Capitol Records, A Division of Universal Music Operations Ltd v British Telecommunications Plc
| Jurisdiction | England & Wales |
| Judge | Mr Justice Miles |
| Judgment Date | 25 February 2021 |
| Neutral Citation | [2021] EWHC 409 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: IL-2018-000221 |
| Date | 25 February 2021 |
[2021] EWHC 409 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
INTELLECTUAL PROPERTY LIST
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Mr Justice Miles
Case No: IL-2018-000221
Edmund Cullen QC & Gwilym Harbottle (instructed by DLA Piper UK LLP) for the Claimants
The Defendants did not appear
Hearing dates: 3 February 2021
Introduction
The Claimants are record companies suing for themselves and in a representative capacity on behalf of other record company members (“Members”) of BPI (British Recorded Music Industry) Limited (“BPI”) and Phonographic Performance Limited (“PPL”). BPI is co-ordinating these proceedings on behalf of the Claimants. BPI is itself a member of the International Federation of the Phonographic Industry (“IFPI”), an international record industry body.
The Claimants seek an order pursuant to section 97A of the Copyright, Designs and Patents Act 1988 (“the Act”) against the Defendant internet access providers (often referred to as internet service providers (“ISPs”)) requiring them to take measures to block their subscribers' access to the website currently known as nitroflare.com (“Nitroflare” or “the Site”). The Claimants contend that the Site is being used to infringe Members' copyrights on a large scale.
The Claimants call Nitroflare a cyberlocker site: that is a file storage site which makes available unlicenced commercial content, including music files, by allowing users to upload and download unlicensed content to and from its servers. As the Claimants accept, the cyberlocker tag is pejorative and potentially tendentious. I shall therefore look beyond the label and consider the substance of how the Site operates and the services it offers to users.
Arnold J helpfully set out the legal framework for website blocking orders in Dramatico Entertainment Ltd v British Sky Broadcasting [2012] EWHC 268 (Ch) (“ Dramatico”) at [30]–[38]. That jurisdiction has been further explained and developed in EMI Records Ltd v British Sky Broadcasting Ltd [2013] EWHC 379 (Ch); The Football Association Premier League Limited v British Sky Broadcasting [2013] EWHC 2058 (Ch); Paramount Home Entertainment International Limited v British Sky Broadcasting [2013] EWHC 3479 (Ch) (“ Paramount”); 1967 Ltd v British Sky Broadcasting [2014] EWHC 3444 (Ch) (“ 1967 Ltd”); Twentieth Century Fox Film Corp v Sky UK Ltd [2015] EWHC 1082 (Ch) (“ Popcorn Time”); Football Association Premier League Limited v British Telecommunications Plc [2017] EWHC 480 (Ch); Nintendo Co Ltd v Sky UK Ltd [2019] EWHC 2376 (Ch) (“ Nintendo”); and Matchroom Boxing Ltd v BT Plc [2020] EWHC 2868 (Ch) (“ Matchroom”).
The Claimants contend that the Court has jurisdiction in the present case to make the blocking order because: (i) each of the Defendants is a service provider within the meaning of section 97A, (ii) the users and/or operators of the Site infringe the Claimants' and Members' copyrights, (iii) the users and/or operators of the Site use the Defendants' services to do so and (iv) the Defendants have actual knowledge of this. The Claimants further submit that it is just and proportionate for the Court in its discretion to make the order sought in respect of the Site.
The claim was issued and served on the ISPs with the evidence on 21 December 2018. Supplemental evidence updating the factual position was served in December 2020 and on 3 February 2021. The Claimants explain the delay since December 2018 as follows. Website blocking orders are complex and require careful identification of the technical steps to be taken by the ISPs. ISPs do not usually consent to their being made but are usually prepared to agree the terms of an order which they will not then oppose, leaving the decision to the Court. Since December 2018 the Claimants have had long-running open and without prejudice negotiations with the Defendants about the form of the order. On the date of the hearing before me the ISPs confirmed that they had agreed the form of the order with the Claimants. They did not oppose the making of the order in principle.
It appears from the researches of the Claimants and their counsel that this is the first application for a blocking order in respect of a site of the present kind. In light of the comments of Birss J in Popcorn Time at [5]–[15], I decided that there should be a hearing rather than dealing with the application on paper.
The evidence and factual background
I have considered and relied on the following evidence: (a) the first, second and third statements of Mr Kiaron Whitehead, General Counsel of BPI. He is responsible for the overall co-ordination of the proceedings on behalf of the Claimants; (b) the first and second statements of Mr Michael Walsh, an IT specialist who acts as a consultant for the BPI. He has acted for BPI in an expert capacity in a number of previous applications pursuant to s. 97A. Mr Walsh's first statement analyses the Site, including: (i) how it is organised to facilitate the uploading and distribution of copyright content; (ii) the percentage of content on the Site for which the Copyrights are owned by the Members; (iii) its likely annual revenues; (iv) the information BPI has on its operator and hosting provider; (v) the process by which IFPI identifies and monitors infringing content on the Site; and (vi) Mr Walsh's recommendations as to the most effective technical means by which to block access to the Site. He has updated his evidence in his second statement, in which he concludes that there has been no substantive change to the Site and its functionality since the date of issue of the Application.
In this section I summarise the Claimants' evidence. I have drawn heavily on the Claimants' helpful skeleton argument (having satisfied myself that it faithfully reflects the underlying evidence).
The Claimants' copyright works
Each of the Claimants is in the business of making, owning and exploiting sound recordings of musical compositions. For the purposes of these proceedings, particular recordings have been selected as sample works (the “Claimants' Recordings”). All of the Claimants' Recordings were available on the Site when a check was carried out in March and October 2018. Each of the Claimants either owns or is the exclusive licensee of the UK copyright in the relevant Claimants' Recording; none of the Claimants has licensed the Site.
The Claimants' Recordings represent a minute fraction of the sound recording copyrights held by the Claimants and the Members on whose behalf these proceedings are brought. Mr Whitehead explains that the Members together hold the UK rights for approximately 99% of all sound recordings legally consumed in the UK, and that no Member has granted a licence to the Site or its users. The updated evidence from Mr Walsh shows that since December 2018 Members' recordings have continued to be made available on the Site in large numbers.
The Site
The Claimants' case is that the Site is deliberately designed to encourage the uploading and downloading of copyright material. They say that it is different from legitimate file storage or file sharing sites. This is why they use the cyberlocker tag. As I said at the outset, the court needs to look beyond the labels and consider the substance of the services offered by the Site.
I shall turn to specific features of the Site in a moment but, in general terms, the Site encourages the sharing of links which it has generated and the downloading of content which it stores. It does this by allowing users to upload content to the Site's servers for free. Downloads can then be made for free by the Site's ‘premium’ and ‘non-premium’ users, with download speeds being faster if a user pays for a premium account. The Site also offers an ‘Affiliate Programme’ which rewards users who upload content. It enables those users to earn money each time their uploaded content is downloaded by another user.
Mr Walsh refers to a number of features of the Site. He says that these indicia show that the Site is not offering a genuine file storage, or file sharing, service but is instead in the business of enabling users to share popular content with members of the public.
The Claimants' evidence establishes to the civil standard that the Site has the following features:
i) The Site allows users to upload and download files.
ii) The Site has a policy whereby uploaded files which are not downloaded by anyone for a period of 90 days will be removed (this was previously 30 days). This avoids storage space being taken up by files which no-one wishes to download. It makes the Site unsuitable for the storage of files which the user wishes to retain.
iii) The Site operates an affiliate programme whereby uploaders earn money from the Site on the basis of (a) the number of downloads of files uploaded by them and (b) the number of sales of premium accounts originating from links from their uploaded...
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Blocking Order Relief For Intellectual Property Rights Holders
...(Ch). 9. Nintendo Co., Ltd v Sky UK Ltd & Ors [2019] EWHC 2376 (Ch). 10. Capitol Records & Ors v British Telecommunications Plc & Ors [2021] EWHC 409 (Ch). 11. Dramatico Entertainment Ltd & Ors v British Sky Broadcasting Ltd & Ors [2012] EWHC Read the original article on GowlingWLG.com The ......
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Blocking Order Relief For Intellectual Property Rights Holders
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