Studios Win Copyright Judgment against File Sharing Web Site

In December 2007, a federal district court judge in Los Angeles held a Web site that facilitates the online downloading and exchange of copyrighted movies, television shows, and music liable for copyright infringement in a suit brought by six member studios of the Motion Picture Association of America (MPAA).

Judge Florence-Marie Cooper of the U.S. District Court for the Central District of California ruled for the plaintiffs after determining that the defendants, the operators of TorrentSpy, http://www.torrentspy.com, had intentionally destroyed evidence relevant to the litigation, according to a Dec.18, 2007 story by Digital Media Wire available at http://www.dmwmedia.com/news/2007/12/18/mpaa-wins-copyright-suit-against-TorrentSpy.com.

“Defendants’ conduct during discovery in this case has been obstreperous,” wrote Cooper in her Dec. 13, 2007 order, “They have engaged in widespread and systematic efforts to destroy evidence and have provided false testimony under oath in an effort to hide evidence of such destruction.”

The plaintiffs, six motion picture studios, filed their lawsuit for copyright infringement under 17 U.S.C. section 501 on Feb. 23, 2006, according to Cooper’s December 13 order, alleging that the operators of TorrentSpy enabled users of their Web site to download copyrighted works illegally from the Internet.

TorrentSpy is an online indexing service for copyrighted movies and television programs that can be downloaded by individuals. The Web site facilitates file-sharing between users, International Data Group News Service reported on Dec. 18, 2007.

Judge Cooper’s ruling was unusual because termination of a case and entry of a default judgment before trial is appropriate only in “extraordinary circumstances,” according to Cooper’s December 13 order. In her order, Cooper granted plaintiffs’ Aug. 30, 2007 motion for terminating sanctions based on defendants’ willful spoliation of key evidence. If a court grants a motion for terminating sanctions, it concludes the lawsuit and enters a default judgment in favor of the party filing the motion.

Plaintiffs’ motion alleged that defendants had destroyed evidence, or engaged in “willful spoliation,” in order to prevent plaintiffs from being able to gather evidence during discovery to support their case at trial. A court may punish destruction of evidence during the pre-trial process in a number of ways. It may impose monetary sanctions or fines, and, in unusual circumstances, if one party has intentionally destroyed evidence, a court can enter default judgment in favor of the other party.

Before entering a default judgment, a court must evaluate five factors in the context of a particular case, according to Cooper’s order. The court must consider the public’s interest in speedy resolution of litigation; the court’s need to prevent overcrowding of its docket; the damage the party making the motion has suffered; public policy favoring resolution of cases after a trial; and the availability of less drastic sanctions.

Cooper found that the defendants had destroyed evidence in a number of ways. She determined that defendants deleted and modified user forum posts on their Web site that mentioned copyrighted movie titles. They also modified and deleted index headings for their compilations of movies and television shows, replacing the names of copyrighted movie titles with generic descriptions like “TV-Unsorted.” The defendants concealed the Internet protocol addresses of users, an action that prevented the plaintiffs from determining whether the defendants had uploaded copyrighted movies. Finally, defendants also refused to disclose the names and address of forum moderators, according to Cooper’s December 13 order.

Cooper also found evidence to suggest that TorrentSpy’s operators may have encouraged Web site managers to censor user forum conversations referencing copyrighted movies. For instance, on March 6, 2006, a manager posted a message to the Web site’s volunteer moderators, stating, “We need to make sure that these forums stay clear of anything related to piracy. … I’d even recommend using the search engine to find past threads that may hurt us,” according to Wired magazine’s blog Threat Level on Dec. 18, 2007, available at http://blog.wired.com/27bstroke6/2007/12/judge-terminate.html.

Cooper concluded that the defendants’ destruction of evidence in this case was intentional. “Upon being served with Plaintiffs’ suit for copyright infringement, Defendants were on notice that this information would be of importance in the case. ... This evidence was not deleted or modified negligently but intentionally in direct response to the institution of this suit.”

TorrrentSpy had already been subjected to lesser sanctions. Last year, a federal magistrate judge in Los Angeles imposed a $30,000 penalty on TorrentSpy’s operators for failing to comply with discovery orders, according to the c|net.com News Blog Dec. 18, 2007, available at http://www.news.com/8301-10784_3-9835333-7.html.

Before the case terminated on December 13, the Web site’s operators had analogized their Web site to the search engine Google and argued that it simply allows users to search for and locate files that users can obtain elsewhere on the Internet – and not from their Web site. The defendants made these arguments in a motion they filed May 8, 2006, requesting the court to dismiss the MPAA’s lawsuit.

TorrentSpy’s operators also argued that they were protected by the Digital Millennium Copyright Act (DMCA), Pub. L. 105-304, 112 Stat. 2860, according to an Aug. 27, 2007 c|net News.com story available at http://www.news.com/TorrentSpy-shuts-down-in-the-U.S./2100-1030_3-6204618.html.

Title II of the DMCA, the Online Copyright Infringement Liability Limitation Act, limits the liability of Web sites in circumstances where the site is acting as a data conduit, transmitting and routing information from one point on a network to another at a user’s request. A Web site will not be liable for infringement of copyright if the following five criteria are met, according to the DMCA: the transmission of the data was initiated by a user and not by the Web site; transmission is carried out through an automatic technical process without selection of the material by the site’s operators; the Web site does not select the recipients of the material; no copy of the material is maintained by the Web site for longer than is necessary for its transmission; and the material is transmitted through the network without modification.

In order to qualify for the safe harbor, Web sites must block users from accessing material if they receive notice that the material allegedly infringes copyright protections.

Although the MPAA won its suit as a result of the December 2007 ruling, it must still demonstrate to the court that it has suffered financial losses in order to qualify for damages from TorrentSpy’s operators, according to the December 18 Threat Level story.

TorrentSpy’s attorney, Ira Rothken, stated that the ruling was “draconian in nature and unfair,” according to the December 18 c|net.com News Blog story. Rothken said TorrentSpy will appeal the decision.

John Malcolm, the MPAA’s executive vice president and director of worldwide anti-piracy operations, said in a statement, “The court’s decision ... sends a potent message to future defendants that this egregious behavior will not be tolerated by the judicial system,” according to a Dec. 20, 2007 BBC story.

“The sole purpose of TorrentSpy and sites like it is to facilitate and promote the unlawful dissemination of copyrighted content. TorrentSpy is a one-stop shop for copyright infringement,” he stated.

Last year, TorrentSpy blocked U.S. residents from gaining access to its Web site.

A statement issued by the company said “TorrentSpy’s decision to stop accepting U.S. visitors was not compelled by any court. Rather, it arises out of an uncertain legal climate in the United States regarding user privacy and the apparent tension between U.S. and European Union Internet privacy laws,” according to the August 27 c|net News.com story. The c|net News Blog reports that TorrentSpy’s servers are located in the Netherlands. (For more on a Web site’s use of “geolocation” to selectively block some users from access, see “Internet Roundup: New York Times blocks British readers’ access to article about terrorist investigation” in the Fall 2006 issue of the Silha Bulletin.)

TorrentSpy also sued the MPAA last year, claiming that the MPAA hired a hacker to steal information from the company, according to a Dec. 18, 2007 Digital Media Wire story. Threat Level reported Dec. 18, 2007 that that case was dismissed, and TorrentSpy appealed the dismissal.

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This page contains a single entry by cla published on October 14, 2009 3:44 PM.

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