In a decision handed down by Mr Justice Arnold on 20 February 2012, the High Court finds that UK users of The Pirate Bay website are liable for copyright infringement for communicating copyrighted sound recordings to the public and that the operators of The Pirate Bay authorise infringements of copyright by its users and are jointly liable for these copyright infringements (Dramatico Entertainment Limited & others v British Sky Broadcasting Limited & others [2012] EWHC 268 (Ch))

Key points:

  • The UK has shown itself again to be at the forefront of innovative moves to tackle online piracy and prevent abuses of content.
  •  In a trial of two preliminary issues, UK users of The Pirate Bay held to infringe the Claimants' copyrighted sound recordings by communicating these works to a 'new' public.
  •  Operators of The Pirate Bay held to authorise infringements of copyright by its UK users and are jointly liable for the copyright infringements committed by its UK users. 
  • Case brought against the six major Internet Service Providers ("ISPs") in the UK rather than against the operators of The Pirate Bay, who were not joined to the proceedings.
  • Further trial will now follow which will deal with the other issues raised by the claim and the grant of an injunction under Section 97A of the Copyright, Designs and Patents Act 1988 ("CDPA") against the ISPs.

Business impact:

  • Issues raised by this case are of wide interest and of general importance for content distributors.
  •  Rights holders are looking to ISPs for an effective remedy and recompense, having found it difficult to effectively shut down the operators of file-sharing websites which enable users to infringe their copyright.
  •  It is increasingly clear that ISPs cannot avoid responsibility for copyright infringement by its users and must take a more active role in its prevention.
  •  Whilst UK users of The Pirate Bay have been found liable for copyright infringement, this finding may have little practical effect as there is questionable value for the rights holders in pursing these individuals, other than to highlight that users of services like The Pirate Bay are infringing copyright in their own right.

Background:

The Claimants are all record companies and include EMI Records, Sony Music and Virgin Records (amongst others). They bring the claim on their own behalf and on behalf of the other members of the BPI (BPI (British Recorded Music Industry) Ltd) and PPL (Phonographic Performance Ltd).

The Defendants are the six main retail ISPs in the UK who choose not to appear or to be represented at this trial of the preliminary issues. The Defendants took the position that it was for the Court to decide whether the users or operators of The Pirate Bay infringed the Claimants' rights and not for them.

The Claimants seek an injunction against the Defendants under Section 97A(1) CDPA which provides that:

"The High Court (in Scotland, the Court of Session) shall have the 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."

The grant of the injunction remains to be determined as it was not one of the issues considered in the preliminary trial. This trial concerned two preliminary issues namely whether;

  • the UK users of The Pirate Bay infringe the Claimants' copyrights in the UK; and
  • the operators of The Pirate Bay infringe the Claimants' copyrights in the UK.

The Pirate Bay

The Pirate Bay is a Swedish file sharing website which allow users to share electronic files, including multimedia, computer games and software, via BitTorrent. It is a widely used website and the Judge noted that "as at 19 December 2011, over 30 million users worldwide were using its service".

The Pirate Bay was set up by four Swedish individuals. They were convicted for criminal offences involving copyright infringement in Sweden in 2009. They lost a subsequent appeal and the four individuals were sentenced to prison and fined 46 million Swedish Kronor. On 1 February 2012, the Supreme Court of Sweden refused further leave to appeal which means that the judgment against the founders of The Pirate Bay in Sweden is now final. Following the decision of the Supreme Court of Sweden, The Pirate Bay has changed its official domain name to thepiratebay.se from thepiratebay.org. The move to a .se domain is thought to be a move to prevent the US authorities from seizing The Pirate Bay's domain.

Operators of The Pirate Bay not joined as Defendants to the action

Similarities were drawn with the case of Twentieth Century Fox Film Corp v Newzbin Ltd ("Newzbin"); (see our newsflash here), and the case was heavily relied upon by the Judge in reaching his findings on copyright infringement. However, a key difference with the Newzbin case was that the operators of The Pirate Pay were not joined to the current proceedings as Defendants.

The founders of The Pirate Bay left Sweden after the first instance judgment against them in 2009 and it is not clear where they now reside. There have been subsequent civil proceedings against the individuals in Sweden but the Claimants in those proceedings have been unable to effect service. As a result, it is highly unlikely that the Claimants in this action would have been able to effect service on the operators of The Pirate Bay. Section 97A CDPA does not require service or the joinder of a third party and the Judge agreed that it would be "impractical, or at least disproportionate, to require joinder or service of the operators or users of TPB".

Copyright infringement by users

The Claimants' case was that UK users of The Pirate Bay infringe copyright by:

  • copying sound recordings (section 17 CDPA); and
  • communicating sound recordings to the public (section 20 CDPA).

Infringement by copying:

If a user of The Pirate Bay website selects a torrent file in order to obtain a copy of some content and then downloads these sound recording content files and proceeds to copy these content files onto their own computer, this will constitute copyright infringement, if the content itself comprises a copyrighted sound recording. Accordingly, there was no great difficulty in concluding that the users are copying copyrighted content and the Judge held that "UK users of TPB who have accounts with the Defendants have infringed and are continuing to infringe, the Claimants' copyrights by copying the Claimants' sounds recordings on large scale".

Infringement by communication to the public:

The communication to the public of a work is an act restricted by copyright in a sound recording under section 20(1)(b) CDPA. The Judge considered what constitutes a communication to the public and the transposition of Article 3 of the Information Society Directive into UK law in some detail, with analysis of a large amount of recent case law.

The Judge concluded that the CJEU's jurisprudence in relation to Article 3(1) of the Information Society Directive is applicable to sections 20(1)(a) - (c) CPDA. He found that the concept of communication must be construed broadly, in following the judgment of the CJEU in Football Association v QC Leisure (see our newsflash here). The Judge accepted the Claimants' evidence that as the UK users are involved both as uploaders and downloaders of content, it was immaterial for the purposes of Section 20 CDPA whether the act of communication took place at the place of origination or the place of reception.

The Judge held that the UK users of The Pirate Bay communicate the copyrighted sound recordings to the public by electronic transmission as the public can access the sound recordings from a place and a time chosen by them within the meaning of section 20(2)(b) CDPA.

The UK users communicate the recordings to a new public (i.e. a public not taken into account by the rights holders when authorising the distribution of the recordings in the first place) as copies of the sound recordings are made available to users who have not made a purchase from an authorised source. Accordingly, the Judge concluded that UK users of The Pirate Bay infringe the Claimants' copyright.

Copyright infringement by operators of The Pirate Bay

The Claimants did not contend that the operators of The Pirate Bay infringe copyright by communicating copyrighted works to the public under section 20 CDPA. Their case on communication to the public was confined to the UK users. This was different to the claimants' arguments in Newzbin, where it was argued that the operators of Newzbin communicated the copyrighted works to the public. The Claimants' stated reason for the different approach in this case was due to the pending reference to the CJEU in Football Dataco Ltd v Sportradar GmbH and the lack of clarity in CJEU jurisprudence about whether communication occurs where it originates or where it is received (or perhaps both).

The Claimants' case was that the operators of The Pirate Bay are liable for copyright infringement on the basis that they have authorised infringements by UK users, and are jointly liable as accessories for infringements by UK users.

Authorisation:

The Judge considered the factors identified by Kitchin J in Newzbin and concluded that the operators of The Pirate Bay authorise infringements of copyright by its users and that the operators go far beyond merely enabling or assisting users. The Judge found that "It is no defence that they openly defy the rights of copyright owners. I would add that I consider the present case to be indistinguishable from 20C Fox v Newzbin in this respect. If anything, it is a stronger case".

Joint tortfeasance:

The Judge again considered the law as set out in Newzbin, this time with regards to the law on joint tortfeasance. Mere assistance or facilitation of infringement is not sufficient for a finding of joint tortfeasance and in Newzbin, Kitchin J held that the "joint tortfeaser must have so involved himself in the tort as to make it his own".

The Judge considered it relevant that the operators profit from the operation of The Pirate Bay and evidence was presented at trial suggesting that revenue generated by click-through advertising on The Pirate Bay website ranged somewhere between US$1.7 million to 3 million in the month of October 2011. The Judge concluded that the operators of The Pirate Bay are jointly liable for the infringements committed by users as they induce, incite or persuade their users to commit infringements of copyright and that the operators and the users act pursuant to a common design to infringe.

Further trial

As the Claimants succeeded on both of the preliminary issues, the remaining issues raised by the claim and whether the Court sees fit to grant an injunction against all of the Defendants under Section 97A CDPA will now be dealt with at a second hearing later this year. The Judge accepted that having regard to the particular circumstances of this case, having two hearings was a sensible way to proceed but makes it clear that he does not regard it as essential for claims of this nature to be dealt with in two stages.