TorrentFreak Email Update

Megaupload Co-Founder Released On Bail
UK Seize Popular Music Blog, Arrest Operators and Threaten Readers
IIPA Reports BitTorrent Sites and Cyberlockers To US Government

Posted: 15 Feb 2012 02:37 AM PST

Following his arrest almost a month ago, the co-founder of the now-defunct Megaupload file-hosting service has finally been granted bail.

Mathias Ortmann was expected to be freed following a January 26th hearing but that was delayed when information collected by the authorities on his finances fell short of Ortmann’s own estimates.

According to the FBI, Ortmann made around $14.5 million from Megaupload between 2005 and 2010, and an additional $3 million in 2011. His accounts, however, showed a total of $20.2 million, some $3.5 million more.

This morning, concerns over the 40-year-old, who was previously described as a serious flight risk by Prosecutor Anne Toohey, were overcome.

Ortmann, from Germany, was released earlier today and will now join his co-accused Bram van der Kolk and Finn Batato at the former’s Auckland home. Bail conditions for all three are strict and include a complete ban on Internet access.

Of those arrested in New Zealand following the raids in January, only Megaupload founder Kim Dotcom remains behind bars. He is due to appear in court next week.

In the meantime it has been revealed that US authorities intend to rely on a United Nations treaty aimed at combating international organized crime to extradite all the NZ-based members of the so-called “Mega Conspiracy” to the US.

While a lawyer working on behalf of the United States government admitted that no copyright offenses are specifically listed in the extradition treaty, he said that certain offenses which involve trans-national crime are covered by the country’s Extradition Act.

In New Zealand, crimes must carry a four year prison sentence to be deemed extraditable. Under the country’s Copyright Act, distributing an infringing work carries a five year maximum sentence. Nevertheless, some observers are predicting that due to its groundbreaking status, the extradition battle for the Megaupload defendants will be both complex and prolonged, and could even go all the way to the Supreme Court.

Separately, according to a report citing the latest issue of New Zealand Police’s ‘Ten One’ magazine, US authorities have congratulated local police on the raids they carried out last month.

“Feedback on the New Zealand operation has been extremely positive from our international law enforcement partners including the FBI and the US Department of Justice,” said Detective Superintendent Mike Pannett, who reportedly monitored events from the FBI’s command center in Washington.

As revealed last week, dozens of heavily armed police – some from elite anti-terrorist divisions – were used to arrest the operators of Megaupload in January.

Source: Megaupload Co-Founder Released On Bail

Posted: 14 Feb 2012 12:03 PM PST

Founded in 2008, RnBXclusive.com quickly became one of the most popular R&B / hip hop blogs. With over a quarter million fans on Facebook it was the go-to destination for many music fans.

But that all changed today when the UK Government’s Serious Organised Crime Agency (SOCA) took over the domain and arrested its operators.

“SOCA has taken control of this domain name. The individuals behind this website have been arrested for fraud,” reads a message on the site’s home page.

In addition to arresting the site’s operators for allegedly defrauding the music industry by posting links to copyrighted music, SOCA also warns those who used the site to download tracks.

In a rather threatening tone SOCA explains that RnBXclusive readers face up to 10 years in prison.

“The majority of music files that were available via this site were stolen from the artists. If you have downloaded music using this website you may have committed a criminal offence which carries a maximum penalty of up to 10 years imprisonment and an unlimited fine under UK law.”

Ominous Warning Banner

seized

To guarantee maximum impact the warning also displays the IP-address of those who visit the site. SOCA explains that they may use this information for further investigation.

“SOCA has the capability to monitor and investigate you, and can inform your internet service provider of these infringements. You may be liable for prosecution and the fact that you have received this message does not preclude you from prosecution.”

The above is reminiscent of a message that was displayed when the UK authorities shut down the popular BitTorrent tracker OiNK. At the time, the site’s visitors also received a warning. The OiNK case, however, turned out to be a waste of tax payer money and the site’s owner eventually walked free.

Finally, SOCA’s warning on RnBXclusive concludes with a rather tendentious claim which appears to come directly from a music industry lobby group.

“As a result of illegal downloads young, emerging artists may have had their careers damaged. If you have illegally downloaded music you will have damaged the future of the music industry.”

The above is worrying, because it wouldn’t be the first time that UK authorities are dragged into a criminal investigation solely based on evidence provided by the entertainment industries. In fact, this was the main reason why the operators of another BitTorrent tracker – FileSoup – had their case dismissed.

In the US similar mistakes were made with the seizure of the music blog Dajaz1. More than a year after Homeland Security's Immigration and Customs Enforcement (ICE) seized the site’s domain, they finally gave it back. It turned out that the seizure was a mistake.

Mel of Dajaz1 also sees similarities between today’s actions and the seizure of their site in 2010.

“Unbelievable, apparently the UK Govt doesn’t believe in Due Process either and their claims of damaging the industry and artists is unsupported propaganda,” she told TorrentFreak. “We’re completely against the process of seizing first and asking questions later.”

Thus far UK authorities haven’t officially responded to the RnBXclusive shutdown and arrests. We will add an update as more news becomes available.

Source: UK Seize Popular Music Blog, Arrest Operators and Threaten Readers

IIPA Reports BitTorrent Sites and Cyberlockers To US Government

Posted: 14 Feb 2012 05:42 AM PST

The International Intellectual Property Alliance (IIPA) has just published its written submission to the Office of the U.S. Trade Representative listing countries that it believes should be identified in the annual Special 301, the report that details the “adequacy and effectiveness of U.S. trading partners' protection of intellectual property rights.”

The IIPA, which counts the Association of American Publishers, BSA, ESA, Independent Film & Television Alliance, MPAA, National Music Publishers' Association, and the RIAA among its members, has listed its grievances against a whole host of countries.

Unsurprisingly, especially given its members’ focus, the main complaints concern movie, music, video game and software piracy. The complaints about infringement in the digital realm are numerous.

From the Priority Watch List, the file-sharing focus falls on Canada, China, Russia and Ukraine.

Canada

According to the IIPA, Canada is “a haven where technologically sophisticated international piracy organizations can operate with virtual impunity in the online marketplace.” This is due, says the group, due to Canada’s reputation for having “weak, ineffective or non-existent” laws to outlaw infringement.

The IIPA notes correctly that Canada plays host to large numbers of BitTorrent sites including perhaps its most famous, isoHunt. The group says that the site has “operated with impunity” for more than 8 years despite being the subject of an injunction issued by a U.S. court. Of course, by definition the U.S. is outside Canadian jurisdiction

Other major torrent sites mentioned as having “Canadian connections” include KickAssTorrents and Torrentz.eu. It’s also noted that many French language torrent sites are operated from Quebec.

File-sharing related actions IIPA recommends Canada takes in 2012
Establish clear liability and effective remedies against those who operate illicit file-sharing services, or whose actions are otherwise directed to promoting infringement.

Enact strong legal incentives for Internet Service Providers to cooperate with copyright owners in combating online piracy, including by limiting the scope of liability safe harbors in accordance with international best practices.

China

The IIPA lists the main sources of online piracy as music portal sites, P2P services, deep-linking services (aka search engines), forums/blogs and cyberlockers. File-sharing client Xunlei and other services offered by its operators are mentioned several times.

Generally the situation in China has improved over the last 12 months with the IIPA noting that major P2P sites have “cleaned up” their pirated content. Illicit streaming services are described as problematic, as is the increase in consumption of illicit content via cellphones.

File-sharing related actions IIPA recommends China takes in 2012

The requests are many, but notably include increasing criminal prosecutions for services such as Xunlei and ‘deep-linking’ search engine operators such as Sohu/Sogou. The IIPA is also calling for China to allow foreign rights holder associations to conduct local anti-piracy investigations, and to lower the threshold for infringement to be considered criminal, to include non-profit copying.

Russia

The IIPA singles out two BitTorrent trackers as especially problematic – RUTracker.org (the renamed torrent.ru) and GameTorrent, a tracker alleged owned by a Russia national but hosted in Estonia.

According to the submission, Russia is home to the “world’s two most prolific criminal release groups” who camcord movies in local theaters and upload them to the Internet. The unnamed groups are said to have been responsible for 77 “exceptional quality” camcorded movies in 2011. A streaming video links site listed as offering such movies is the popular Video2k.tv

On the free music front, Russia’s Facebook equivalent, vKontakte, is singled out for criticism, despite apparently responding correctly to takedown demands.

“While vKontakte will generally takedown specific content when notified, that is an inappropriate enforcement mechanism for a problem of vKontakte’s own making,” the submission states.

Sites that charge a nominal amount for music, such as the numerous AllofMP3-type clones, are described as an “important source of piracy” which have grown to more than 30 in number since that site’s demise.

File-sharing related actions IIPA recommends Russia takes in 2012

As with China, the requests are numerous but focus on the takedown of unlicensed music streaming services and social networks (i.e vKontakte), MP3 download sites, BitTorrent trackers, and action against site operators even if their servers are outside Russian jurisdiction. IIPA also calls for changes in the law to force greater cooperation from ISPs against infringement.

Ukraine

Unsurprisingly, Demonoid.me is the focus of the IIPA’s anti-BitTorrent sentiments in Ukraine with claims that the site offers 75,000 movies and 47,000 TV shows for free. Cyberlocker EX.ua, which was raided in January but is now back online, leads the IIPA’s file-hosting complaints.

File-sharing related actions IIPA recommends Ukraine takes in 2012

IIPA wants Demonoid and pay-MP3 sites such as MP3Fiesta taken down by the police. Under current Ukraine law, ISPs are not responsible for the actions of their users, a situation that causes rightsholders problems say the group.

From the Watch List, the file-sharing focus falls on Italy, Spain and Switzerland.

Italy

The IIPA reports progress in Italy in recent years, citing the court-ordered ISP blockades of The Pirate Bay and the recently and voluntarily shuttered BTjunkie. Several other file-sharing sites have also been closed but IIPA says that further takedowns are being hindered by authorities not taking infringement seriously enough.

The Peppermint Jam case, which resulted in Italy’s Data Protection Authority ruling that monitoring P2P users and collecting their IP addresses is illegal, also causes problems for rightsholders.

File-sharing related actions IIPA recommends Italy takes in 2012

Take additional criminal actions against P2P services that meet the criteria for injunctions and liability established in the Pirate Bay decision and order ISPs to block access to those services.

Eliminate legal obstacles for rights holders to gather IP address evidence against file-sharers.

Spain

According to the IIPA, 55% of Spain’s online music piracy takes place via P2P networks such as BitTorrent, eMule and Ares, 34% via hosted websites and 11% via streaming services.

The ESA claim that there are around 30 major Spanish websites offering links to illicit copies of video games and bemoans the lack of support from local ISPs in tackling the problem. Nevertheless, since P2P linking sites have been ruled legal in Spain many times before, up to now there has been very little they can do.

File-sharing related actions IIPA recommends Spain takes in 2012

IIPA says that P2P really took off in 2007. It’s probably not a coincidence that in 2006 a circular from the Attorney General proclaimed the decriminalization of P2P downloads. No surprise then that IIPA wants this announcement “corrected”.

The group also wants the ability for rightsholders to bring civil and criminal actions against infringers by allowing them to obtain identifying information, and the law modified so that so that rights holder-submitted notices of infringement are capable of imparting ISPs with effective knowledge that infringement is occurring through its service without a court order.

Switzerland

The IIPA criticism of this land-locked country begins with a long-time enemy, the Razorback2 eD2K (eDonkey) indexing system which was subjected to huge raids in 2006 but later recovered. Swiss-based file-hosting giant RapidShare gets a brief mention as host of infringing content, but avoids the aggressive criticism of the past.

The main problem for the IIPA appears to concern current law.

“Since Switzerland’s copyright law contains a private copy exception with no expressly stated legal source requirement, downloading and streaming from servers operated by pirates outside Swizterland are being portrayed as legal in Switzerland by the press and anti-copyright activists, as long as there is no uploading,” the IIPA states in its report.

The IIPA also bemoans the fact that Swiss law allows DRM circumvention which taken together with the private copying exception “would allow individuals to circumvent access or copy control measures in order to copy from illegal sources and share with friends.”

File-sharing related actions IIPA recommends Switzerland takes in 2012

The 2010 ‘Logistep ruling‘ meant that collecting IP addresses in Switzerland with the aim of later filing a lawsuit was confirmed to be illegal and that IP addresses are personal data. IIPA would like the Data Protection Act changed to allow pursuit of infringers.

From the Special Mention List, the file-sharing focus falls on Hong Kong, former home of the now-defunct MegaUpload.

Hong Kong

Surprisingly, Megaupload isn’t mentioned at all in the IIPA submission, not even as a copyright enforcement “success story”. The same cannot be said about Filesonic, one of the world’s leading cyberlocker services.

Filesonic is among the top 10 file-sharing sites on the Internet, with a quarter billion page views a month. It disabled all 3rd party sharing in the wake of the Megaupload shutdown and actively blocks Hong Kong IP address.

None of this appears to have improved its standing with US entertainment companies. In its report the IIPA refers to Filesonic as an “infringing distribution hub” so when combined with a previous announcement by Hong Kong customs, Filesonic must be left feeling uneasy.

File-sharing related actions IIPA recommends Hong Kong takes in 2012

The IIPA notes that Hong Kong is working with rightsholders to combat infringement but more must be done, including the tightening up of proposed copyright-related legislation with a particular eye on punishing repeat infringers.

Summary

The IIPA submission is long, detailed, and actually informative and objective in parts, but it’s also peppered with language, insinuations and omissions one might expect of the lobby groups involved.

In the main, countries are criticized for not having tough enough laws to support US interests and where they do they’re criticized for not enforcing them.

ISPs are being put under pressure around the globe and are either criticized for not living up to their responsibilities under the law or where they do, for not doing enough to voluntarily assist rights holders.

File-sharing sites, wherever they may be, are branded as criminal organizations. Authorities are encouraged to legislate with that in mind, sooner rather than later.

Source: IIPA Reports BitTorrent Sites and Cyberlockers To US Government

The Pirate's Press

Wednesday, 15 February 2012