Without doubt the whole “Speculative Invoicing” operation employed by various participants with various roles has proven to be flawed and has targeted innocent people. That is proof alone that there has been no justification in operating such a scheme, even if infringers are caught.
Sadly, I know of certain people involved in the GEIL operation who have stated that “Collateral Damage” is acceptable if it catches the infringers. I take this to mean that no matter how many innocent people are targeted and pay up through fear, this “Justifies” their actions if they catch infringers.
As regards GEILs Letter Of Claim (“LoC”), the one small problem in what happened to be an excellent outcome of their original LoC being neutered is there is no initial settlement figure, and thus the real threat of the LoC is dumbed down. That could be a problem because an infringer (Or an infringer who seeks legal guidance) may see a figure of compensation far differently than GEIL.
It now transpires that unsuspecting subscribers who admitted the infringement have immediately received another letter from GEIL demanding a settlement figure which is more close to their original LoC and completely ignores everything that was decided by the Judge in GEILs original Norwich Pharmacal Order (“NPO”) back in March 2012. I suppose GEIL are not going to let a decision from an “unimportant” High Court Judge dissuade them from carrying on their absurd claims!
So what can a subscriber who has been led in to admission of guilt take from it? And what can they do when they receive the unjustified claim of compensation from GEIL?
If the alleged infringer admits GEILs claim then I believe clarification must be given to what extent. Admission could be:
1. An actual download took place by accident and cancelled quickly.
2. An actual download took place by accident and cancelled eventually.
3. An actual download took place in completion in anything from X hours to X days and removed by the infringer from the p2p software.
4. An actual download took place in completion in anything from X hours to X days and not removed by the infringer from the p2p software.
What about the infringement? It may be accepted that “Two acts” of infringements occurred:
1. The alleged infringer has admitted to downloading the copyright material.
2. The alleged infringer has made the copyright material available for GEIL to download a small part.
What is in dispute is GEILs value of compensation of a demand for £350.00 per infringement or £700.00 for four infringements.
Let us start by looking at GEILs letter of claim under the section “Our claim for damages”:
The act of file sharing the Work without the consent of GEIL or BDP has caused damage to our business. We contend that every copy of the Work that is downloaded represents a potential lost sale. Whenever the Work is made available for download to other parties there is the opportunity for multiple downloads to take place resulting in lost revenue. In addition to GEIL selling direct, we also enter into licensing agreements for third party organisations to distribute our content. File sharing also results in lost royalty revenue and weakening of the Ben Dover brand. The court has power in such circumstances to award GEIL and BDP damages for our loss and, in appropriate circumstances, additional damages where the unlawful file sharing has been flagrant
The level of damages we claim will depend on the extent to which you have downloaded the Work and/or made it available for the download by others.
Now the decision from the Judge Mr Justice Arnold in the Court case:
134. Secondly, in the case of those Intended Defendants who are infringers, the Claimants have no idea about the scale of the infringements committed by each infringer. Some might have infringed on a very substantial scale indeed, while others might only have infringed to a minor extent.
Now I will look at particular aspects of GEILs evidence, claim, proposed settlement and their claim of legal consequences.
The single most important fact is GEILs evidence has a small part of an upload from an IP address. This is very evident from GEILs claim of “Whenever the Work is made available for download to other parties there is the opportunity for multiple downloads to take place resulting in lost revenue”. This is backed up by the Judge when he states “the Claimants have no idea about the scale of the infringements committed by each infringer”.
So making a claim of “the opportunity for multiple downloads” when the Judge quite rightly says that they have no idea how much, is where GEIL have the major problem of lack of evidence. GEIL have the evidence of one upload.
What about GEILs claim of lost revenue? Surely lost revenue must be taken in to account after all relevant costs are taken out for sending a DVD to a consumer. Compiling a DVD and packaging costs need to be considered, then the sale value to a distributor and finally the postage costs to post it to a distributor.
After all this is taken in to consideration, even a 30% gross profit on the £30.00 sale of a DVD to a distributor is £9.00 profit.
This is also on the basis that you can actually buy the film if it is at all available through Distribution. It cannot be deemed lost revenue if the film is not available to purchase.
Although it is the case the Judge declared GEIL have the right to protect their copyright, it is certainly not right for GEIL to claim disproportionate compensation. If GEILs claim to an alleged infringer is lost revenue through sharing and uploading, making the same claim against other alleged infringers is double-counting.
If 10 alleged infringers were asked to pay compensation, each alleged infringer would be asked to pay for the infringement of the others. This would in the case of the 10 alleged infringers make them pay for a total of 90 infringements.
From the Judgment, Mr Becker makes reference to “the reasonable royalty should be assessed on the basis of a ‘time limited license [sic] to exploit a work by providing copies of it on an unlimited worldwide basis’ “, whilst the LoC claims “In addition to GEIL selling direct, we also enter into licensing agreements for third party organisations to distribute our content. File sharing also results in lost royalty revenue and weakening of the Ben Dover brand”.
It now transpires that GEIL are making the claim that the Court will grant their claim for a “One year” standard licence agreement for one film which they would typically grant for Distributors. This could be as much (If not more) as £1,500.00. Exactly how they can equate sharing one film to a one year licence is baffling! It can only be considered the basis of a licence for as long as the download took place. If it took two days to download the film by the infringer, it can only be a licence for that amount of time, which would be no more than £10.00.
It may be argued by GEIL that they would only ever negotiate the minimum term of a licence to be one year, but negotiation is precisely the point when it comes to an agreement for a licence. It cannot be one way. A Distributor can make the decision if they wish to agree to those terms or not.
It also has to be taken in to consideration that you have the disproportionate situation (Above) of infringers having to pay for all other infringements resulting in double-counting again.
The particular claim of flagrancy in GEILs LoC relates to their claim that an infringement has damaged the Ben Dover Productions (“BDP”) brand. I will set aside the notion that this is a possibility as it could be argued that is what GEIL are doing. This claim fails again through the evidence situation (Above). To what level can GEIL claim an infringer has damaged the BDP brand? Again no evidence to back up such claim.
My summary of GEIL and their latest claim against those who admitted the infringement are:
1. To what level of infringement has GEIL established from the infringer?
2. What evidence does GEIL have to prove an infringers level of infringement?
3. Why do GEIL quite directly ignore the Judges opinion?
4. Do GEIL consider the profit only aspect of lost revenue?
5. How can GEIL consider the idea of multiple uploads, licencing and flagrancy when it results in double-counting?
6. How can GEIL impose the one year licence on an infringer without negotiation when a download may take up to two days?
Special thanks to Hickster
Mr Becker was quoted here:
Disregarding the fact that our films when purchased sell for far in excess of £10, he totally missed the fact that file sharing occurs not in a closed user group of those circa 9,000 Telefonica customers, but in a far larger community of millions of users. Fundamentally we are pursuing those that are uploading not downloading, they are potentially uploading to millions of others who are also using these networks. How many they upload to is impossible to calculate, but in effect these violations are unauthorized distribution, we are not pursuing those who have simply downloaded one film.
“millions of users”………Oh dear God.
“potentially uploading to millions of others”……..Oh dear God, please!!!
“How many they upload to is impossible to calculate”………..No evidence?
“we are not pursuing those who have simply downloaded one film.”………Untrue!!!
Demanding £350.00 for one infringement makes what Mr Julian Fraser Becker says as untrue.