Saturday, July 23, 2011

TorrentFreak Email Update

TorrentFreak Email Update

PayPal, IFPI and Police Collaborate To Strangle Pirate Music Sites

Posted: 23 Jul 2011 03:43 AM PDT

In March this year IFPI announced that they had reached agreement with MasterCard, Visa and the City of London Police to develop cooperation against sites selling unauthorized music. Under the deal, IFPI investigators hand evidence of infringement to the police who proceed to engage the payment processors.

“Once the police have verified the evidence, they notify MasterCard and Visa who require the acquiring bank providing the retailer with payment services to produce evidence of appropriate licenses to sell music or cease providing those services to the retailer,” IFPI explained.

It’s suggested by IFPI that the main targets of the action are Russian ‘AllofMP3′-style clones, sites that often operate legally under domestic legislation much to the disappointment of the international music industry.

However, the engagement of a new and powerful ally this week has the potential to affect many ‘private’ members-only BitTorrent sites, wherever they may be.

While the March announcement from MasterCard and Visa would have been of little concern to the majority of torrent sites, the news that online payment processor PayPal is now getting on board will be viewed very differently and will sound a cautionary warning for the future.

Admittedly the relationships between PayPal and torrent sites don’t always run smoothly (accounts and funds are often frozen or completely lost), but nevertheless PayPal remains the long-standing donation service of choice for dozens, maybe hundreds, of torrent sites. Very often donations are their only source of revenue.

While in connection with this scheme IFPI specifically refer to the ‘sale’ of illicit music (something which the vast majority of torrent sites don’t directly engage in), previous anti-piracy cases have framed torrent site user donations as “subscriptions” or “paid memberships.” To the UK police, who have already been happy to arrest the admins of several torrent and other file-sharing sites, the difference may be academic.

“Today’s announcement shows that PayPal is very serious about fighting music piracy,” said Carl Scheible, PayPal UK’s managing director.

“We’ve always banned PayPal’s use for the sale of content that infringes copyright, and the new system will make life even harder for illegal operators. Our partnership with the music industry helps rights holders make money from their own content while stopping the pirates in their tracks.”

As highlighted in our earlier article, it is perfectly possible to run a few-hundred-thousand-peer private tracker for a fairly modest monthly outlay but with rising costs associated with topsite access (for obtaining new content quickly) and site-run seedboxes, outlay can begin to spiral out of control.

If the music industry does indeed pressure PayPal to take action against torrent site donations as well as sites directly selling unauthorized music, administrators will be forced to reconsider their positions. Some will undoubtedly call it a day.

Source: PayPal, IFPI and Police Collaborate To Strangle Pirate Music Sites

“Appalling” $1.5m File-Sharing Verdict Slashed To $54,000

Posted: 22 Jul 2011 01:43 PM PDT

Back in November 2010, Jammie Thomas-Rasset lost her re-retrial against the RIAA.

The jury found her guilty of infringing the rights of Capitol Records and awarded a $62,500 fine per song punishment.

Sharing just 24 songs using the file-sharing client Kazaa was set to cost her a cool $1.5 million.

But now, following a decision by a federal court, that verdict has been slashed to ‘just’ $54,000. In delivering his verdict, U.S. District Judge Michael Davis slammed the November decision.

“The Court concludes that an award of $1.5 million for stealing and distributing 24 songs for personal use is appalling. Such an award is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable,” Judge Davis wrote in his verdict.

“In this particular case, involving a first-time willful, consumer infringer of limited means who committed illegal song file-sharing for her own personal use, an award of $2,250 per song, for a total award of $54,000, is the maximum award consistent with due process.

“This reduced award is punitive and substantial. It acts as a potent deterrent.”

This latest verdict marks the third occasion that Judge Davis has overruled the decision of a jury in the RIAA’s case against Rasset-Thomas.

In 2007 a jury hit Jammie Thomas-Rasset with a $222,000 verdict. She appealed and in 2008 a mistrial was declared. Judge Davis ruled that the fines were "disproportionate to the damages suffered."

The case went for re-trial before a new jury in 2009 and a guilty verdict was reached yet again, this time with even harsher fines. Thomas-Rasset was ordered to pay $80,000 per infringement, a massive $1.92 million in total.

Just a few months on and this amount was slashed to $54,000 when the award was deemed unconstitutional.

In November 2010 the appeal of the retrial was heard and once again the RIAA and Capitol Records came out on top. The jury decided that Thomas-Rasset had to pay a $62,500 fine per shared song, a total of $1.5 million, a verdict which has today been overturned by Judge Davis.

Today’s decision is unlikely to mark the end of the road in this case. The RIAA are said to be dissatisfied with the result and are reported to be considering their options.

Lawyer Ben Sheffner, who broke the news, posted a copy of the decision online (embedded below).

Order on Motions to Amend/Alter Verdict in Capitol v. Thomas-Rasset

Source: “Appalling” $1.5m File-Sharing Verdict Slashed To $54,000

Anti-Piracy Lawyers Find Cheaper Way To Identify BitTorrent Users

Posted: 22 Jul 2011 08:48 AM PDT

Every first year law student knows that copyright related court cases are exclusively a matter of federal law. You can’t bring a copyright suit in state court, period.

However, during the past months more and more BitTorrent-related cases were filed at state courts. And as a complete surprise to us, the judges in question granted the copyright holders the right to subpoena the Internet providers of subscribers they accuse of copyright infringement.

Once the copyright holders obtain the personal details they use this to send out their infamous pay-up-or-else letters, asking the alleged file-sharers to send them a few thousands dollars. On the surface this seems to be identical to what the copyright holders are doing in the federal court cases, aside from the fact that it’s easier and less expensive.

But how can this be? Are these cases being handled properly, have judges forgotten that copyright cases don’t belong in a state court?

In order to find out more about this shortcut we contacted anti-piracy lawyer Marc Randazza whose law firm has filed federal lawsuits against hundreds of BitTorrent users. Randazza told us that the cases filed at state courts are not lawsuits against the alleged sharers, but merely a request to allow the copyright holders to demand that ISPs hand over customer information.

“What is going on here is a complaint for pure discovery — in other words, all the lawyer is asking the court for is for the court to give him the right to figure out who the defendants are. This seems to me to be a proper way to do things,” Randazza told TorrentFreak, admitting that he also has also filed a few cases in state court.

“In effect, it seems like a good thing for the defendants, the plaintiffs, and the courts. Look at it this way: If you do it the federal way, you need to file a case with the proper parties joined. So, separate cases for each hash file and possibly separate cases in separate states — depending on how the local court looks at jurisdiction.”

Although we’re not sure whether simplifying and cheapening the discovery process is a good thing, as it may lead to even more alleged sharers being targeted, Randazza argues that it will lead to cheaper settlement offers.

“If you do it this way, you can at least engage the potential defendants early on. If you do that, your costs are lower and thus your settlement figures can be lower.”

“In my torrent cases, my defendants have to pay pretty high figures to get out of the case — because we put a lot of money and effort into the case. If there were an easier way to get in contact with the torrenters, then they would likely all get off much lighter. Food for thought for potential defendants,” Randazza told us.

But are people really looking for lower settlement offers?

As pointed out earlier, the major problem with the settlement scheme is that people get wrongfully accused, and lower payoffs don’t change that. On the contrary, handling these cases the state court way will only increase the number of potential settlements without a proper review of the ‘evidence’.

In addition, hiring legal representation will make even less sense with lower settlements fees, as that will be more expensive than settling the case outright. It will leave most alleged illicit BitTorrent users with no other option than to settle, even if they are wrongfully accused.

Despite Randazza’s comments, we have the feeling that lawyers who take their cases to state court are not doing this with the interests of their targets in mind. But that shouldn’t surprise anyone of course.

Source: Anti-Piracy Lawyers Find Cheaper Way To Identify BitTorrent Users
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