Sunday, August 7, 2011

TorrentFreak Email Update

TorrentFreak Email Update


Super 8 Screener Leaks – With Howard Stern’s Name All Over It

Posted: 07 Aug 2011 12:18 AM PDT

A high-quality copy of the Steven Spielberg movie ‘Super 8′ has turned up online and is spreading like wildfire. While it is hardly unusual for preview copy DVD screeners to become available in this way, it is unusual for them to carry watermarks which appear to identify the source of the leak. Come Monday morning, Howard Stern might have some questions to answer.

Back in June, Paramount Pictures were setting their lawyers on Todd Blatt, a mechanical engineer from Baltimore.

Blatt had used his design skills and 3D printing company ShapeWays to come up with replicas of the strange cube-shaped objects seen in the Steven Spielberg movie, Super 8.

While that confrontation appeared to end fairly bloodlessly, a new copyright controversy surrounding the movie may not.

Poor-quality cammed copies of Super 8 started turning up online as soon as the movie premiered, but during the last 24 hours the game has gotten a whole lot more interesting. Several P2P release groups have uploaded the movie in high-quality, each one apparently sourced from the same studio-issued DVD Screener.

As can be seen from the screenshot below, the copy has the usual watermarks across the bottom of the screen stating that the movie is the property of Paramount Pictures. However, in the top right hand corner is another watermark which appears to indicate who the copy was given to – H STERN.

Super 8 Watermark

The watermark runs throughout the entire copy and although it’s possible that someone is trying to have some fun at Mr Stern’s expense by putting it there, it seems unlikely that a release group would do such a thing.

Furthermore, if that was the case and a clean ‘unpranked’ copy was available, it would turn up very quickly indeed. At the moment it seems that all release groups are using the same source.

A few hours ago Stern stylist Ralph Cirella denied having anything to do with the leak.

Ralph

The other possibility of course is that there is another H STERN on the DVD Screener list. Likely? We’ll probably find out on Monday.

Source: Super 8 Screener Leaks – With Howard Stern’s Name All Over It

Are You Guilty If Pirates Use Your Internet? Lawyer Says NO

Posted: 06 Aug 2011 07:21 AM PDT

Every month thousands of people are sued for allegedly sharing copyrighted material on BitTorrent. Many of the accused claim to be innocent, and point their finger at someone else who may have used their Internet connection to share the file. But does this mean they’re off the hook? Lawyer Nicholas Ranallo believes so.

ranalloToday we publish two opinion pieces from copyright lawyers who are familiar with the mass-lawsuits against alleged BitTorrent users in the U.S.

Both lawyers discuss whether someone can be held liable for the copyright infringements committed by others on their Internet connection.

The opinion below comes from Nicholas Ranallo, who is a licensed attorney in California and New York. He currently resides in Boulder Creek, California and is building a solo practice handling emerging issues in Intellectual Property, Internet law and e-commerce.

Ranallo’s opinion focuses on the question of whether people are liable for the copyright infringements of others, which may occur when they operate an open WiFi network or when they share their internet access with roommates or employees.

The other post in this series, which argues the opposite of Ranallo (but focusing on the open WiFi angle only), can be found here. We thank both Ranallo and Randazza for their contribution.

Liability for 3rd Party Copyright Infringement: A Lawyer's Take on Misleading Legal Claims by Pre-Settlement Trolls

The continuing adventures of the copyright trolls have been covered widely on this blog and others, so I will limit my thoughts today to one particular aspect of the scheme: Copyright trolls' claims regarding your responsibility for someone else's infringement of copyrighted works.

Or in other words, are you liable for the infringements of other people when you choose to leave (parts of) your wiFi network open to friends, family or even complete strangers. In the press many of the attorneys representing copyright holders claim you are. Some even have a dedicated section on the topic included in with their settlement letters.

Lawyer John Steele for example, uses the following description, which he has ironically enough pirated from a FAQ that competitor copyrightsettlements.com hosts on its website.

"If you are unfamiliar with the copyright protected file or content, we normally find that the infringement was the result of a spouse, child, roommate, employee, or business associate uploading, downloading or otherwise sharing or displaying the copyright protected material over your Internet connection. Infringements can also result from an unsecured wireless network. In any of these scenarios the Internet Service Provider (ISP) account holder is still legally responsible for the infringement(s) and settlement(s) fees.”

This statement needs to be deconstructed and examined. There is a lot of (mis)information in there, with many startling claims about copyright liability.

As a whole, the trolls' statement of your potential defenses reminds me a lot of the mob's policy on similar issues in Goodfellas : Your roommate downloaded this? F__k you, pay me. Your child downloaded this? F__k you, pay me. Your 'business associate' or someone you've never met downloaded this? You get the idea.

Perhaps it's not surprising that the flow chart at copyrightsettlements.com always ends up at "you are guilty," however THIS IS NOT THE LAW. In fact, their claims are legally incorrect in a fun assortment of ways. I'm going to focus only on the ways that it's incorrect under existing copyright law in this article.

Third-Party Liability for Infringement under Existing (Real) Copyright Law

It's important to focus on the concept of third-party liability under copyright law because the copyright trolls' entire scheme is built on one particular aspect of copyright law – statutory damages. Normally, a plaintiff's recovery is limited to actual damages, or the monetary measure of the actual harm done. The copyright law, however, imposes statutory minimum and maximum penalties that are grossly disproportionate to the value of an actual work (i.e. one copy of a song or video), up to $150,000 for the most egregious infringements. Perhaps not surprisingly, this $150,000 figure gets cited a lot by copyright trolls as the amount to which they will be entitled if they sue you.

Courts have articulated three basic ways that a person can be held liable for infringing another's copyright: direct liability, contributory liability, and vicarious liability. Direct liability means, quite simply, that you infringed the copyright yourself. This is first-party liability and is probably not surprising to anyone. The other two are the focus of this article, and the ultimate rebuttal to the misstatements in the FAQ.

A. Contributory Infringement

In MGM v. Grokster 545 U.S. 913, 930 (2005) the United States Supreme Court (USSC) described liability under the doctrine of contributory infringement as follows: "One infringes contributorily by intentionally inducing or encouraging direct infringement." The USSC approvingly cites Gershwin Publishing Corp. v. Columbia Artists Mgmt., Inc., the 2nd Circuit Court of Appeals adopted the following test for contributory infringement.

"One who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may also be held liable for the infringement. 443 F2d 1159, 1162 (2nd Circuit 1971).

The Gershwin test has been widely adopted by courts, including in the 9th Circuit, home to copyrightsettlements.com. As you can see, this test is far narrower than the F__k you, pay me test adopted by copyrightsettlements.com. The Gershwin test specifically requires:

1) Knowledge of the infringing activity
2) Intent
3) Inducing, causing, or materially contributing to the infringing conduct of another.

The 9th Circuit had a chance to revisit the issue of contributory infringement in the wake of the USSC ruling in Grokster, described above, and elaborated further on the requirements for contributory infringement in the digital realm in Perfect 10, Inc. v. Amazon.com, Inc., 508 F. 3d 1146(9th Circuit, 2007). Perfect 10 held that:

“a computer system operator can be held contributorily liable if it 'has actual knowledge that specific infringing material is available using its system and can “take simple measures to prevent further damage' to copyrighted works, yet continues to provide access to infringing works."

Notably, the italics in this sentence were the court's own, and emphasized ACTUAL knowledge of SPECIFIC infringing material. This is certainly not the test described by CEG.

B. Vicarious Infringement

The USSC also described vicarious infringement in MGM. The Court stated that one “infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it.” Grokster, 545 U.S. at 930, 125 S.Ct. 2764.

Like contributory liability, above, this definition has multiple elements, BOTH of which need to be shown to before imposing liability.

1) Profit from direct infringement
2) A right (and ability) to stop or limit the infringement

This test has two distinct elements, BOTH of which need to be shown to impose liability. I cannot think of a good faith argument that any of the parties described by the core claim actually profit from infringing activities, especially when the work that is claimed to be infringed is porn. An employer profits from an employee downloading porn? Really? You profit when someone downloads porn via your unsecured connection? Profit? This stretches all bounds of credulity.

It almost seems unnecessary to go into the second element, the right and ability to control, when the first element cannot reasonably be shown. But this prong also raises a host of issues, especially in cases involving spouses, "business associates", or roommates. I need only recall the look of my college kitchen to conclude that we never really had sufficient right or ability to control each others' activities in any way.

C: Inducement?

The USSC discussed a third potential avenue for third-party liability in MGM under the broader rubric of contributory liability, but this route is equally unhelpful for the core claim. In MGM the Court recognized that one could be liable if they "induced" the infringement of another. The Court held that "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties." MGM at 936-37.

Although this could conceivably apply to an unsecured router, the court is quick to extinguish this possibility for the situations described in the core claim. The court specifically states that:

"Accordingly, just as Sony did not find intentional inducement despite the knowledge of the VCR manufacturer that its device could be used to infringe, 464 U. S., at 439, n. 19, mere knowledge of infringing potential or of actual infringing uses would not be enough here to subject a distributor to liability… The inducement rule, instead, premises liability on purposeful, culpable expression and conduct…".

Notably, the FAQ page emphasizes repeatedly that purposeful, culpable expression and conduct is not at all necessary. It does emphasize, however, that you are still liable.

The Takeaway

The copyright troll's core claim regarding third-party liability is extremely misleading regarding the present state of third-party liability under copyright law. As each misstatement works to the benefit of the trolls, I can only assume that this misrepresentation is intentional. One can only wonder whether they will face claims of fraud and misrepresentation from those who were misled by these statements.

(Disclaimer: The legal analysis and opinion expressed herein are solely those of the author. Nothing herein is to be construed as legal advice and is not meant to replace the advice of an attorney with knowledge of the specific facts of your case. No attorney-client relationship is created, and you should not send me confidential information. Please just don't try to sue me for offering my thoughts. Thank you.)

Source: Are You Guilty If Pirates Use Your Internet? Lawyer Says NO

Are You Guilty If Pirates Use Your Internet? Lawyer Says YES

Posted: 06 Aug 2011 07:21 AM PDT

Every month thousands of people are sued for allegedly sharing copyrighted material on BitTorrent. Many of the accused claim to be innocent, and point their finger at someone else who may have used their Internet connection to share the file. But does this mean they’re off the hook? Lawyer Marc Randazza believes not.

randazzaToday we publish two opinion pieces from copyright lawyers who are familiar with the mass-lawsuits against alleged BitTorrent users in the U.S.

Both lawyers discuss whether someone can be held liable for the copyright infringements committed by others on their Internet connection.

The opinion below comes from Marc Randazza, a lawyer who has sued thousands of BitTorrent users in recent months on behalf of copyright holders. His piece focuses mainly on the question of whether people who operate open WiFi networks are liable for the copyright infringements of others.

As much as we may disagree with his cases in this field, Randazza has always been gracious with his time when we have had questions about his and other cases.

We understand that our readers may not agree with Randazza either, but we ask that comments remain civil and respectful. He has been respectful to us, and we ask that readers treat him as our guest and take the opportunity for debate.

The other post in this series, which argues the opposite of Randazza, can be found here. We thank both Ranallo and Randazza for their contribution.

—–

Why Negligence in Torrent Cases?

I. Introduction – Is it illegal to leave your wifi open?

For a while, I have been bringing anti-torrent cases against defendants who have been illegally distributing my client's movies. However, we recently began adding a negligence claim to the complaints – arguing that if you leave your wifi open, and someone uses it to pirate my client's materials, you are at least partially responsible. In the wake of a recent judgment for $10,401.00 against a defendant in one of these cases, where the $10,000 was for the negligence claim, I have gotten quite a few inquiries from people asking if it is illegal to leave your wifi open.

I am pleased to report that there are no laws on the books, which affirmatively mandate that you must lock your wifi. However, there are civil claims that can make you liable for the infringements of others. That is what civil claims are for — to privatize certain legal issues. When there is a car accident, we don't usually bring the prosecutors into it. The parties figure out who was negligent, and the negligent party pays the other party for its damages.

What it comes down to is whether the defendant had a part in the plaintiffs damages. So the question is not: “Is it illegal to have open wifi?” The correct question is: “Can you be held liable for what others do with your connection if you leave your WiFi open?” The answer to that is “yes you can.”

II. Negligence

The law of negligence has a long history, and it morphs over time. The unchanging elements of a negligence claim are:

* Duty – did the defendant have a duty?
* Breach – did the defendant breach that duty?
* Causation – was the breach the cause of the plaintiff's damages?
* Damages – were there damages, and if so, how much?

Whether or not there is a duty is where the most debate occurs. Whether or not there is a duty is a matter of law for the court to decide, and some courts have already endorsed the theory that there may be a duty to keep your wifi secured. In an ever-evolving legal landscape, legal duties are constantly updating with technology. In law school, we are introduced to this concept by reading the case called "The T.J. Hooper." In that case, the plaintiffs shipped two barges full of cargo, there was a storm, the barges sank and the cargo was lost.

The defendants were the owners of the tugboats that were towing the barges. The plaintiffs claimed that since the tugboats did not have working radios that could have warned them about the storm, the tugboat operators were negligent. This was 1932, and radios were not required to be on the ships by any law. Furthermore, it was not common custom for commercial ships to have them at this point, and only one company on the whole Eastern Seaboard used them.

Judge Learned Hand wrote the opinion in this case, and he stated that it did not matter that there was no law mandating their use. It did not even matter that shipping companies generally did not have radios. Hand wrote that it is the province of the courts to decide whether a duty exists, and it is not up to the affected group to make that decision. In circumstances of evolving technology, the duty may change along with technology, even if common practice does not.

III. Application: Is leaving your wifi open "negligent"?

I believe that leaving your home wifi open is, indeed, negligent. Unlike the radios in the T.J. Hooper case, closed wifi connections are actually the norm. The vast majority of Americans recognize that leaving their wifi connection open is foolhardy and likely to lead to trouble. I have heard other lawyers compare leaving your wifi open to leaving a loaded gun lying around.  I think comparing open wifi to a loaded gun is overly melodramatic and hysterical.  However, the point is well taken – you are leaving the instrumentality of an illegal act out there for anyone to use.

While unlike leaving a gun around (nobody ever died from open wifi), I’d say leaving your home wifi open is more like leaving your keys in your car in your driveway.  Someone might just steal it, in which case the only person who gets hurt is you, right?

Wrong. 

The kind of person who would steal your car is probably the kind of person who would commit other crimes (or just do something stupid).  So if you leave your keys in your car, and someone takes it and drives it into someone's fence, you’re at least partially responsible for the damage.  If the car thief runs off, who should pay for the damage? The fence owner or you? It would seem that between those two parties, you would be more responsible than the fence owner. You wouldn't say that the fence owner should have built a better fence, would you?

That's what negligence is:  It is the law saying "You really should have seen that coming."  When you do something careless, and that carelessness costs someone else money, you pay the ”carelessness tax” – Negligence. 

And the kind of person who would steal wifi is more likely to steal something else, isn’t he?  So if you invite wifi theft by leaving your home network open, you’re more likely than not also inviting more.  

While there is no law requiring you to keep your wifi secured, the absence of a law is no refuge from the consequences of being careless. The existence of the duty is heightened by the fact that it is common knowledge that cyber criminals use open wifi networks to commit nefarious acts. Everyone has heard about the cases where purveyors of child pornography used open wifi connections to transmit their materials. Then, the poor saps who left them open are greeted by police raids.  

Is your wifi open?  I would bet it is not.  Mine certainly isn't, and the reason why is not that I mind sharing with my neighbors.  If my neighbor needs my wifi for some reason, I have a guest network that I would share with him if he asks.  But, then if I get a subpoena for something he did, at least I know who to point the finger at.  I'm not willing to take that risk for someone who might just be cruising around in a car looking for an opportunity to commit a crime. 

IV. Other Benefits of Bringing the Negligence Claim

Bringing a negligence claim in a torrent case has some added benefits. It takes care of two classes of defendants:  The “it was some other guy” case, and the "if I lie about open wifi, you can't get me" case.  

The Some Other Guy Case: When pressing these cases, I frequently talk to the IP account owner, and he says "It was my roommate, not me." When someone gives me the “it was some other guy” defense, I would much rather go after the other guy. When the roommate gives up the other guy, I think that pressing a negligence claim against him is a bit mean-spirited, and I recommend dropping the negligence claim against a cooperative account holder.

However, if the account owner does not want to reveal the identity of the actual guilty party, then he is shielding the defendant and I have no qualms about making him a defendant too. In cases like that, I’m required to press the negligence claim, to get to the truth, and obtain proper compensation for my client. There is very little chance that a roommate will not know what is going on, and if they are supplying a connection to someone who is using that connection to steal from my client, then my client has a legal right to be compensated for its losses. If someone is concealing the direct infringer, then I find little wrong with holding that person responsible.  

The Open Wifi Liar: The unfortunate fact is that a common meme among the “IANAL, but I play one on torrent boards,” crowd is that any torrent suit can be won if you lie and tell the plaintiff that you had an open wifi.  I’ve caught even real licensed lawyers dispensing this “advice.”  (which is unethical)  There are even those who advocate leaving your wifi open on purpose, just so that you can have plausible deniability about anything that happens on your network.  I would say that one out of two defendants that I deal with initially claim “I had open wifi.” That winds up being a lie about 95 percent of the time   If they were all telling the truth, there would be free wifi coast to coast, and the age of wifi Aquarius would be upon us.   

So how do we move forward in these kinds of cases?  

Step 1: A relatively mild investigation and questioning of the potential defendant.  Most non-sociopaths are lousy liars and are easily tripped up. This step winds up shaking out a good percentage of the liars.  Often telling the “some other dude” account holder that we will move forward with the negligence claim gives them pause and they get the roommate on the phone. This is effective most of the time, but not 100%.  So what do we do then?  Move on to the next two options:

Option A: We engage in discovery, seize all of the computers in the house, issue subpoenas to everyone the account holder knows, and start having depositions of everyone who lives in their home and neighborhood.  By the time we’re done, we not only will likely have gotten to the bottom of things, we would have flipped the defendant’s entire life upside down.  While that might get us somewhere, I prefer not to be that heavy-handed if I can avoid it. 

Option B: Recognize that the open wifi story still leaves negligence liability on the table, so work with that. This gives us an avenue of liability with which to hold people responsible without turning their neighborhood upside down.

Ultimately, the negligence claim brings a lot of benefits. The downside is that occasionally, you catch someone who was simply merely careless. When that happens, my client is usually willing to use discretion and to settle rather lightly. Sometimes, when the defendant is particularly sympathetic, and it is clear that they are not lying, we have been willing to settle for little more than them filing a police report and agreeing to lock their wifi down.

V. Conclusion

I respect the perspective of those who don’t like the negligence claim.  They have every right to say that they disagree with the law. The owners of the T.J. Hooper didn't think it was fair that they were held to a standard, which neither law nor custom required them to live up to. But, the court understood that sometimes, when you can take a pretty easy and cheap route to preventing harm, you may very well have a duty to do so. You can keep your wifi open if you like, and if nobody ever uses it for evil purposes, then you won't ever be held negligent. Similarly, if the T.J. Hooper had only seen calm seas, its owners would have gotten away with not having radios.

Ultimately, it comes down to "what should you have done?" And, "if you don't do it, and someone else loses, who should bear the cost?" It may seem unfair to some, but if you consider that my client is losing money, and the open-wifi-guy (even if he wasn’t one of the liars) contributes to that loss, who should bear the cost? Between him and my client, I think it should be him.

Furthermore, this claim really helps to shake out some of the more dishonest people, who deserve to get sued.  Therefore, I stand behind bringing the negligence claims, and I think that the good outweighs the bad.  

VI. Epilogue

Let me conclude by thanking Ernesto and the TorrentFreak community for this opportunity to share the marketplace of ideas with you all. Wide open and robust debate on matters of public concern is what the First Amendment is all about. I recognize that this is not a friendly forum for my positions, but nobody ever grew or learned anything from just shouting into an echo chamber.

I respect dissenting opinions. I think there is room for healthy disagreement on most items, and I am not unaware that this negligence claim is controversial.

The fact is, I have a job to do, and I’m going to do it for my client to the utmost of my ability.  My engagement letter with my clients does say that I will withdraw from representation if they want me to take action that will cause harm to the First Amendment.  But other than that, my client is entitled to the full menu of legal theories that I can come up with. Anything less would be unethical on my part.  

Source: Are You Guilty If Pirates Use Your Internet? Lawyer Says YES

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