Media CAT vs Adams: a new hurdle to the DEA implementation?

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While the judicial review proceedings in relation to the Digital Economy Act are reaching their final stage (prior to a possible appeal), the London Patents County Court has recently raised important questions in the latest case brought against alleged illegal file-sharers in Media C.A.T Ltd and Malcolm Adams et al.
Media CAT had entered into several contracts with film copyright owners granting it “all rights necessary to allow [Media CAT] to inquire claim demand and prosecute through the civil courts where necessary any person or persons identified as having made available for download a [copyrighted-protected] film”. Under those contracts, Media CAT would have the “sole and exclusive right to demand collect and receive all revenues of illegal file sharing”.

The course of action followed by Media CAT and its lawyers to identify and prosecute illegal file-sharing activities, is in line with what has now become a routine (as well as an unpopular) procedure. Media CAT instructed a company called NG3 System Ltd to monitor P2P networks and obtain a list of IP addresses that had allegedly downloaded films, together with the dates and times of such downloads. Media CAT subsequently obtained court orders (through the Norwich Pharmacal procedure) for ISPs to disclose the identity of the owners of those IP addresses. Once the names and addresses of the alleged infringers became known, Media CAT solicitors (ACS: Law) sent around 10,000 letters threatening legal action and asking for £495 in settlment. The judge considers that, following the receipt of those letters, 20% of the addressees have likely agreed to settle and that approximately £1M was collected (with 65% of that sum going to ACS:Law in accordance with their agreement with Media CAT).

The defendants argued that the technology used by the claimant to monitor P2P activity was not sufficient to prove that infringements had occurred. The NG3 System tracking software was definitely not error-free since an “IP address may end up on the tracker list even when a person starts downloading a file onto their home system but then stops immediately, [in which case]no file is downloaded (or so little of a file as to be irrelevant) but the tracker system has logged the IP address as a node on the P2P network”.

His Honour Judge Birss QC has unfortunately not had a chance to give a final decision on the merits of the alleged infringements, since the claimant requested to discontinue the proceedings due to financial and legal problems of both Media CAT and ACS:Law, although it is clear that the judge did not have any sympathy for the claimant’s conduct. Interestingly though, he raised some questions on the validity of the evidence introduced during the case, casting doubts on the use of tracking and monitoring technology for the prosecution of online piracy:

1. “Does the process of identifying an IP address in this way establish that any infringement of copyright has taken place by anyone related to that IP address at all?

2. Even if it is proof of infringement by somebody, merely identifying that an IP address has been involved with infringement, […] does not mean that the particular defendant [i.e. the holder of that IP address] has done so.

3. The damages claimed deserve scrutiny. If all that is proven is a single download, then all that has been lost is one sale of one copy of work.. The sort of sum that might represent would surely be a small fraction of the £495 claimed […].”

We don’t know whether the judge’s comments would have been incorporated in his final decision on the merits of this case, but it will be interesting to see whether his reasoning will have any impact on the DEA judicial review proceedings, as it emphasises that any new legislation in this field will struggle to survive deep scrutiny based on the principle of proportionality and on any evidence-based judicial challenge.

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