mere conduit” over which information flows on the network but also includes

indexing and search services which are actively facilitating illegal file sharing, and

hosting providers which lease server space to their users. The courts treat these

very differently. The approach of the courts has been consistent in Member States

in relation to its treatment of index and search providers.

3.2 Indexing and Searching

3.2.1 Newzbin (UK)

Newzbin is an indexing and searching site which was held to be liable for primary

and secondary copyright infringement by the High Court for England and Wales in

March 2010.9 Newzbin provides indexing services for the Usenet system which is

a global system of online bulletin boards that users may read or contribute to. Its

website describes it as the “Google of Usenet”10

. The content posted to Usenet can

be either in text or binary form. Binary files, which could include copyrighted

movies for example, being substantially larger than a text file, must be split into

more easily manageable parts in order to be processed. These parts will then be

posted in separate messages in the newsgroup and a user wishing to download a

particular movie must be sure to download all of the relevant parts. Newzbin

processes and stores the header information of these separate messages in three

main indices. A member of the site can then search these various indices for

material by categories. One of these indices is a file format known as NZB which

aids users in downloading these files in a quicker way than would usually be

possible. It eliminates the need for a user to search for each individual relevant

part manually.

9 Twentieth Century Fox and others v NewzBin Limited [2010] EWHC 608 10 http://www.newzbin.com/ (visited 7 June 2011).

14

The claimants contended that the defendant infringed their copyrights by: i)

authorising acts of infringement by its members; ii) procuring, encouraging and

entering into a common design with its members to infringe; iii) communicating

the claimants‟ copyright works to the public, namely the defendant‟s members.

They also claimed Newzbin was a service provider with actual knowledge of other

persons using its service to infringe copyright and sought an injunction under

section 97A of the Copyright, Designs and Patents Act 1988.

Kitchin J identified what was meant by “authorisation” in this context as “the grant

or purported grant of the right to do the act complained of. It does not extend to

mere enablement, assistance or even encouragement” and went on to state that this

grant or purported grant may be implied from the relevant circumstances, for

example the level of control retained by the service provider. He analysed the

application of these principles in Roadshow Films Pty Ltd v iiNet Ltd.11

Roadshow was primarily concerned with the question of whether iiNet, one of the

largest ISPs in Australia, authorised infringing acts of some of its subscribers who

were downloading copyrighted films. Proceedings were brought with the aim of

preventing copyright infringement by means of a peer-to-peer system known as

BitTorrent which was being used by these subscribers. The claim was dismissed

for three reasons: first, because the copyright infringements occurred directly as a

result of the use of the BitTorrent system and iiNet did not control and was not

responsible for the operation of that system; second, because iiNet did not have a

relevant power to prevent those infringements occurring; and third, because iiNet

did not sanction, approve or countenance copyright infringement; it had done no

more than supply an internet service to its users.

In applying principles extrapolated from Roadshow and other caselaw, Kitchin J

considered that Newzbin had authorised its users‟ infringements. Relevant to this

finding was the fact that by their very nature, the NZB files facilitate infringement,

are created by the defendant and are entirely within their control.

11 Roadshow Films Pty Ltd v iiNet Ltd (No3) [2010] FCA 24

15

In relation to the second part of the claim – participation in a common design –

Kitchin J remarked that “it is well established that a person who procures an

infringement of copyright is liable joint and severally with the infringer”. Mere (or

even knowing) assistance or facilitation of the primary infringement is not enough

to sustain a claim but the tortfeasor “must have so involved himself in the tort as to

make it his own”. The factors considered above in relation to NZB files were also

considered to be relevant to this part of the claim and the test was satisfied on the

facts.

Concerning the third part of the claim, the defendants were held primarily liable

for infringement by communication to the public contrary to section 20 of the

Copyright, Designs and Patents Act 1988 which implemented Article 3 of

Directive 2001/29/EC. Kitchin J considered whether the copyrighted material had

been made available to the infringing users by the defendants. Material in his

decision here was the fact that its behaviour was not in any way passive, but on the

contrary they have “intervened in a highly material way”.

Importantly, with respect to injunctions against service providers pursuant to

section 97A, the claimants failed in seeking an injunction to prevent Newzbin

from indexing all copyrighted materials, even those of which they do not own the

rights. Kitchin J declined to impose an injunction of this breadth and was satisfied

that the injunction already granted extending only to the claimant‟s repertoire was

adequate.

Commentators12

have stated that this case is significant because it was the first of

its kind in the UK to hold an online service provider both primarily and

secondarily liable for copyright infringement committed by its users. The activities

of Newzbin are of a very different nature however to search engines or indeed

access providers. Murray has noted that because of the refusal to grant the final

12 Darren Meal and Mark Shillito, “Twentieth Century Fox Film Corp v Newzbin Ltd - copyright - online service provider held liable for copyright infringements of its users” E.I.P.R. 2010, 32(8),

N67-72.

16

injunction sought, this is “more of a limited victory for the claimants not the

complete victory painted by some media outlets”.13

3.2.2 The Pirate Bay (Sweden)

On April 17, 2009, the District Court of Stockholm handed down its judgment

against the infamous Pirate Bay website‟s founders.14

They were fined a sum

equalling €2.7 million and each sentenced to one year imprisonment for copyright

infringement.

The Pirate Bay is a BitTorrent tracking, indexing and searching website. The

BitTorrent protocol is a peer-to-peer system which allows for the wide distribution

of large amounts of data without incurring large server costs and bandwidth

consumption. The BitTorrent client or application is then used in the creation, up

and downloading of torrent files. A tracker, such as the Pirate Bay, helps users to

locate one another so that the initial file sharing can occur. A tracker is clearly

instrumental in the entire process and has been identified as “the first port of call

in the assignment of indirect copyright infringement blame”.15

If a tracker is

configured to do nothing more than merely track the torrent, then liability can be

hard to establish. Most trackers however, in reality, act as both trackers and

indexes and provide all of the features necessary to initiate downloads.16

Swedish law differs from UK law in that “authorising infringement”, as discussed

above, is not an existing ground upon which to base a claim of secondary

liability.17

Copyright infringement in Sweden is a criminal activity and is

punishable as such. In the case at hand it was first necessary to establish that a

crime had occurred. It was held that a communication to the public of copyright

infringing material contrary to the Swedish Copyright Act (the Act on Copyright

13 Andrew Murray, “UPDATE: Twentieth Century Fox v Newzbin” The IT Lawyer’s Blog,

available at http://theitlawyer.blogspot.com/2010/03/update-twentieth-century-fox-v-newzbin.html

(visited 03/06/2011). 14

Public Prosecutor v Neij Unreported April 17, 2009 (TR (Stockholm)). 15 Okechukwu Benjamin Vincents, “Secondary liability for copyright infringement in the

BitTorrent platform: placing the blame where it belongs” E.I.P.R. 2008, 30(1), 4-10. 16 Ibid. 17 Jerker Edstrom and Henrik Nillson, “Case Comment: The Pirate Bay verdict – predictable and

yet…” E.I.P.R. 2009, 31(9), 483-487.

17

in Literary and Artistic Works 1960 as subsequently amended) had indeed

occurred.

The District Court then went on to consider whether the defendants had

participated in furthering the copyright infringement. It was held that because the

interface made infringement incredibly easy for the user, and because it facilitated

contact between the users, they were liable.18

In relation to the part played by each

of the defendants, they were deemed to have collectively furthered the

infringement as they worked together as a team. In relation to the question of

intent, it was contended that they did not have specific knowledge of the files that

were being shared but the judge held that they had sufficient knowledge that

infringements were occurring and specific knowledge was not necessary. There

was also evidence presented displaying the commercial motives behind the

website which held sway with the judge.

One interesting point to note is that in the BitTorrent technology, users which

collectively share a work, such as a movie, are referred to as a “swarm”. These

users can be either “seeders” or “leeches”. A “seeder” is a computer which

contains an entire torrent and offers it for upload. This can be compared with a

“leech”, who does not initially have the complete torrent, but once they commence

downloading, they simultaneously make the same files available for downloading

by others via the BitTorrent client which they are using. This creates a more

efficient environment. In the case at hand, the court held that both the “seeder” and

“leech” were making works available which constituted communication to the

public. Given that a “seeder” or “leech” generally only makes available

fragmented pieces of the work, each piece will not usually be a standalone

copyright-protected work. Edstrom and Nillson have suggested that “it is possible,

and perfectly reasonable … that the Court has applied general criminal law

principles and considered all participants in a “swarm” to be accomplices of the

same crime of communication to the public.”19

18 Henrik Wistam & Therese Andersson, “Case Comment: The Pirate Bay Trial” C.T.L.R. 2009, 15(6), 129-130. 19 Ibid.

18

The defendants had demonstrated a blatant disregard for copyright owners‟ rights

and given the circumstances and background, the outcome was hardly surprising in

this instance. The case was seen by the entertainment industry as a huge win for

rightsholders in Sweden, which would arguably now be seen as a favourable

jurisdiction for copyright infringement claims. In reality however, it has been

referred to as more of a “minor milestone”20

. The trial became a spectacle more

due to the political implications that surrounded it and the huge anti-copyright

movement which ensued, which lies outside of the scope of this thesis. The Court

of Appeal upheld this decision in November 2010, decreasing the sentences of

each of the parties upon assessing their liability individually, but increasing the

damages payable by each.21

3.2.3 Pirate Bay and Mininova (Netherlands)

On 30 July 2009, BREIN, the Dutch association representing both the recording

and movie industries, won a case against the Pirate Bay demanding that the site

block access to all users in the Netherlands within ten days or face a penalty of

€30,000 per day up to a maximum of €3 million. The judge ordered The Pirate

Bay to desist and refrain from infringement in the Netherlands of the copyrights

and neighbouring rights of the rightsholders represented by BREIN, including

from the offering of services in the capacity of an intermediary within the meaning

of article 26d of the Dutch Copyright Act. It subsequently transpired that the 3

owners of the site which were sued no longer had the power to block access and

the site continued to be accessible.

BREIN then turned their attention to a similar website. In August, in an unreported

judgement22

, the Utrecht District Court ordered Mininova to remove links to all

copyright infringing material within three months or face a fine of €1000 per

offending torrent up to a maximum of €5 million. Mininova is a search engine for

BitTorrent files, similar to that of Pirate Bay. They were held liable for enabling,

inducing and profiting from its users‟ copyright infringements but it was not,

20 Ibid. 21 Neij v Public Prosecutor Unreported November 26, 2010 (HR (Stockholm)). 22 Brein v Mininova B.V. Unreported August 26, 2009 (DC (Utrecht)).

19

however, liable for communicating or making available infringing works.23

The

site differs from the Pirate Bay in that it merely allows its users to store torrent

files but does not itself index and categorise the stored information.

Mininova were operating a Notice & Takedown procedure on their site but the

court held that this was not enough and it should be assumed that all commercial

works were copyrighted. The court said that it is “generally known that

commercially made films, games, music and TV series are copyrighted and that

these works are only copyright-free in exceptional cases”.24

3.2.4 RapidShare (Germany)

In Germany in 2009 the District Court of Hamburg delivered their judgment in a

case taken against RapidShare AG by the German rightsholders association

GEMA.25

RapidShare is a Swiss file hosting website, also known as a cyber-locker

or web-locker, where users can upload large amounts of data and are provided

with a download link for each file that they upload. This link may be used to by

anybody who possesses it to download the files any number of times. RapidShare

differs from the technologies discussed in the previous cases in that it does not

provide any search functions for its users, nor does it categorise or index the

content. There does however exist third party search engines which search

RapidShare and similar sites, facilitating effortless copyright infringement. Cyber-

lockers have become increasingly popular in recent years, surpassing the

BitTorrent technology as the method of choice for illegal file sharing.26

GEMA claimed that the defendant had not done enough to prevent the illegal

uploading and downloading of non-licensed musical works, thus violating its

23 Simon Baggs and Rachel Barber, “Case Comment: Twentieth Century Fox Film Corp v Newzbin

Ltd – a changing tide in the fight against online piracy: how significant is the Newzbin judgment?”

Ent. L.R. 2010, 21(6), 234-237. 24 Intellectual Property Magazine, “Dutch court rules against file sharing site Mininova” available

at

http://www.ipworld.com/ipwo/doc/view.htm?id=229019&searchCode=S&searchPage=basic_searc

h&queryString=mininova (visited 7 June 2011). 25 GEMA v Rapidshare AG Unreported 12 June 2009 (LG (Hamburg)). 26 TorrentFreak “Cyberlockers Take Over File-Sharing Lead From BitTorrent Sites”

http://torrentfreak.com/cyberlockers-take-over-file-sharing-lead-from-bittorrent-sites-110111/ (visited 12 June 2011). RapidShare and four other cyberlocker sites were listed in the top 100

visited websites ahead of the Pirate Bay in 2011 according to popular internet blog.

http://www.ipworld.com/ipwo/doc/view.htm?id=229019&searchCode=S&searchPage=basic_search&queryString=mininova

http://www.ipworld.com/ipwo/doc/view.htm?id=229019&searchCode=S&searchPage=basic_search&queryString=mininova

20

members‟ copyrights by making the content publicly available within the meaning

of section 19a of the German Copyright Act27

. The defendants claimed that the use

of these files was excepted since it amounted to private use as provided for in

section 53. Moreover, they claimed to have cooperated with rightsholders by

removing infringing material once they were on notice of such files, and it was

contended that they were using all appropriate and reasonable measures to prevent

illegal copying.

The court granted an injunction against RapidShare and held that they had wilfully

contributed to the infringements. They had made the content publicly available

within the meaning of section 19a and it thus fell outside the scope of the section

53 exception. It was held that the reactive approach of the defendant in

cooperating with the rightsholders was not satisfactory and the removal of

infringing links was insufficient since it did not prevent users from uploading the

infringing file again. The court ruled that RapidShare, going forward, would have

to monitor for potentially illegal uploads. In coming to this conclusion, the court

considered a number of other matters, including the fact that the filtering system

employed by the abuse department within RapidShare was insufficient because it

could be easily circumvented. They also frowned upon the fact that the defendants

systematically refrained from ascertaining the identity of its users, including those

who signed up for paid membership.

A similar case taken against RapidShare by Capelight Pictures has since been

overturned by the Dusseldorf Court of Appeals which held that RapidShare is not

liable for the infringements carried out by its users.28

The court rejected the

imposition of impractical filtering measures and held that RapidShare should not

be under any obligation to prevent the dissemination of download links. This was

seen as a huge victory for intermediaries who do not actively participate in the

sharing of infringing files in the same way that a BitTorrent index and search

provider for example does.

27 Law on Copyright and Neighboring Rights (Copyright Law) 1965 as amended. 28 Rapidshare AG v Capelight Pictures Unreported 22 March 2010 (OLG (Düsseldorf)).

21

3.3 Hosting Providers

The intermediaries which provide space on their servers to their subscribers, to

allow them to connect a website to the Internet for instance, are known as host

providers.29

A host provider does not make available its own content but instead

merely provides a third party with connectivity by technically enabling them to

publish their own content.30

It can be confusing because sometimes access

providers offer hosting services also. When you add social media sites such as

Facebook and YouTube, where the site user generates the content, or bulletin

boards such as boards.ie, to the mix it is hardly surprising that the water muddies.

Host providers are subject to a notice and takedown procedure and usually once

this is adhered to they cannot be held liable for infringement. As can be seen in

Chapter 2, a defence of Hosting is provided in the E-Commerce Directive.31

3.3.1 Google Adwords

The CJEU handed down its ruling in Google France32

commonly known as the

Google Adwords case, in March 2010. This was a case involving Google‟s paid

referencing service called „Adwords‟. This is an advertising system which sells

keywords to economic operators so that their business endeavour is placed in the

search results in the sponsored links section of the Google search results page

when a user conducts a searches using one or more of the keywords which have

been purchased. This case related to trademark infringement but the court was also

asked to rule on the liability of the referencing service provider, Google.

The questions of whether a referencing provider such as Google was an

“information society service” for the purpose of the E-Commerce Directive, and if

so may they avail of limited liability as provided for in article 14 of said Directive,

29 Broder Kleinschmidt, An International Comparison of ISP’s Liabilities for Unlawful Third Party

Content (2010) International Journal of Law and Information Technology Vol. 18 No. 4, 332. 30 Ibid. 31

This was transposed into national law by SI 68/2003 European Communities (Directive

2000/31/EC) Regulations 2003. 32 Joined Cases C-236/08 – Google France SARL, Google Inc. v Louis Vuitton Malletier SA, C-

237/08 Google France SARL v Viaticum SA, Luteciel SARL, and C-238/08 Google France SARL v Centre National de recherche en relations humaines (CNRRH) SARL, Pierre-Alexis Thonne, Bruno

Raboin, Tiger SARL [2011] ECR (page number unavailable at time of writing).

22

were referred to the CJEU. It was held that such an advertising service does fall

within the scope of information society service and as such they may be said to be

providing “hosting” services for the purposes of the Directive. Whether they may

be exempt from liability based on the article 14 defence depends on whether they

play a neutral role. In other words, their conduct must be “merely technical,

automatic and passive, pointing to a lack of knowledge or control of the data

which it stores”.33

If the service provider has not played an active role then it

“cannot be held liable for the data which it has stored at the request of an

advertiser, unless, having obtained knowledge of the unlawful nature of those data

or of that advertiser‟s activities, it failed to act expeditiously to remove or to

disable access to the data concerned”.34

This is reassuring for service providers.

Provided that they do not have knowledge of the infringing activity they will be

allowed to avail of the article 14 hosting exemption.

3.3.2 Google Video

In March 2011, the Paris Court of Appeal heard four similar cases35

in relation to

Google Video and imposed a monitoring obligation on Google to prevent future

infringements of the litigious work. Illegal copies of protected works were placed

on Google Video. The rightsholders notified Google Video pursuant to the notice

and takedown regime which it implemented. These videos were removed by

Google from their platform, but subsequently were made available again. On

appeal it was held that Google were not entitled to avail of the hosting exemption.

It was held that Google not only had an obligation to remove the videos which

they had been notified of, but they also had a duty to monitor and prevent future

access to these videos The court also considered that Google Video was going

beyond the merely neutral and passive functions of a hosting provider. Some

commentators have said that the court is recognising a “new duty of

33 Joined Cases C-236/08 – C-238/08, note 32, at 114. 34 Joined Cases C-236/08 – C-238/08, note 32, at 120. 35 Google Inc. v Compagnie des phares et balises; Google Inc. v Bac Films, the Factory; Google Inc. v Bac Films, the Factory, Canal +; and Google Inc. v Les Films de la Croisade, Goatworks

Films 21 March 2011 (Paris Cour d‟Appel de Paris)

23

surveillance”.36

This is remarkable as it seems to transform the system of notice

and takedown into a burdensome system of notice, takedown and keep down. This

may be compared with the opinion of Advocate General Jääskinen in the case of

L’Oréal v eBay.37

3.3.3 L’Oreal and Ebay

In his opinion, the Advocate General communicates his reservations in relation to

a neutrality-based assessment of a hosting provider as advocated in the Google

France. According to the Advocate General, the court referenced Recital 42 when

endorsing the neutrality-test but this recital, he feels, relates to 'mere conduit' and

'caching' providers, but not to a hosting provider. He makes the distinction

between a referencing service provider and an electronic marketplace such as eBay

and notes that if the conditions that were applied in Google France were applied to

an electronic marketplace it would seriously endanger the objectives of the E-

Commerce Directive.38

He stated that it would be “surreal that if eBay intervenes

and guides the contents of listings in its system with various technical means, it

would by that fact be deprived of the protection of article 14 regarding storage of

information uploaded by the users”.39

The Advocate General goes on to address the issue of future infringements where

he reiterates the principle of notice and takedown. He recalls that an ISP is

required to act expeditiously to remove infringing material of which he has actual

knowledge. This actual knowledge may only relate to the past or the present and

not to the future.40

36 Catherine Jasserand, “Recent Decisions of the Paris Court of Appeal: toward an extra duty of

surveillance for hosting providers?” Available at

http://kluwercopyrightblog.com/2011/03/29/recent-decisions-of-the-paris-court-of-appeal-towards-

an-extra-duty-of-surveillance-for-hosting-providers/ (visited 14 June 2011). 37 Case C-324/09 L'Oréal SA, Lancôme parfums et beauté & Cie SNC, Laboratoire Garnier & Cie,

L'Oréal (UK) Limited v eBay International AG, eBay Europe SARL, eBay (UK) Limited, Stephan

Potts, Tracy Ratchford, Marie Ormsby, James Clarke, Joanna Clarke, Glen Fox, Rukhsana Bi,

[2011] ECR (page number unavailable at time of writing), Opinion of Advocate General Jääskinen. 38 Case C-324/09, Opinion of Advocate General Jääskinen, note 37, at 142. 39 Case C-324/09, Opinion of Advocate General Jääskinen, note 37, at 146. 40 Case C-324/09, Opinion of Advocate General Jääskinen, note 37, at 162.

24

The CJEU handed down its judgment in this case on the 12th

July41

and in fact

advocated a neutrality based test. It was recognised that liability is not automatic

but that if the operator of an electronic marketplace provides a service that is not

“merely technical and automatic”42

and has played an active role having

knowledge of, or control over, the data in relation to the goods offered for sale,

they cannot rely on the article 14 exemption.43

It is now for the referring court in

the UK to assess whether eBay have played such a role.

It was further held that even if the service provider plays a passive and neutral

role, it may not rely on the exemption from liability if it was aware of facts or

circumstances, having regard to which, a diligent economic operator ought to have

known that such offers were unlawful and failed to act expeditiously.44

With

regard to injunctions preventing future infringements it was held that injunctions

may be granted against the operator of an online marketplace “to take measures

which contribute, not only to bringing to an end infringements of those rights by

users of that marketplace, but also to prevent further infringements of that kind.

Those injunctions must be effective, proportionate, dissuasive, and must not create

barriers to legitimate trade.”45

This judgment could prove to be burdensome for intermediaries who are likely to

have to bear the costs of implementing the technical measures necessary to prevent

incurring liability.

3.4 Internet Access Providers

Litigation efforts have traditionally been directed toward those hosting or

operating infringing websites such as the Pirate Bay but recently these efforts have

begun to focus elsewhere. Over the course of the last year or so a number of

judgments have been rendered in various Member States concerning Internet

41 Case C-324/09 L'Oréal SA, Lancôme parfums et beauté & Cie SNC, Laboratoire Garnier & Cie,

L'Oréal (UK) Limited v eBay International AG, eBay Europe SARL, eBay (UK) Limited, Stephan

Potts, Tracy Ratchford, Marie Ormsby, James Clarke, Joanna Clarke, Glen Fox, Rukhsana Bi

[2011] ECR (page number unavailable at time of writing). 42 Case C-324/09, note 41, at 113. 43 Case C-324/09, note 41, at 116. 44 Case C-324/09, note 41, at 124. 45 Case C-324/09, note 41, at 144.

25

access providers and requests to implement blocking measures. These judgments

illustrate the diverging approaches and views adopted across the EU. This is due to

differences in national legislation or type of proceeding since these will be

criminal proceedings in some jurisdictions and civil in others. Universally it would

appear that whether an access provider will be ordered to block a particular

website or not will depend upon satisfaction of the legal principle of

proportionality, which I will discuss in more detail in a subsequent chapter.

3.4.1 Telenor (Denmark)

In 2010 the Supreme Court of Denmark held that the blocking measures which

Telenor were ordered to implement were in fact proportionate in the

circumstances.46

This is a surprising outcome but on closer inspection, it becomes

clear that this is due to a particular provision in Danish law in relation to copying

the original protected work. As already discussed above, in order for efficient

communications to occur via the Internet, temporary copies must be made of every

packet of data that is transmitted. In doing so the intermediary is exempt from

liability unless the work which is being transmitted is in itself illegal. In this case

the temporary copies are held also to be illegal copies. This ruling places a huge

burden on intermediaries to implement a technical measure which, as discussed in

the subsequent chapter, has little effectiveness.

3.4.2 Ziggo (Netherlands)

In the Dutch case mentioned in the previous subsection, BREIN were successful in

their endeavours against the Pirate Bay, but nevertheless the site remained

successful and active in the Netherlands. BREIN then turned their attention toward

access provider Ziggo seeking a preliminary injunction ordering them to block

46 Telenor (tidligere DMT2 A/S og Sonofon A/S) v IFPI Danmark 27 May 2010 (Højesterets)

This case is available in Danish at http://www.domstol.dk/hojesteret/Documents/Domme/153-

09.pdf (visited 15 June 2011). Unofficial translation available at http://hssph.net/Sonofon_IFPI__DK_SupremeCourt_27May2010_PirateBay.pdf (visited 21 July

2011).

26

access for its subscribers to all of the sites of the Pirate Bay. On 19 July 2010 the

court of The Hague rejected the claim.47

BREIN based their claim on the IPRED provision which states that injunctions

may be sought against “innocent” third parties whose facilities are used in the

course of infringement. Ziggo stressed that it was a “mere conduit” and the Court

held that while injunctions may be taken against third party intermediaries as a

separate action notwithstanding the liability regime set down for ISPs in the

national rules transposing the relevant provisions of the E-Commerce Directive,

this would only apply in specific and identifiable cases of infringement. The

granting of an injunction would otherwise be disproportionate.

The judge also considered the principle of subsidiarity in delivering his judgement.

While BREIN claimed that this was the last resort, it was held that they could in

fact have pursued individual infringers in what would have been a less far-

reaching option than imposing a general blockade.

3.4.3 Belgacom and Scarlet (Belgium)

On the 9th

of July 2010, the Antwerp Commercial Court refused to impose an

injunction to block access to The Pirate Bay on service providers Belgacom and

Telenor.48

This had been sought by the Belgian Anti-Piracy Foundation. The

implementation of such a measure was held to be disproportionate. The ISPs

argued that they were merely technical operators and did not have the competence

to judge whether a site that a subscriber wishes to access is unlawful or not.49

This

case has been appealed and the oral hearings took place before the Antwerp Court

of Appeal in May. There is no publicly available information in relation to this

case and at the time of writing the Court is yet to present its judgment.

Interestingly in the same jurisdiction the Belgian Court of Appeal is awaiting the

ruling of the CJEU in the case of Scarlet Extended.50

A case was taken by Belgian

collecting society Société Belge des auteurs, compositeurs et éditeurs (SABAM)

47 BREIN v Ziggo Unreported July 19, 2010 (RB (Den Haag)). 48 Belgian Anti-Piracy Federation v Belgacom Unreported 8 July 2010 (RvK (Antwerp)). 49 http://www.edri.org/edrigram/number8.14/belgium-isps-pirate-bay (visited 15 July 2011). 50 SABAM v Tiscali Unreported January 28, 2010 (App (B)).

http://www.edri.org/edrigram/number8.14/belgium-isps-pirate-bay

27

against Scarlet (then Tiscali), an ISP, seeking an injunction requiring them to make

it impossible for their subscribers to engage in the illegal file sharing of any

musical work in SABAM‟s repertoire. This was granted by the Court of First

Instance, essentially requiring Scarlet to implement a preventive filtering and

blocking system.51

The Court of Appeal referred the case to the CJEU for a

preliminary ruling. The Advocate General delivered his opinion in April 2011 and

this is discussed in the ensuing chapter.

3.4.4 UPC (Austria)

In an extremely recent case taken by the Austrian Association for Anti-Piracy

(VAP), Internet access provider UPC was ordered by the Commercial Court of

Vienna to block access to streaming website kino.to which was hosted from the

island of Tonga.52

It was held in the circumstances that such measures are

proportionate once enforced with DNS or IP blocking but monitoring measures

such as deep packet inspection were considered to be disproportionate. In this

particular case the site‟s administrators could not be identified. The judgement

which was rendered on the 17th

of May 2011 was highly controversial and UPC is

expected to appeal. The case was extremely similar to the above mentioned Dutch

case of BREIN v Ziggo, the outcome of which was to the contrary.

3.4.5 UPC (Ireland)

In this landmark case judgment was given in favour of service provider UPC and

the injunction sought by the plaintiffs was refused.53

UPC had claimed that it had

no liability under the Copyright and Related Rights Act, 2000 and argued that it

was a mere conduit for illegal downloading. Charleton J said that while injunctive

relief was merited on the facts of the case, respect for the doctrine of the separation

of powers prevented the granting of the orders sought. Interestingly, Charleton J

said that he had erred in his previous judgment in the Eircom54

case as there was

no legislative basis in Irish law that enabled him to reach the conclusions he did

51 SABAM v SA Tiscali [2007] ECDR 19. 52 Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH v UPC Telekabel

Wien GmbH Unreported 17 May 2011 (HW(Vienna)). 53 EMI Records (Ireland) Ltd & Ors v UPC Communications Ireland Ltd [2010] IEHC 377. 54 EMI Records (Ireland) Limited v Eircom Plc [2009] IEHC 411.

28

and he invited the parties involved in that case to reapply to the Courts. These

cases are discussed in more detail in Chapter 5.

29

Chapter 4 Options Available for IAP Action & Striking a Balance

4.1 What in theory can an IAP actually do and can it work?

There are a number of mechanisms that an Internet access provider could

hypothetically implement on their infrastructure to combat illegal file sharing of

copyrighted content including blocking and filtering measures or the

implementation of a graduated response regime. Each of these will be considered

in turn below. These methods however are either ineffective or they do not satisfy

the requisite principle of proportionality as discussed in the opinion of the

Advocate General in Scarlet Extended which is currently before the Court of

Justice of the European Union.55

Technical experts insist that the term „Internet Blocking‟ is somewhat of a

misnomer because it gives the impression that it can be implemented with little or

no difficulty and “it is simply a choice to switch on or switch off”.56

This is

certainly not the case. It involves complex and costly technologies which can be

easily circumvented. The Internet is inherently designed to ensure the free flow of

data so that any barriers which materialise will be sidestepped.

Regrettably Internet blocking is a tool that is sought on the foot of political or

emotional motivations rather than implemented as a result of evidence of any

genuine effectiveness.

4.1.1 DNS Blocking

The Internet is essentially a network of smaller interconnected networks. Each

device on the network is associated with a unique sequence of numbers known as

an IP address. When information is transmitted from one device to another, it is

broken into what are known as packets, containing origin and destination IP

addresses among other information, sent across multiple networks, and

55

Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et éditeurs

(SABAM). 56 Cormac Callanan et al. Study: Internet blocking: balancing cybercrime responses in democratic

societies, (Aconite Internet Solutions, 2009) available at http://www.aconite.com/sites/default/files/Internet_blocking_and_Democracy.pdf (visited 21 July

2011).

30

reassembled at the destination device. A host or server will generally have a

Domain Name System address or DNS address as well as an IP address. The DNS

is a system that was designed to make the Internet easier to use by associating

words rather than number sequences with the host or server. As an example, take

the infamous Pirate Bay website whose DNS address is thepiratebay.org. When

this address is entered into a browser a DNS server resolves this to its IP address

which is 194.71.107.15 and subsequently the user is connected to the requested

website.

If a service provider blacklists the domain of a particular website in their DNS

server then the DNS address when entered by the user cannot be resolved to the

corresponding IP address rendering the site inaccessible. 57

This type of blocking

can be easily eluded if the user has knowledge of the actual IP address itself since

they may type this directly into the browser gaining access to the rogue site. This

can potentially be obtained by something as simple as performing a web search.

4.1.2 IP Blocking

This is a more effective method of blocking but it has more wide reaching side

effects. With IP blocking or packet dropping, a blacklist is made containing IP

addresses so that packets containing the blacklisted IP sequence are dropped

preventing any attempted communication with the aberrant server.58

The problem

with this method is that an IP address can be associated with a server which hosts

many sites, which may all be legitimate except for one. This carries with it a huge

risk of over-blocking. If such a regime were sought to be imposed on ISPs they

would most likely want some kind of indemnification from the music companies

to protect them in the likelihood that they will be sued for blocking a legitimate

site.

This type of blocking may be easily skirted by the person operating the blocked

site. All that is required is merely to adopt a new IP address and the blocking

measure is rendered useless. Likewise the user need not be an expert in order to

57 Jonathan Zittrain and Benjamin G. Edelmann, “Internet Filtering in China” (2003) Cyberlaw Vol. I, 585. 58 Ibid.

31

evade this type of blocking mechanism. 59

This can be done by using a proxy that

connects to the website on behalf of the user.60

Websites exist such as

http://zend2.com which uses a “mirrored server with the help of which your IP and

other details are always concealed”61

or http://tools.rosinstrument.com/proxy/

which provides vast libraries of publicly available proxies.62

4.1.3 Filtering

Content filtering is a more complex mechanism which involves real-time

intervention by the ISP. A list of forbidden URLs is compiled and the service

provider can implement a proxy or a firewall that checks every URL request of a

subscriber against this list.63

If a subscriber requests a blacklisted URL they will

receive an error message or may be redirected to a legitimate site where legal

copies of the material they seek are available. 64

This is a very precise method

which does not pose the same threats of over-blocking as the previous options. It

does however involve the implementation of extremely complex and costly

equipment which hampers the efficiency of data transmission to the detriment of

the subscribers, the ISP and the Internet community. 65

4.1.4 Graduated Response

Graduated response is a system in which a service provider sends a number of

infringement notices to a subscriber who is using their Internet account to illegally

download protected musical works. These notices increase in gravity with each

instance ultimately resulting in suspension or disconnection of the subscriber‟s

account if they continue to infringe. This procedure, or variations of it, including

the Hadopi system in France and the private agreement which has been

59 Joe McNamee, Internet Blocking: Crimes should be punished and not hidden

http://www.edri.org/files/blocking_booklet.pdf (visited 21 July 2011). 60 Kleinschmidt, note 22. 61

www.zend2.com (visited 21 July 2011). 62 Richard Clayton, Anonymity and Traceability in Cyberspace Ph.D. (University of Cambridge,

2005). 63 Kleinschmidt, note 22, at 336. 64 Ibid. 65 Ibid.

http://www.zend2.com/

32

implemented in this jurisdiction by Eircom, is discussed in more detail in the

ensuing chapters.

4.2 Striking a Balance – Proportionality and Effectiveness

Whilst Member States, pursuant to their European obligations under the Directives

discussed in chapter 2, provide in their national laws for injunctions regimes which

may potentially encompass such blocking or filtering obligations as set out above,

it is crucial that such measures satisfy the principle of proportionality.

Article 8(1) of the Copyright Directive provides that sanctions must be “effective,

proportionate and dissuasive”. This is reiterated in article 3 of the IPRED which

also stipulates that these sanctions must be “fair and equitable”.

In what will be the most important decision in relation to the imposition of

monitoring obligations on ISPs, the Court of Justice is expected to deliver its

decision at the end of this year.66

This will provide much needed guidance to

judges presiding in cases where rightsholders are seeking injunctions of the kind

discussed above. Advocate General Cruz Villalón delivered his opinion in Scarlet

Extended on 14th April, stating that a general obligation to monitor, in abstracto,

and as a preventative measure could not be imposed.67

Although the Advocate

General opinion is a non-binding guideline, the CJEU usually tends to follow the

same reasoning and ISPs are hopeful that the CJEU ruling will finally provide

some sensible guidance on the matter.

SABAM sought an injunction against Scarlet, an ISP, requiring it to impose

technical measures to make it impossible for its subscribers to engage in the illegal

file sharing of any musical work in the repertoire of the collecting agency. The

injunction was granted by the Court of First Instance, requiring Scarlet to

implement a preventive filtering and blocking system. The Court of Appeal

referred two questions to the CJEU as follows: does EU law permit a national

court to order an ISP, in abstracto and for all of its customers, bearing all of the

66 Case C-70/10, note 55. 67 Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et éditeurs

(SABAM), Opinion of Advocate General Cruz Villalón.

33

costs, to introduce a filtering and blocking system, for works in which the

applicant claims to hold rights; and if so must the national court apply the

principle of proportionality when deciding on the effectiveness and dissuasive

effect of the measure sought.68

The Advocate General pointed out that this constitutes a general obligation to

monitor as a preventive measure, such that a finding that there had been an actual

infringement would not have first been made. Furthermore it would make the ISP

fully responsible for the costs of implementing such a measure. He went on to note

that such a system would impose a restriction on rights of privacy and protection

of personal data which are protected under the Charter of Fundamental Rights.

While it is accepted that the exercise of such rights may be restricted, this may

only be done „in accordance with the law‟ and must meet requirements concerning

„the quality of the law‟ at issue. As such, a restriction of this kind would only be

permissible if it were pursuant to national laws that are accessible, clear and

predictable.69

Advocate General Jääskinen in L’Oréal v Ebay stated that in granting an

injunction against an intermediary, given the requirement of proportionality, “what

is crucial, is that the intermediary can know with certainty what is required from

him, and that the injunction does not impose impossible, disproportionate or illegal

duties like a general monitoring obligation.”70

Advocate General Cruz Villalón noted in his opinion that the Belgian statutory

provision at issue did not provide expressly in clear, precise and predictable terms,

for an obligation on ISPs to install such a general monitoring obligation.71

Since

the provisions of national law in most Member States implementing article 8(3) of

the Copyright Directive are very similarly worded to the Belgian provision it

follows that none of the national law provisions are sufficiently clear to justify

68

Reference for a preliminary ruling from the Cour d‟appel de Bruxelles (Belgium) lodged on 5

February 2010 - Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et

éditeurs (SABAM). 69 Court of Justice of the European Union Press Release No 37/11 Luxembourg 14 April 2011. 70 Case C-324/09, Opinion of Advocate General Jääskinen, note 37, at 181. 71 Court of Justice of the European Union, note 69.

34

filtering or graduated response obligations. As such, the introduction of any

graduated response measure for example, would require statutory footing.

In relation to “effectiveness”, in order for a blocking or filtering measure to satisfy

the proportionality test, it is conceded that no measure is 100% effective, so what

is important here is that the obligation is clearly identified. In other words if the

court says to an ISP, you must implement measures x, y, and z and after you have

done this you cannot be held liable, this will be sufficiently clear and specific.

What is not acceptable however is for a court to say you must ensure that your

subscribers cannot access a certain site but it is up to you how you implement this.

This opens up the possibility of liability for the access provider as of the moment

that one subscriber can access the prohibited site.

Cost allocation issues may be taken into consideration at this point also. Huge

costs burdened on Scarlet were acknowledged as unfair by AG Cruz Villalón in

his opinion. The importance of cost allocation was also highlighted in the judicial

review of the Digital Economy Act in the UK.72

This was the only ground upon

which BT and TalkTalk were partially successful in - all other grounds were

dismissed. This is discussed in more detail in Chapter 6.

72 British Telecommunications Plc & Anor, R (on the application of) v The Secretary of State for

Business, Innovation and Skills [2011] EWHC 1021.

35

Chapter 5 Ireland - A chronology of case law

5.1 Introduction

The current legislative conditions in Ireland in the area of copyright have given

rise to contradictory judgments and lengthy debates. The Government launched a

national copyright review in May and it is presently an incredibly controversial

topic. This chapter presents the case law in chronological order which illustrates

the attitudes of the courts, music industry and intermediaries concerning the

enforcement of copyright against illegal file sharing in this jurisdiction.

5.2 Norwich Pharmacal

In a 2005 dispute73

, the High Court granted what is known as a Norwich

Pharmacal order to the music industry instructing Ireland‟s largest ISP Eircom to

release the names and contact information corresponding to the IP addresses of

seventeen subscribers who had allegedly infringed the copyright of a number of

sound recordings which were vested in the plaintiffs. This rule was enunciated in a

House of Lords decision74

where Lord Reid stated that “if through no fault of his

own a person gets mixed up in the tortious acts of others so as to facilitate their

wrong-doing he may incur no personal liability but he comes under a duty to assist

the person who has been wronged by giving him full information and disclosing

the identity of the wrongdoers”.75

A Norwich Pharmacal order differs from other orders in that generally only parties

named in existing litigation are obliged to disclose documents and other

information relevant to the proceedings. It must only be used as a last resort. If

other methods are available to discover this information then these avenues must

be exhausted firstly. These orders have been adapted for use against ISPs where

copyright infringement is concerned. An ISP is not committing any infringement

yet they are the only means of permitting identification of the transgressor. An

Internet user is assigned, by their ISP, a unique number known as an Internet

73 EMI Records (Ireland) Ltd & Ors v Eircom Ltd & Anor [2005] IEHC 233. 74 Norwich Pharmacal Company and Ors v Commissioners of Customs and Excise [1973] UKHL 6. 75 Ibid.

36

Protocol or IP Address. These can be static or dynamic and are a means of

identifying the subscriber. If it can be established in the High Court that there is

sufficient evidence of a wrongdoing the order may be granted. Usually an

undertaking of damages will be required also.

Kelly J emphasised that there was no suggestion of wrongdoing on the part of the

Defendants but that there was no other method available to the plaintiffs to

ascertain the identities of the individuals in this case.

5.3 Graduated Response

The process of obtaining a Norwich Pharmacal order is an expensive one and as

such rightsholders began to seek other means to prevent infringement and turned

their focus to ISPs. In 2009 proceedings were again taken against Eircom by EMI

and the other big players in the music and film industry.

The basis of this claim lay in section 40(4) of the Copyright and Related Rights

Act 2000 which reads as follows:

(3) Subject to subsection (4), the provision of facilities for enabling the

making available to the public of copies of a work shall not of itself

constitute an act of making available to the public of copies of the work.

(4) Without prejudice to subsection (3), where a person who provides

facilities referred to in that subsection is notified by the owner of the

copyright in the work concerned that those facilities are being used to

infringe the copyright in that work and that person fails to remove that

infringing material as soon as practicable thereafter that person shall also

be liable for the infringement

After eight days of evidence an agreement was effected between the parties and no

court order was thus required. On the 29th of January the terms of the settlement

were filed with the court. It essentially constituted a private agreement between the

parties and thus did not create any precedent for other ISPs in the jurisdiction. The

exact details of the protocol remain confidential.

37

This introduced the first graduated response system in Ireland. The Irish Recorded

Music Association (IRMA) use software to detect the occurrence of illegal file

sharing and on foot of this provide Eircom with notifications containing among

other things the IP addresses of the individuals uploading or downloading such

content. Eircom can then identify the account which matched the particular IP

address at the time when the alleged infringing incident occurred.

Rather than divulge this information to IRMA, Eircom sends the customer a

notification informing them that their IP address has been identified by IRMA as

infringing copyright. The notification advises the customer that these acts are

illegal and provides information on how the customer can avoid repeating the

infringement. If the customer continues to engage in infringement, after a fourteen

day period has passed, Eircom will issue a second warning to the customer in the

form of a letter indicating that if the infringement continues the customer‟s

Internet service will be disconnected.

If Eircom is notified that a third infringement has occurred they will write to the

customer to advise them that their service will be withdrawn for a seven day

period as they have continued to engage in copyright infringement. If the customer

infringes a fourth time then their Internet connection will be disconnected for a 12

month period.

Under the terms of the settlement it was agreed that the plaintiffs would take

proceedings against the other access providers in the State, since it would be unfair

to expect Eircom to carry the entire burden alone. It was also agreed that Eircom

would not oppose an injunction ordering them to block the Pirate Bay website.

5.4 The Pirate Bay

On the 24th

July 2009, Charleton J delivered an ex tempore judgment76

granting an

order against Eircom to block access to the Pirate Bay. Since in the main

proceedings as discussed above it was agreed that such an application would not

be objected to by Eircom, an argument from only one of the parties was heard.

76 EMI Records (Ireland) Ltd v Eircom PLC [2009] IEHC 411.

38

Charleton J quoted section 40(4) of the Copyright and Related Rights Act 2000 as

the basis for his conclusion and goes on to explain that this section “gives an

entitlement in the right circumstances to the plaintiffs to seek an order against a

party who is essentially innocent in relation to copyright infringement, in

distinction to those actively stealing copyright material through the act of copying

without authorisation and facilitating it”.77

Charleton J places Eircom in this

bracket of innocent transmitter. The so called innocent transmitter once notified of

the infringement that is occurring must act as soon as practicable to remove the

infringing material before they in themselves become liable. The Judge in this case

interpreted this section as encompassing what he refers to as the “pipe or

channel….down which the copyright infringing material is going”.78

An order was granted “requiring the defendant to block or otherwise disable access

by its internet subscribers to the website - thePirateBay.org and related domain

names, as set out in the schedule, to IP addresses and URLs, as set out in the

schedule, together with such other domain names, IP addresses and URLs as may

reasonably be notified as related domain names by the plaintiffs to the defendant

from time to time.”79

As of the 1st of September 2009 if an Eircom subscriber attempts to access the

forbidden URL they will be redirected to a page explaining why the site is not

available. The music industry seemed to have found a sympathetic ear with

Charleton J but their increasing confidence would be dealt a blow in the following

months when he would change his mind as to the legislative basis in Irish law for

the granting of such an injunction.

5.5 Data Protection Implications

In April 2010 the graduated response protocol again came before Charleton J as its

implementation raised a number of issues concerning the Data Protection Acts

1988-2003.80

The Data Protection Commissioner (DPC) did not appear before the

77 [2009] IEHC 411, note 76. 78 [2009] IEHC 411, note 76. 79 [2009] IEHC 411, note 76. 80 EMI Records & Ors v Eircom Ltd [2010] IEHC 108.

39

courts due to an issue relating to indemnity for his costs and as such judgment was

delivered upon only receiving the advice of the parties to the main case. The

questions raised are paraphrased as follows:

1. Do IP adresses in the hands of EMI, taking into account the purpose for

which they are collected, constitute personal data for the purposes of the

Data Protection Acts 1988-2003?

2. Having regard to section 2A(1) of the 1988 Act, and assuming that the

processing by Eircom of “personal data” in the context of the termination

of a user‟s Internet subscription is necessary for the purposes of the

legitimate interests pursued by Eircom, does much processing represent

unwarranted processing by reasons of prejudice to the fundamental rights

and freedoms or legitimate interests of the data subject?

3. Having regard to section 2A(1) and 2B(1) of the 1988 Act, may the parties

to the settlement implement the graduated response process where: (a) in

doing so they are engaged in the processing of personal data; and (b) the

termination of Internet access is predicated on the commission of an

offence without such offence having been investigated by an authorised

body or determined by a court of competent jurisdiction?

Section 1 of the 1988 Act, as amended, defines personal data as “data relating to a

living individual who can be identified either from the data or from the data in

conjunction with other information in the possession of the data controller.”81

According to Charleton J in order to be personal data under the Act “the

information has to identify a living individual from the data or from data in

conjunction with other information in the possession of the data controller, or from

other information that is likely to come into the possession of the data

controller.”82

He goes on to state that the only possible means for the data

controller to ascertain the identity of a person relating to a particular IP address is

81 Data Protection Act 1988, s.1. 82 [2010] IEHC 108, note 80, at 23.

40

to obtain a Norwich Pharmacal in an expensive process though the courts. He

therefore answered the first question in the negative.83

Charleton J, in answering the second question, felt that he must first ascertain if it

was necessary for Eircom to enter into the agreement. He also addressed whether

the protocol interfered with any fundamental right and if so whether such

interference was proportional and justified. Section 2A(1) of the Act states as

follows:

2A (1)Personal data shall not be processed by a data controller unless

section 2 of this Act (as amended by the Act of 2003) is complied with by

the data controller and at least one of the following conditions is met:

(a) the data subject has given his or her consent to the processing or, if

the data subject, by reason of his or her physical or mental

incapacity or age, is or is likely to be unable to

appreciate the nature and effect of such consent, it is given by

a parent or guardian or a grandparent, uncle, aunt, brother or

sister of the data subject and the giving of such consent is not

prohibited by law,

(b) the processing is necessary

(i)for the performance of a contract to which the data subject is

a party,

(ii) in order to take steps at the request of the data subject prior

to entering into a contract,

(iii) for compliance with a legal obligation to which

the data controller is subject other than an obligation imposed by

contract, or

(iv) to prevent

83 [2010] IEHC 108, note 80, at 25.

41

(I) injury or other damage to the health of the data subject,

or

(II) serious loss or damage to property of the data subject

,or otherwise to protect his or her vital interests

where the seeking of the consent of the data subject or

another person referred to in paragraph (a) of this

subsection is likely to result in those interests

being damaged,

(c) the processing is necessary

(i) for the administration of justice,

(ii) for the performance of a function conferred on a person by or

under an enactment,

(iii) for the performance of a function of the Government or a

Minister of the Government,

(iv) for the performance of any other function of

a public nature performed in the public interest by a person,

(d) the processing is necessary for the purposes of

the legitimate interests pursued by the data controller or by

a 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 fundamental rights and freedoms or

legitimate interests of the data subject.

Charleton J. considered that more than one of the conditions set out in the above

provisions are met regarding Eircom‟s legitimate interests, particularly their

interest in upholding the law. He stated that it is “completely within the legitimate

standing of Eircom to act, and be seen to act, as a body which upholds the law”.84

84 [2010] IEHC 108, note 80, at 29.

42

He mentions that the subscriber contract specifies that access may be terminated if

the subscriber uses the facility to infringe the copyright of others. He therefore

found that the processing, warning, and ultimately disconnecting was necessary

both in complying with the law and in performance of the contract.85

Furthermore,

it was held that there was nothing disproportionate in the ultimate sanction of

disconnection for three infringements of copyright and that there were adequate

procedural safeguards in place.86

Therefore the second question was also answered

in the negative.

In relation to the third question, Charleton J. acknowledged that while there are

instances when both criminal and civil offences overlap by reason of statute, he

was satisfied that none of the parties were interested in detection and prosecution

of any criminal offence here and that there was nothing in the protocol which

would involve the disposal of proceedings or the sentence of any court.87

On the

contrary the protocol was based upon civil principles which do not require an

examination of knowledge, intention, recklessness or negligence. He therefore

considered that it was not necessary to require an investigation by an authorised

body or determination by a court of competent jurisdiction.88

Consequently the

third question was answered in the affirmative and it was declared lawful for the

parties to implement the graduated response protocol.89

The judgment of Charleton J. has been criticised as deeply flawed90

and the Data

Protection Commissioner may also be criticised for allowing this case to be heard

without sending any representation to give information that was necessary in order

for the judge to gain a broader view of the issues at hand. It was predicted upon

implementation that it would be likely that Eircom would end up wrongly accusing

innocent Internet users of copyright infringement. 91

This has in fact transpired and

85 [2010] IEHC 108, note 80, at 29. 86 [2010] IEHC 108, note 80, at 30. 87 [2010] IEHC 108, note 80, at 40. 88 [2010] IEHC 108, note 80, at 41. 89

[2010] IEHC 108, note 80, at 42. 90 TJ McIntyre “Data Protection Commissioner investigating Eircom‟s „three strikes‟ system” IT

Law in Ireland available at http://www.tjmcintyre.com/2011/06/300-false-accusations-data-

protection.html (visited 23 June 2011). 91 TJ McIntyre “Eircom, three strikes and false positives” IT Law in Ireland available at

http://www.tjmcintyre.com/2009/08/eircom-three-strikes-and-false.html (visited 23 June 2011).

43

the graduated response protocol is now being investigated by the DPC, which

according to TJ McIntyre has the “potential to derail the entire system”.92

An

internal error which occurred when the clocks went forward last October caused

approximately 300 subscribers to receive warning notifications erroneously. This

has called the entire protocol into disrepute and has triggered a wider investigation

into its proportionality. At the time of writing this investigation was on-going.

5.6 UPC

5.6.1 Background

Upholding their side of the graduated response settlement, EMI and the other

music companies went on to pursue additional ISPs in Ireland seeking to impose

the implementation of a similar regime. Vodafone agreed that it would follow

suit93

but UPC refused and the issue again came before Charleton J in the High

Court in October 2010 and a surprising turn of events saw UPC secure a victory,

albeit on a technicality.94

The plaintiffs sought an injunction pursuant to sections 37 and 40(4) of the

Copyright Act 2000 restraining UPC from infringing the copyright in music works

owned by or licensed to the plaintiff companies by making these available through

the provision of internet facilities, along with an order to block the Pirate Bay

website. UPC claimed that there was no liability in law for acting as a mere

conduit and the sections of the 2000 Act permitting injunctions do not apply.

Moreover, such an injunction would not be just or convenient as it would infringe

fundamental rights and the principle of proportionality.

5.6.2 Attitude of UPC

In a lengthy judgment Charleton J. condemned the attitude of UPC towards the use

of its services for copyright infringement. He remarks that the customer use policy

92 Ibid. 93 Ronan McGreevy, “Vodafone in line to join file-sharing clampdown” The Irish Times, 6 June

2010, available at http://www.irishtimes.com/newspaper/ireland/2010/0616/1224272615990.html (visited 25 July 2011). 94 [2010] IEHC 377, note 53.

44

provides for the possibility of termination of the contract if the services of UPC are

used to infringe copyright, as does the policy of Eircom. He comments that UPC

does not abide by their policy however, unless they can profit from it. Charleton

J‟s tone throughout the judgment displays a similar air of disdain toward UPC and

his viewpoint relating to the role of intermediaries and their “economic and moral

obligation to address the problem” is evident.95

5.6.3 Possible Solutions

Charleton J. considered a number of possible solutions. He did confirm that he was

against the idea of any solution based on the blocking or severe constriction of all

peer to peer traffic “unless the harm is demonstrated to be so grave as to illegal file

sharing of copyright material as to render that both necessary and just”.96

This

would otherwise be unreasonable since peer to peer technology did have its

legitimate uses, even if these were in the minority.

The solutions which he identified as satisfying the principle of proportionality and

inexpensive to implement include Detection, Global File Registry, and CopySense.

Detection involves the use of software such as DtecNet which searches the

network to trace copyrighted files being shared. It then records the IP address of

the person sharing these files along with information about the files themselves.

Although this method can be evaded by use of a proxy IP address or by using

encryption, Charleton J. nevertheless came to the conclusion that this solution is

both viable and proportionate.97

The Global File Registry option consists of a

database containing a collation of unique identifiers such as a filehash for

copyright protected files and the software issues take-down information in relation

to these files. When a user searches for these files, the search results do not display

the files which have a take-down status. The user is redirected to a site where the

particular music work can be accessed legally. Charleton J. stated that privacy is

not infringed through use of this option since it simply reads numbers identifying

the illegality of the transmission and the record companies can never identify who

95 [2010] IEHC 377, note 53, at 20. 96 [2010] IEHC 377, note 53, at 33. 97 [2010] IEHC 377, note 53, at 37.

45

is infringing their copyright through use of this option alone.98

The CopySense

option involves identification of copyrighted content through use of “digital

fingerprint” technology. It is implemented in universities and colleges as part of a

graduated response system to prevent users of the college network from illegally

file sharing. Charleton J was satisfied that this type of system did not invade

privacy since it did not monitor content. He was also of the opinion that this type

of option was clearly effective and believed that the implementation of such a

solution by UPC could prove successful.99

5.6.4 Fundamental Right of Privacy

It has long been accepted that a right to privacy exists in this jurisdiction and it has

been invoked numerous times over the years. In the digital sphere it can be

difficult to define its scope but Charleton J. remarked that “Privacy in the modern

panoptic society must be flexible enough to address new technologies and

developments and their privacy implications while at the same time certain enough

as to offer guidance and clarity as a matter of law.”100

He was of the view that the

„right to be left alone‟ encapsulated here can never extend to any communication

designed to further a criminal operation however. Moreover, he was of the view

that in relation to the Internet, “there are no privacy or data protection implications

to detecting unauthorised downloads of copyright material using peer-to-peer

technology”.101

5.6.5 Authority of the Court

Charleton J then considered whether he was entitled to grant such injunctions as

were requested of him in this case. He noted that he was bound to apply the law

“within the four corners of the Copyright and Related Rights Act 2000”.102

Furthermore he stated:

98 [2010] IEHC 377, note 53, at 38. 99 [2010] IEHC 377, note 53, at 49. 100 [2010] IEHC 377, note 53, at 66. 101 [2010] IEHC 377, note 53, at 68. 102 [2010] IEHC 377, note 53, at 86.

46

The courts are not entitled, on the other hand, to take an area which has

been properly legislated for as to the extent and balance of rights by the

Oireachtas and to take a different view. For the Court to pursue the course

of granting an injunction on the basis not of law but of economic abuse or

moral turpitude would lead the Court beyond the threshold of the judicial

arm of government and into legislation.”103

He therefore went on to consider the exact scope of the Copyright and Related

Rights Act 2000 and any relevant European legislation.

In this instance the injunctions were sought pursuant to sections 37 and 40(4) of

the Act. Section 37 concerns the exclusive right of the owner to make copies of the

work available to the public and is worded as follows:

37.—(1) Subject to the exceptions specified in Chapter 6 and to any

provisions relating to licensing in this Part, the owner of the copyright in a

work has the exclusive right to undertake or authorise others to undertake

all or any of the following acts, namely:

(a) to copy the work;

(b) to make available to the public the work;

(c) to make an adaptation of the work or to undertake either of the

acts referred to in paragraph (a) or (b) in relation to an adaptation,

and those acts shall be known and in this Act referred to as ‘‘acts

restricted by copyright’’.

(2) The copyright in a work is infringed by a person who without the

licence of the copyright owner undertakes, or authorises another to

undertake, any of the acts restricted by copyright.

103 [2010] IEHC 377, note 53, at 86.

47

(3) References to the undertaking of an act restricted by the copyright in a

work shall relate to the work as a whole or to any substantial part of the

work and to whether the act is undertaken directly or indirectly.

It is acknowledged that in peer-to-peer file sharing, the parties making copies of

protected works available to the public include the downloader and uploader. UPC

however are not making the works available since they do not store, host, or cache

the files but are merely a conduit. The crucial issue, he notes, is “whether the Act

allows the Court to interfere with the transit through the UPC network of copyright

music to those intent stealing it and offering it for theft on their home

computers.”104

Section 40(1)-40(3) declares:

40.—(1) References in this Part to the making available to the public of a

work shall be construed as including all or any of the following, namely:

(a) making available to the public of copies of the work, by wire or

wireless means, in such a way that members of the public may

access the work from a place and at a time chosen by them

(including the making available of copies of works through the

Internet);

(b) performing, showing or playing a copy of the work in public;

(c) broadcasting a copy of the work;

(d) including a copy of the work in a cable programme service;

(e) issuing copies of the work to the public;

(f) renting copies of the work;

(g) lending copies of the work without the payment of remuneration

to the owner of the copyright in the work, and references to

104 [2010] IEHC 377, note 53, at 92.

48

‘‘lawfully making available to the public’’ shall mean the

undertaking of any of the acts referred to in paragraphs (a) to (g)

by or with the licence of the copyright owner.

(2) References in this Part to the making available to the public of copies

of a work shall include the making available to the public of the original of

the work.

(3) Subject to subsection (4), the provision of facilities for enabling the

making available to the public of copies of a work shall not of itself

constitute an act of making available to the public of copies of the work.

(4) Without prejudice to subsection (3), where a person who provides

facilities referred to in that subsection is notified by the owner of the

copyright in the work concerned that those facilities are being used to

infringe the copyright in that work and that person fails to remove that

infringing material as soon as practicable thereafter that person shall also

be liable for the infringement.

Providing the facilities which are used in the activity of making available copies of

the protected works, does not in itself breach copyright. Liability can only be

established if the person or company providing the facilities has been notified and

subsequently fails to remove the infringing material.

The meaning of removal is given some consideration in the judgement. Charleton

J. discusses how the legislation must be interpreted to give effect to the wishes of

the legislature, but that he may not interpret the wording in a way which would

effectively result in “rewriting the text”.105

To block access to pirated material is

not removing the material in the ordinary sense of the word. To use the suggested

solutions of CopySense or Global File Registry would neither constitute removal

from the network. He came to the conclusion that the plain wording of the section

required that “action should be taken…not by digital blocking or diverting

strategems, but by removal. That is simply not possible in the context of a transient

105 [2010] IEHC 377, note 53, at 96.

49

communication.”106

He turned his focus to European law to determine whether this

could shed some light on the situation.

5.6.6 European Obligations

A national measure should be construed in accordance with its legislative purpose,

in accordance with its obligations under European law. Charleton J examined the

defences provided to ISPs in the E-Commerce directive, as discussed in Chapter 2

above. These defences arise when an ISP establishes that they are providing the

mere conduit, or are caching or hosting. Although he accepts that UPC is a mere

conduit, he opines that article 15 of the E-Commerce Directive does not preclude a

court from requiring an ISP to “terminate” or “prevent” an infringement.107

This

language, he notes, is in marked contrast to the “removal of infringing material”

referred to in the 2000 Act.108

The Copyright Directive does not provide any further assistance either. It is

pointed out in paragraph 104 of the judgment that although the explanatory note

attaching to the 2004 SI109

on copyright states that it has made a number of

amendments to ensure full compliance with the relevant directives, this is in fact

not the case. Recital 59 states that:

(59) In the digital environment, in particular, the services of

intermediaries may increasingly be used by third parties for

infringing activities. In many cases such intermediaries are best

placed to bring such infringing activities to an end. Therefore,

without prejudice to any other sanctions and remedies available,

rightholders should have the possibility of applying for an

injunction against an intermediary who carried a third party’s

infringement of a protected work or other subject-matter in a

network. This possibility should be available even where the acts

carried out by the intermediary are exempted under Article 5. The

106 [2010] IEHC 377, note 53, at 100. 107 Recital 45 of the E-Commerce Directive 108 [2010] IEHC 377, note 53, at 109. 109 SI 16/2004 European Communities (Copyright and Related Rights) Regulations 2004.

50

conditions and modalities relating to such injunctions should be left

to the national law of the Member States.”

Furthermore, article 8 which deals with sanctions and remedies declares the

following:

1. Member States shall provide appropriate sanctions and remedies in

respect of infringements of the rights and obligations set out in this

Directive and shall take all the measures necessary to ensure that

those sanctions and remedies are applied. The sanctions thus

provided for shall be effective, proportionate and dissuasive.

2. Each Member State shall take the measures necessary to ensure

that rightholders whose interests are affected by an infringing

activity carried out on its territory can bring an action for damages

and/or apply for an injunction and, where appropriate, for the

seizure of infringing material as well as of devices, products or

components referred to in Article 6(2).

3. 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 a copyright or related right.

Charleton J puts particular emphasis on the fact that the Copyright Directive places

an obligation on the Member State to ensure that a rightsholder is in a position to

apply for an injunction against an ISP, however the particular wording of the 2000

Act does not provide for this. Nor does an interpretation of the 2000 Act in light of

the Framework Directive as amended or the E-Commerce Directive provide for

such a construction. This led the judge to the conclusion that the 2000 Act has

“made no proper provision for the blocking, diverting or interrupting of internet

communications intent on breaching copyright. In failing to provide legislative

provisions for blocking, diverting, and interrupting copyright theft, Ireland is not

yet fully in compliance with its obligations under European law.”110

Injunctive

110 [2010] IEHC 377, note 53, at 138.

51

relief was refused to the plaintiffs even though Charleton J. was of the opinion that

such relief was indeed merited on the facts. This legislative gap has recently been

the subject of much debate which is detailed in the following chapter.

52

Chapter 6 National Measures against piracy on the Internet

6.1 Introduction

National legislation has been introduced in a number of countries worldwide

including the UK, France, Korea, Taiwan and New Zealand. National regimes are

also currently envisaged in Finland, Italy and Denmark. Draft legislation was

passed in Finland in October 2010 providing for notification and warning but not

extending to disconnection.111

It is unclear how this will work without provision

for any ultimate sanction. At the time of writing this has not yet come into force.

Spain also has adopted its Sustainable Economy Act which contains provisions

aimed at speeding up the process of blocking and shutting down websites which

are used to infringe copyright.112

Since the focus of this paper is within the EU, the

national measures which have been adopted in the UK and France are analysed in

detail.

6.2 UK – Digital Economy Act 2010

In 2009 a White Paper entitled “Digital Britain” was produced by the Government

with the ambition to “secure the UK‟s position as one of the world‟s leading

digital knowledge economies”.113

It acknowledged that embracing the digital

revolution to fully appreciate and thus maximise exploitation of this reality was a

necessary step, potentially leading to huge commercial and industrial

opportunities. The recommendations contained in the report and the lengthy

consultation process which ensued, culminated in the drafting of the Digital

Economy Bill. Its most contentious feature was the imposition of an obligation on

ISPs to suspend the internet access of serious infringers of peer-to-peer illegal file

sharing. This caused outrage amongst internet-based communities and activists

111 Torrent Freak, “File-Sharers to Receive Warning Letters, But No 3 Strikes”

http://torrentfreak.com/file-sharers-to-receive-warning-letters-but-no-3-strikes-101102/ (visited 17

July 2011). 112

Francisco Javier Cabrera Blázquez, “The „Sinde Act‟”

http://kluwercopyrightblog.com/2011/03/04/the-sinde-act/ (visited 17 July 2011). 113 Department for Culture, Media and Sport and Department of Business, Innovation and Skills,

Digital Britain: Final Report (Department for Culture, Media and Sport and Department of Business, Innovation and Skills ,2010) available at http://www.official-

documents.gov.uk/document/cm76/7650/7650.pdf (visited 25 July 2011).

53

such as the Open Rights Group.114

The bill was heard during the so called wash-up

period, which essentially follows the announcement of an impending general

election, and as such was not properly debated. This has since been a cause for

concern. Benjamin Farrand noted that other suspicions arose in relation to the

motives of the Business Secretary, Lord Mandelson, in announcing that such

measures to control piracy would be introduced.115

Apparently this occurred just

days after he had dined with Dave Geffen, the founder of Asylum Records, whilst

holidaying in Corfu. Opponents of the Bill viewed this as evidencing the sway of

industry lobbyists over the legislative process. After receiving very little debate,

the Bill was given the Royal Assent on April 12, 2010, and entered into force on

June 12, 2010.

The Government‟s explanatory note on the Act gives a good illustration of how

the provisions might work in practice:116

Copyright owners identify cases of infringement and send details

including IP addresses to ISPs;

The ISPs verify that the evidence received meets the required

standard, and link the infringement to subscriber accounts;

The ISPs send letters to subscribers identified as apparently

infringing copyright. They keep track of how often each subscriber

is identified;

If asked to do so by a relevant copyright owner, ISPs supply a

copyright infringement list showing, for each relevant subscriber,

which of the copyright owner‟s reports relate to that subscriber. The

list does not reveal any subscriber‟s identity;

114Jim Killock, “Digital Economy Bill: Dangerous and Draconian Just Got Dictatorial” Open

Rights Group http://www.openrightsgroup.org/blog/2009/digital-economy-bill (visited 2 March

2011). 115 Benjamin Farrand, “The Digital Economy Act 2010 - a cause for celebration, or a cause for

concern?” E.I.P.R. 2010, 32(10), 536-541. 116 Digital Economy Act 2010, Explanatory Notes, available at

http://www.legislation.gov.uk/ukpga/2010/24/notes/division/5/2 (visited 10 March 2011).

54

Copyright owners use the list as the basis for a “Norwich

Pharmacal” court order to obtain the names and addresses of some

or all of those on the list. At no point are individuals‟ names or

addresses passed from the ISP to a copyright owner without a court

order;

Copyright owners send “final warning” letters direct to infringers

asking them to stop online copyright infringement and giving them

a clear warning of likely court action if the warning is ignored; and

Copyright owners take court action against those who ignore the

final warning.

A good overview of the elements of the Bill, relating to copyright infringement,

which survived the legislative process, is given in the aforementioned article by

Farrand.117

Sections 3 – 18 are those sections with which we are concerned. These

are difficult to read since they refer to and amend the Communications Act 2003.

Sections 3 – 7 provide the framework for an Initial Obligations Code which must

be drafted or approved by Ofcom. These sections provide guidance as to what

should be included in this code. A draft code118

was published by Ofcom on the

28th of May 2010 for consultation.

Section 3 of the DEA places the ISPs under an obligation to inform subscribers of

infringements reported by rights owners. The notice given to the subscriber must

contain a description of the infringing content, evidence displaying the IP address

at the time of the infringement, and the name of the content owner making the

report. It also extends to impose liability on an internet subscriber who allows

another to utilise the service and commit an infraction on the service. This far-

reaching clause can cause problems for businesses whose employees use their

service on a daily basis, parents whose children use the home accounts and many

other private and public organisations.

117 Farrand, note 115. 118 Ofcom, Online Infringement of Copyright and the Digital Economy Act 2010: Draft Initial Obligations Code available at http://stakeholders.ofcom.org.uk/binaries/consultations/copyright-

infringement/summary/ condoc.pdf (visited 13 March 2011).

55

There are ramifications for unsecured wireless access also. A subscriber presently

has the choice of whether to leave their network unsecured, but this will essentially

be allowing access, as caught by the Act. This effectively amounts to “constructive

prohibition of unsecured Wi-Fi by the back door, for consumers, corporations and

the public sector”.119

Farrand notes the irony in the situation; in light of the stated

aim of the Digital Britain Report - to ensure maximum accessibility – section

3(6)(h) may in fact “have the effect of reducing accessibility as libraries, airports

and even corporations such as Starbucks end their open-access Wi-Fi services in

order to avoid liability”.120

Section 4 obliges the ISP to provide infringement lists to content owners, upon

their request. Confusion may arise here without further clarification as noted by

Farrand.121

Content holders are notifying ISPs of infringing IP addresses per

section 3 and then under section 4 ISPs are providing content holders with a list of

these IP addresses. Without further explanation this seems to be somewhat

purposeless. However, since IP addresses are often specified on an ad hoc basis, it

is possible for the same user to have infringed multiple times on different IP

addresses.

Section 9 provides for the imposition of an obligation on the ISP to take “technical

measures” against certain subscribers as a preventative step. These measures

include suspension of a relevant subscriber‟s122

internet connection, restrictions on

download speed or quantities, restrictions on the types of material that they can

access, or other types of limits on access to the internet. The following section

however states that these technical measures cannot be put in place by the ISPs

until at least 12 months following an initial obligations code entering into force.

These technical measures must be regulated by an Ofcom drafted code to be

approved by Parliament, namely the Technical Obligations Code. These measures

could include such actions as download caps, bandwidth throttling, protocol

119 Lilian Edwards, “Mandy and Me: Some Thoughts on the Digital Economy Bill” (2009) 6:3

SCRIPTed 534. 120 Farrand, note 115, at 540. 121 Ibid. 122 A relevant subscriber is one whom the amount of copyright infringement reports against them, has exceeded a threshold as set out in the initial obligations code. In other words they will appear in

a copyright infringement list.

56

blocking and port blocking. Something of important note is the very general clause

that a measure can be anything that “limits the service provided to the subscriber

in another way”.123

This effectively gives the government the power to limit the

internet access of anybody in any way if it can be seen to potentially reduce or

prevent online copyright infringement. In this regard, the redeeming feature of the

Technical Obligations Code is that its provisions must be objectively justifiable,

must not unduly discriminate against any person or class of persons and must be

proportionate and transparent.

Perhaps one of the most controversial aspects of the Bill was the initial clause 17

which has attracted much criticism from stakeholders. This clause provided the

Secretary of State with a power to amend the Copyright, Designs and Patents Act

1988 for the purpose of preventing or reducing online copyright infringement, if it

is appropriate to do so because of technological developments. This caused

consternation because it would allow for primary copyright legislation to be

amended without examination by Parliament. Large technology companies such as

Google and Facebook wrote an open letter lobbying against this clause.124

It was

then revised to ensure that any amendment by the Secretary of State pursuant to

this clause would be proportionate. It must also now receive the approval of

Parliament.

At the beginning of February, Ofcom were ordered to review the powers given by

the DEA, relating to blocking websites which could be used for copyright

infringement.125

Before Government will begin to enforce the website blocking

measures, they want to be sure that these can in fact work in practice. This led to

the creation of a working group on the matter to facilitate discourse on how to

make the proposed system more agreeable.126

ISPs are inevitably concerned about

123 Digital Economy Act 2010, s9. 124 Charles Arthur, “Tech chiefs attack digital economy bill” The Guardian 10 March 2010,

available at http://www.guardian.co.uk/technology/2010/mar/10/digital-economy-bill (visited 25

July 2011). 125

Kate Holten, “Ofcom to review Digital Economy Act” Reuters 1 February 2011, available at

http://uk.reuters.com/article/2011/02/01/uk-britain-digital-idUKTRE71041O20110201 (visited 2

March 2011). 126 Mark Sweeney, “Government hunts for „plan B‟ on internet piracy proposals” The Guardian 25 February 2011, available at http://www.guardian.co.uk/ technology/2011/feb/25/digital-economy-

act-website-blocking (visited 2 March 2011).

57

potential litigation which could arise as a result of blocking a website. One

possible solution to this that has been suggested is the indemnification of ISPs by

the rights holders and the placing of the onus on the rights holders to prove

undoubtedly that the website was in fact being used for illegal purposes before

blocking it.127

Two of the UK‟s largest ISPs, BT and Talk Talk, applied for judicial review of the

Act, to assess whether it was incompatible with certain provisions of EU law. Five

grounds were advanced for challenge. These included the contention that the DEA

is incompatible with certain provisions of the E-Commerce Directive and the

Privacy and Electronic Communications Directive; that they are disproportionate

in their impact on ISPs, businesses and consumers; and that the suggested costs to

be footed by ISPs are inappropriate.128

The first ground of challenge was an alleged breach of the Technical Services

Directive. Article 8(1) TSD requires Member States to inform the Commission of

any draft technical regulation and a statement as to why it is necessary, for the

purposes of legal certainty and transparency. It has been established that a draft

technical regulation which has not been duly notified is unenforceable at national

level.129

It was held that the initial obligations enacted by the DEA are not yet

legally enforceable against any individual, including ISPs; and, therefore, they do

not have the requisite “legal effect”. They could not be said to be technical

regulations and as such this ground was dismissed.130

The second ground of challenge was a purported breach of the E-Commerce

Directive, particularly articles 12, 15 and 3(2) which relate to the prohibition of all

forms of restrictions by Member States which would hamper the free provision of

Information Society Services, the limited liability regime of mere conduit ISPs,

and a no general monitoring obligation. The judge noted that a careful balancing of

competing interests was completed in drafting articles 12 and 15 and if one were to

127 Ibid. 128 [2011] EWHC 1021, note 72. 129 [2011] EWHC 1021, note 72, at 63. 130 [2011] EWHC 1021, note 72, at 93.

58

depart from the plain meaning, an unfair tipping of the balance in favour of one

industry to the detriment of the other could occur.131

The judge noted that it is conceivable that an IPR holder may draw the attention of

an ISP to an infringement or likelihood of repeat infringement and invite them to

terminate or prevent such an infringement. In these circumstances, the “careful

balance” struck by the legislator allows Member States to authorise the courts or

competent administrative authority to order the ISP to terminate or prevent the

infringement, so long as the ISP is not made liable (by way of fine or

compensation) in respect of the infringement itself. The potential exposure of ISPs

to financial penalties etc. was raised as an argument to bolster this ground of

challenge but this was dismissed because such liabilities would arise as a result of

failure to comply with the core obligations of ISPs under the DEA as opposed to

liability for the underlying infringement. The judge reiterated that he could not

give such an extended meaning to article 12 and on a natural reading of this clause,

there was no breach.132

It was contended by the claimants that the database of information linking

infringements with subscribers, which must be maintained by ISPs pursuant to the

DEA, is contrary to article 15‟s no general monitoring obligation. The judge stated

that “nothing in the DEA requires ISPs to inspect or examine the information

transmitted for any purpose” and the role of the ISP under the DEA is a passive

one.133

It is the copyright owners themselves that must show that an infringement

has occurred and the ISP has itself no general obligation to inspect or examine the

transmitted information for potential or actual copyright infringements.

The third ground of challenge was a breach of the Data Protection Directive134

(DPD) and the Privacy and Electronic Communications Directive135

(PECD). It

131 [2011] EWHC 1021, note 72, at 100 – 108. 132 [2011] EWHC 1021, note 72, at 107 - 108. 133 [2011] EWHC 1021, note 72, at 115. 134

Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the

protection of individuals with regard to the processing of personal data and on the free

movement of such data.

135 Directive 2002/58/EC of the European Parliament and of the Council concerning the processing

of personal data and the protection of privacy in the electronic communications sector.

59

was submitted that the processing of “personal data” within the meaning on the

DPD is likely to be required by ISPs under the initial obligations of the DEA. It

was conceded that copyright owners would be processing personal data but it was

held that this processing was permissible in the context of copyright

infringement.136

There is uncertainty as to whether an IP address constitutes

“personal data” but it seems that the judge here is of the opinion that they do. This

issue has been the subject of much debate across Europe with different

jurisdictions reaching contradicting conclusions. In Ireland it would appear that

they do not constitute “personal data”.

The only ground which was successfully challenged was in relation to costs.

Section 15 of the DEA empowered the Secretary of State to implement a Costs

Order addressing cost sharing between ISPSs, rights holders and Ofcom in relation

to costs incurred in implementing and complying with their obligations under the

DEA. It refers to three kinds of costs: qualifying costs which are administrative

costs incurred by Ofcom or the appeals body; relevant costs which are

administrative costs borne by the ISPs in carrying out its obligations; and case fees

set by the appeals body in respect of each subscriber appeal which it receives.

Under the Costs Order, each of these costs were to be split between the ISP and

the copyright owner with the ISP incurring 25%. This was held to conflict with the

Authorisation Directive137

. While it was held that relevant costs and case fees

could be borne by the ISP, to require them to pay qualifying costs is unlawful.138

BT and TalkTalk were originally refused leave to appeal this decision however it

has very recently come to light that an appeal hearing was in fact granted and is

scheduled for 7th October 2012.

139 This is yet another hurdle that the DEA must

overcome before we will see its implementation.

136

[2011] EWHC 1021, note 72, at 161. 137 Directive 2002/20/EC of the European Parliament and of the Council of 7 March 2002 on the

authorisation of electronic communications networks and services. 138 [2011] EWHC 1021, note 72, at 200. 139 Malcolm Hutty, “BT, TalkTalk to get an appeal hearing” Linx 25 July 2011, available at

https://publicaffairs.linx.net/news/?p=4757 (visited 26 July 2011).

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6.3 France – HADOPI

In January 2010 the French law amending the existing French Intellectual Property

Code (IPC)140

, known as “Hadopi 2”, was finally adopted in modified form after a

review by the French Constitutional Council. This sets out the French approach to

the graduated response regime. It has as its aims141

the “encouragement of the

development of the legal offer on the Internet” and the “protection of works to

which a copyright or related right is attached against any infringement”. This

intentionally strikes a balance between the educational and the repressive. Hadopi

stands for Haute Autorité pour la Diffusion des Oeuvres et la Protection des droits

sur Internet which translates as the High Authority for the Diffusion of Creative

Works and Copyright Protection on the Internet. It is an independent

administrative body, hereinafter referred to as the Authority, with a board of nine

members – three appointed by the government, two by the legislative bodies, three

by judicial bodies and one by the Superior Council of Artistic and Literary

Property.

The Authority, upon referral by sworn agents142

, acts to inform an ISP that an

infringement has occurred. The ISP then sends an email notification to the

subscriber that corresponds with the infringing IP address, warning them of this

first occurrence. If infringement reoccurs within six months, a second warning will

be sent by registered mail. Since the sworn agents are processing IP addresses, the

issue of processing personal data has arisen. The Constitutional Council

considered that the IP addresses make it indirectly possible to identify a person

and to process data of a personal nature. As such, processing must be subject to the

requirements of the national data protection laws and the data may be transmitted

only to the Authority or to the judicial authorities. The processing of such data

must be “strictly proportional to the purpose it is sought to achieve.”143

140 Act No. 92-597 of 1 July 1992 on the Code of Intellectual Property (Code de la Propriété

Intellectuelle) hereinafter referred to as IPC. 141 IPC Article L331-13. 142 IPC Article L331-24. 143 Decision no 2009-580 of June 10th 2009 of the French Constitutional Council, English version available at http://www.conseil-constitutionnel.fr/conseil-

constitutionnel/root/bank_mm/anglais/2009_580dc.pdf (visited 22 July 2011).

61

If the subscriber continues to infringe, a formal judicial complaint will be made.144

The judge has the power to impose sanctions including disconnection of the

subscriber account. While suspension will be reserved for the most serious

infringers, it is the cornerstone of the system, and without this sanction, it would

serve a “mere letterbox role” and would be “nothing more than a scarecrow whose

warning messages would soon be ignored”.145

The sanction of suspension is set down in Chapter V of the IPC entitled “Criminal

Provisions”. Article L.335-7 states that any infringement under Article L. 335-2146

,

L.335-3147

or L. 335-4148

of the IPC carries a punishment of “suspension of access

to a public communication line for a maximum of one year, plus the prohibition to

take over the same period another contract on a similar service from any operator”.

Originally, under what is known as “Hadopi 1”, the administrative body had the

power to order disconnection of the infringing subscriber‟s account. This was held

to be unconstitutional by the French Constitutional Court149

as it was reasoned that

only a judge would be empowered to do so. It was held that “the powers to impose

penalties created by the challenged provisions vest the Committee for the

protection of copyright, which is not a court of law, with the power to restrict or

deny access to the internet by access holders and those persons whom the latter

allow to access the internet. The powers vested in this administrative authority are

not limited to a specific category of persons but extend to the entire population.

The powers of this Committee may thus lead to restricting the right of any person

to exercise his right to express himself and communicate freely, in particular from

his own home. In these conditions, in view of the freedom guaranteed by article 11

of the Declaration of 1789, Parliament was not at liberty, irrespective of the

guarantees accompanying the imposition of penalties, to vest an administrative

144 IPC Article L331-25. 145 Jean-Sébastien Mariez, “HADOPI… 3 small suspension points…” Juriscom.net available at

http://www.juriscom.net/documents/ pla20110315.pdf (visited 17 July 2011). 146 Any edition of writings, musical composition, drawing, painting or any other production,

printed or engraved in whole or in part, in defiance of the laws and regulations relating to

property of the authors shall constitue infringement. 147 Any reproduction, performance or dissemination of an intellectual creation or of software, by

any means whatsoever shall constitute infringement. 148 Any fixation, reproduction, communication or making available to the public, or any broadcasting of a performance, phonogram, videogram or a program shall constitute infringement. 149 Decision no. 2009-580, note 143.

62

authority with such powers for the purpose of protecting holders of copyright and

related rights”.150

Article L.335-7-1 introduces a misdemeanour of “characterised negligence” which

is punishable by the imposition of suspension for a maximum of one month. This

obligates a subscriber to implement a means of security on their own network. If a

subscriber‟s network is hacked then they will be liable. In 2006 the DADVSI Act

was passed in France to implement the Copyright Directive.151

This act contained

provisions imposing an obligation on subscribers to secure their connection so as

to ensure that it is not being used by another for copyright infringement, but it did

not provide for any sanctions to deal with a failure to comply with this condition.

Hadopi however introduced liability for this. According to the article L. 336-3 a

subscriber “has the obligation to ensure that this access is not the subject to a use

for the purpose of reproducing, representing, making available or communicating

to the public works or other materials protected by a copyright or a neighbouring

right without the authorisation of the right holders”.152

The decision of the French Constitutional Court also considered the

proportionality of the penalty of suspension, particularly in relation to the

presumption of innocence and the fundamental rights of the defendant. The regime

imposed a strict liability on the Internet subscriber unless they could adduce

evidence to prove that the infringement had been committed by a third party.153

This reversal of the burden of proof was held to be unconstitutional. It was stated

that “under article 9 of the Declaration of 1789, every man is presumed innocent

until proved guilty. Parliament cannot therefore introduce a principle of

presumption of guilt in criminal matters. However, as an exceptional measure,

such a presumption may be introduced, particularly in the case of minor offences,

once such presumptions are not irrebuttable, the rights of the defence are respected

and the available facts tend to confirm the likelihood of the commission of the

150 Decision no. 2009-580, note 136, at 16. 151

Law No. 2006-961 of 1 August 2006 on Copyright and Related Rights in the Information

Society. 152 IPC Article L. 336-3. 153 Nicola Lucchi, “Regulation and Control of Communication: The French Online Copyright Infringement Law (HADOPI)” (2011) 19 JICL (page number unavailable at time of writing due to

availability of electronic copy only).

63

incriminated act.”154

With regard to freedom of expression and communication,

the Court recognises that freedom of communication is a fundamental right, and

that this extends to include freedom to access online communication services

given the importance of this in the participation of democracy and the expression

of ideas and opinions.155

Any restriction placed on the exercise of this right must

be “adapted and proportionate to the purpose it is sought to achieve.”156

The Hadopi regime is not merely a three strikes policy, but adopts a broader

approach to entice people to lawful downloading. It does this in two ways:

educational measures and the introduction of the “Carte Musique Jeune”. As part

of an education code school pupils receive information about illegal downloading

of protected works and the potential sanctions that may be imposed on copyright

infringers. They also receive information in relation to valid legal offers available

on the Internet. The “Carte Musique” is a card subsidised by the government

offered to people between the ages of 12 and 25 which will allow them to purchase

€50 worth of music online for a payment of just €25.

One of the problems with Hadopi is that it monitors only peer-to-peer

technologies. Studies have shown that the use of peer-to-peer in accessing illegal

copies of protected works however has declined and that the consumers of these

illegal materials are now using alternative channels such as cyber-lockers.157

Perhaps this has been too expensive and protracted a system to implement with

waning efficacy, if these trends are anything to go by. Nonetheless it aims to have

reached a target of sending 10,000 first warning notices per day by. Its

effectiveness thus far remains to be seen as there is yet to be an independent study

with reliable figures.

154 Decision no. 2009-580, note 143, at 17. 155

Decision no. 2009-580, note 143, at 12. 156 Decision no. 2009-580, note 143, at 15. 157 PWC, The speed of life: Discovering behaviors and attitudes related to pirating content (PWC,

2011) available at http://download.pwc.com/ie/pubs/2011_discovering_behaviors_attitudes_related_to_pirating_conte

nt.pdf (visited 22 July 2011).

64

Chapter 7 Ireland

7.1 Consultation on Amendment to Copyright and Related Rights Act

2000

In the week leading up to the 2011 election, rumours were rife that a Statutory

Instrument was being rushed through the legislative process without political

debate and was due to be signed by the Minister for Enterprise, Trade and

Innovation Mary Hanafin TD. This caused much consternation among

stakeholders, particularly since the very closely related Scarlet v SABAM is

currently before the Court of Justice of the European Union. Minister Hanafin was

quick to respond to this speculation, confirming that legislation would not be

hurried through parliament. It was also confirmed that the advice of the Attorney

General had been sought, along with consultation with the Department of

Communications, Energy and Natural Resources. Minister Hanafin concluded that

it would be normal practice to “consult all the relevant stakeholders in advance of

legislation such as this being enacted.”158

The Digital Economy Act was swept

through in a similar fashion in the United Kingdom to much dissatisfaction, and as

such is already undergoing a review.

Richard Bruton T.D., the Minister for what has recently been renamed Jobs,

Enterprise and Innovation, announced on the 9th

May, a review of the Copyright

and Related Rights Act 2000.159

The terms of reference of the review are

summarised into the following short points: to identify any areas which are seen to

create barriers to innovation; identify solutions and recommendations for the

implementation of such solutions; assess whether the introduction of a „fair use‟

doctrine may be appropriate in Ireland; and make recommendations for changes to

the EU law if necessary. The deadline for submissions to this review was 14th

July

2011 and at the time of writing these were being compiled and reviewed by the

158

Department of Jobs, Enterprise and Innovation, Minister Hanafin clarifies speculation on

possible changes to copyright law http://www.deti.ie/press/2011/20110224.htm (visited 22 July

2011). 159 Department of Jobs, Enterprise and Innovation, Consultation on the Review of the Copyright and Related Rights Act 2000 http://www.djei.ie/science/ipr/copyright_review_2011.htm (visited 22

July 2011).

65

Copyright Review Committee. A consultation paper will be prepared as the next

stage of the review process and is due for publication in the autumn.

Notwithstanding this review, on the 9th

June, a question was raised in the Dáil in

relation to the supposed gap that has existed in Irish law as identified in the

October judgment of Charleton J and it was sought to have this resolved as a

matter of urgency.160

Proposed wording for a Statutory Instrument was published

on the 20th June by the Department, with an astonishingly brief consultation period

of just ten days.161

This was extended at the request of stakeholders to the 30th

July

2011. The proposed SI will purportedly bring Ireland into line with its European

obligations under the Copyright Directive and the E-Commerce Directive. The

Department stated that it had believed that the types of injunctions which ought to

be available were already available in this jurisdiction under section 40(4) of the

2000 Act. They also stated that Charleton J had not considered removal of access

rather than „mere‟ removal of the infringing material in his judgment. Furthermore

it is emphasised that the proposal is not intended to introduce a Hadopi-style

graduated response system. The SI proposes to insert the following wording after

section 40(5) and 205(9) of the 2000 Act respectively:

(5A) (a) without prejudice to subsections (3) and (4), the owner of the

copyright in the work concerned may apply to the High Court for

an injunction against a person who provides facilities referred to in

subsection (3) where those facilities are being used by one or more

third parties to infringe the copyright in that work.

(b) In considering an application for an injunction under this

subsection, the court shall have due regard to the rights of any

third party likely to be affected and the court shall make such

directions (including, where appropriate, a direction requiring a

160

Willie O‟Dea Dáil Debates Vol. 735 No. 1, 14987/11 9 June 2011

http://debates.oireachtas.ie/dail/2011/06/09/00014.asp (visited 22 July 2011). 161 Department of Jobs, Enterprise and Innovation Consultation on Amendment to Copyright and

Related Rights Act, 2000 http://www.djei.ie/science/ipr/copyrightconsultation.htm (visited 22 July 2011).

66

third party to be put on notice of the application) as the court may

deem necessary or appropriate in all the circumstances.

(9A) (a) without prejudice to subsections (7) and (8), the rightsowner

may apply to the High Court for an injunction against a person who

provides facilities referred to in subsection (7) where those

facilities are used by one or more third parties to infringe any of

the rights referred to in Parts III and IV.

(b) In considering an application for an injunction under this

subsection, the court shall have due regard to the rights of any

third party likely to be affected and the court shall make such

directions (including, where appropriate, a direction requiring a

third party to be put on notice of the application) as the court may

deem necessary or appropriate in all the circumstances.

7.2 A Closer Look

The Department have stated that Charleton J in his judgment failed to consider the

concept of removal of infringing material from access as opposed to „mere

removal‟ by UPC.162

It is not clear what exactly is meant by this. In paragraphs 99

and 100 of the judgment there is a discussion and analysis of the system of deep

packet inspection and packet dropping in order to prevent a piece of data transiting

the network. The distinction is made between removal from access and whether

the entire communication is removed. The expert witness explained that when you

stop a communication the files still exist on the machines that it existed on before

the communication.163

Charleton J was of the opinion that “[c]utting off access to

the computers holding pirated copyright songs is not to remove infringing

material; it is to stop the transit of that material.”164

He further notes that the

solutions of CopySense and Global File Registry, which he had explored, also

cannot be said to remove the infringing material from the Internet. “This is not, in

the ordinary use of language, the removal of infringing material from the network”

162 Ibid. 163 [2010] IEHC 377, note 53, at 99. 164 [2010] IEHC 377, note 53, at 100.

67

he remarked.165

Furthermore “the plain wording of the section in its use of the

present tense and its reference to removing infringing material, requires that action

should be taken in respect of a then existing situation, not by digital blocking or

diverting stratagems, but by removal. That is simply not possible in the context of

a transient communication.”166

It would thus appear that Charleton J did in fact

give consideration to the concept of removal from access, and that in doing so he

came to the conclusion that it was not possible. It is unclear what the Department

is attempting to achieve with this statement, but in any event it is unlikely to have

any impact on the outcome of the consultation.

Another noteworthy point is that the Department has emphasised that the proposed

amendment is not about the introduction of a statutory regulatory regime such as

the French “Hadopi” system or the regime set out in the Digital Economy Act in

the United Kingdom.167

This emphasis would appear to be just a fallacy however.

Once this amendment has been implemented, there is nothing to prevent

rightsholders from seeking injunctions requiring ISPs to implement a graduated

response system. It will be for the judge to decide, based on certain legal principles

whether such an injunction is mandated in the circumstances. The injunctions

regime provided for in the broad wording of the proposal could potentially

encompass not only blocking but mass filtering obligations and the eventual

introduction of a graduated response system is not inconceivable in these

conditions.

Academic commentators have noted that the injunctions provided for under this

broad wording could potentially be aimed at a number of different groups.168

The

wording of the proposal covers anybody providing facilities which may be used by

an infringing third party. This is broad enough not only to include the imposition

of an injunction on access providers like Eircom and UPC, but also cyber-lockers

such as Rapid Share and Megaupload, and those who upload on a peer-to-peer

165 [2010] IEHC 377, note 53, at 100. 166

[2010] IEHC 377, note 53, at 100. 167 Department of Jobs, Enterprise and Innovation, note 154. 168 Rónán Kennedy, “Consultation on amendments to Copyright Act 2000” Commons.ie available

at http://coimin.ie/?cat=6 (visited 15 July 2011). This blog post documents a twitter discussion which occurred between TJ McIntyre and Rónán Kennedy in which the proposed amendments

were discussed.

68

network. The concept of a leech in the context of peer-to-peer is described earlier.

If a leech is using a client which allows download only, then these users will not, it

seems, fall under the remit of this injunctions scheme. Neither will a download

only user on a cyber-locker. This is because a download only user does not

provide facilities which may be used for infringement. As Rónán Kennedy notes,

if the pursuit of individual downloaders through Norwich Pharmacal orders proved

futile, the option to seek injunctions against individual infringers one by one will

hardly be much more of an effective alternative.169

It is not inconceivable to think that there may be some who will argue that Ireland

is in fact already complying with its European obligations and that an amendment

is entirely unnecessary. The Department admits that even they were under the

impression that injunctions of the kind mandated under EU law were already

available in Irish law under Section 40 (4) of the 2000 Act and by reason of the

inherent power of the courts to grant injunctions, which are equitable and

discretionary remedies granted according to settled principles, developed by the

courts.170

The representative body for the telecommunications sector in Ireland

have drafted a response to the consultation to that effect which may be viewed by

the public by request to the Department. They argue that while a Member State

must ensure that a rightsholder is in a position to apply for an injunction against an

intermediary, it is not specified what type of injunction must be available.

Furthermore, Recital 59 of the Copyright Directive asserts that “the conditions and

modalities relating to such injunctions should be left to the national law of

Member States”. The very fact that Ireland expressly limited this injunctive relief

to a notice and takedown procedure, exercising the discretion set out in Recital 59,

it may be argued, satisfies the obligation as set out in article 8(3) of the E-

Commerce Directive. This argument is unlikely to hold much weight and it is

likely that the Statutory Instrument will become law soon regardless of the

countless objections that it receives.

169 Ibid. 170 Department of Jobs, Enterprise and Innovation, note 154.

69

Charleton and O‟Keeffe further explain the legislative gap.171

Although article 12

of the E-Commerce Directive provides for the defence of „mere conduit‟, it also

states that this should not prevent a court, in accordance with national law, from

requiring a service provider “to terminate or prevent an infringement” or from

“establishing procedures governing the removal or disabling of access to

information.” Charleton and O‟Keeffe note that in the European legislation the

words used are: remove, disable, terminate, prevent.172

The wording in the 2000

Act refers to the removal of infringing material. When different words are used in

legislation, it is noted, they have intentionally different meanings.173

The disabling

of access is not the removal of material. A graduated response system ultimately

resulting in the disconnection of the users Internet connection pursuant to a court

order is not removal of material but is would operate to prevent the occurrence of

an infringement. They note that in this sense the Irish legislation does not go as

far as it should under the European directives.174

They observe that Britain

complies with its obligations with the Digital Economy Act 2010 but even before

this became law, the transposing laws in the UK used all four of the words listed

above which appear in the European directives.175

Only one of these appears in the

Irish legislation.

The wording of the amendment as it stands provides little or no guidance to a

judge in a court of law. Charleton and O‟Keeffe have expressed their opinion on

judicial discretion and judicial activism in the context of such injunctive relief.

They note that merely because an injunction is available pursuant to national law it

does not mean that it is an automatic remedy, and must still be subject to the

discretionary jurisdiction of the courts. While it may appear simple, they remark, it

poses a dilemma to every judge that is requested to grant interlocutory relief

because no finding of fact has yet been made and there is a grave concern of the

consequences if the decision turns out to have been a wrong one. They state that a

judge must not only be sure that the making of an order injuncting an activity is

171 Peter Charleton and Conor O‟Keeffe, “Copyright Piracy and the Internet” (2011) 172 Ibid. 173 Ibid. 174 Ibid. 175 Ibid.

70

right but that the individuals whom the injunction is aimed at must know that

which is permitted and that which is forbidden, and it must be possible for them to

comply with it. A number of guiding principles which a court may take into

account when establishing whether an injunction is an appropriate remedy, may be

found in Kirwan.176

Even more considerations are involved in injunctions relating

to digital piracy. One of the principles in EU law, Charleton and O‟Keeffe add, is

“prevue par la loi”177

In other words they are “entitled to know what the law is;

what it demands; how judges are empowered; and what he is likely to be facing in

the event of a breach.”178

This is difficult when the injunction dictates the

implementation of a technical measure which may be of a new untested kind given

the rapid pace at which technology advances and becomes obsolete.179

Judges

must also consider third party rights which may be affected by any such injunction

along with the burden of costs and resources and where this should lie. All of these

considerations can prove to be quite a headache for the judiciary and the broad

wording of the proposed amendment is not likely to alleviate this in any way.

The proposed wording expressly places an obligation on the judge to have due

regard to the rights of any third party likely to be affected. These rights include the

right to respect for privacy of personal communications, the right to protection of

personal data and the right of freedom of information. All of these rights are

protected under the Charter of Fundamental Rights. These rights are not absolute

however and may be restricted in certain circumstances. Advocate General Cruz

Villalón stated that they may be abridged but only in accordance with the law. He

considered that the legal basis for such a restriction must be adopted nationally and

must be “accessible, clear and predictable”.180

Once the final ruling has been

handed down, it is hoped that it will provide some detailed guidance to national

judges seeking to impose a technical measure on an intermediary. Charleton J was

of the opinion that there were no privacy or data protection implications to

detecting unlawful downloads of protected works using peer-to-peer technology,

176 Brendan Kirwan, Injunctions, Law and Practice (Thomson Roundhall, 2008). 177 Charleton and O‟Keeffe, note 164. 178 Ibid. 179 Ibid. 180 Court of Justice of the European Union, note 69.

71

nor to blocking, nor to a graduated response.181

Digital rights advocates would beg

to differ.

If the Advocate General‟s opinion is adopted by the CJEU, then it will not be

likely that a graduated response scheme could be imposed on foot of an injunction

at the behest of the righstholder pursuant to the proposed amendment. This type of

scheme would require statutory status similar to the DEA or Hadopi. From the

Advocate General‟s opinion it would appear that such national legislation must be

accessible, clear and predictable. As part of the EU Commission‟s Telecoms

Package182

which aimed to reform the regulatory framework for electronic

communications and services within the EU, a directive was introduced in 2009

amending the Framework Directive.183

This was transposed in Ireland on the 1st of

July 2011 and requires judicial oversight for any such scheme. The relevant clause

reads as follows:

Measures taken by Member States regarding end users’ access to, or use

of, services and applications through electronic communications networks

shall respect the fundamental rights and freedoms of natural persons, as

guaranteed by the European Convention for the Protection of Human

Rights and Fundamental Freedoms and general principles of Community

law.

Any of these measures regarding end-users’ access to, or use of, services

and applications through electronic communications networks liable to

restrict those fundamental rights or freedoms may only be imposed if they

are appropriate, proportionate and necessary within a democratic society,

and their implementation shall be subject to adequate procedural

safeguards in conformity with the European Convention for the Protection

181 [2010] IEHC 377, note 53, at 68. 182 European Commission Memo/09/491, Agreement on EU Telecoms Reform paves way for

stronger consumer rights, an open internet, a single European telecoms market and high-speed

internet connections for all citizens Brussels, 5 November 2009. 183 Directive 2009/140/EC of the European Parliament and of the Council of 25 November 2009

amending Directives 2002/21/EC on a common regulatory framework for electronic

communications networks and services, 2002/19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and 2002/20/EC on the authorisation

of electronic communications networks and service.

72

of Human Rights and Fundamental Freedoms and with general

principles of Community law, including effective judicial protection and

due process. Accordingly, these measures may only be taken with due

respect for the principle of the presumption of innocence and the right to

privacy. A prior, fair and impartial procedure shall be guaranteed,

including the right to be heard of the person or persons concerned, subject

to the need for appropriate conditions and procedural arrangements in

duly substantiated cases of urgency in conformity with the European

Convention for the Protection of Human Rights and Fundamental

Freedoms. The right to effective and timely judicial review shall be

guaranteed.184

Charleton and O‟Keeffe note that because of the advocates of Internet freedom,

issues which once were simple have now become “entangled with issues of

privacy, issues of data protection, issues of personal freedom, entitlements to

communicate and ultimately...a requirement…that no one is to be cut-off from

Internet service unless there is judicial determination.”185

The requirement of

judicial determination to which they refer is that which is described above. The

tone of the article suggests that this is a bad thing but it is difficult to understand

how consideration of such issues should ever be bemoaned. They observe that

until now an Internet contract was a private contract between two parties and if

breached could be sued upon. Under the amendments to the Framework Directive

termination of an Internet contract is now subject to “prior judicial supervision”

and “a special and protected status” is given to these contracts.186

184 Ibid, article 1(b). 185 Charleton and O‟Keeffe, note 164, at 8. 186 Ibid.

73

Chapter 8 Conclusion

It is clear that if the proposed Statutory Instrument is adopted in the coming

months, the conundrum of digital piracy will remain far from solved. Whether

rightsholders will bombard the courts with a deluge of injunction applications or

whether they will be deterred from doing so by the impending Scarlet decision

remains to be seen. A lot of questions remain unanswered. One thing is for certain

however, the judge assessing these injunction applications will not have an easy

task. It will be a struggle for the courts to assess what exactly is proportionate

when it comes to ever-evolving technical measures.

Pursuant to the proposed amendment to Irish law, an injunction ordering the

implementation of general filtering obligations would fall foul of the Scarlet

principles. Any injunction seeking to impose a “three-strikes” regime would

similarly conflict with the guiding principles of European jurisprudence, unless it

were the subject of accessible, clear and precise national legislation. Furthermore,

the ultimate disconnection of such a system must be subject to prior judicial

determination. Such a system is not likely to be introduced in this jurisdiction in

the near future. Although the Norwich Pharmacal route of directly pursuing the

infringer would be the method of enforcement preferred by ISPs, this has proven

futile, as noted by Charleton J, because of huge costs and labour intensity. Perhaps

a less costly and less burdensome option which would allow a rightsholder to

obtain the information that they require to pursue the individual, through a lower

court, would be preferable. This however, would need to be the subject of well

thought out primary legislation, with the input of the Oireachtas, which addresses

data protection issues and all of the other concerns of the parties involved.

There is no one universal remedy for the problem of piracy in the Internet age. It

may be alleviated only upon cooperation of all concerned parties. Increasing

enforcement alone is not the appropriate way to tackle this. A balance between the

pedagogical and the oppressive needs to be reached, along with an increase in the

availability of affordable legitimate digital products. This may only be achieved

through a broad all-encompassing review of the copyright regime. The

implementation of secondary legislation addressing enforcement alone, in spite of

74

the wider review which is now occurring is imprudent and will benefit none. In the

words of Professor Ian Hargreaves in his definitive report on the issue “[a]ction is

needed on all fronts.”187

187 Ian Hargreaves, Digital Opportunity: A Review of Intellectual Property and Growth (2011) at

8.45.

75

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Benjamin Farrand, “The Digital Economy Act 2010 - a cause for celebration, or a

cause for concern?” E.I.P.R. 2010, 32(10), 536-541

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Liability of Intermediaries Carthy Thesis

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