Swefilmer Piracy Trial Ends, Operators Face Years in Jail

Founded more than five years ago, Swefilmer grew to become Sweden’s most popular movie and TV show streaming site. It was once said to have accounted for 25% of all web TV viewing in Sweden.

In 2015, a 22-year-old Swefilmer operator revealed he’d been raided and in 2016 a Turkish national was arrested in Germany on a secret European arrest warrant. The now 26-year-old was accused of receiving donations from users and setting up Swefilmer’s deals with advertisers.

The pair appeared at the Varberg District Court in January, accused of making more than $1.5m from their activities between November 2013 and June 2015.

After a few weeks’ suspension, the case got back underway this month, when details of the investigation into the site were revealed to the Court.

This week the trial concluded with prosecutor Anna Ginner describing the Swefilmer streaming operation as being like “organized crime”, while demanding a 4.5-year prison sentence for the 26-year-old alongside damages of more than $1.5m.

“I say this bears the traits of organized crime. A crime that has drawn in a lot of big money,” said Ginner via video link.

“The aim was to provide all visitors of the website Swefilmer an opportunity to see movies for free. The website even placed advertising to encourage more visitors,” she said.

“The effect of the business has been that thousands of users have done just that, instead of paying for the Swedish film companies. This has damaged the film studios.”

According to local media, the 26-year-old’s lawyer dismissed the prosecution’s claims as “fantasy”, noting that it’s not clear that his client committed any crimes at all.

That assertion wasn’t shared by lawyer Henrik Pontén of RightsAlliance.

“We must not forget that it is only a small part of the money that we have been able to find. There is a large amount of money that has been lost somewhere in the world,” Pontén said.

The prosecution considers the 26-year-old to be the main player behind the site, with the 22-year-old playing a much smaller role. He stands accused of receiving around $4,000 of the proceeds but according to his lawyer Claes Kennedy, no crime was committed, since at the time it had not been established by the EU court that linking to pirated content was illegal.

Nevertheless, the prosecution wants the site’s former administrator to receive a year in jail but may settle for a suspended sentence plus community service, a point on which his lawyer agrees.

For his part, Henrik Pontén hopes the punishments are closer to the top of the scale as a deterrent to others.

“Foreign criminals are attracted to Sweden for the opportunity to earn serious money and receive low penalty rates,” he told Hallands Nyheter.

The district court’s decision is due mid-May.

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Kodi Counters Scaremongerers and Clarifies Its Stance on DRM

The Kodi media player software has seen a massive surge in popularity over the past two years.

With help from a wide range of third-party add-ons, some of which offer access to pirated content, millions of people now use Kodi as their main source of entertainment.

Earlier this month we interviewed the Kodi team to talk about their plans and piracy-related challenges. They were very upfront about these issues and happy to provide some counterbalance to often misleading news reports.

The Kodi team itself sees no value in actively banning third-party addons. Instead, they would like more legitimate content providers to join their platform. One of the things that could make this easier is by allowing Kodi to interface with DRM.

DRM-compatibility would make it possible for major movie studios and the likes of Netflix to stream their content in a protected environment, which is a minimal requirement for many.

However, the words “Kodi” and “DRM” in one sentence proved to be a rather volatile mix.

Soon after we posted our article, wild theories started to emerge, and social media, YouTube, and other news outlets started to spread inaccurate claims, with some predicting the end of Kodi.

This week the Kodi team decided to clarify their stance. Responding to the “ill-informed idiots on YouTube” and click-bait writers, the team makes it clear that DRM poses no threat to the media player software that people have come to love.

“Let’s try again and make this crystal clear: Kodi is a free, open-source neutral software. Kodi will never, ever require DRM to work, nor will it ever be a locked software. Ever! Read that a couple more times for good measure,” they write.

Since Kodi is open source, released under a GNU General Public License, the software itself can’t ship with DRM. However, there might be ways to set it up so it is compatible with DRM software that’s already on users’ systems or devices.

This will help to bring content providers on board and change the perception of Kodi as a piracy facilitator, the team says.

“From our perspective, supporting low-level DRM is a first step to changing that. Basically, what this means is providing some sort of interface to work with the DRM already present on your system.

“For example, Android ships with software that plays back DRMed content from Netflix. Kodi could hook into this already existing software in Android to playback the same content, so you never have to leave Kodi,” they add.

In other words, the only thing that Kodi is trying to do is help content providers to embrace the platform, not to hunt down or limit the availability of third party add-ons.

To the many news outlets who spread inaccuracies or falsehoods, the developers say they are always happy to answer their questions. In any case, readers are warned not to fall for wild claims, as they are often incorrect.

As for DRM, the Kodi team said its formal position can be summarized with the following four sentences.

– Kodi will never provide content, DRMed or not.
– Kodi will never stop working with your content.
– We will never prevent you from using Kodi as you so choose.
– We do not condone, condemn, encourage or recommend any particular use of Kodi.

Period.

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Australia Readies New Copyright Safe Harbor Consultation

Unlike in the United States where so-called safe harbor provisions apply to Internet service providers and online platforms such as Google and Facebook, Australia’s system offers reduced protection for the latter group.

To put the country on a similar footing as other technologically advanced nations, amendments were proposed to Australia’s Copyright Act that would’ve seen enhanced safe harbor assurances for platforms including search engines and social networks.

Last month, however, the government dropped the amendments before they were due to be introduced to parliament. That came as a surprise, particularly as Prime Minister Malcolm Turnbull had given the proposals his approval just a week earlier.

While business startup advocates were disappointed by the move, copyright holders welcomed the decision, with Dan Rosen, chief executive of the Australian Recording Industry Association, calling for a “full, independent and evidence-based review” in advance of similar future proposals. Just a month later and that seems a likely outcome.

In a statement delivered by Minister for Communications Mitch Fifield, the government has now announced a further consultation on extending the safe harbor provisions of the Copyright Act.

“An expanded safe harbor regime would provide a useful mechanism for rights holders to have material that infringes their copyright removed from online service providers,” Fifield said.

“An expanded regime would also ensure that service providers are not held responsible for the infringing actions of their users, provided they take reasonable steps to take down material that infringes copyright.”

The minister said that the government intends to “proceed carefully” to ensure that any legislation achieves the above objectives while balancing the need to grow Australia’s digital economy and supporting the needs of creators and copyright holders.

The Department of Communications will now oversee a series of meetings and roundtable discussions with stakeholders, prior to delivering advice to the government by early June 2017.

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Megaupload User Asks Appeals Court to Help Get His Files Back

Soon after Megaupload’s shutdown more than five years ago, many of the site’s users complained that their personal files had been lost as collateral damage.

One of these users is Kyle Goodwin, who operates a sports video company in Ohio. He used Megaupload as part of his business, to safely store large videos he created himself.

But, after Megaupload’s servers were raided Mr. Goodwin could no longer access the files. Hoping to resolve the issue, he asked the court to assist him and others to retrieve their personal property.

Helped by the Electronic Frontier Foundation (EFF), Williams Mullen law firm, and Stanford’s Hoover Institution, Mr. Goodwin filed over half a dozen requests since 2012 asking the court to find a workable solution for the return of his data. Thus far, however, this has been without success.

This week, his legal team brought the issue before the Court of Appeals for the Fourth Circuit, pointing out that the Government’s seizure of Megaupload and its apparent disregard for the rights of former users of the service continue to affect innocent bystanders.

After more than five years, they hope that the court will help to break the case open, so former users will be able to retrieve their personal files.

“Mr. Goodwin, and many others, used Megaupload to store legal files, and we’ve been asking the court for help since 2012. It’s deeply unfair for him to still be in limbo after all this time,” EFF’s Senior Staff Attorney Mitch Stoltz says.

“The legal system must step in and create a pathway for law-abiding users to get their data back.”

Mr. Goodwin’s lawyers asked the court to issue a ‘writ of mandamus‘ to the trial court, requesting it to act on their client’s behalf and create a process for Megaupload users to regain access their data.

The longer it takes the higher the risk is that data will be permanently lost, the legal team stresses. And at this moment it could still take many years before the criminal case reaches its conclusion.

“The seizure and continued denial of access also violates Mr. Goodwin’s constitutional rights. Under the Fourth and Fifth Amendments, the government was obligated to execute the searches and seizures in a manner that reasonably protected the rights of third parties to access and retrieval,” the petition reads.

While the sports videographer is the only Megaupload user who’s fighting for his rights in court, there are many others who still hope to be reunited with their lost data. Last year a former Megaupload user contacted TorrentFreak in desperation, hoping to recover a personal photo that is very dear to him.

According to EFF, the Government can’t stand idly by in these cases. More and more users are hosting their personal data in the cloud and it’s important that their rights are taken into account.

“We’re likely to see even more cases like this as cloud computing becomes increasingly popular,” EFF’s Legal Director Corynne McSherry comments.

“If the government takes over your bank, it doesn’t get to keep the family jewels you stored in the vault. There’s a process for you to get your stuff back, and you have a right to the same protection for your data,” she adds.

In a few weeks we will know if the Appeals Court agrees, or if the waiting continues.

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Selling Piracy-Configured Media Players is Illegal, EU Court Rules

Probably the biggest story in online piracy scene over the past 12 months has been the massive increase in popularity of piracy-configured set-top devices.

Mostly running Android, these devices are often supplied with software such as the neutral Kodi platform augmented with third-party addons, each designed to receive the latest films, TV shows or live sports, with minimum input from the user.

One of perhaps hundreds of sites involved in these sales was Netherlands-based Filmspeler.nl (Movie Player), an online store that found itself targeted by Dutch anti-piracy group BREIN. Filmspeler’s owners felt that its pre-configured devices were legal, arguing that their sale did not amount to a “communication to the public” as determined in the EU Copyright Directive.

In 2015, the Dutch District Court referred the case to the EU Court of Justice. It was asked to consider whether it’s illegal to sell a product (in this case a media player) with pre-installed add-ons containing hyperlinks to websites from where copyrighted works such as movies, TV shows and live broadcasts are made available without copyright holders’ permission.

A year later, Advocate General (AG) Campos Sánchez-Bordona issued his recommendation to the Court.

Describing how Filmspeler owner Mr. Wullems knowingly added infringing add-ons to Kodi devices, with hyperlinks to content published by known ‘pirate’ sites, the AG added that Filmspeler advertised its media players as ways to watch content without paying. This, he said, amounted to a communication to the public and hence copyright infringement.

But while the AG’s opinion was important, it is the EU Court of Justice’s opinion that holds absolute legal weight. After months of deliberation it handed down its decision a few minutes ago and it’s bad news for purveyors of ‘pirate’ devices all around the EU.

In a long and complex ruling, the ECJ said that a media player with pre-installed addons, accessed through structured menus, grants users “direct access to the protected works published without the permission of the copyright owners” and “must be regarded as an act of communication to the public.”

That large numbers of people have bought these players was taken by the Court to mean that there are an “indeterminate number of potential viewers” involving a large number of people (the public).

On the crucial question of whether the copyright works were transmitted to a “new public”, the Court found that the audience for these devices was not something taken into account by the copyright holders when they first gave permission for their works to be distributed.

Referencing the earlier GS Media case, the ECJ placed emphasis on whether links were offered in the knowledge they were infringing and whether the subsequent communication to the public had a profit element.

“It is common ground that the sale of the movie player took place in the knowledge that the player came installed with add-ons containing hyperlinks providing access to works that are placed illegally on the internet,” the decision reads.

“Moreover, it can not be denied that the media player was provided for the purpose of profit because the player was bought in order to obtain direct access to the protected works, which were accessible from streaming sites without consent from the copyright holders.

“Thus, the sale of such a media player should be considered a ‘communication to the public’ within the meaning of Article 3, paragraph 1 of Directive 2001/29.”

Having determined that such piracy-configured players can be considered infringing by EU member courts, the ECJ goes on to provide greater clarity on the status of copyrighted content streamed on the Internet without copyright holders’ permission.

The ECJ states that reproduction of content may only be exempt from reproduction rights when it fulfils five conditions:

– When the operation is temporary
– Transient or incidental
– An integral part of a technological process
– For the sole purpose of facilitation within a lawful intermediary
– The act has no independent economic significance

Since copyrighted works are obtained from streaming websites without obtaining permission from copyright holders, the above standards are not met and no copyright exceptions are available. Streaming copyrighted content from an illicit source can therefore be considered illegal.

The Filmspeler case will now head back to the Dutch court but this decision is likely to echo all around Europe and have a notable and immediate effect on cases involving ‘pirate’ boxes and illicit streaming.

The decision will be published in English later today.

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Pirate Site Blockades Violate Free Speech, Mexico’s Supreme Court Rules

In many European countries it’s a mere formality to order local Internet providers to block access to pirate sites, but this is not the case in Mexico.

In 2015 the Government’s Mexican Institute of Industrial Property (IMPI) ordered local ISP Alestra to block access to the website mymusiic.com.

The website in question was targeted at a Mexican audience and offered music downloads, some of which were shared without permission.

The ISP was not pleased with the order and appealed it in court. Among other things, the defense argued that the order was too broad, as it also restricted access to music that might not be infringing.

A few days ago the case was heard by the Supreme Court of Justice of the Nation, which ruled that the Government’s order is indeed disproportional. Mexican law does allow for blocking orders, but these have to be targeted at specific content instead of the website as a whole.

Mymusiic.com

“Although such [blocking] measures are provided for by Law and pursue a legitimate purpose, the fact is that they do not meet the requirements of necessity and proportionality since the restrictions on the right of freedom of expression must refer to specific content,” Minister Alberto Perez Dayán said.

“Hence the generic bans on the operation of certain websites and systems may violate the human right of freedom of expression,” he added.

The broad request ordered by IMPI equates to censorship and violates the constitution. Minister Perez Dayán compared the proposed blockade with the shutdown of a printing press, for publishing a single work without permission.

With this Supreme Court decision in hand, it will be very difficult for the authorities, or rightsholders, to demand similar blockades in the future. Instead, they will have to resort to targeting specific content, through takedown notices or via more targeted blocking efforts.

Mymusiic.com, the site that got the landmark case started, has quietly disappeared and is no longer operational.

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Kim Dotcom Asks Police to Urgently Interview FBI Director Jim Comey

When authorities in the United States and New Zealand shut down Megaupload in 2012, large amounts of data were seized in both locations. The data in the US is currently gathering dust but over in New Zealand yet another storm is brewing.

In the weeks following the raid, hard drives seized from Dotcom in New Zealand were cloned and sent to the FBI in the United States. A judge later found that this should not have been allowed, ruling that the copies in the FBI’s possession must be destroyed.

Like almost every process in the Megaupload saga the ruling went to appeal and in 2014 Dotcom won again, with the Court of Appeal upholding the lower court’s decision, stating that the removal of the clones to the United States was “plainly not authorized.”

At the time Dotcom said that fighting back is “encoded in his DNA” and today he’s taking that fight to the FBI. On Sunday, FBI director James Comey touched down in Queenstown, New Zealand, for an intelligence conference. With Comey in the country, Dotcom seized the moment to file a complaint with local police.

In the complaint shared with TorrentFreak, lawyer Simon Cogan draws police attention to the Court of Appeal ruling determining that clones of Dotcom drives were unlawfully shipped to the FBI in the United States. Since Comey is in the country, police should take the opportunity to urgently interview him over this potential criminal matter.

“As director of the FBI, Mr Comey will be able to assist Police with their investigation of the matters raised in Mr Dotcom’s complaint,” the complaint reads, noting several key areas of interest as detailed below.

Speaking with TF, Dotcom says that since the New Zealand High Court and Court of Appeal have both ruled that the FBI had no authority to remove his data from New Zealand, the FBI acted unlawfully.

“In simple terms the FBI has committed theft,” Dotcom says.

“The NZ courts don’t have jurisdiction in the US and could therefore not assist me in getting my data back. But FBI Director Comey has just arrived in New Zealand for a conference meaning he is in the jurisdiction of NZ courts. We have asked the NZ police to question Mr Comey about the theft and to investigate.”

In addition to seeking assistance from the police, Dotcom says that he’s also initiated a new lawsuit to have his data returned.

“We have also launched a separate civil court action to force Mr Comey to return my data to New Zealand and to erase any and all copies the FBI / US Govt holds. We expect an urgent hearing of the matter in the High Court tomorrow,” Dotcom concludes.

It’s likely that this will be another Dotcom saga that will run and run, but despite the seriousness of the matter in hand, Dotcom was happy to take to Twitter this morning, delivering a video message in his own inimitable style.

In your face Comey, in your face! #FVEY #Queenstown #FBIThieves http://pic.twitter.com/aJb5MrHKWe

— Kim Dotcom (@KimDotcom) 25 April 2017

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