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By: MarkJ - 28 July, 2011 (9:23 AM)
internet copyright lawpirate flagRights Holders have won a significant and controversial victory against a UK internet provider today after it succeeded in using the High Court of Justice (London) to force BT into blocking access to the pirate website Newzbin2. The ruling, which could result in all broadband ISPs being forced to block access to any website that is deemed to facilitate "illegal" internet copyright infringement, has been welcomed by creative industries.

The situation began in December 2010 when the MPA filed an injunction against BT which, using Section 97A of the UK Copyright, Designs and Patents Act, required the provider to block access to a Newsgroup (Usenet) indexing website called Newzbin2.

Presiding Judge, Justice Arnold, ruled today:

"In my judgment it follows that BT has actual knowledge of other persons using its service to infringe copyright: it knows that the users and operators of Newbin2 infringe copyright on a large scale, and in particular infringe the copyrights of the Studios in large numbers of their films and television programmes, it knows that the users of Newzbin2 include BT subscribers, and it knows those users use its service to receive infringing copies of copyright works made available to them by Newzbin2.

In general, I am satisfied that the order sought by the Studios is a proportionate one. It is necessary and appropriate to protect the Article 1 First Protocol rights of the Studios and other copyright owners. Those interests clearly outweigh the Article 10 rights of the users of Newzbin2, and even more clearly outweigh the Article 10 rights of the operators of Newzbin2. They also outweigh BT’s own Article 10 rights to the extent that they are engaged.

The order is a narrow and targeted one, and it contains safeguards in the event of any change of circumstances. The cost of implementation to BT would be modest and proportionate."

Rights Holders have been quick to warn this morning that the "comprehensive and unequivocal judgment sets a clear legal precedent", which they claim will enable content creators and distributors to secure greater cooperation from ISPs to address piracy on the internet.

Chris Marcich, President and MD (EMEA) of the MPA, said:

"This ruling from Justice Arnold is a victory for millions of people working in the UK creative industries and demonstrates that the law of the land must apply online. This court action was never an attack on ISPs but we do need their cooperation to deal with the Newzbin site which continually tries to evade the law and judicial sanction. Newzbin is a notorious pirate website which makes hundreds of thousands of copyrighted products available without permission and with no regard for the law."

Spyro Markesinis, Vice President of Business and Legal Affairs at Momentum Pictures, said:

"Without licensing revenues, films simply cannot be funded or produced. If that means a film like The King's Speech may not be made in the future, the public, as well as those people whose livelihoods depend on film, will lose out. So we applaud the decision and look forward to working with the ISPs and the Government to keep the pressure up on the pirates and help safeguard the future of the industry."

Lord Puttnam CBE, President of Film Distributors’ Association, said:

"Today’s result is an important victory in the battle against a commercial pirate site which refused to operate within the law. Finally, it seems we have a way to deal with rogue sites which will benefit the film industry including UK independent distributors and, more broadly, the entire creative sector."

Richard Mollet, Chief Executive Officer, The Publishers Association, said:

"This is a great result and will benefit the whole of the creative sector. Online infringement has been allowed to run unchecked for far too long, damaging jobs and growth. It is satisfying to see that the Copyright Act gives the creative sector the ability to fight back."

Geoff Taylor, CEO of the BPI, commented:

"This judgment sends a clear signal that ISPs have a role to play in protecting their customers from rogue websites that exploit and profit from creative work without permission, ignore takedown notices and locate themselves beyond the reach of law enforcement."

Rights Holders claim that Newzbin2 has around 700,000 members, which help the sites operator to generate "in excess of £1 million per year". A series of related court rulings have already found Newzbin2 to be breaking the law.

Peter Bradwell, Copyright Campaigner at the Open Rights Group (ORG), said:

"Website blocking is pointless and dangerous. These judgements won't work to stop infringement or boost creative industries. And there are serious risks of legitimate content being blocked and service slowdown. If the goal is boosting creators' ability to make money from their work then we need to abandon these technologically naive measures, focus on genuine market reforms, and satisfy unmet consumer demand."

Mike O’Connor, CEO of Consumer Focus, said:

"Website blocking only treats the symptoms, not the cause of why consumers infringe copyright. Blocking access to Newzbin2 is short-sighted and will not reduce demand for Hollywood movies. Consumers will seek out other sources and the only long term solution is more and better legal alternatives.

“Release windows” imposed by Hollywood studios drive some UK consumers to access movies through unlicensed sites. Currently Sky has an exclusive deal so that for 15 months after cinema release it is the only provider that can show a Hollywood movie online or on television. The Competition Commission has been looking into this situation since August 2010 with a decision due next month.

Content producers want a market structure that generates maximum profits - meeting consumer demand for movies by offering services legally with different price points, either through subscription or pay-per-view, is the only viable long-term solution. The issue is not that consumers won’t pay – after all Newzbin2 is a subscription service.

We are heading into a blocking injunction arms-race -what we really need is the members of the Motion Picture Association to be innovative and focus on meeting UK consumer demand legally."

BT will now have to adapt its Cleanfeed system, which works alongside the Internet Watch Foundation ( IWF ) to block child sexual abuse content, to include the infringing website. The move is also likely to put significantly more pressure upon ISPs to agree a new Voluntary Code of Practice for handling related blocks.

The government is currently working with both ISPs and Rights Holders on the details of this and today's ruling will weaken the position of ISPs during any negotiations. At present ISPs have concerns over the costs of doing this and are seeking an impartial judge to asses each case (i.e. to prevent legal retaliation by site owners).

The Voluntary Code is necessary for Rights Holders because it would otherwise be too costly for them to pursue ISPs through the courts every time they wanted a particular website blocked. Unfortunately such filtering systems are both expensive to develop, especially for smaller ISPs, and also incredibly easy to circumvent (VPN, Proxy Servers, DNS changes etc.).

A BT Spokesperson said:

"This is a helpful judgement, which provides clarity on this complex issue. It clearly shows that rights holders need to prove their claims and convince a judge to make a court order. BT has consistently said that rights holders need to take this route. We will return to court after the summer to explain what kind of order we believe is appropriate."

ISPreview.co.uk understands that BT will not have to block Newzbin until October 2011 since a number of technical, and potentially economic, details have yet to be worked out. This also fits in with the current discussions over a Voluntary Code of Practice, which incidentally would only focus on a small-ish number (i.e. top 100) of the most directly infringing websites (i.e. not YouTube and Google etc.).

UPDATE 11:33am

Added a comment from BT above. BT told ISPreview.co.uk that it has consistently stated that "copyright infringement is wrong" and argued that rights holders like the MPA should use the courts to enforce their legal rights, including under section 97A, (which has been available to them since 2003) and that they will comply with a court order as a result of any such case. "This case demonstrates that we were right," added BT.

BT also pointed out that, crucially, this case involves a site against which these rights holders have already taken legal action and on which there is a previous court judgment finding infringement. The ISP added, "the judgment makes it clear that rights holders wanting blocking orders about other sites will need to substantiate allegations against individual sites before the courts."

UPDATE 11:42am

A statement from the UK Internet Service Providers Association ( ISPA ) follows.

Nicholas Lansman, ISPA Secretary General, said:

"ISPA has long maintained that this is an issue that rights holders should seek to address in court, rather than through voluntary means, and today’s ruling should go some way to offering clarity on what is a complex area.

However, concerns about over-blocking, ease of circumvention and increased encryption are widely-recognised which means that blocking is not a silver bullet to stop online copyright infringement. Rather, as the Government-commissioned Hargreaves Review recently found, there should be more focus on offering innovative, fully-licensed content services to give consumers what they are clearly demanding."

UPDATE 12:32pm

The boss of UK ISP Aquiss has also waded in to today's news.

Martin Pitt, Managing Director of Aquiss UK, commented:

"I am serious concerned to hear today that the High Court of Justice has awarded in favour of the Motion Picture Association (MPA) and the blocking of the web site Newzbin. The blocking of web sites, in my view, is not the way forward to address the interests of Rights Holders, but does sadly open the flood gates that Internet Service Providers have to police the internet for
content outside our control. This will increase costs on ISPs. If the MPA wishes to have greater cooperation with ISPs, providing investment in better distribution methods, rather than court cases, would go along way."

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