Legal Beagle
Pirate Bay Loses Appeal
Pirate Bay’s co-founders have lost their appeal against convictions for encouraging illegal file-sharing, and have had their collective fine increased by $2 million to $6.5 million.
On November 26, 2010, a Stockholm court of appeals ruled that Fredrik Neij, Peter Sunde and Carl Lundstrom remain guilty of helping Pirate Bay users illicitly share copyrighted music and film content via their website. While the Swedish appeals court did reduce each of their prison sentences from one year to between four and 10 months, it also raised the amount they have to pay in damages to the entertainment industry to $6.5 million.
All four Pirate Bay co-founders were found guilty in April 2010 of assisting in the distribution of copyrighted content. The fourth co-founder convicted in April 2010, Gottfrid Svartholm Warg, did not appear at the appeals court hearings, citing illness.
Following the ruling, Sunde vowed to take the appeal “to the highest court”. Defense lawyers for Neij and Lundstrom said they were not surprised but disappointed by the ruling and confirmed that they would probably appeal to the European Supreme Court.
The four Pirate Bay co-founders were ordered to pay damages to 17 different music and media companies including Sony BMG, Universal, EMI, Warner Music, MGM and 20th Century Fox, having being found guilty of making 33 specific files accessible for illegal sharing.
Neij, 32, must now serve 10 months in prison; Sunde, 32, will serve eight months, and Lundstrom, 50, will serve four. Svartholm, the youngest of the four at 26 years old, will have his case heard at a later date.
The Guardian, November 26, 2010 (Josh Halliday)
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RIAA Wins Big in Third Minn. Downloader Trial
Jammie Thomas-Rasset, the Minnesota woman who has been found guilty of illegally downloading and sharing songs online in 2006, has lost another round in court.
On November 3, 2010, a jury in Minneapolis decided that she was liable for $1.5 million in copyright infringement damages to Capitol Records, or $62,500 for each song she illegally shared in April 2006. The RIAA who represents the four major music labels in the case applauded the verdict.
“We are again thankful to the jury for its service in this matter and that they recognized the severity of the defendant’s misconduct,” the RIAA said in a statement. “Now with three jury decisions behind us along with a clear affirmation of Ms. Thomas-Rasset’s willful liability, it is our hope that she finally accepts responsibility for her actions.”
Thomas-Rasset continues to appeal the judgments that have been ruled against her, “We intend to raise our constitutional challenge again,” said Kiwi Camara, an attorney representing Thomas-Rasset. “The fight continues.”
The trial is the third for Thomas-Rasset, who was originally accused of sharing 1,700 songs, enough to fill about 150 CDs. After one jury found her liable for copyright infringement in 2007 and ordered her to pay $222,000, the judge in the case later ruled that he erred in instructing the jury and called for a retrial. In the second trial, which took place in 2009, a jury found Thomas-Rasset liable for $1.92 million.
Thomas-Rasset subsequently asked the federal court for a new trial or a reduction in the amount of damages in July 2009.
But in 2010, the judge found that amount to be “monstrous and shocking” and reduced the amount to $54,000. Following that, the RIAA informed Thomas-Rasset that it would accept $25,000, if she agreed to ask the judge to “vacate” his decision, which means removing his decision from the record. Thomas-Rasset rejected that offer almost immediately.
The third milestone win for the RIAA in this case is viewed as an effective way to communicate their anti-piracy message to the public. The cases create awareness about the consequences illicit file-sharing may have.
CNet News, November 3, 2010 (Steven Musil)
RIAA.com, November 3, 2010
Read The Press Release: Click Here
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Federal Judge Shuts Down LimeWire
LimeWire has officially been shut down by a federal judge.
The LimeWire case has come to an end as a federal judge Kimba M. Wood of Federal District Court in Manhattan found the P2P (peer-to-peer) file sharing site guilty of assisting users in committing copyright infringement. Judge Wood sided with the plaintiffs who claimed that over 93% of the software’s traffic was made up of infringing content. The case against LimeWire LLC by the RIAA started in 2006, charging LimeWire with online infringement.
Judge Wood also found LimeWire founder Mark Gordon to be personally liable. The RIAA then made two separate motions, one for permanent shut down of the company, and the other for freezing of the company’s assets. The first of these motions was immediately upheld, as LimeWire stopped distributing its software. In its place at the LimeWire company website there is a legal notice posted:
“THIS IS AN OFFICIAL NOTICE THAT LIMEWIRE IS UNDER A COURT-ORDERED INJUNCTION TO STOP DISTRIBUTING AND SUPPORTING ITS FILE-SHARING SOFTWARE. DOWNLOADING OR SHARING COPYRIGHTED CONTENT WITHOUT AUTHORIZATION IS ILLEGAL.”
The Examiner, October 27, 2010 (Cheryl Phillips)
San Francisco Chronicle, November 18, 2009 (Richard Lardner, AP)
Library of Congress, November 17, 2009
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UMG Loses Appeal For Promos
On January 4, 2011, the US Court of Appeals, Ninth Circuit sided with consumer advocates, upholding a lower court’s ruling that a record company couldn’t block the resale of used CDs just by marking them as “not for sale.”
The case pitted Universal Music Group against online merchant Troy Augusto, who acquired numerous promotional CDs and then sold them on eBay.com. Such discs, which the record company mails to reviewers and industry insiders, typically carry labels that declare “Promotional Use Only - Not for Sale.” They may also instruct the recipient that the discs remain the property of the record company and are merely being licensed for promotional use.
The “first sale” provision of federal copyright law holds that the owner of a copy of a work may sell or dispose of it without the copyright owner’s approval. UMG argued that its promotional CDs weren’t covered by the first-sale rule because recipients of the discs didn’t own them, they merely were licensees with limited privileges.
The Ninth Circuit had been sympathetic to similar arguments from software developers, ruling that they can bar the resale of their products by licensing them to buyers instead of selling them outright. But appeals court Judge William C. Canby Jr., writing for the three-judge panel, said that the same logic didn’t apply to UMG’s promotional CDs. That’s because the discs were sent unbidden to people on the UMG mailing list, with no indication from the recipients that they agreed to the licensing terms in the packaging.
“Because the record here is devoid of any indication that the recipients agreed to a license, there is no evidence to support a conclusion that licenses were established under the terms of the promotional statement,” wrote Judge Canby. “Accordingly, we conclude that UMG’s transfer of possession to the recipients, without meaningful control or even knowledge of the status of the CDs after shipment, accomplished a transfer of title.”
As unfair as it seems to record companies, the recipients of promo CDs are now free to ‘dispose’ of the discs as they see fit, and people like Troy Augusto are now free to sell them on eBay.
Los Angeles Times, January 4, 2011 (Jon Healey)
FindLaw.com, January 4, 2011
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Quick BITS AND BYTES
Supreme Court to Tiffany: eBay is OK
The Supreme Court won’t overturn a ruling that says eBay isn’t violating Tiffany’s trademarks by selling items on its website that might be counterfeit.
On November 29, 2010, the high court refused to hear an appeal from Tiffany Inc.
Tiffany sued eBay in 2004, claiming that eBay engaged in trademark infringement and dilution because most items that sellers list for sale as genuine Tiffany jewelry on its sites were fakes.
However, the lower courts had cited the fact that eBay took down listings when Tiffany informed the company that the materials were counterfeit. The judges said eBay cannot be held responsible for counterfeits being sold on its site if the website doesn’t know the items are fake.
Tiffany wanted the Supreme Court to reconsider that ruling. The case is Tiffany Inc. v. eBay Inc., 10-300.
Yahoo! News, November 29, 2010 (AP)
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PC Mag Called Out For Encouraging Piracy
The music industry has accused the IT magazine, PC Mag, of encouraging copyright theft after it listed a number of alternative P2P services in the wake of Limewire being shut down. PC Mag received a letter signed by a number of music industry executives which accused the publication of encouraging copyright infringement.
The PC Mag story had listed six P2P services and torrent trackers, along with the disclaimer that “all of these services should be used for legal downloads, of course.”
Despite the disclaimer the music industry executives were fuming. “The harm done to the creative community when people are encouraged to steal our music is immeasurable. Disclaimer or no, when you offer a list of alternative P2P sites to LimeWire and include more of the serial offenders, PC Magazine is slyly encouraging people to steal more music.”
PC Mag editor-in-chief Lance Ulanoff, replied that it was his magazine’s job to cover all aspects of technology, which includes the products, services and activities that some groups and individuals might deem objectionable.
TechEYE.net, November 25, 2010 (Nick Farrell)