Motion Picture Association v BT,(1) known as Newzbin 2, was about the legal remedies that can be obtained to combat online copyright infringement. The case had a favourable outcome for a collection of rights holders, with the High Court issuing an injunction under Section 97A of the Copyright, Designs and Patents Act 1988 against an internet service provider (ISP) to block access to an unlawful file-sharing website, Newzbin2.
Rights holders have previously made successful legal claims against infringing websites, forcing them to shut down. However, such victories often prove hollow, as the operators simply create a near-identical infringing website elsewhere. Newzbin2 is the first case in the United Kingdom in which rights holders have forced an ISP to block access to an infringing website. It represents a significant step forward for copyright owners, such as film and music companies, and establishes another weapon in the fight against large-scale copyright infringement.
At the centre of the issues in this case were two EU directives, which provide competing rights to different parties.
The EU E-commerce Directive (2000/31/EC) provides protection for companies (eg, ISPs) that are engaged in certain types of internet activity. Companies that simply transmit information in a network are "mere conduits" and are not liable for copyright infringements which take place on their networks. The directive was transposed into UK law by the Electronic Commerce (EC Directive) Regulations 2002.
The EU Information Society Directive (2001/29/EC) states that, notwithstanding the protections afforded to ISPs in the E-commerce Directive, rights holders may apply for an injunction against intermediaries whose services are used by a third party to infringe copyright. The recitals to the directive state that:
"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 carries a third party's infringement of a protected work or other subject-matter in a network."
The Information Society Directive was implemented by Section 97A of the act, which states that "[t]he High Court… shall have power to grant an injunction against a service provider, where that service provider has actual knowledge of another person using their service to infringe copyright".
In a 2010 case(2) www.newzbin.com was found to have infringed the copyright in films owned by a number of major film studios. Following an injunction, the original Newzbin company went into liquidation and the original Newzbin website stopped operating. Shortly afterwards a virtually identical website, Newzbin2, started to operate from the same domain name.
Newzbin2 operated in essentially the same manner as its predecessor and provided the means for continued large-scale infringement of copyright in films which were owned or licensed by the claimants - Twentieth Century Fox, Universal, Warner Bros, Paramount, Disney and Columbia.
Newzbin2 was operated by unidentified individuals who acted under pseudonyms. The servers used to host the website were located in Sweden, not in the United Kingdom, and the domain name 'www.newzbin.com' was registered to a Seychelles company. These facts presumably dissuaded the claimants from trying to proceed against the website, as they had done in the previous action. Instead, the claimants brought an action against BT, seeking to block access to the Newzbin2 website. BT is the largest ISP in the United Kingdom, with around 35% of the market.
The judge ruled in favour of the claimants and granted an injunction under Section 97A of the act, requiring BT to adopt certain technical means to prevent its subscribers from accessing the Newzbin2 website. BT had accepted the claimants' submissions that it was a 'service provider' under Section 97A, but had raised a range of arguments against the injunction being granted. The judge rejected the arguments, finding that:
at the time that the content was downloaded and the infringement took place, both a Newzbin2 service and a BT service were being used;
BT had "actual knowledge" of the infringement taking place;
the operation of the 'mere conduit' defence under Article 12(1) of the E-commerce Directive should not prevent the granting of the injunction;
the injunction would not breach Article 15(1) of the directive, which prohibits EU member states from imposing a general obligation on ISPs to monitor information transmitted or stored across their network; and
the injunction would not infringe the rights of Newzbin2's users to freedom of expression under Article 10 of the European Convention of Human Rights.
The decision represents a major victory for the claimants, which may now challenge other high-profile file-sharing websites with renewed vigour. As leading Hollywood film distributors, the claimants are in the enviable position of having the financial clout to pursue such websites aggressively.
For rights holders without these financial means, the position is less satisfactory. Shortly after the judgment was handed down, the government announced that it would scrap plans to allow rights holders to compel ISPs to block infringing websites. The plans had been a tenet of the Digital Economy Act 2010, but communications regulator Ofcom reviewed the blocking policy earlier in 2011and found the required technology to be problematic and ineffective. Ofcom found that the technology tended to block legitimate content and could be circumvented by some users. For now, rights holders must rely on injunctive relief under Section 97A of the Copyright, Designs and Patents Act if they wish to block access to infringing sites. This process is likely to be longer and more expensive than the process envisaged under the original Digital Economy Act plans.