Blaming ISPs

In a decision that could have global implications, an Australian judge has ruled that an Internet service provider is not responsible for the infringing activities of its users.

During the past few years, major music industry players have called upon ISPs to help combat piracy. In fact, some industry folk have even moved past asking ISPs for help and have blamed connection providers as being part of the problem.

While delivering the keynote address at France’s 2008 MIDEM conference, U2 manager Paul McGuinness said ISPs and telecom companies had “built multibillion-dollar industries on the back of our content without paying for it,” adding, “their snouts have been at our trough feeding free for too long.”

More recently, U2 frontman Bono echoed his manager’s remarks in an op-ed piece for the New York Times. In a piece published on the first Saturday of the year, Bono said ISPs should track what their customers do online.

“We’re the post office, they tell us; who knows what’s in the brown-paper bags,” Bono wrote. “But we know from America’s noble effort to stop child pornography, not to mention China’s ignoble effort to suppress online dissent, that it’s perfectly possible to track content.”

Yes, there’s quite a bit of support, mostly within the music industry, to hold ISPs accountable. However, that movement may have hit a stumbling block when Australian Federal Court Justice Dennis Cowdroy ruled that an ISP couldn’t be held accountable for its users’ actions.

On the plaintiff’s side were 34 movie companies, including Australian branches of Hollywood’s Universal Pictures, Warner Bros. and 20th Century Fox. Together, the entertainment companies accused Australia’s third-largest ISP – iiNet – of failing to prevent users from trafficking in copyrighted material, as in peer-to-peer file-sharing.

But Federal Court Justice Dennis Cowdroy wasn’t persuaded that all the infringement problems could be blamed on the ISP. Although the judge ruled that iiNet was aware that some of its users were swapping copyrighted material, the company could not be held responsible. Cowdroy also said iiNet is unable to stop users from infringing on copyrights.

The judge also addressed a major issue in the case – that failing to stop infringement actually authorizes infringing activity.
“I find that the mere provision of access to the Internet is not the ‘means’ of infringement,” Cowdroy said.

Cowdroy also said that, while movie copyrights were being infringed upon on a large scale, ISPs shouldn’t have to shoulder the blame “merely because it is felt that something must be done.”
While investigating possible infringements, the film companies hired investigators to record instances where iiNet users swapped copyrighted material via BitTorrent technology, resulting in 3,000 pages worth of infringing activity per week.
The movie companies then sent infringement notices to iiNet asking the company to tell the users to stop the madness, and to disconnect the infringers if they ignored the company’s pleas. The film companies also asked iiNet to block some specific sites.
In response, iiNet did warn its customers. However, the ISP claimed that some of the film companies’ demands, if enacted, would violate privacy and freedom of speech laws.

Of course, a decision made by an Australian court isn’t legally binding throughout the world. But it does indicate how other courts might rule when and if presented with similar cases. Plus, if iiNet was found liable for the infringing actions of its users, that might open the door for just about anyone to sue an ISP for whatever its users may be up to.

“If the ISPs become responsible for the acts of their customers, essentially they become this giant and very cheap mechanism for any one with any sort of legal claim,” said University of New South Wales’ Cyberspace Law and Policy Center executive director David Vaile. “The ISPs become the policemen, the enforcers.”

Watching The Detectives

University of Georgia police recently arrested an employee whose responsibility was to catch students, faculty and employees using the university’s network to download copyrighted material. His alleged crime? Blackmailing those he caught, telling them he would ignore their alleged infringements in return for cash payments.

According to the Athens Banner-Herald, campus police arrested 37-year-old Dorin Lucian Dehelean for trying to extort money from a UGA student.

Dehelean, while working for the university’s Enterprise Information Technology Services, contacted a student in January and told her he had caught her violating university policy by downloading copyrighted material. However, Dehelean also told the student he could make “the situation go away in exchange for money,” according to UGA police chief Jimmy Williamson.

But the student told Dehelean she didn’t have any money. Then she told an academic official about Dehelean.

Campus police were notified and a plainclothes UGA officer posing as the student met with Dehelean, who was eventually arrested and charged with one count of theft by extortion – a crime punishable by up to 10 years in prison.

But what may be the worst part of this episode is that UGA police believe Dehelean might have attempted to blackmail other students and one may have even paid him off.
“We are running down some leads that may lead us to other victims,” Williamson said. “We have information that makes us believe [Dehelean] might have had another transaction.”

Rhapsody To Stream Alone

Online music service Rhapsody is about to become its own master, as RealNetworks and Viacom announced plans to restructure the joint venture into its own stand-alone corporation.

RealNetworks is the majority owner and operator of Rhapsody America LLC, while Viacom holds a minority stake in the online music service. Both companies plan to restructure Rhapsody into an independent company. RealNetworks will contribute operating capital to help the online streamer stand on its own two feet.

Under the terms of the restructuring expected to be completed by the end of the first quarter, RealNetworks will not have any operating control over the service and Rhapsody will have no single majority owner.

“Separating Rhapsody into its own independent company is a significant first step in making RealNetworks a more focused and profitable company,” RealNetworks President and acting CEO Robert Kimball said. “Rhapsody will be the largest pure play digital music service in the market. We have provided Rhapsody with the right team, and financial and intellectual property assets to succeed in the competitive market for digital music.”