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CONSUMER REPORT

Crackdown on Illegal Downloading Brings Global Legal Action

Illegal file-sharing through peer-to-peer networks continues to be a problem for copyright owners despite efforts by various industry groups and court rulings. However, recent developments might provide hope for copyright owners as zealous prosecution of users by the entertainment industry across the globe might be providing the proper deterrence.

The following are summaries of some of the recent developments in this area.

This month, the Recording Industry Association of America (RIAA) continued its pursuit of individual users by filing lawsuits against 753 people it claims have engaged in illegally swapping of music over the Internet.

Settlements Up to $5,000

This is just another wave of lawsuits that the RIAA and its member music companies have initiated after already suing more than 6,500 people for copyright infringement. Most of these actions have resulted in settlements with monetary terms in the range of US$3,000 to $5,000.

This latest lawsuit involves people at 11 different universities who were using a variety of file-sharing networks, such as Kazaa, Grokster and eDonkey.

The music industry credits its legal attacks against infringers with increasing music sales by 1.6 percent in 2004. RIAA President Cary Sherman believes that these lawsuits “are a critical deterrent” that “arrests the extraordinary growth of illicit” file sharing.

On the other side of the pond in the UK, the British Phonographic Industry (BPI) has recently won legal battles on two fronts.

First, in a recent action, the BPI reached an out of court settlement for 50,000 Pounds (US$95,603) with 23 people engaged in illegal file-sharing, where the average compensation payment was 2,200 Pounds (US$4,206) each. The BPI said that “these settlements show we can and will enforce the law.”

BPI General Counsel Geoff Taylor stated that the BPI is “determined to find people who illegally distribute music, whichever peer-to-peer network they use, and to make them compensate the artists and labels they are stealing from.” However, Taylor went on to say that the BPI has “no desire to drag people through the courts. So we have attempted to reach fair settlements where we can.”

ISP Monitoring

On a second front, a British High Court granted an order requiring six British Internet service providers to disclose the names and addresses of 31 individuals alleged to have been involved in illegally uploading music files onto peer-to-peer networks. The BPI typically will monitor file-trading networks such as Kazaa or eDonkey to obtain Internet Protocol addresses of users’ computers and then will ask a court to order ISPs to release their identities.

Meanwhile, the fight against pirated music took an interesting turn recently in Italy, where the Italian fiscal police in Reiti, a town near Rome, imposed a groundbreaking fine of up to 1.4 million Euros ($US1.8 million) on a DJ who had illegally downloaded more than 2,000 MP3 files and 500 video clips.

The fiscal police operation that targeted radio stations and clubs in the region found that the DJ played the MP3 files in a nightclub. Although the fine remains subject to administrative recourse, the Italian Recording Industry Association (FIMI) has indicated that this fine is the largest fine imposed to date on an individual for the illegal copying and use of MP3 files.

Enzo Mazza, director of FIMI, declared: “This DJ was touring clubs and making money out of the music he played — while those who had invested time, talent, hard work and money into creating the music in the first place did not get a cent. We hope this precedent will serve as a deterrent for those who are thinking of doing the same.”

In another recent case, a French Court of Appeal released from prison an individual who was sued for copying almost 500 movies on the Internet, burning them and sharing them with friends. The decision was based on Article L-122-5 of the French Intellectual Property Code, which states that “authors can’t forbid copies or reproductions that are only intended for the private use of the copyist.”

Enforcement Will Deter

Although this decision seems to provide the impression that private use might be a defense against a claim of online copyright infringement, there are still approximately 50 similar criminal cases pending, and in the past, infringers have been sentenced.

Forceful enforcement initiatives by the entertainment industry, settlements involving payment of substantial monetary damages, fines and imprisonment will likely reduce the volume of illegal downloading — however, the bigger challenge for copyright owners is to change the mentality among most users that online content such as music is common property to be used at will and without any fees.

It has been said that “information wants to be free,” but with these recent developments in the music industry, that “information” better not come with a tune. If it does, you will pay for it — user fees or fines, your choice.


Javad Heydary, an E-Commerce Times columnist, is a Toronto lawyer licensed to practice in both Ontario and New York and is the managing editor of Lawsof.com.


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