Copyright

Optus wins first round of Optus TV Now!

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At first instance, Rares J has ruled that Optus’ TV Now service does not infringe the copyright in broadcasts of the AFL or the NRL (its the first round only as, by agreement, leave to appeal to the Full Court was given to whichever party lost before the decision was handed down).

The pressures of time mean that I can only provide a very brief synopsis at this stage: however, his Honour has also published a very helpful Summary in what would probably be considered more user friendly language (and length).

To recap: Optus offered its 3G mobile (cellular) customers – well the personal and small and medium business ones – with a service in which they could choose to record a broadcast of a free to air (FTA) television broadcast. Once a customer chose a recording, Optus’ equipment recorded the FTA transmission (in 4 different formats: PC, Apple, Android and iOS) on Optus’ servers and the customer could then chose to replay the recording at a later time (within 30 days) by having it streamed to their computer, iOS or Android device. All customers got some storage (45 minutes) as part of their subscription, but could pay for more. (For Optus’ descriptions see here and here.)

Back in 2006, the law was amended to make it clear that time shifting (what used to be called home taping such as when people had VCRs) or format shifting of FTA broadcasts for personal use did not infringe copyright in the broadcast or any underlying works. See s. 111.

In finding that there was no infringement, Rares J had to deal with 7 issues. For present purposes, however, the key finding was that it did not make any difference whether or not the customer used their own equipment in their own “house” or the equipment was owned by someone else or located elsewhere.

When the legislation to amend s 111 was introduced it underwent some amendment of its own and Rares J noted that the further amendments were stated to be intended to:

“The bill adds new copyright exceptions that permit the recording or copying of copyright material for private and domestic use in some circumstances. This amendment makes it clear that private and domestic use can occur outside a person’s home as well as inside. The amendment ensures that it is clear that, for example, a person who under new section 109A copies music to an iPod can listen to that music in a public place or on public transport. (Rares J’s emphasis)

and

57 The Minister then explained in the Senate, repeating the words of the Further Supplementary Explanatory Memorandum, why cl 111(1) had been reworded saying (ibid):

“This relates to time shifting. … This amendment substitutes a new section 111(1), which removes the requirement that a recording of a broadcast under section 111 must be made in domestic premises. This amendment provides greater flexibility in the conditions that apply to time-shift recording. The development of digital technologies is likely to result in increasing use of personal consumer devices and other means which enable individuals to record television and radio broadcasts on or off domestic premises. The revised wording of section 111 by this amendment enables an individual to record broadcasts as well as view and listen to the recording outside their homes as well as inside for private and domestic use.” (Rares J’s emphasis)

Thus, it appeared Parliament did not intend to draw a distinction between equipment owned and operated by the viewer in his or her own premises. Accordingly, his Honour considered (at [63]):

… the user of the TV Now service makes each of the films in the four formats when he or she clicks on the “record” button on the TV Now electronic program guide. This is because the user is solely responsible for the creation of those films. He or she decides whether or not to make the films and only he or she has the means of being able to view them. If the user does not click “record”, no films will be brought into existence that he or she can play back later. The service that TV Now offers the user is substantively no different from a VCR or DVR. Of course, TV Now may offer the user a greater range of playback environments than the means provided by a VCR or DVR, although this can depend on the technologies available to the user.

Like the 2nd Circuit in Cartoon Network, his Honour considered (at [66]) that there was no real or sufficient distinction between the characterisation of a user of the service to record a FTA broadcast and someone who used a VCR or DVR to do so.

Rares J noted the careful contractual obligations imposed by Optus to ensure that users promised to use the service only for their own private or domestic purposes and, in recognition of the ordinary experience of life, was prepared to infer that was typically the purpose for which the service was used, even apparently in the case of small and business customers.

The other major issue for comment at present is who makes the communication when the customer pressed the “play” button. Rares J recognised that, in a sense, Optus made the communication as it was its servers which transmitted the stream to the customer. Having regard to the deeming provisions in s 22(6) and (6A), however, his Honour considered that the more correct characterisation was that it was the customer him or herself who made the communication. It was the individual customer who decided what was recorded and who also decided whether, when and to where it was transmitted. In reaching this conclusion, Rares J distinguished the situation in Roadshow where a Full Court had found that there could be a communication to the public by transmission of Bittorrent streams between computers without any human intervention. At [91], Rares J considered that the role of the customer of the TV Now service was very different from that of someone who just clicked on a link on a web page. His Honour commented at [95]:

It may appear odd that Optus, which has stored the films in its NAS computer, does not “communicate” (make available online or electronically transmit) the film in the compatible format, but that is because it did nothing to determine the content of that communication. The user initially chose to record the program so that later he or she could choose to play the film so recorded using the TV Now service. Optus’ service enables the user to make those choices and to give effect to them. But in doing so, Optus does not determine what the user decided to record when he or she later decides to play it on the compatible device he or she is then using to watch the film. Hence, the user, not Optus, is the person responsible for determining the content of the communication within the meaning of s 22(6) when he or she plays a film recorded for him or her on the TV Now service. Thus, the user did the act of electronically transmitting the film within the meaning of ss 86(c) and 87(c).

Needless to say, there are quite a few “other” points in Rares J’s 115 paragraphs:

Singtel Optus Pty Ltd v National Rugby League Investments Pty Ltd (No 2) [2012] FCA 34

For a more recent “no volitional act, therefore no infringement” case in the USA see Prof Goldman’s ‘Photobucket Qualifies for the 512(c) Safe Harbor (Again)–Wolk v. Kodak‘

There seems to have been a similar success in Singapore; but Rares J considered the TV Catch Up case in the UK less helpful as the legislation and type of usage in question was rather different. A question on communication to the public has been referred by the English court to the CJEU.

Lid dip: Copyright Council

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A third case of extradition

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The 1709 blog has a good summary of the arrest of Megaupload.com’s Kim “Dotcom” in New Zealand for allegedly copyrights in the USA.

Case 1 (Hew Griffiths aka ‘bandido’)

Case 2 (Richard O’Dwyer)

Meanwhile, some controversy is brewing because the FBI has seized the domain name and apparently blocked any access to the site even by those who have stored material legitimately in the service. Does that mean we all need to start worrying what will happen if our online back-up service is being used by alleged pirates too?

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Extraditing (alleged) copyright criminals

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The internet is all a twitter over the prospect that a 23 year old British subject, Richard O’Dwyer, may be extradited from the UK to the USA to face criminal charges for copyright infringement.

Well guess what, it has happened before albeit from this far away destination.

Mr Griffiths has apparently served his time (in both Australia and the USA) and had this to say to an enterprising journalist.

Lid dip: Graham Dent for the boing boing link!

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ISP gets DMCA win in USA

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The Ninth Circuit has affirmed the trial court’s summary dismissal of UMG copyright claims against Veoh on the basis of §512(c) – the ‘hosting’ safe harbour. UMG argued 3 reasons why §512(c) did not apply:

First, UMG argues that the alleged infringingactivities do not fall within the plain meaning of “infringe-ment of copyright by reason of the storage [of material] at thedirection of a user,” a threshold requirement under§ 512(c)(1). Second, UMG argues that genuine issues of factremain about whether Veoh had actual knowledge of infringe-ment, or was “aware of facts or circumstances from whichinfringing activity [wa]s apparent” under § 512(c)(1)(A).Finally, UMG argues that it presented sufficient evidence thatVeoh “receive[d] a financial benefit directly attributable to. . . infringing activity” that it had the right and ability to control under § 512(c)(1)(B). We disagree on each count, andaccordingly we affirm the district court.

Each of these requirements has a counterpart in our US Free Trade Agreement ‘inspired’ – see s 116AH items 1 and 4 and therefore should repay consideration.

On the knowledge / awareness point:

At [11], Judge Fisher noted that UMG had not notified Veoh of any infringing material under the DMCA before commencing proceedings. After noting at [12] that Congress placed the burden of policing infringements on copyright holders, Judge Fisher continued at [13]:

[13] UMG asks us to change course with regard to§ 512(c)(1)(A) by adopting a broad conception of the knowl-edge requirement. We see no principled basis for doing so.We therefore hold that merely hosting a category of copy-rightable content, such as music videos, with the generalknowledge that one’s services could be used to share infring-ing material, is insufficient to meet the actual knowledgerequirement under § 512(c)(1)(A)(i).
Then at [14], Judge Fisher rejected UMG’s arguments that Veoh should be held to have sufficient awareness of infringing activity:
…. For the same reasons, we hold that Veoh’s general knowledge that it hosted copyright-able material and that its services could be used for infringe-ment is insufficient to constitute a red flag.
In Section 2, Judge Fisher dismissed UMG’s other evidence of awareness. One point of interest was that an email from Michael Eisner CEO of Disney would have been sufficient if from a third party, but was rejected since it was from a copyright holder and did not follow the DMCA process.

The 1709 blog has a good summary and links here.

As Techdirt points out, however, the costs of the litigation drove Veoh out of business.

Next up, presumably, the Ninth Circuit’s decision in the appeal from Viacom v Youtube.

Although, as noted above, the decision has potential ramifications for the corresponding Australian provision, I am not convinced it has much to say on Roadshow v iiNet (which concerned Category A activity, not Category C anyway) where the AFACT Notices seemed to provide specific notice (once properly explained).

UMG Recording Inc v Shelter Capital Partners LLC., Case: 09-55902, 9th Cir. December 20, 2011

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ISPs and “3” strikes in Australia

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On the eve of High Court hearings in Roadshow v iiNet (transcripts here, here and here), the 5 major ISPs in Australia (Telstra Bigpond, Optus, iiNet, iPrimus and Internode) released a proposal (pdf) for dealing with (illegal) file sharers and other online copyright infringers.

Under s 116AG of the Copyright Act, the remedies against an ISP (which is a carriage service provider) for infringing materials transmitted over its network may be restricted to an injunction requiring it to terminate a subscriber’s account or to take reasonable steps to disable access to an online location outside Australia provided the ISP complies with the requirements in s 116AH. Similar limitations on the remedies available are imposed in respect of ISPs in the other categories. One of the conditions in s 116AH is that the ISP had adopted and reasonably implemented a policy for termination of the accounts of repeat infringers in appropriate circumstances.

The proposal can be seen as intended to address that requirement.

The proposal refers to the large amounts of lost revenues often claimed by the copyright owners from illegal activity online. It also draws attention to evidence that large proportions of infringers do not engage in infringing conduct after receiving a warning that their activity is infringing.

Accordingly, the proposal puts forward a scheme in which:

  1. a copyright owner may send a notice alleging infringing activity to an ISP which will then send its subscriber, if it can match a subscriber to the information provided by the rights holder, an education notice;
    1. a 21 day “grace period” will follow to allow the subscriber to seek legal advice or query the notice with a proposed Independent Panel or act on the notice;
  2. after the expiry of the 21 day “grace period”, the rights holder may send a further copyright infringement notice to the ISP if the subscriber is still engaging in the conduct or some other infringing conduct relevant to the rights holder and the ISP will send the subscriber, if it can match a subscriber to the information provided by the rights holder, a Warning Notice;
    1. a 21 day “grace period” would apply for each Warning Notice as well
  3. if, in any given 12 month period, the ISP has issued to the same subscriber an Education Notice and [three] Warning Notices and, presumably, receives another allegation against the subscriber, the ISP will send the subscriber a Discovery Notice and, if the conduct is still continuing or no objection has been lodged with the Independent Panel after 21 days, the ISP will inform the rights holder that the subscriber has not addressed matters after receiving the [third] Warning Notice and the rights holder may apply for preliminary discovery or a subpoena to obtain the subscriber’s details and take direct action against the subscriber for copyright infringement.

The [three] in square brackets is how it is presented in the proposal, presumably to indicate this is an aspect they are willing to negotiate.

A feature of the proposal is its proposal for the institution of a Copyright Industry Panel to prepare and disseminate educational material and operate an “appeals” process whereby subscribers can dispute allegations of infringement.

The proposal points out that setting up the systems to implement this (or presumably any) system to deal with the problem will be expensive and, having regard to the enormous extra revenue copyright owners claim they stand to gain, they should bear some part of that cost.

The proposal is planned to operate for 18 months to evaluate how it works.

It remains to be seen how acceptable all this is to the copyright owners (which in turn may well depend on who “wins” the Roadshow appeal). The Australian Content Industry Group, apparently representing music and film copyright owners such as APRA-AMCOS, reportedly rejected it out of hand.

Except perhaps in the case of ISPs hosting third party websites with infringing material or providing “location information” tools to the sites of third parties who have infringing content and, maybe, some caching activities, it is not immediately clear how the rights owner will identify which subscriber it wants to get an Education or Warning Notice sent to.

Also, it is not clear on my first reading whether the Education Notice and the 3 Warning Notices in any given 12 month period must be sent by the same copyright owner in respect of the same infringement (e.g. the one video on a hosted website) or, presumably, may be generated by different rights holders in respect of the same or different activity?

Communications Alliance Ltd A Scheme To Address Online Copyright Infringement (An Australian Internet Service Provider (ISP) Proposal) (pdf)

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ISPs and filtering

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While we wait with bated breath for the High Court’s deliberations on Roadshow v iiNet (transcript of hearing here, here and here), it is worth noting that the CJEU (formerly the ECJ) has struck down an injunction against an ISP which required the ISP to monitor all its users’ traffic and filter (block) copyright infringing material.

SABAM, the Belgian authors’ collecting society (counterpart to APRA) obtained an interlocutory injunction against Scarlet, an ISP. SABAM contended that some of Scarlet’s customers were using its services to engage in peer-to-peer file sharing of copyright materials without authorisation. It obtained from the Belgian courts an order that Scarlet implement a system of filtering to ensure that its users were blocked or otherwise made it impossible for them to send or receive in any way, files containing a musical work using peer-to-peer software without the permission of the copyright owners.

It was common ground between the parties that this would require Scarlet to introduce a system for filtering:

–        all electronic communications passing via its services, in particular those involving the use of peer-to-peer software;

–        which applies indiscriminately to all its customers;

–        as a preventive measure;

–        exclusively at its expense; and

–        for an unlimited period,

which is capable of identifying on that provider’s network the movement of electronic files containing a musical, cinematographic or audio-visual work in respect of which the applicant claims to hold intellectual property rights, with a view to blocking the transfer of files the sharing of which infringes copyrigh

It was also common ground between the parties that such a system would require :

–        first, that the ISP (Scarlet) identify, within all of the electronic communications of all its customers, the files relating to peer-to-peer traffic;

–        secondly, that it identify, within that traffic, the files containing works in respect of which holders of intellectual-property rights claim to hold rights;

–        thirdly, that it determine which of those files are being shared unlawfully; and

–        fourthly, that it block file sharing that it considers to be unlawful.

That is, the ISP would have to monitor all the traffic across its network.

While the CJEU recognised that IP, in this case copyright, was a fundamental right. It also recognised that its protection needed to be balanced against the protection of other fundamental interests. It was necessary to strike a fair balance between the rights of copyright owners, ISPs and their customers. This injunction did not do that and so was incompatible with Community law (we would say “invalid”):

47      In the present case, the injunction requiring the installation of the contested filtering system involves monitoring all the electronic communications made through the network of the ISP concerned in the interests of those rightholders. Moreover, that monitoring has no limitation in time, is directed at all future infringements and is intended to protect not only existing works, but also future works that have not yet been created at the time when the system is introduced.

48      Accordingly, such an injunction would result in a serious infringement of the freedom of the ISP concerned to conduct its business since it would require that ISP to install a complicated, costly, permanent computer system at its own expense, which would also be contrary to the conditions laid down in Article 3(1) of Directive 2004/48, which requires that measures to ensure the respect of intellectual-property rights should not be unnecessarily complicated or costly.

49      In those circumstances, it must be held that the injunction to install the contested filtering system is to be regarded as not respecting the requirement that a fair balance be struck between, on the one hand, the protection of the intellectual-property right enjoyed by copyright holders, and, on the other hand, that of the freedom to conduct business enjoyed by operators such as ISPs.

50      Moreover, the effects of that injunction would not be limited to the ISP concerned, as the contested filtering system may also infringe the fundamental rights of that ISP’s customers, namely their right to protection of their personal data and their freedom to receive or impart information, which are rights safeguarded by Articles 8 and 11 of the Charter respectively.

Thus, the filtering injunction did not strike a fair balance between the protection of IP and the rights of ISPs and their customers.

Case C-70/10 Scarlet Extended SA v SABAM, 24 November 2011.

IPKat has the text of the CJEU’s Summary and as they point out, the CJEU’s ruling has some interesting implications for the filtering injunction ordered by Arnold J in Newzbin 2.

Of course, in Australia, we do not labour under a Charter of Rights. Section 116AH(2) of the Copyright Act 1968 does, however, place some limits on a “carriage service provider’s” obligations to monitor:

(2)  Nothing in the conditions is to be taken to require a carriage service provider to monitor its service or to seek facts to indicate infringing activity except to the extent required by a standard technical measure mentioned in condition 2 in table item 1 in the table in subsection (1),

which is a rather more anodyne protection. Also, under the Telecommunications Act, carriers and carriage service providers have prohibitions on disclosing information related to communications (which is not the same thing as a prohibition on monitoring), but there are important exceptions including disclosures authorised by or under law. Cf  e.g. ss 276 and 280.

 

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Copyright safe harbour scheme review Mk 2

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Last Friday, the Commonwealth Attorney-General released a Consultation Paper on ‘Revising the Scope of the Copyright Safe Harbour Scheme’.

As reported then, there were two components to that review.

Over the weekend, the second component – streamlining the notice and take down procedures – has been edited out of the revised version (pdf) (doc version via here).

So now, the consultation paper just relates to re-defining “carriage service provider“.

There’s a fact sheet on how the scheme currently works. Unfortunately, the links to the previous review and submissions seem to have been taken down.

Last Friday’s post referred to the US-Australia Free Trade Agreement. The relevant provision is in chapter 17. So far as the protections apply to service providers, Art. 17.11 paragraph 29 provides:

(xii) For the purposes of the function referred to in clause (i)(A), service provider means a provider of transmission, routing, or connections for digital online communications without modification of their content between or among points specified by the user of material of the user’s choosing, and for the purposes of the functions referred to in clause (i)(B) through (D), service provider means a provider or operator of facilities for online services or network access.

This may be contrasted with the corresponding provision in the “parent” of article 17.11, §512(k) (pdf) of the US Copyright Act which defines service provider for the purposes of the DMCA safe harbours as follows:

(1) Service provider.—(A) As used in subsection (a), the term “service provider” means an entity offering the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user, of material of the user’s choosing, without modification to the content of the material as sent or received. (B) As used in this section, other than subsection (a), the term “service provider” means a provider of online services or network access, or the operator of facilities therefor, and includes an entity described in sub- paragraph (A).

At least, the US definition appears to make it clear that a service provider may be one who provides services not just, as the Australian legislation seems to have been drafted to reflect, only providers, or operators, of facilities for such services. Given the nebulous nature of the term ‘facilities’, however, that may be a difference more imagined than real.

Although it doesn’t provide any “binding” authority like the Free Trade Agreement, the EU directives proceed on the basis of persons providing “information society services”. See e.g. art.s 12 -15 of the E-Commerce Directive, DIRECTIVE 2000/31/EC (pdf).

Lid dip: Leanne O’Donnell.

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Copyright safe harbour scheme

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Links to the Consulatation Paper on the Copyright safe harbour scheme for carriage service providers.

Broadly, the safe harbour schemes provide some protection from some remedies for carriage service providers:

Category A – acting as a conduit for internet activities by providing facilities for transmitting, routing or providing connections for copyright material
Category B – caching through an automatic process
Category C – storing copyright material on their systems or networks, and
Category D – referring users to an online location (for example, linking).

The first problem is that the definition of csp isFrom

    in

the Telco Act (i.e.) those providing the, er, telephone service. Didn’t cover Google or Yahoo or a whole host of other Internet service providers. The Australian definition is much narrower than the US definition. So, the Government is exploring broadening this.

There may be a question of what the US Free Trade Agreement permits.

The second question is looking at ways to streamline the notice system.

Lid dip Libby Baulch

Submissions must be in by 22 November 2011.

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The future (?) for booksellers

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Remember all the fuss when the Minister (was reported to have) said all the bookshops (except those in the big cities) were going to close? (or something like that).

It would appear that his comments may have arisen from a report by the Book Industry Study Group.

The report is not public yet, but the 138 submissions are and so is the Market Analysis Research Report from PWC (pdf).

There are lots of facts and figures in there. You may even recognise this as a world you live in:

Lengthy delivery times and insufficient availability of eBook titles are seen as impeding the competitiveness of Australia’s booksellers (‘bricks and mortar’ and online).

On the question of insufficient availability:

Options to improve business models for publishers could involve entering into international agreements to share global rights, competing directly for global rights, and controlling costs through centralisation. Experimentation will remain a priority for book publishers.

“Sharing” global rights probably won’t help the availability problem for electronic titles as that seems to be the cause of the problem. As a consumer, don’t I want less “sharing” so that when things become available electronically overseas I can get access to them now?

Interestingly:

The available evidence suggests that overseas online booksellers are generally able to sell books published overseas at prices (including delivery) that are cheaper than those charged by Australian online booksellers. The price competitiveness of Australian booksellers is affected by the GST, the exchange rate, wholesale book prices, and postage costs.

On postage costs:

Our initial analysis suggests that an Australian business posting a book-like parcel to an Australian address would pay approximately 90 per cent more than a British business would to post the same package to the same address.

Well, if you’ve ever bought a book from The Book Depository, you know you don’t pay anything like the $10+ an Australian retailer charges you -$0. So why would you pay $30+ for a new paperback if you can get it for $10 – 15 from The Book Depository or electronically from Kindle/iBook/Nook?

Being old fashioned, I do enjoy wandering into a book store and browsing, but spending an extra $20 for a paperback which I (usually) only read once?

I do also enjoy reading books set in Australia or, more portentously, about the Australian experience. These cost pressures, however, will surely mean that Australian books will have to become cheaper to compete. It will be interesting to see how the Book Industry Study Group tries to solve that conundrum.

Lid dips: @isobelclare and @smh

 

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Australia signed up to ACTA

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Last Saturday, while half of us were trying not to watch Meat Loaf earn a reported $500,ooo (here, here or here) or tweeting, the Minister for Trade travelled to Japan to sign ACTA (the Department’s home page currently has a photograph of the actual signing).

According to the Minister’s Press Release:

The implementation of ACTA will not require legislative changes in Australia. Rather, trading partners will adapt their laws to the high standards of IP enforcement that already apply in Australia.

According to the USTR, no changes would be required to US law either.

The Minister for Trade’s Press Release states that Australia is one of 10 countries attending the signing + the EU. Howard Knopf reports that those signing included Australia, Canada,  Japan, Morocco, New Zealand, Singapore, (South) Korea & USA, but the EU didn’t. According to ZDNet, the EU still working on it. So this may be a bit “optimistic”.

According to the USTR, the EU, Mexico and Switzerland did attend and “confirmed their continuing strong support for and preparations to sign the Agreement as soon as practicable”.

Lid dip @howardknopf

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