Control Freaks

Following the European Court of Justice decision in the Reprobel case, it is perhaps not surprising that the UK Intellectual Property Office has announced that it is to abandon the UK's private-copying exception which was introduced in October 2014, and which was effectively declared illegal by the High Court in July of this year, and so had to be withdrawn.

It now seems clear that the IPO were never going to find a workable scheme which met the criterion of fair compensation for rights holders demanded by the EU InfoSoc Directive, while at the same time avoiding unpopular levies on consumables and hardware capable of being used to copy, in particular, music, computer games, ebooks and films, for personal use.

The Reprobel decision, although not specifically concerned with copying for private use, highlights just how complicated the levy system can become. Each EU member state has found its own way of tackling the issue, with no overall EU-wide harmonisation in prospect. It seems that the IPO and those representing rights owners could not find an existing model to achieve fair compensation .

So where does this leave ordinary users in the UK? Clearly some will have been unaware of the introduction of the exception last year, and possibly a larger minority will have been unaware of the rescinding of the exception, so they will no doubt continue to format shift their personally owned music and store tracks on the cloud in blissful ignorance that that is not legal in most cases. Then there is the grey area of the legality of copies made while the exception was in force. Those users who are aware of the changes face a difficult decision: whether to make copies for personal use in contravention of the law in the reasonably sure knowledge that they won't get caught, or abide by the law and deny themselves a degree of sensible flexibility in their viewing and listening choices. One thing they will not do is go out and buy a digital replacement such as a download, for a CD or DVD they already own.

The decision not go ahead with the private copying exception will also have implications for other parts of the music distribution industry. Operators of cloud services may face pressure to amend their terms of service to reflect the new status quo, and some streaming services may be forced to tighten up their procedures to prevent users from creating multiple copies of the same download. But what also seems clear is that the music industry has won a Pyrrhic victory since whether or not it is illegal, many users will continue to make private copies of their legally owned music etc, just as they used to do in the pre-digital age.

The European Commission has officially presented its plan to abolish geo-blocking and filtering restrictions across EU member states. The new proposal requires online services to allow users to access their accounts all across Europe, even in countries where it's officially not available yet.

The same is true for users of many other streaming services such as BBC iPlayer, Amazon Instant Video and HBO Go.

This means that paying customers are often unable to use their accounts, or with restrictions, when traveling to other European countries.

These geo-blocking practices have been a thorn in the side of the European Commission who today published a concrete proposal requiring streaming services to ban them.

The proposal, which is the first in EU's broader copyright reform , requires online services to remove geo-blocking in Europe. This means that Netflix users can access their local content library in any EU member state. Andrus Ansip, Vice-President for the Digital Single Market said:

We want to ensure the portability of content across borders. People who legally buy content -- films, books, football matches, TV series -- must be able to carry it with them anywhere they go in Europe.

While the plans are a positive development for users, copyright holders may be more skeptical. They will have to rewrite their licensing agreements to allow online access to content across borders. In addition, Pirate Party MEP Julia Reda points out that the proposal only fixes part of the problem . People who are in countries where Netflix and other services aren't available, will remain without access.

The plans proposed today still requires official approval from the European Parliament but the commission hopes that it will be implemented in 2017.

More concrete copyright reform proposals are expected to follow next year. This includes updated anti-piracy measures based on the follow the money approach as well as various exceptions to allow broader use of copyrighted material.

In late September, the Federal Trade Commission (FTC) filed a complaint against two marketers of weight-loss supplements -- Roca Labs, Inc and Roca Labs Nutraceutical USA, Inc.

According to the FTC , Roca Labs, Inc "allegedly made baseless claims for their products, and then threatened to enforce 'gag clause' provisions against consumers to stop them from posting negative reviews and testimonials online."

The gag clause that the FTC refers to -- in which customers unwittingly sign away their rights to post online reviews after making a purchase -- is becoming increasingly common. And it's only one of several strategies that companies have used to suppress negative reviews of their products.

A bill that's picking up steam in the US Senate -- the Consumer Review Freedom Act -- directly addresses these gag clauses. But while it represents a step in the right direction, the bill fails to address other shady practices of the online review industry.

The messy world of online reviews

Who knows what to believe these days about the authenticity and veracity of online -- typically anonymous -- reviews, which assess everything from restaurants to physicians .

Some reviews are fake (known as " astroturfed " reviews) and some are real. Some might contain truthful and honest views, while some might be bought and paid for , which includes fake positive reviews posted by the companies themselves.

But either way, let's face it: most businesses, large and small, don't want you to post negative comments about their products or services on internet sites such as Yelp , TripAdvisor , Angie's List and the aptly named PissedConsumer.com . Even a short and damning tweet on your own Twitter account might tick off a business.

There's a reason businesses care. One study in 2014 found that 39% of consumers read online reviews on a regular basis, up from 32% in 2013. Another survey found that 61% of shoppers will read product reviews before making a purchase.

So, what's a company to do when faced with negative reviews, real or otherwise?

A typical strategy is to try to silence online critics by suing them for defamation and claiming the reviews contain false allegations .

In fact, some businesses may go even further and file meritless defamation cases against reviewers, hoping the high costs of litigation will squelch the critics and cause them to retract their comments. These baseless libel suits are known as SLAPPs -- strategic lawsuits against public participation.

A 2010 New York Times article first called public attention to the issue. It told the story of a young man who posted a negative review about a towing company and soon found himself facing a defamation suit, with the company seeking US$750,000 in damages.

Today, many states now have anti-SLAPP statutes that allow victims to quickly dismiss these frivolous cases, thus taking some sting out of defamation as a remedy for negative reviews.

Read the fine print

Now, there's a new technique that some thin-skinned businesses are adopting to prevent peeved customers for speaking out: the use of gag clauses , in which customers sign away their rights to criticize a company when they enter into a contract with it.

These gag clauses are usually buried in the fine print and often go unread. According to Chris Morran of The Consumerist , they're appearing in contracts for "everything from cheapo cellphone accessories, to wedding contractors, to hotels, to dentists, to weight-loss products, to apartment complexes."

A major problem, attorney Jonathan Tung observes, is that "there is no national consensus on whether such gags are legal or not," as "some courts have deemed such clauses unconscionable while other courts have been very reluctant to interfere, citing freedom to contract."

In other words, some courts consider gag clauses invalid and unenforceable, while others uphold them. A customer who violates a gag clause by posting a negative review of a company thus risks paying the company whatever amount was specified in the contract for breaking the gag clause.

Congress steps in

The US Congress has entered the fray with the Consumer Review Freedom Act of 2015 . Sponsored by Senator John Thune (R -- South Dakota), the bill renders contractual gag clauses void if they prohibit consumers from reviewing products or assessing performance, and if the clauses constitute "form contracts." (Many lawyers would term these adhesion contracts because the consumer has almost no power or leverage to negotiate a better deal.) The Consumer Review Freedom Act also gives the Federal Trade Commission the power to enforce the law on behalf of gagged consumers.

Here, Congress is following the lead of California, which in 2014 became the first state to adopt a statute forbidding businesses from gagging their customers. The measure is also supported by Yelp , where more than 90 million reviews have been posted.

A matter of contract, not the First Amendment

Surprisingly, perhaps, this is not a First Amendment free speech issue. The First Amendment certainly protects our ability to express our opinions, and opinions -- as opposed to false allegations -- are also typically shielded from defamation liability.

For example, posting online that a restaurant has "horrible service" or that it is "too loud" are matters of protected opinion. Conversely, claiming that the restaurant has "rats in the kitchen" or that it uses "stale products" in its recipes are factual allegations that, if false, are not protected.

But the First Amendment only protects speech from government censorship. The companies including gag provisions in their contracts are not government entities. Gag clauses thus are a matter of contract -- not constitutional -- law.

Although it has some quibbles with the language used in the Consumer Review Freedom Act, the Electronic Frontier Foundation says "it's great to see lawmakers addressing some of the most overtly unfair contract clauses."

There are, of course, many more problems with online reviews not addressed by the new bill, such as how to deal with completely fake and paid-for reviews. But some companies are taking action on their own.

In April, the Seattle Times reported that Amazon "sued three websites it accuses of purveying fake reviews, demanding that they stop the practice." It was only the first legal punch thrown by the giant Internet-based retailer. Last month, Amazon sued "more than 1,000 unidentified people selling fake reviews on its Web store."

Make no mistake: the Consumer Review Freedom Act is a great step forward for consumers who want to speak out, and it is wonderful to see Yelp supporting it . But by failing to address fake posts and preventing companies from filing SLAPPs, it only nibbles at the edges of the larger problems in the Wild West of online reviews.

In what we very much hope launches a "race to the top" to protect online fair use, today YouTube announced a new program to help users fight back against outrageous copyright threats. The company has created a 'Fair Use Protection' program that will cover legal costs of users who, in the company's view, have been unfairly targeted for takedown.

We have criticized YouTube in the past for not doing enough to protect fair use on its service, including silencing videos based on vague " contractual obligations " and failing to fix the many problems with its Content ID program . However, when the company takes positive steps to protect its users, we take notice.

Google describes the program on its blog , but here are the basic details: When the company notices that a video targeted for takedown is clearly a lawful fair use, it may choose to offer the user the option of enrolling their video into the program. If the user decides to join, the video will stay up in the United States and, if the rightsholder sues, YouTube will provide assistance of up to $1 million dollars in legal fees.

YouTube has started the program off with four videos that the company believes represent fair use. You can watch them here .

While we would like the program to do a little bit more--for example, given that the main criteria is that a video must be clearly lawful we'd like YouTube to provide any user that meet that criteria the option of enrolling their video into the program, rather than hand-selecting which ones gets to participate--we think this is a solid and unprecedented step forward in protecting fair use on the site.

We commend YouTube for standing up for its users, and we hope the program will inspire other service providers on the web to follow its lead.

Torrentfreak commented on a draft document indicating some rather censorial legislation is being considered by the EU Commission. Torrentfreak explains:

A leaked document has revealed the EU Commission's plans for copyright in 2016. In addition to tackling the issue of content portability in the spring, the draft suggests the Commission will explore a follow-the-money approach to enforcement, clarify rules for identifying infringers, and examine the crosss-border application of injunctions.

Noting that creative rights have little value if they cannot be enforced, the Commission calls for a balanced civil enforcement system to enable copyright holders to fight infringement more cheaply and across borders.

A 'follow-the-money' approach, which sees the involvement of different types of intermediary service providers, seems to be a particularly promising method that the Commission and Member States have started to apply in certain areas, the draft reads.

It can deprive those engaging in commercial infringements of the revenue streams (for example from consumer payments and advertising) emanating from their illegal activities, and therefore act as a deterrent.

On this front the Commission says it intends to take immediate action to set up a self-regulatory mechanism with a view to reaching agreement next spring. While voluntary, the EU says the mechanism can be backed up by force if necessary.

The document also highlights a need to address the (cross-border) application of provisional and precautionary measures and injunctions . Clarification is needed, but this appears to be a reference to EU-wide site blocking.

Furthermore, the EU indicates it will examine the rules for copyright takedowns and the potential for illicit content to be taken down and remain down.

The Commission is also carrying out a comprehensive assessment and a public consultation on online platforms, which also covers 'notice and action' mechanisms and the issue of action remaining effective over time (the 'take down and stay down' principle), the draft reads.

Finally, Julia Reda MEP is raising alarms over the Commission's intent to clarify the legal definition of communication to the public and of making available .

The Commission is considering putting the simple act of linking to content under copyright protection, Reda writes.

This idea flies in the face of both existing interpretation and spirit of the law as well as common sense. Each weblink would become a legal landmine and would allow press publishers to hold every single actor on the Internet liable.

Update: EU claims that it is not seeking a hyperlink tax or EU harmonised website blocking

19th November 2015. See  article from publicaffairs.linx.net

Linx is a trade group of UK ISPs so has a keen interest on issues being discussed by the EU. Linx reports:

EU Commissioner Andrus Ansip has confirmed that forthcoming European copyright proposals will not include introduce ancillary copyright rules, and will not attempt to harmonise web-blocking laws across the EU.

In an interview with Politico, the European Commission Vice President for the Digital Single Market said that there were no plans to require news aggregators and pay publishers for the right to link to their content.

Ansip said that it was too early to tell what lessons would be learned from ancillary copyright laws recently passed in Spain and Germany.

The BBC is taking measures against the unauthorized use of its iPlayer service by actively blocking UK VPN services. The measures aim to prevent foreigners from accessing iPlayer without permission, but they're also blocking many legitimate UK citizens from surfing the Internet securely.

While the service is intended for UK viewers, who have to pay a mandatory TV license, it's also commonly used overseas. Recent research suggests that 60 million people outside the UK access iPlayer through VPNs and other circumvention tools.

Traditionally the BBC hasn't taken any measures to prevent unauthorized use, but this changed very recently. Over the past several days TF has received several reports from VPN users who can no longer access iPlayer from UK-based VPN servers. Blocked viewers see the message:

BBC iPlayer TV programmes are available to play in the UK only.

This effectively stops foreigners and expats from accessing the service, but it also affects license paying UK citizens who use a VPN to browse the Internet securely. They will now have to disconnect their VPN if they want to access iPlayer.

Several VPN users are not happy with the change and have voiced their complaints. The issue is also causing concern among VPN providers, which are looking for options to circumvent the blockade.