Tech Liberty releases Rianz submission in dropped $2700 music piracy case

UPDATE Nov 5:  Lobby group Tech Liberty has released the text of a Recording Industry Association (Rianz) submission in the case of a Wellington woman, which the recording industry group ultimately decided not to pursue (it had been seeking $2700 in penalties).

Tech Liberty helped the defendant with her submission, founder Thomas Beagle says, along with assistance from Susan Chalmers at InternetNZ and pro bono work from Kate Duckworth at Baldwins.

Mr Beagle sees five key points in the Rianz submission to the Copyright Tribunal.

• Rianz admitting in footnote 25 that it might not be the account holder who downloaded the works but someone else sharing the connection [Legally, this was neither here nor there. Under the Copyright (Infringing File Sharing) Amendment Act the account holder bears responsibility, whomever might have used the account. It was perhaps not a point Rianz was keen to have highlighted in a public challenge, however - CK]
   
• The attempted rewrite of the NZ Copyright Act and regulations in para 30 to enable RIANZ to claim for each potential download.
   
• The argument that the lack of challenges to the notices and the continuing file sharing showed that the infringer was flagrantly breaching the law, rather than being completely clueless about it.
   
• The justification for asking for $1250 worth of deterrent penalties.
   
• That Rianz uses Mark Monitor to track file sharing activity, a system that only downloads part of the work from the person they're accusing.

NBR has an open invitation to Rianz to comment on the case, or seven others that are in front of the Tribunal.

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ckeall@nbr.co.nz

Rianz drops $2700 claim under new file sharing law

Oct 19: The Recording Industry Association of NZ (Rianz)  has dropped two of its first eight "third-strike" claims brought under the new file sharing law.

Each of the accused - who have to prove their innocence under the legislation - faced penalties of up to $15,000 in hearings in front of the Copyright Tribunal. 

Tech Liberty cofounder and Council for Civil Liberties executive committee member Thomas Beagle caught both Rianz and the Ministry of Justice on the hop this afternoon when he revealed one of the claims had been withdrawn amid confusion over who illegally downloaded files over an account shared by more than one flatmate.

The Copyright (Infringing File Sharing) Amendment Act (2011) holds an internet account holder - such as the billpayer for a household, or an employer, school or hotel selling wi-fi  - responsible for the actions of everyone who uses that account to access pirated material.

The accused woman (a Telecom customer) held the internet account for a flat. Mr Beagle says she did not even know what file sharing was, let alone download any illegal music tracks.

When the woman requested a formal hearing in front of the Copyright Tribunal (rather than a verdict based on paperwork so far), Rianz appears to have got cold feet.

Ministry of Justice spokesman Nathan Green told NBR Rianz had filed eight claims. It had now withdrawn two. There is no timetable to hear the remaining six in the first wave of claims to be filed.

Possibly solid case, but PR disaster
Technically, the woman might have been in breach of the new law, but by Mr Beagle's account the claim was shaping up to be a public relations disaster for Rianz - not to mention the government as it graphically illustrated the problems of holding an account holder solely responsible.

$2700 in penalties
Rianz had been seeking $2669.25 in penalties, according to Tech Liberty.

Mr Beagle, whose organisation assisted the defendant, says that broke down as follows:

• $1075.50 as the cost of the music.
• $373.75 to repay the cost of the notices and tribunal fee.
• $1250 as a deterrent.

Among other objections, Mr Beagle found the $1250 over-the-top, given a total of five tunes had been, allegedly, illegally downloaded.

"We're very happy for the defendant that the case has been dropped, but we're disappointed that it didn't go to the Tribunal to see what they thought of Rianz's ridiculously high penalty claims," Mr Beagle told NBR this afternoon.

"The Rianz submission says that they saw this as a chance to set a precedent, and they have therefore tried on some rather spurious and self-serving logic to set the penalty bar as high as possible. Their claim that the regulations say that we can claim the retail cost of the works but we're going to multiply it by 90 is just ridiculous," Mr Beagle said.

"This case, even though it's been dropped, shows just how unfair the law is. The defendant knew nothing about file sharing, but in the process of defending it she has suffered significant distress, lost her internet account and well as some friends and the place she was living. The idea that account holders should be responsible for the actions of people sharing an internet account is ludicrous and doesn't match the realities of how people live."

Mr Beagle doesn't accept the argument that Rianz showed compassion and common sense by dropping the case.

He says the woman offered to pay costs, but Rianz demanded the claim go to the Tribunal (before later changing its mind and dropping the claim after she requested a formal hearing).

"I read the Rianz letter  turning down her offer. They were fairly vehement in their refusal," Mr Beagle told NBR.

More, if Rianz had wanted to press its claim, it could have under the law as it stands.

"The account holder is liable and has no defence even if they knew nothing of the infringing. The drafters of this law knew that," Lowndes Jordan partner Rick Shera told NBR.

Guidance, test cases needed
"There is a need for guidance from the Tribunal on a number of aspects of this regime," Mr Shera told NBR.

"While we may get some of that guidance from the cases which are continuing on the papers without a hearing, a formal hearing in person would be preferable. Hopefully, copyright owners are not going to just abandon every case where an account holder exercises its statutory right to have a formal hearing.

"The one issue we don’t need any guidance on though is the liability of an account holder for the actions of other people using the account, like the other flatmates in this example.

"One of the things we do need to know though is how the Tribunal will calculate any award it makes against the account holder. The regulations mention market availability, deterrence and impact on the market for the work as relevant issues but we don’t know how exactly it will assess that.  Neither do we know what evidence of actual damage it will require."

Shortcomings of the law would have been revealed
"I suspect Rianz withdrew [the claim] because, had it gone to the Tribunal, the numerous shortcomings of the three-strikes law would have been illustrated by this person's case," InternetNZ policy lead Susan Chalmers told NBR.

"She didn't download but would have been on the hook for thousands in any event. No one was 'educated' by the notices. The ordeal destroyed personal relationships and caused this young woman a great deal of strife. The policy behind this law is fundamentally flawed and hopefully MBIE will take this into account during the 2013 review of the Copyright Act.

"I  think she was quite brave to request a hearing."

Mr Beagle said Tech Liberty was not working with any other accused under the file sharing law, but was available to give advice and assistance to anyone who needs it.