High Court denies film companies Newzbin profits


A judge at England’s High Court has refused to award the Motion Picture Association (MPA) piracy profits generated by now-defunct indexing website Newzbin2, arguing that to do so could have a “chilling effect on innovation and creativity.”

Newzbin2 indexed, linked to and allowed users to download files that had been uploaded to discussion forum Usenet and was set up and hosted in the Seychelles after the original Newzbin site was shut down. In 2009, the MPA sued the site for copyright infringement, claiming it was facilitating the download of illegal copies of its films.

The site was found liable in 2010 and closed down in November 2012. Newzbin founder David Harris’s assets have been frozen pending a trial later this year, and the MPA has since been seeking proprietary claim to the infringing sites’ profits.

In a ruling published on Tuesday, judge Justice Newey denied the MPA’s request.

Responding to a claim by MPA’s legal representative Richard Spearman that likened copyright infringement to theft, Newey said that a copyright infringer “is more akin to a trespasser” and that in the case of trespassing, landowners have no propriety claim to the fruits of a trespass.

Newey also said that handing the profits of infringement over to copyright owners could “stultify enterprise.”

“Suppose that a market trader sells infringing DVDs…from a stall he has set up on someone else’s land without consent. The owner of the land could not, as I see it, make any proprietary claim to the proceeds of the trading [and] there is no evident reason why the owner of the copyright in the DVDs should be in a better position,” he said.

A spokesperson for the MPA said the group is planning to appeal against the judge’s decision, and said that the ruling did not take into account “the specific facts of the case.”

“The only innovation and creativity Newzbin has shown is the way in which the site has operated outside the law to exploit what others have taken time and money to create,” they said.

Ben Allgrove, a partner at Baker & McKenzie LLP in London, said the decision is interesting as it addresses the unresolved question of the extent to which, in IP law, claimants can seek a propriety remedy as opposed to a compensatory of restitutionary one.

“The decision is unsurprising in that it reflects the orthodox view on this issue, but I do not think it answers the question once and for all,” said Allgrove.

“Copyright, and other IP rights, are expressly recognised to be property rights. If that is the case, provided that it does not result in double recovery, there has to at least be an argument that the availability of proprietary remedies is a natural consequence of that. Until we get further appellate jurisprudence on the topic, the question remains open in my view, though this decision is obviously relevant,” he added.

This article was first published on 08 February 2013 in World IP Review

Newzbin2, Motion Picture Association, High Court, ruling, copyright infringement

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