In Twentieth Century Film Corp v Newzbin Ltd [2010] EWHC 608 (Ch), Mr Justice Kitchin has ruled in favour of a number of film makers and distributors on the liability of an intermediary for authorising copyright infringement. In his judgment, published on 29 March 2010, he found that Newzbin ‘engaged in a deliberate course of conduct well knowing that the vast majority of the materials in [its] Movies category… are commercial and so likely to be protected by copyright and that the users of Newzbin who download those materials are infringing that copyright’.
Newzbin operates a web site on the Usenet discussion system. It had revenues exceeding £1 million per annum and its premium members paid 30p a week to use its services. The claimant film companies, which included Universal, Warner Bros, Paramount, Disney and Columbia, alleged that Newzbin focused on piracy – the basic claim is that Newzbin locates and categorises unlawful copies of films and displays the titles of these copies in its indices; provides a facility for its users to search for particular unlawful copies and displays the results; and provides a simple one-click mechanism whereby users can acquire unlawful copies of their choice. Because of the prominence given to binary content generally (as opposed to Usenet text content), the film companies regarded the Newzbin service as an active party in copyright infringement, ‘authorising’ infringement.
Newzbin claimed that its web site is simply a search engine like Google but directed to Usenet rather than the Web. It also claimed to be ‘content agnostic’ and designed to index the entire content of Usenet. Its position was that the mere provision of hyperlinks did not in its view leave it with any liability and any supply of unlawful material was an act occurring exclusively between the hyperlink user and the relevant Usenet server operators.
The judgment includes a detailed explanation of the Usenet system for those unfamiliar with it (at [5]-[13]). It also illuminates the Newzbin system at some length and the crucial NZB facility, which greatly eases the task of any copyright infringer (at [14]-[51]). One of Newzbin’s instructions to its editors was said to reveal ‘an awareness by the defendant that users are primarily interested in films and constitutes a positive encouragement and inducement to its editors to focus on films in making their reports’.
Mr Justice Kitchin had ‘no doubt that the defendant is and has been aware for very many years that the vast majority of films in the Movies category of Newzbin are commercial and so very likely to be protected by copyright, and that members of Newzbin who use its NZB facility to download those materials, including the claimants’ films, are infringing that copyright.‘. Moreover there was undisputed expert evidence that Newzbin could have filtered out offending material if it so wished.
Section 16 of the Copyright, Designs and Patents Act 1988 inter alia provides that copyright in a film is infringed by a person who, without the licence of the copyright owner, does, or authorises another to do, any act restricted by that copyright. Mr Justice Kitchin turned (at [86]) to the meaning of authorisation and the cases on it such as CBS v Amstrad [1988] 1 AC 1013 and the Australian cases, Cooper v Universal Music Australia Pty Ltd [2006] FCAFC 187 and Roadshow Films Pty Ltd v iiNet Ltd (No. 3) [2010] FCA 24. In the particular context, the judge stated:
- I consider the following points are material. I begin with the nature of the relationship between the defendant and its members. Premium members enter into an agreement with the defendant which permits them to access Newzbin in consideration of a weekly payment. Thereafter these members are introduced to Newzbin as being a system which provides a searching and indexing facility and a guide to the materials available on Usenet. They are invited to explore the various indices at the level of reports in the Newzbin index or at the files level in the RAW and Condensed indices. In each case they have the option of browsing the databases directly or by using the various Newzbin subject matter categories. Focusing on the Movies category, premium members see that this category is broken down into levels of sub-category which permit them to search and browse not only by reference to the names of particular films but also, for example, by reference to genre. This is clearly a sophisticated facility.
- This brings me to a number of aspects of Newzbin which I consider to be of particular importance. In relation to binary content, Newzbin provides premium members with a facility which extends considerably beyond indexing and categorisation. It identifies all (or in the case of the RAW index, many) of the, perhaps several thousand, messages which make up a particular binary work and, in so doing, saves those members the very substantial task of manually locating and identifying each of them separately. Moreover, the reports in the Newzbin index provide a considerable body of very useful information in relation to each title. They include descriptive information, the URL and an NFO file which identifies the individual user who posted the content to Usenet, the email address of that user, information from which the date on which the content was posted to Usenet can be deduced and the number of files making up the particular work.
- The next aspect of great importance is the NZB facility. Upon the press of a button, the system creates an NZB file which is delivered to the member’s computer where it may be stored. When run by the member it causes the news client to fetch all of the Usenet messages and reassemble the original binary work from its component parts and so, in the case of a copyright work, inevitably make an infringing copy. Once a work is entered onto the defendant’s Newzbin index, use of the NZB facility is bound to result in that work being copied. In the context of the other features of Newzbin, the NZB facility provides the means for infringement, was created by the defendant and is entirely within the defendant’s control.
- I also consider it significant that a very large proportion of the content of the Movies category is commercial and so very likely to be protected by copyright. This has not led the defendant to install some kind of filtering system which, on the evidence, it could easily have done. To the contrary, it has actively encouraged its editors to make reports on films, has rewarded them for so doing and has instructed and guided them to include URLs in their reports and well knows of the common practice of using NFOs too. For the reasons I have given, I regard the contractual restrictions upon editors and members in relation to infringing activity to be window dressing. In short, they are inconsistent with the structure and operation of the Newzbin system and the advice given to editors both generally and specifically. Moreover, the defendant has taken no steps to remove editors who, to the defendant’s knowledge, have posted reports on infringing materials. So far as premium members are concerned they are given ready access to all the films and programmes in the Movies and TV categories, detailed information about the films and programmes available and the facility to download them.
- For all these reasons I am entirely satisfied that a reasonable member would deduce from the defendant’s activities that it purports to possess the authority to grant any required permission to copy any film that a member may choose from the Movies category on Newzbin and that the defendant has sanctioned, approved and countenanced the copying of the claimants’ films, including each of the films specifically relied upon in these proceedings.
Not only did Mr Justice Kitchin consider that Newzbin was liable for authorisation of infringement, he considered that Newzbin had ‘procured and engaged in a common design with its premium members to infringe the claimants’ copyrights’. Newzbin was also found liable under s 20 of the CDPA for infringement by communication to the public of the copyrighted films. Moreover, ‘flagrancy’ was found to be proved; this will increase the level of damages in the case.
There was an understandable welcome for the judgment from the Motion Picture Association. ‘We welcome the Court’s decision’ said Ted Shapiro, the Motion Picture Association’s general counsel for Europe. ‘Newzbin is a source of immense damage to the creative sector in the UK and worldwide. This is an important decision and it sends a clear message that websites focusing on providing viewers with pirated film and TV programmes infringe copyright and are liable for their actions even where those websites don’t themselves host the content. This decision will help to support the continued investment in new legal online services and the creation of new films and television shows for enjoyment by audiences both in the UK and around the world.’
