Key updates on copyright protection and enforcement for sports media rightsholdersNick Fitzpatrick, Alasdair Muller
2017/18 has seen a number of significant developments in copyright law at both a UK and European level. This article considers the effect that some of the significant judicial decisions and legislative changes will have on the way sports rights holders protect and enforce their rights. Specifically, it looks at:
- How case law from the past year has increased the number of potential defendants who might now be regarded as being liable for acts of primary copyright infringement by virtue of communicating works to the public;
- The way in which ISP blocking injunctions have been adapted and advanced in order to provide greater protection to rightsholders in terms of preventing infringement of their copyright works online; and
- The potential effects of increased criminal sanctions for online copyright infringement.
The categories of audio-visual media piracy which most significantly impact the sports sector arise in both offline and online environments primarily involve the misuse of transmission signals and recordings. An "off-line" infringement might include an unlicensed re-communication by a second broadcaster of copyright works contained in a legitimate broadcast (most commonly where material is being used without licence or beyond the scope of the licensed use, without a valid reason). Particularly in the context of live events, both broadcasters and rights holders need to remain vigilant so as to identify and take steps to take down infringing broadcasts. These headaches involve prompt legal action, sometimes in remote jurisdictions, but commonly require the application of relatively well understood legal norms and so do not form the focus of this piece.
As rights holders look to increase their global viewership, and technology transforms our viewing habits, it is inevitable that both broadcasters and rights-holders will face other complex piracy challenges.
It is therefore perhaps inevitable that the area which has seen most interesting activity in the last year has again been in an "on-line" context: in particular where streams or clips of events (again, often but not always taken from legitimate sources) are uploaded to the internet and made accessible to members of the public without the rights-holder's consent.
To give some idea of the scale of the problem, the most recent statistics published by the UK Intellectual Property Office show that around a quarter of internet users access material protected by copyright illegally online1 . Police figures cited in a recent report published by FACT estimate that there were two million computer misuse offences committed in England and Wales in 2016 - more than burglary, robbery, vehicle-related theft, criminal damage or violent offences2 . As a result, the same FACT report cited digital piracy as one of the biggest challenges facing not just the creative industries in Britain, but also the wider economy.
Increasingly, infringement occurs through the use of media players which permit the installation of add-ons containing hyperlinks to unauthorised content (often referred to as "loaded" boxes, for example the Filmspeler player, discussed further below). The UK IPO estimates that over one million of these devices have been sold in the UK in the last two years.3 Infringing streams are now also frequently made available (by linking or other means) through social media platforms such as YouTube, Facebook and Twitter, which clearly puts infringing content readily at the fingertips of a huge number of fans.
The issue of enforcement is clearly a complex one, especially in circumstances where the uploader, streaming server, streaming platform, operator and/or host of a linking website, and the ultimate viewer may all be located in different jurisdictions.
However, a number of judgments over the past year have been very favourable to rightsholders, allowing them the opportunity to seek to enforce their rights against a wider group of potential defendants in the piracy chain. Retailers of "loaded" IPTV boxes, online content sharing platforms and streaming servers, and indeed those viewing content illegally could all now be liable for primary copyright infringement by communicating protected works to the public. These classes of potential defendants are each discussed in turn below.
Retailers of "loaded" IPTV boxes
As is discussed above, a rising method of viewing unauthorised content is through the use of “IPTV media players”, which are capable of incorporating add-ons containing hyperlinks to unauthorised content.
One of the better-known examples is Kodi - freely available software designed to allow users to access their videos, music and photographs through a single application, which can be loaded (or pre-loaded by intermediate sellers) onto set-top boxes etc. and modified with third-party add-ons to allow access to pirated content through hyperlinks.
The issue of whether the sale of such media players infringe copyright was referred from the Dutch courts to the Court of Justice of the European Union (CJEU) in Filmspeler4 . The action was brought by Stichting Brein, (a Dutch foundation that seeks to prevent the illegal exploitation of copyright works) against the defendant, Mr Wullems, who sold multimedia players (in which he had installed add-ins containing hyperlinks to websites offering unrestricted access, free of charge, to protected content) under the trading name Filmspeler.
The issue in question was whether Mr Wullems' acts fell within the definition of a "communication to the public" within Article 3(1) of the Copyright Directive 5 . Previous case law has established that this requires:
- an "act of communication" - i.e. an intervening act by a user, in full knowledge of the consequences of that action, that gives customers access to a protected work, particularly where, in the absence of that intervention, those customers would not, in principle, be able to enjoy the protected work6 . In order for there to be an "act of communication", it is sufficient that the work is made available in such a way that customers could access it from wherever and whenever they individually chose, irrespective of whether they availed themselves of the opportunity; and
- that the act of communication be to the "public" (i.e. an indeterminate number of potential viewers, with the implication that this covers a fairly large number of people)7 ; and
- there to be either:
- communication by a technical means different from that which was previously used (e.g. converting a satellite or terrestrial signal into an online stream, as was the case in VCAST 8 ); or
- a "new public" - i.e. one not already taken into account by the copyright holder when they authorised the initial communication to the public of their work9 .
Whether the communication is profit-making in nature has also repeatedly been held to be a relevant consideration10 .
The CJEU held that Mr Wullems' activities went beyond the mere sale of a technical accessory providing the physical means for enabling or making a communication of the copyrighted material. Rather, Mr Wullems' acts were held to be "indispensable" in the communication to the public of the protected works, and his intervention was performed deliberately and with full knowledge of the consequences that entailed. This was evidenced, in particular, by various advertisements for the media player stating that it allowed free access to films and sport.
As fairly large numbers of people had brought the media players, the communication was to a public; and a "new public" was established as the relevant rightsholders had either refused to allow or had restricted the distribution of the content concerned and had not authorised unrestricted communication of that content to the public on the websites to which the hyperlinks installed in the FilmSpeler player connected.
Accordingly, the sale of a such a media player itself constituted a "communication to the public" under the Copyright Directive, and was therefore an infringing act.
The judgment in Filmspeler also confirmed that end users (i.e. those viewing the unauthorised streams) could also be held liable for copyright infringement, based on acts of reproduction of the protected content.
In the QC Leisure case11 , the CJEU found that an act of reproduction occurred both:
- when frames of digital video and audio are created within the memory of a satellite decoder; and
- when a broadcast is displayed on screen.
However, as the broadcasts that were being received in QC Leisure had been made lawfully, it was held that the acts of reproduction merely amounted to "transient copying", and therefore fell within the exception in Article 5(1) of the Copyright Directive 12 .
By contrast, in FilmSpeler, the Court held that there was no "lawful use" of the protected works as (as above) the holders of the relevant copyright had refused to allow or had restricted the distribution of the content concerned and had not authorised unrestricted communication of that content to the public on the websites to which the hyperlinks installed in the FilmSpeler player connected.
The CJEU's ruling in Filmspeler broadens the potential group of defendants who might now be regarded as being primarily liable for unauthorised acts of communication to the public. Sports rights holders and broadcasters are now able to take action against those selling media players incorporating add-ons containing hyperlinks to infringing content13 - and also in appropriate cases against the end users receiving that unauthorised content (a cautionary message for consumers!).
Online content sharing platforms
In another case brought by Stichting Brein (this time against seeking a blocking injunction against two Dutch ISPs, Ziggo BV and XS4ALL Internet BV, to prevent their customers accessing the Pirate Bay website (TPB)14 , commonly referred to as the "Pirate Bay case"), the CJEU confirmed that, in addition to the uploaders and end users of infringing content, operators of online sharing platforms (in particular those that allow users to locate and share infringing content over a peer-to-peer network, by means of indexation of metadata and the provision of a search engine) may also be liable for copyright infringement, based on a communication to the public.
The CJEU held that the service provided by TPB made it much easier for users to share infringing content. In particular, as well as offering a search engine function, TPB website:
1.categorised files based on features such as the type of work, genre and popularity; and
2.actively filtered torrent files, both to remove those that were faulty or no longer active, and to remove those relating to certain types of content.
TPB was held to have acted with full knowledge of the fact that the content it was providing to users was infringing, and therefore its actions were held to be sufficient to constitute an "act of communication" for the purposes of Article 3(1) of the Copyright Directive.
It was also clear that the works were communicated to a "public" - TPB claimed to have several million users, and as those users were all able to access the copyright works over the P2P network at any time (indeed, simultaneously), the works were made available to the public, even if those users availed themselves of the opportunity. As the works were made available without the permission of the relevant rights holders, it also followed that the communication was to a "new" public.
ISPs in the UK have been obliged to block access to TPB for some time now15 . However, this had previously been on the basis that:
3.users of the site (rather than the site operator itself) were liable for committing acts of copyright infringement (both through creating copies by downloading content files, and by communicating those files to the public through the P2P network); and
4.the operators of the site had authorised, induced or incited such infringements by its users, or acted in common design with its users with a common design to infringe, and were jointly liable on this basis.
This case confirms that rightsholders do also have the ability to pursue the operators of such sharing platforms directly for infringement without needing to prove infringement of the end user. However, in practice, rightsholders may often view ISP blocking orders as a more efficient weapon in their arsenal, as pursuing pirates directly is likely to be more onerous without being any more effective.
2017 also saw several orders granted by the UK High Court requiring ISPs to block access to streaming servers delivering infringing live streams (as opposed to websites linking to or embedding such streams). In the UK, such orders are granted under Section 97A of the Copyright Designs and Patents Act 1988 (CDPA).
This is significant as a single sever may be accessed using any number of different interfaces (for example, the same stream on the same server may be accessed by multiple apps, websites and add-ons for set-top boxes), and therefore if access to that server is blocked, all of those access mechanisms will be disrupted.
The first such order was granted in March of 2017, following an application by the Premier League in Football Association Premier League v British Telecommunications Plc and others 16 . In order for the Court to have jurisdiction to grant the Order requested, the Premier League was required to establish that:
- the Defendants were service providers;
- that users and/or operators of the targeted servers were infringing the Premier League's copyright;
- they were using the Defendants' services in order to do so; and
- the Defendants had knowledge of this.
Of these, only the second merits any real discussion - it is well-established that the ISPs are service providers under the Electronic Commerce (EC Directive) Regulations 200217 , the internet services clearly enabled users to access the target servers, and the ISPs were aware of this. In relation to the issue of copyright infringement, the Court considered that:
- in the course of streaming Premier League matches, users created copies of the Premier League's copyright works18 ; and
- the copyright works were communicated to the public by the operators of the targeted servers19 .
In the case of the operators of the infringing servers specifically, they had intervened deliberately and in full knowledge of the consequences of their actions, to provide an indeterminate number of potential viewers access to the works. Insofar as the streams were re-transmissions of cable or satellite broadcasts, there was evidently a different technical means of delivery20 . Alternatively, in the event that the streams were sourced from internet transmissions, a "new public" was easily established given that the initial communication was only authorised to be transmitted to users of paid streaming services. The acts of communication were also deemed to be targeted at the public in the UK.
The Order differed from previous Section 97A blocking injunctions in a number of important respects, including that:
- the Order only had effect at times when live Premier League matches are bring broadcast; and
- the list of blocked servers could be regularly "re-set", allowing new servers to be identified and ensuring that old servers were not blocked unless they continued to stream infringing content.
The Court considered that the Order sought by the Premier League was proportionate and reasonable, and that there were effective safe-guards in place to prevent over-blocking.
The original Order was in place until the end of the 2016/17 Premier League season, and a further injunction on similar terms was issued in July 2017 to cover the 2017/18 season21 .
In light of these judgments, UEFA has also sought and been granted an Order on similar terms, requiring ISPs to block access to streaming servers delivering infringing live streams of UEFA matches to UK customers for the duration of the 2017-18 UEFA competition season22 . Doubtless many other rights holders will follow suit in light of the Premier League and UEFA's success.
As with the Pirate Bay case, these judgments also confirm that it would be open for rights holders to pursue the operators of the infringing streaming servers for infringement directly, should this ever be deemed to be a cost-effective solution.
Increased criminal penalties for online copyright infringement
2017 also saw the UK government implement a significantly higher maximum custodial penalty for online copyright infringement - increased from two years to ten23 .
The offence in question is set out in Section 107(2A) CPDA (as amended by Section 32 of the Digital Economy Act 2017), which states that any person who infringes copyright in a work by communicating it to the public commits a criminal office if they:
5.know or has reason to believe that they are infringing copyright in the work; and
6.either: (i) intend to make a gain for themselves or another person; or (ii) know or have reason to believe that their actions will cause loss to the owner of the copyright owner, or expose the copyright owner to the risk of loss.
The new legislation also clarifies that "gain" and "loss" extend only to money, but that such gain or loss does not have to be permanent. Loss is also defined to include "a loss by not getting what one might get".
Previously, the same offence only applied where a person communicated the copyright work in the course of a business, or to such an extent as to "affect prejudicially", the copyright owner. As well as imposing a more significant deterrent to pirates in terms of a more severe sanction, the new legislation therefore also gives rightsholders greater certainty as to when the elements of the offence will be satisfied by referring to the more precise notions of monetary gain and loss rather than the previous (slightly nebulous) concept of "prejudicial effect".
However, rightsholders must also remember that: (i) the burden of proof is higher for criminal cases; and (ii) the various presumptions set out in Sections 104 to 106 CDPA (which generally relate to title to the copyright works in question) do not apply to criminal actions under Section 107. Furthermore, criminal proceedings do not allow for interim relief, or for damages or an account of profits to be awarded.
The judicial decisions above show that courts are generally prepared to give a broad interpretation to the concept of what constitutes a "communication to the public". This is clearly to the advantage of rightsholders, as it widens the potential pool of defendants within the piracy chain who could be held liable for acts of infringement.
ISP blocking orders have also become a more significant weapon in the arsenal of rightsholders over the past year given their extension to include blocking streaming servers rather than individual websites, as all mechanisms used to access the infringing server will be disrupted, thereby making the blocking significantly more effective. As a result, recent traffic to many infringing websites has decreased significantly over the course of the year.
Rightsholders have also been given greater certainty as to when the criteria for pursuing a criminal offence for online copyright infringement have been made out. Not only this, but the maximum sanction has been increased five-fold. The threat of such a penalty may therefore prove an effective deterrent going forwards.
Legal developments in 2017 have shown that the law is advancing apace to seek to curb digital piracy. The solution may not yet be perfect, but rightsholders will certainly hope that developments continue to be forthcoming throughout 2018 and beyond, in order to ensure that they can at least remain "on par" with the pirates.
This is an extract from the Media Rights chapter of the LawInSport and BASL Sports Law Yearbook 2017/18. To obtain a full copy of the Yearbook, which contains 10 chapters and over 50 articles like this from the industry’s leading sports lawyers, please visit our website: https://sportslawyearbook.uk/
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- Tags: Broadcasters | Copyright | Copyright Designs and Patents Act 1988 (CDPA) | Copyright Directive | Court of Justice of the European Union (CJEU) | Digital Economy Act 2017 | Electronic Commerce (EC Directive) Regulations 2002 | European Union | Football | Intellectual Property | IP | Premier League | UEFA | Union of European Football Associations (UEFA) | United Kingdom (UK)
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About the Author
Nick is a media and sport lawyer with 20 years' experience, including substantial experience of negotiating and structuring complex arrangements for the exploitation of media rights across all platforms, brand exploitation, event organisation, sports administration, copyright, gambling and advertising.
Sport and Intellectual Property Associate, DLA Piper
Alasdair is a solicitor working in the London office of DLA Piper, with experience in sport law, intellectual property, litigation and international arbitration; previously seconded to the British Horseracing Authority.