The Authors' Take - Demystifying the ‘Honest’ Infringer: Reorienting Our Approach to Online Copyright Infringement using Behavioural Economics

Demystifying the ‘Honest’ Infringer: Reorienting Our Approach to Online Copyright Infringement using Behavioural Economics

by Sabesh Asokan

There is an intriguing paradox at the heart of online copyright infringement: while most people perceive themselves as law-abiding and honest, the practice of unlawfully downloading copyright material is widespread. How might we explain this contradiction? Could the answers inform our approach to addressing online infringement? These are questions I sought to confront in my upcoming contribution to JIPLP.

To shed light on these issues, I turned to research in the sphere of behavioural economics and psychology. In a recent work, Dan Ariely examined the disconnect between individual self-concepts of honesty and the propensity to engage in dishonest behaviour. In the context of intellectual property law, Ariely’s work suggests that the social acceptability of online copyright infringement, and negative perceptions of the creative industries fuel infringement. This is because people’s moral intuitions about what constitutes acceptable behaviour are shaped by the norms within their social groups, and people often rationalise dishonest behaviour as justified retribution against wrongdoers.

Yet, existing approaches to tackling copyright infringement have failed to effectively address these core beliefs which drive individuals to infringe. The prevailing response to online copyright infringement among developed countries has been to strengthen and expand laws against copyright infringement. Particularly notable developments have been the introduction of graduated response systems and the growing use of website blocking injunctions. While legal measures excel at reducing the supply of infringing content, they have only had modest, transitory success in reducing the demand for such content. I suggest that this is because legal solutions presume infringing behaviour is based on a rational assessment of the costs and benefits associated with infringement, whereas the psychological and structural drivers of infringement are far more complex.  

To reorient our approach to copyright infringement, I examine how social norms, market strategies, and digital architecture can target key drivers of online infringement left unaddressed by legal solutions. Particular highlights include: exploring how to deliberately cultivate a norms-based intellectual property system, examining the potential of blockchain technology to enhance access to legal content, and investigating how to shape the architecture of the Internet to ‘nudge’ consumers to select legal content.  

The approach I suggest does not demand that we dismiss the value of the law in addressing infringement. Instead, by recognising the value of other instruments in the regulatory toolbox alongside the law, we can begin to craft a more nuanced approach, sensitive to the full breadth of its causes.

[This is an Authors' Take post, which provides readers with an insight into current IP scholarship, featuring preliminary comments and thoughts from authors of articles accepted for publication in forthcoming issues of the Journal of Intellectual Property Law & Practice (OUP).] 

High Court employs ‘intention to target’ approach to determine application of UK copyright law

Author: Nedim Malovic (University of Southampton)

Omnibill (Pty) Ltd v Egpsxxx Ltd (in liquidation) and Another [2014] EWHC 3762 (IPEC), Intellectual Property Enterprise Court, 17 November 2014

Journal of Intellectual Property Law & Practice (2015), doi: 10.1093/jiplp/jpv007, first published online: February 21, 2015

Conclusive evidence brought Birss J to hold a UK company responsible for targeting the UK public by communicating infringing content on a website issued through its services in South Africa.

Legal context and facts

This case related to photographs of escorts that were used on the defendants' website without permission from the claimant. The court had to consider whether infringement had occurred by communicating those works to the public under s 20 of the Copyright Designs and Patents Act 1988 (CPDA). There was no dispute that copyright in the photographs belonged to the claimant.

The first defendant was a UK company which had no employees. The allegedly infringing website was owned by the defendant company and was, at an earlier stage, registered in South Africa, although the company director, Mr Carter, had made arrangements to move its content to the UK. Mr Carter denied any liability for the contents of the website, because it had been set up by a third party who was not an employee, director or shareholder of the defendant company.

Under UK law, for liability to arise the defendant's act must infringe a substantial portion of the copyright owner's exclusive economic rights under s 16 CDPA. Birss J addressed two primary questions: (1) whether the defendants' website or relevant parts of it had been targeted at the UK public, and if so (2) whether the second defendant in the proceedings (Mr Carter), was jointly liable with the first defendant company for damages in tort.

Analysis

Was there a communication to the public, directed at the UK?

Birss J reasoned that the question of whether a website is targeted at a particular country requires a multi-factorial analysis which depends on the circumstances of the case, as well as consideration of both aspects which can be inferred from looking at the content on the website itself and elements arising from the inherent nature of the services offered by the website.

Both parties referred to Arnold J's judgment in EMI Records Ltd v British Sky Broadcasting Ltd [2013] EWHC 379. This had considered a number of rulings of the Court of Justice of the European Union (CJEU) in the ambit of ‘targeting’ towards specific Member States, including Football Dataco v Sportradar GmbH & Sportradar AG (C-173/11, EU:C:2012:642) and Peter Pammer v Reederei Karl Sclüter GmbH & Co KG (C-585/08, EU:C:2010:740). In those decisions, the CJEU suggested a number of non-exhaustive criteria to determine when targeting occurs. These criteria include factors such as whether the trader's activity is directed to the Member State of the consumer's domicile; whether the trader uses a language or a currency other than the language or currency generally used in the Member State in which the trader is established; whether there is any mention of telephone numbers with an international code; whether the trader uses a top-level domain name other than that of the Member State in which the trader is established; and whether there is any mention of an international clientele composed of customers domiciled in various Member States. In EMI, Arnold J accepted the claimant's argument that, where a communication to the public which originated outside the UK is received inside the UK, the communication would be treated as occurring within the UK if it targets the UK public.

Birss J emphasized that evidence that a substantial proportion of visitors to a website is based in the UK may not be determinative, but may nonetheless support a conclusion that the relevant communication is aimed at the public in the UK. A ‘substantial proportion’ may vary between 10 and 25 per cent. Birss J was not convinced that the share of UK visitors to the South African sub-domain was either less then 10 per cent or more then 25 per cent, thus amounting to a substantial proportion.

While the sole purpose of companies placing their services online is to reach out to international clientele, it would be surprising if the intention were to target an international public. The finding that the site is at least in part aimed at the UK is consistent with the purpose of that concept in copyright law. Birss J held that targeting a substantial proportion of the public in the UK could be regarded as conclusive evidence that the claimant's exclusive right to communication to the public was infringed under s 20 CDPA.

Was the second defendant liable?

Birss J established that the first defendant company had been set up in order to shelter liability. Mr Carter had directed the transfer of the content of another website (already hosting unauthorized copies of the claimants' works) to the allegedly infringing website with a view to communicate that content to the public. Because the latter website was found to have infringed the claimant's rights in the UK, Birss J referred with approval to the judgment of Kitchin J in Twentieth Century Fox v Newzbin [2010] EWCH 608 in order to determine Mr Carter's liability in tort for authorizing infringement under s 16 CDPA. Kitchin J held that, in cases involving supply, or authorization by supply, the following circumstances must be considered: the nature of the relationship between authoriser and infringer; whether the equipment or other material supplied constitutes the means used to infringe; the degree of control which the supplier retains; and whether he has taken any steps to prevent infringement.

Birss J concluded that, even if a third party had materially transferred the content of another website to the allegedly infringing website, this had taken place because of Mr Carter's authorization. So Birss J held Mr Carter liable in tort for infringing the claimant's right under s 20 CDPA.

Practical significance

The factors to consider in determining when targeting occurs appear clearer following a number of decisions of the CJEU and their application in UK courts. As regards the application, it is notable that Birss J confirmed his judgment in Thomas Pink Ltd v Victoria's Secret UK Ltd [2014] EWHC 2631. In this case, he held that, though this is a question of fact, it is not necessary that all the contents of a website target the same country to establish that there is an intention to target the public on a certain territory. In Omnibill, Birss J elaborated on this, clarifying that, even if the different sub-domains were aimed at different countries, the website as a whole could be considered as targeting the UK public, provided that certain conditions are met.