Industry Suppressed Report Showing Users Of Shuttered 'Pirate' Site Probably Helped Movie Industry...

from the well,-look-at-that dept

We've seen study after study after study after study after study showing, contrary to the claim of the industry and certain politicians that users of file sharing sites are pure "freeloaders" who are "leeching," that the users tend to be larger spenders on media and ancillary products. So it's really not a huge surprise that a new study would come out saying the same thing...

But, in this case, the history of the report, which has not actually been released, is a lot more interesting. As you may recall, in June, law enforcement across Europe arrested a bunch of people for apparently running Kino.to -- a site that had been listed by US entertainment lobbyists as one of the worst of the worst "pirate sites," out there. So, it sure would be interesting to find out that, before all of this happened, some entertainment industry lobbyists had commissioned research into the type of folks who used Kino.to and their media consumption habits.

Indeed, as TorrentFreak found out, it appears that just such a report was commissioned and created... and the results matched all those other studies we've seen:

The study, which was carried out by Society for Consumer Research (GfK), found that users of pirate sites including Kino.to did not fit the copyright lobby-painted stereotype of parasites who take and never give back.

In fact, the study also found that Internet users treat these services as a preview, a kind of “try before you buy.”

This, the survey claims, leads pirate site users to buy more DVDs, visit the cinema more often and on average spend more than their ‘honest’ counterparts at the box office.

“The users often buy a ticket to the expensive weekend-days,” the report notes.

Of course, this report never saw the light of day. The only reason it appears to be getting out is what appears to be disgruntled researchers on the report who are upset it was spiked by whoever commissioned it... though the firm does have a history of working with organizations within the movie industry.

Of course, all of this raises some questions. Considering all of this research -- including some that appears to have been sponsored by the industry itself... why does the industry continue to lie and insist that people who use these sites are pure freeloaders? Do they not believe their own studies? Or do they simply fear the loss of control such a reality would really mean? Either way, it seems that those politicians, law enforcement officials and press who continue to parrot the industry's claims about those who use these services might want to reconsider how they portray these sites.

Filed Under: europe, file sharing, movies, piracy, studies
Companies: kino.to

EU Considers Banning Ratings Agencies From Warning That Countries May Be In Financial Trouble

from the head-in-the-sand-regulating dept

Ratings agencies, who rate the risk and financial viability of all sorts of debt products, were one of the major scapegoats of the financial crisis. A lot of people pointed the blame finger at them, noting that they rated all sorts of incredibly risky and often highly questionable financial instruments as being incredibly safe. And, it's absolutely true that they did a dreadful job. But, it's kind of ridiculous to blame companies for stating an opinion. On top of that, it's a basic free speech issue. You can't tell a company that it can't express an opinion on the financial soundness of something. To me, the real problem with the ratings agencies was that the government built them into the law. That is, the government required certain institutions to maintain specific percentages of "highly rated" bonds in order to engage in certain activities. That not only legitimatized the opinions of ratings agencies like Moody's and S&P, but it also gave those "opinions" much more of a feeling of fact, rather than opinion. Could you imagine if the government said movies could only be shown in theaters if the NYTimes and the Washington Post movie reviewers gave them positive reviews? That's what the law is basically like with ratings agencies.

And while I think that the big ratings agencies can make big mistakes, that doesn't mean the answer is to shut them up. However, some regulators in Europe disagree. They're discussing a plan to require agencies to not give out ratings, specifically on sovereign debt, which is where many of the key concerns are right now. With many countries in Europe facing serious debt problems (Greece, Portugal, possibly Spain and Italy among them), it seems like Europe has decided the best way to deal with the problem... is to stop people from talking about the problem.

It's difficult to think of a worse plan.

The defenders of the plan complain that S&P, Moody's and Fitch represent an oligopoly over ratings. And that may be true, but that's no excuse for stifling speech. The way to deal with an oligopoly is to add more competition to the market, rather than limiting what those companies can do... especially when it comes to things like expressing an opinion.

Filed Under: europe, free speech, rating agencies, sovereign debt
Companies: fitch, moody's, s&p

EU Court Disagrees With Pretty Much Every Other Court; Says Ebay May Be Liable For Third Party Trademark Infringement

from the not-this-again dept

The luxury goods folks have been on the legal warpath against Ebay for a while, because they don't like the fact that anyone else can make a market for their product, other than "authorized" distributors. They hide some of that by claiming that their real concern is in "counterfeit" products being sold, but the truth is they want to control the full distribution chain. For years, though, they've been bringing a variety of lawsuits against eBay, trying to establish that the company has some sort of weird requirement to magically know if a good someone is selling is counterfeit (the real goal is to get Ebay to block all sales of their products, and if they can get liability for any infringing works, then Ebay has incentives to block all such products).

In the US, the war has been waged by Tiffany, which resulted in a big fat loss at the appeal court level and no interest from the Supreme Court in hearing an appeal. The courts correctly and smartly pointed out that general knowledge that people infringe via the site is not enough to say that the site should have to police the products -- especially since it had no clue how to tell what was really infringing and what was legit. Furthermore, Ebay bends over backwards to take down counterfeit products when it becomes aware of them, and also has a whole program to make it easier for trademark holders to alert the company of counterfeit goods.

In Europe, the battle has been waged by L'Oreal. And, even though European governments and courts seem to have a more welcoming view towards third party liability than US courts, for the most part, L'Oreal has lost many, many times in Europe (it's filed similar lawsuits in a whole bunch of countries). However, it appears to have finally found a slightly sympathetic court.... and tragically, it's the European Court of Justice (the top European Court), which has ruled that Ebay can be liable in certain cases, if it's determined (a) that the goods for sale target the EU market, if the company is considered to have played "an active role" and if it "has enough information" to determine that the use is infringing. Now this isn't quite as bad as some of the press have made it out to be, as the Court still says there are protections... but it does outline key exceptions to those protections, and the key question is on which side of the line Ebay falls.

Ebay claims that it's in compliance and thus not guilty of such infringement, but I'm sure L'Oreal will be pushing the case back in the specific court (this is the UK case). Still, just opening the door like this to a rather subjective standard of "active role" and having "enough information" to know that something is infringing, seems wide open to abuse... and could lead to Ebay making its service a lot less useful, just because some luxury brand giants hate competing.

Filed Under: europe, liability, trademark
Companies: ebay, l'oreal

EU Politicians Realize US View Of De Facto Ownership Of The Internet Makes Their Data Protection Laws Irrelevant

from the jurisdictional-mess dept

One of the topics that we've discussed since the very beginning of Techdirt is the odd questions of jurisdiction raised by the internet. Pre-internet, most (though not all) jurisdiction questions where fairly straightforward: where was the alleged infraction/crime committed. Once you added the internet to the question, things got weird fast and no one seemed to really want to deal with it. Over the years, there have been some flareups here and there, but over the last couple of years, one thing has started to become clear: the US government feels that it has jurisdiction over much of the internet, even as it decries any other country that suggests something similar.

As we noted recently, folks, like Erik Barnett at Homeland Security, have a rather expansive view over why the US has jurisdiction over any website using a .com or .net domain name. And, of course, it goes way beyond that as well, with the recent admissions from Microsoft that EU data protection rules are effectively meaningless when faced with a US PATRIOT Act request for data. Basically, the US appears to claim that even if the data is stored in Europe, with strict data protection rules, if it's a US company, the US believes it has jurisdiction and can demand access to it.

Not surprisingly, this is upsetting EU officials, who realize that their data protection rules may be effectively meaningless if the US continues to take this rather expansive view of its own jurisdiction.

While you can understand why US officials and law enforcement want to view the world this way, what stuns me is that they appear to be both totally tone deaf to how this makes the US look abroad, as well as oblivious to the obvious unintended consequences and likely counter moves to such a view. Not only does it give moral cover to other countries doing the same thing -- potentially harming US interests significantly -- it's also going to lead to inevitable backlash and widespread harm to US companies and internet users, as users in foreign countries won't go near their services.

This is what happens when you have people who can't think more than single step ahead and put them in a position of power.

Filed Under: data protection, eu, europe, jurisdiction, ownership, patriot act, privacy

Wikileaks Can Receive Visa & Mastercard Donations Again... But Visa Doesn't Understand Why

from the for-the-lulz? dept

Last week, Wikileaks and Datacell threatened to sue Mastercard, Visa and Paypal if it didn't stop blocking payments to Wikileaks. The claims were basically collusion charges, in that all of the major payment companies were blocking payments. Things got strange today, however, when suddenly Datacell announced that payments worked again, and clearly implied that the companies had lifted the blockade. Except, Visa is insisting that it has not lifted its ban on Wikileaks and has no idea how payments are getting through. The details seem a bit sketchy. Some careful wording by Datacell's CEO suggest that he really just found an alternative payment gateway provider, which likely means this is a very temporary loophole, before the payment companies block again.

Filed Under: antitrust, collusion, europe, wikileaks
Companies: datacell, mastercard, paypal, visa, wikileaks

WikiLeaks Planning Legal Action Against PayPal, MasterCard & Visa

from the thought-this-would-go-away? dept

There hasn't been much talk lately over the fact that PayPal, MasterCard and Visa all cut off Wikileaks late last year, after the US government freaked out about the release of some State Department Cables. None of the firms has done a very good job explaining why this makes sense (or why they continue to allow other groups, such as the KKK to receive funding, while singling out Wikileaks). I'm sure those three firms, which took quite a public bashing when the news originally dropped, would prefer that there not be any more talk about it. However, Wikileaks and the payment firm they used, DataCell, are apparently planning to file a legal complaint this week against all three firms in Europe. A draft of the complaint, which was obtained by Andy Greenberg at Forbes (linked above and embedded below), claims that the three firms violated Articles 101 and 102 of the EU Treaty, effectively a form of antitrust law. While I tend to think many antitrust claims are merely attacks on successful companies, this seems like a case where they could make sense. Here you have basically the only three ways for most people to transfer money easily, all agreeing to block a single (small) client from receiving money, despite no legal ruling against the operation (hell, charges haven't even been filed). It certainly would make for an interesting case.

Filed Under: antitrust, collusion, europe, wikileaks
Companies: mastercard, paypal, visa, wikileaks

Police Arrest A Bunch Of Folks In Europe For Linking To Infringing Content

from the linking-=-crime dept

After the US lobbyists complained about Kino.to, an online site that linked to (but did not store, copy, reproduce, transmit, etc.) infringing works, apparently European law enforcement decided to "do something." Working off of a Dresden-based warrant, police raided homes in Germany, Spain, France and the Netherlands and arrested 13 people, with a 14th still being sought. The site was apparently quite popular in Germany, and with other German-speaking people around the globe. What I'm having trouble understanding is why this is a criminal operation, rather than a civil operation. Anyone who felt they were wronged by the site could have filed a civil suit. Furthermore, despite a number of similar operations, it's still immensely troubling to see people arrested for linking, rather than for violating any of the specific rights prescribed to copyright holders. I recognize, of course, that copyright holders are upset about sites that link to unauthorized versions of their works, but shouldn't the targets be those who actually are uploading the works, rather than those who are linking?

Filed Under: arrests, europe, kino.to, linking

'New' ACTA Version Published, EC Pushes For Signing

from the and-here-we-go dept

There hasn't been much movement in the last few months with ACTA, though there's been plenty of scrambling behind the scenes. The latest is that a "new" final draft of the document has been released, though all it really appears to have changed is the signing period. But, more important, is the news that the EC is pushing really hard to get it signed:

The European Commission is piling on pressure for ACTA (Anti-counterfeiting Trade Agreement), and is quietly preparing a legal proposal for the EU to sign it. The news comes in the context of ongoing discussion in the European Parliament on the question of whether to obtain a legal opinion on ACTA's compatibility with the Treaties.

In its recent Communication on IPR Enforcement, the Commission suggests it is a fait accompli that the EU will sign ACTA in 2011. Indeed that all of the countries involved in the negotiation will sign.

However, the European Parliament, which has been much more skeptical of ACTA from the beginning, is apparently still skeptical, and would like to take the shocking step of actually making sure that ACTA doesn't go against existing EU laws. The EC has simply declared that it is, and would rather that the Parliament not actually confirm this. Hopefully, the Parliament doesn't cave in to EC pressure, and actually takes the time to make sure that anything it signs is appropriate.

Filed Under: acta, eu parliament, europe, european commission

EU Commission Proposes New IP Rules, With More Weight On Enforcement & Making ISPs Police The Internet

from the that's-not-how-things-work dept

Not a huge surprise given things happening elsewhere around the globe, but it appears that the European Commission (who have already been in the tank for the entertainment industry, as seen in their enthusiastic support of ACTA) has come out with a new plan for intellectual property in Europe that has a major focus on enforcement, including turning ISPs into copyright cops. Of course, it's long been the desire of the entertainment industry to have ISPs do all the dirty work in trying to stop infringement. The problem, of course, is that all of this assumes it's somehow easy for ISPs to determine what is and what is not infringing. It's not. Even the companies themselves don't seem to recognize it some of the time. It's sad that so many politicians can't seem to understand the very basics of the law and technology on these issues, leading to proposals like this one that will not help "boost creativity and innovation," but will hinder it by stifling the very technology that is most needed for creativity and innovation.

Filed Under: copyright, enforcement, europe, european commission, ip, patents

EU Advocate General Says ISP Filtering To Block Infringement Violates Fundamental Rights Charter

from the nicely-said dept

A bunch of folks have been passing along the opinion statement by the European Court of Justice's Advocate General, Pedro Cruz Villalon, that a blanket requirement that ISPs block copyright infringement is a violation of the EU's Human Fundamental Rights Charter (pdf). The opinion came in relation to an ongoing lawsuit between the Belgian anti-piracy organization SABAM and the ISP Scarlet. A Belgian court had ruled that Scarlet had to put in place filters to block infringement, but Villalon is saying that would violate fundamental rights for a variety of reasons. Most importantly, he recognizes that copyright infringement is something that is not obvious, but is only determined after a court ruling, and these filters would clearly block files that had not yet been determined to be infringing:

The court order would apply in abstracto and as a preventive measure, which means that a finding would not first have been made that there had been an actual infringement of an intellectual property right or even that an imminent infringement was likely.

Nice to see more court systems recognizing this. This was the same point that was key to the iiNet ruling in Australia. Many defenders of mandatory filtering seem to think that it's "obvious" what's infringing and what's not. Yet, as has been seen, time and time again, that's not the case at all. Demands for aggressive filters assume that copyright infringement is something that is clear and obvious, rather than something established by a court ruling. Thankfully, the European Court of Justice's Advocate General seems to recognize this key point.

On top of that, he points out that such a required filter on Scarlet would be way too broad, in that it would also impact many people not a party to the case, or not even under the jurisdiction of Belgian law:

In particular, the Advocate General points out that the court order would have a lasting effect for an unspecified number of legal or natural persons irrespective of whether they have a contractual relationship with Scarlet and regardless of their State of residence. The system must be capable of blocking any file sent by an internet user who is one of Scarlet’s customers to another internet user -- who may or may not be one of Scarlet’s customers and who may or may not live in Belgium -- where that file is thought to infringe a copyright managed, collected or protected by Sabam.

From that, he concludes:

The installation of that filtering and blocking system is a restriction on the right to respect for the privacy of communications and the right to protection of personal data, both of which are rights protected under the Charter of Fundamental Rights. By the same token, the deployment of such a system would restrict freedom of information, which is also protected by the Charter of Fundamental Rights.

In other words, such filters... violate fundamental rights. The various countries (hello Netherlands) pushing for such filters might want to pay attention.

Now, this isn't a final ruling. It's basically just the recommendation from the Advocate General to the court on how it should rule. Hopefully, the court pays attention.

Post updated to reflect that it was the "fundamental" rights charter, rather than the "human" rights charter. Sorry for the mistake.

Filed Under: copyright, eu, europe, filters, human rights