Naked Law

Dutch and Belgian music goes out of tune?

The door has been opened towards EU-wide online digital downloading.  In a move that is out of tune with similar bodies in other EU countries, the Dutch and Belgian music copyright collecting societies have agreed to abolish the cross-licensing agreements they have with 14 other European collecting societies (see also IPKAT and BBC).

It is impractical for individual copyright owners to monitor all usage of their works and they use collecting societies to do this for them.  Currently, any website wishing to sell downloads across the EU will have to deal with 16 separate collecting societies, for any one track and the likes of iTunes and MSN Music have already been busily signing country by country agreements.  The European Commission thinks that the current position is anti-competitive and is 'difficult to reconcile in a borderless online world'.

In particular, various collecting societies have entered into the 'Santiago' Agreement which has an 'economic residency' requirement that prevents EU-wide licensing of music downloads.  The European Commission issued a Statement of Objections against the terms of the Santiago Agreement complaining that it 'unjustifiably transposed into the Internet world the national monopolies that the societies have traditionally held in the offline world.'

The European Commission has said that it will make a formal decision in response to the move by the Belgian and Dutch societies to break rank.  The Commission is continuing formal anti-competition proceedings against the other collecting societies, but has agreed to 'examine carefully any proposal on commitments that other collecting societies may submit to lift the restrictions'.

Time will tell whether there will ultimately be an EU-wide collecting society and whether the Dutch and Belgian societies are now well placed to take on that role.

Sony backs legal P2P service

The record industry has often been criticised for concentrating too hard on attacking P2P (e.g. by suing the P2P software companies or users of P2P), and not hard enough on coming up with legitimate alternatives.  In recent times, though, we are told that there have been dramatic increases in legal downloading, through iTunes and similar services.  Now, PlayLouder MSP is planning to launch a subscription service allowing users to download or share (using a P2P network) as much music as they like for £26.99 a month.  And, more notably, Sony is the first major to sign up a licensing deal with PLMSP.  The press release explains:

"By controlling the network on which the music flows, PLMSP is able to effectively and accurately track and monitor the distribution of digital music through a sophisticated method of audio fingerprinting and return the appropriate share of revenues back to the rights owners."

PLMSP says that it aims to gain 40,000 UK users over the course of the next year, and that the service will be launched next month.

Too .XXX rated for US

The introduction of the controversial .xxx TLD has been delayed following the concerns of the US government and the Government Advisory Committee (GAC).  Assistant Secretary at the US Department of Commerce, Michael Gallagher, wrote that the department “has received nearly 6,000 letters and e-mails from individuals expressing concern about the impact of pornography on families and children”.  The Chairman of the GAC had already written to ICANN last week to warn it of the possibility of individual governments directly expressing their concerns and to urge ICANN to “allow time for additional governmental and public policy concerns to be expressed before reaching a final decision on this TLD”.

The .xxx TLD is the latest in the line of new sponsored top level domain names to be approved in principle by ICANN. sTLDs are designed for use by particular industries or sectors - .mobi received final approval last month for websites created specifically for mobile devices.  ICM Registry is the organisation that would operate the .xxx sTLD – it has agreed to a one month delay to the final approval of .xxx (which was due to have be given on Tuesday), stating it “remains committed to including all affected stakeholders in policy development for the .xxx domain”.

The .xxx domain has had a tough time just getting to this stage, seen by some as a practical way of regulating pornographic material and protecting children from adult content, and by others as encouraging obscene material and lending a legitimate front to a sordid industry.  The preliminary approval received in June came five years after the .xxx domain was initially proposed.

IMC Registry say that .xxx would promote self-regulation within the adult entertainment industry and would help ensure safe use of the internet for child and family user groups.  Critics predict “a political and litigious firestorm over time, as various government entities move to try force "adult" sites into the new domain space, and battles erupt over what an adult site is defined to be”.  Karl Auerbach, a former ICANN board member, fiercely criticised the granting of preliminary approval for .xxx in the light of ICANN’s general reluctance to create new domain names:  “Why should .xxx get precedence over schools, churches, civic groups, aboriginal communities, labor organizations, and artistic groups?....[I]t is insulting to the community of internet users when ICANN hands one of those few resources to a group that intends to use it to promote the worst that humanity has to offer”.

While the opposition is certainly vociferous, I can’t help thinking that the .xxx domain seems like a sensible option for websites “of a certain sort”.  It would surely make life easier for both those that want to find them and those that want to avoid them, provided that adult content providers were willing to move to .xxx domains. There is currently no legal basis for either government agencies or domain name registrars insisting that adult content must be hosted on an .xxx domain when they become available.

Get Safe Online…

… is a campaign due to be kicked off in October to educate small businesses and consumers as to the risks of online trading and increase awareness of internet security.  Run jointly by the Government and private sector, it currently has the backing of 8 major companies including Microsoft, Dell, eBay and HSBC and is seeking additional corporate partners. Each are contributing £150,000 of support. It is not yet known whether the site will address the legal issues relevant to businesses who chose to trade online, such as defamation and compliance with e-commerce and distance selling legislation.

Information Commissioner targets law firms

The Information Commissioner - who oversees compliance with data protection legislation in the UK - has launched a "crackdown" on solicitors that fail to register as data controllers.  A statement from the Information Commissioner's Office claims that a third of solicitors are "likely to be in breach".

The Data Protection Act 1998 applies to anyone processing personal data on computers and certain manual filing systems.  These "data controllers" are required to notify the Information Commissioner of their processing unless they are exempt, but the exemptions are unlikely to apply to many law firms.

Does the Government think copyright is still "appropriate"?

I understand that a paragraph of Labour's general election manifesto continues to cause intrigue (and some concern) among rights holders and other interested groups.  Chapter 8 of the manifesto stated:

"We will modernise copyright and other forms of protection of intellectual property rights so that they are appropriate for the digital age.  We will use our presidency of the EU to look at how to ensure content creators can protect their innovations in a digital age.  Piracy is a growing threat and we will work with industry to protect against it."

Most notable is the implication that the current form of copyright (and other IP) is no longer "appropriate" in the "digital" age, at least not without modernisation.  At the time, The Register called this "ominous" and said "we fear they may disagree with us on what is 'appropriate'". The theme was repeated in Labour's presentation to businesses (though somewhat toned down - note the removal of "appropriate") when Labour pledged to:

"Modernise copyright and intellectual property regimes, so that in a digital age, creators, entrepreneurs and creative industries can invest in ideas and talent knowing that they will get a proper reward for their investment."

The Government's manifesto pledge was too vague to tell exactly what modernisations they have in mind, but we might speculate based on common criticisms of current copyright laws.

Software patents - the official line

The European Patent Office - the body charged with granting European patents for states to the European Patent Convention (EPC) - has set up a website providing information on the "law and practice" under the EPC in relation to computer implemented inventions and also on proposed legislative reforms on the patentability of such inventions.

The website could be good news for commentators looking for unbiased and reliable information on the vexed question of software patents.  Sources on the web often lurch between the two extremes of opinion - that there should be no exclusion from patentability simply because it's implemented through software against those who wish to exclude software completely from the field of patentable inventions!  As the EPO appears to have shifted in favour of a wider scope of grants, their commentary will undoubtedly be subject to intense scrutiny.

A WEEE while yet ...

The DTI has made a further announcement about the WEEE directive that is sure to frustrate the European Commission: producer and distributor responsibilities in relation to collection and recycling of waste electrical and electronic goods will not come into effect in the UK now until June 2006.

The DTI statement explained that the delay reflected "the Government's concerns that an adequate UK network of facilities for separate collection of WEEE should be in place for householders to use" and the fact that "a UK-wide network of WEEE collection facilities will not be ready by the start of next year".

No review of Nominet iTunes decision

The High Court last week threw out an application for judicial review of a decision of Nominet’s Dispute Resolution Service.  Apple had successfully obtained the transfer of the domain name itunes.co.uk from CyberBritain Group Ltd, with the Expert finding that CyberBritain had abused its registration by using the domain name to redirect internet traffic to Napster - a direct competitor of Apple. 

The judge found the application by Benjamin Cohen, boss of CyberBritain, to be flawed in a number of respects and also criticised the failure to use Nominet’s own appeals procedure. 

An indication, perhaps, that the courts are disinclined to favour applicants seeking to overturn Nominet decisions, at least where Nominet’s own procedures have not been exhausted?

Rights in your software? It's not so clear ...

As if to confirm the Patent Office's suspicions - that businesses aren't careful enough about the ownership of IP in their dealings with one another - the High Court ruled recently that a company that commissioned software from a software developer neither owned nor held an exclusive licence to the resulting software.

Clearsprings Management Limited commissioned Business Link Limited to produce a web-based database system, but the parties had no written agreement setting out who would own the copyright in the software.  Both parties accepted that Business Link owned the copyright on creation (as author of the software); Clearsprings claimed that it had either been subsequently assigned to them, or that Business Link had granted to Clearsprings an exclusive licence (with a right to sublicence).

The judge decided that it was not necessary to imply an assignment or an exclusive licence or even a licence with a right to sublicence:

"In my judgment it is not necessary to imply into the contract a term giving [Clearspring] ... exclusivity in relation to the copyright .... the only terms which are necessary to give the contract business efficacy are, firstly, a licence for [Clearspring] ... to use the software for the purposes of their business and, secondly, a restriction on [Business Link] ... making use of the information about [Clearspring's] ... operating procedures for purposes other than those of [Clearspring]."

So without an express contract, and despite the fact that Business Link designed the software to fit Clearspring's needs and was paid to do so, Clearspring had only limited rights in the software.  IPKat says:

"this decision is the most detailed yet on which terms may or not be implied into a software commission contract. [IPKat] ... congratulates the court on taking the business efficacy rule so far."

This case should act as a further warning: if you are paying someone to design software for you, make sure you know (and can demonstrate to a court) what rights you will have in the software.