UK: The Sinking Of Pirate Bay

Last Updated: 28 May 2009
Article by Nick McDonald

Summary of Article

  • This judgment is certainly significant. However, whilst tempting, it is premature to state that this judgment necessarily has wider effect.
  • Illegal downloading has thrown the creative arts industry into crisis.
  • Pirate Bay is a BitTorrent Tracker, ie it does not store copyright infringing material in any way.
  • The 4 individuals (Neij, Warg, Lundstrom and Sunde) have been convicted of "assisting making available copyrighted content".
  • One of the key issues is whether they are entitled to rely upon the E-Commerce Directive as "mere conduits" of infringing material.
  • The fact that they have not been able to do so does throw into question whether sites such as Google, YouTube, or eBay could be similarly criminally liable.
  • However, this decision is inevitably going to be appealed and the ultimate decision remains uncertain.
  • Even if the 4 individuals are ultimately convicted, the finding that they have "assisted" the dissemination of infringing material is a decision on its facts to some extent.
  • Moreover, it is unlikely that decision would be repeated in other jurisdictions, such as the UK, where caselaw has found that the charge of authorising copyright infringement has a high threshold.


The decision by a Swedish court to convict Frederik Neij, Gottfrid Svartholm Warg, Carl Lundstrom and Peter Sunde of assisting making available copyrighted content" is potentially significant, but caution needs to shown in immediately suggesting it will have wider effect.

Facts Of The Case

Pirate Bay is a well-known Swedish filesharing site, which uses BitTorrent technology to allow its users to share and therefore download content.

Pirate Bay has been the target of the music industry, and the Swedish authorities, for some time. On 31 May 2006, the website's servers were raided by the Swedish police, causing the site to close down for three days.

Despite mounting pressure, however, the site remained generally operational, and its founders have consistently argued that the site is doing nothing illegal.

However, on 31 January 2008, charges were filed by Swedish prosecutors against four individuals, Peter Sunde, Fredrik Neij, Gottfrid Svartholm and Carl Lundstrom, for "promoting other people's infringements of copyright laws".

There followed a high profile trial, dubbed a 'Spectrial' by Pirate Bay itself (a combination of spectacle and trial).

On 17 April 2009 the four mean were convicted and each sentenced to one year in jail each and ordered to pay a total of 30 million SEK (3.6 million USD). Inevitably, an appeal has now been lodged.

Crisis In The Music Industry

The case is yet the latest round in an ongoing battle between the creative arts industry and filesharers.

It is a widely held view that the creative arts industry, and the music industry in particular, is in crisis because of the decline in CD sales and exponential rise in copyright infringement over the internet. A report by Enders Analysis from last year estimated that global CD sales, for example, are likely to stabilise at around £23 billion in 2009, down from a high of £45 billion in 1997.

Put simply, the internet has created a bootleg crisis in the creative arts industry that threatens to overwhelm it.


Principally, illegal downloads are effected through filesharing: the activity of trading digital files with other users over the internet. First generation filesharing protocols, such as Napster, used a central server to access materials. It was thus easy to identify a central source of copyright infringing materials. Second, third and fourth generation filesharing protocols do not use a central server. Instead of users being dependent upon receiving content from a central source, they are able to exchange data with each other. Moreover, they can achieve anonymity by routing traffic through other users' clients.

Fourth generation filesharing allows streams instead of files to be transmitted over a P2P network. Therefore, it is possible, for example, to listen to live video or audio without any server being involved. In order to do this, swarming technology is used, which involves use of the BitTorrent protocol to download segments of data from a variety of other users and then put it together to create the data stream.

Pirate Bay operates on this basis, and indeed is widely regarded as the world's largest Bit Torrent Tracker.

The Legal Context

It is important to remember that online infringement can never be looked at within the boundary of a single jurisdiction. It is a multi-jurisdictional, international issue. Copyright protection in other jurisdictions, whilst unified to extent through the Berne Convention and the Universal Copyright Convention, is not subject to the same tests.

That said, copyright works generally must be original, and they must have a fixed material form. They do not, however, generally need to be registered. Therefore, no forms need be completed nor are there any fees payable to obtain copyright protection.

As such creative works such as music or videos invariably attract copyright protection, which means that such works downloaded from sites such as Pirate Bay in an unauthorised manner infringe the copyright of the owner of those works (artists, or more often, record companies and musical producers' organisations).

Infringement of copyright can occur in numerous different ways. In the UK, copyright infringement is governed by s.16 Copyright Designs and Patents Act 1988. Primary acts of infringement include:

  • Copying the work;
  • Issuing copies to the public;
  • Renting, lending the work to the public;
  • Performing, showing or playing the work to the public;
  • Communicating the work to the public;
  • Making an adaptation of the work or doing any of the above in relation to an adaptation.

...or authorising any of the above acts, which is a key point.

Secondary acts of infringement include:

  • Making;
  • Importing into the UK;
  • Possessing in the course of business;
  • Selling or letting for hire.

Deliberate copyright infringement is, under s.107 the Act, a criminal offence.

Similarly, in Sweden, criminally infringing acts include assisting copyright infringement and assisting making available copyrighted content. It was these offences that were brought against Neij, Warg, Lundstrom and Sunde. On the second day of the trial prosecutors were forced to drop the charge of assisting copyright infringement because they were unable to prove that .torrent files submitted as evidence used The Pirate Bay's tracker, nor were they able to fully explain the technology involved to the Court.

However, the charge of assisting making available copyrighted content (Or "Assisting in violation of copyright law" as an English translation of the judgment reads) remained (as did "Preparing for a violation of copyright law"). Neij, Warg, Lundstrom and Sunde were convicted of "assisting" but cleared of "preparing for".

There is no legal difference between a hard copy and a digital copy of a copyright work. To that extent, copyright is technology neutral.

However, there are some differences in the extent to which copyright infringement of such material will occur. Clearly, whilst the transmission of physical copyright works can be easily tracked, that is less easy with electronic works. The question is the degree of involvement that websites such as Pirate Bay have in facilitating the downloading by individual users of infringing copyright content.

The EU directive 2000/31/EC (the E-Commerce Directive) provides that information society services providers are not liable for damages in certain circumstances, where that provider is a "mere conduit" of that content, is involved in "caching" that content, or is a "host" of such content.

Article 15 states that there should be no obligation on such entities "to monitor the information which they transmit or store, nor a general obligation actively to seek facts or circumstances indicating illegal activity".

However, member states may "establish obligations for information society service providers promptly to inform the competent public authorities of alleged illegal activities undertaken or information provided by recipients of their service or obligations to communicate to the competent authorities, at their request, information enabling the identification of recipients of their service with whom they have storage agreements". Therefore, there is an obligation on such information society service providers to institute systems for dealing with copyright complaints.

These 'safe harbour' provisions have been used in defence of internet service providers. They have also been used to defend eBay and Google. In Belgium, for example, the Lancôme/Ebay judgment of the Brussels Court of Commerce found that Ebay qualified as a "host" under the E-Commerce Directive, that it benefited from 'safe harbour' provisions in the E-Commerce Directive and was entitled to rely on Article 15 in its defence against claims that it had allowed sales of trade mark infringing goods.

It was also the 'safe harbour' provisions, and in particular Article 12, upon which Pirate Bay's lawyers – in part - relied in arguing that they were not liable for any damages. On the third day of the Trial, in what has become known as the "King Kong Defence", defence attorney Per Samuelson stated to the Court:

"EU directive 2000/31/EC says that he who provides an information service is not responsible for the information that is being transferred. In order to be responsible, the service provider must initiate the transfer. But the administrators of The Pirate Bay don't initiate transfers. It's the users that do and they are physically identifiable people. They call themselves names like King Kong.... According to legal procedure, the accusations must be against an individual and there must be a close tie between the perpetrators of a crime and those who are assisting. This tie has not been shown. The prosecutor must show that Carl Lundström personally has interacted with the user King Kong, who may very well be found in the jungles of Cambodia..."

In finding that Pirate Bay was indeed a commercial information service provider, the Court held that the failure by Pirate Bay to establish a system for dealing with copyright complaints meant that it could not rely upon the 'safe harbour' provisions.

What Does This Decision Mean?

Per Samuelson argued that, under Swedish law, the charges must be brought against individuals and there must be a close tie between the perpetrators of an offence (the downloaders of copyright infringing material) and those accused of "assisting". Per Samuelson argued that, importantly, Pirate Bay can be used for downloading legal files as well as illegal files.

Clearly, the Swedish Court has taken a different view. The immediate and obvious response is therefore that sites like Google, eBay and sites containing user generated content (UGC sites) may also be criminally liable for IP infringements.

However, it is impossible to state – at this stage – that the Pirate Bay decision is either right, is not merely limited to its own facts, or that the application of legal principles is necessarily applicable across other jurisdictions.

Firstly, it is important to understand that the case relates to criminal liability, and therefore involves the fusion of copyright infringement (or rather assisting copyright infringement), which is essentially a civil offence, and criminal liability for assisting that essentially civil offence. Further, as regards damages it involves a rejection of the argument that liability can be discharged by the 'safe harbour' provisions set out in the E-Commerce Directive.

Moreover, the Swedish statute being applied is a new category of copyright infringement termed (in the Google translation of the Swedish Judgment at least) as "transfer to the general public", which is perhaps similar to "Communicating the work to the public" under UK law. This was only introduced on 1 July of 2005 by implementation of the EU Copyright Directive, and therefore remains relatively untested by the Swedish Courts.

Further, the conviction is actually for more than just copyright law. One of the defendants, Gottfrid Svartholm Warg was also charged and convicted of a "Violation of the law banning certain health-hazardous goods", ie possession of amphetamines, that no doubt swayed the Court to some degree.

All sorts of other issues were raised during trial, such as whether the defendants had acted in concert or independently. The chaotic structure of Pirate Bay contributed to these arguments. Fredrik Neij and Gottfrid Svartholm Warg essentially ran the site. Peter Sunde Kolmisoppi's liability stems from advertising payments and the issuance of invoices. Carl Lundstrom purchased servers and bandwidth. Therefore, since this matter is going to appeal, this issue will be tested again.

In reality, Pirate Bay is a fairly extreme example, as a website which – arguably at least - openly allowed its users to access infringing material. The factual position is much different for sites such as Google, eBay, and YouTube, for which such infringements are – even if widely known about – genuinely inadvertent. Recital 42 of the E-Commerce Directive makes clear that the 'safe harbour' exemptions are only intended to cover cases where the activity of the information society service provider is limited to the technical process of operating and giving access to a communication network over which information made available by third parties is transmitted or temporarily stored, for the sole purpose of making the transmission more efficient:

"...this activity is of a mere technical, automatic and passive nature, which implies that the information society service provider has neither knowledge of nor control over the information which is transmitted or stored."

Therefore, Pirate Bay, whose very name arguably implies its aim is to facilitate pirate copies of copyright works, is not the sort of entity whom that legislation was envisaged as protecting from damages payments. Even in that context, it is far from certain that the prosecutions of Neij, Warg, Lundstrom and Sunde will be upheld on appeal.

Moreover, even if they are, the legal position is not necessarily the same across other jurisdictions. We do not, for example, have a law in the UK for facilitation of copyright infringement, although authorisation of copyright infringement is an offence and has a higher threshold than merely facilitating. In the well known case of CBS Songs –v- Amstrad (1988) RPC 567 the House of lords held that a twin cassette deck that could be used making copyright infringing tapes did not constitute the authorisation of copyright infringement because the cassette deck has legitimate uses. The decision mirrors a similar decision in the US, Sony –v- Universal City Studios 104 US 774 (1984) in which the legality of a Betamax video recorder which could both play recorded films was upheld.

That is not to say that copyright owners have no form of redress in the UK. The 'safe harbour' provisions, or example, merely prevent liability for damages or any other pecuniary measure, or for criminal sanctions. They do not however, prevent the possibility of injunctive relief. The Copyright Directive, which was implemented in UK through the Copyright and Related Rights Regulations 2003 inserted s.97A into the Copyright Designs and Patents Act 1988. S.97A gives the High Court the power to grant injunctions against internet service providers where there is actual knowledge of a third party using its services to commit a copyright infringement offence. Such knowledge can be effected through a notice to the ISP from the copyright owner. The Electronic Commerce Regulations require ISP's provide such contact details so that notices can be served.

However, the possibility of criminal liability in the UK for individuals such as in the Pirate Bay case is much more remote.


The Pirate Bay decision is a high profile, somewhat unexpected, and significant decision in a relatively new area. It is therefore a landmark decision of sorts. It potentially creates a new landscape for downloaders of infringing copyright material and providers of technology and services to assist that process. To that extent, the creative arts industry has won a major battle and will no doubt trumpet its success.

Yet, it is unwise, at this stage, to draw wider conclusions. It will be interesting to see what outcome emerges from the appeal (which could take up to 6 years) and even if the convictions are upheld the facts of this case are, to an extent, unique.

However, this is certainly a decision that will send shockwaves through the internet community. Moreover, it perhaps heralds a day, not too far distant, when internet users will no longer have easy access to free, illegal copyright material. For an internet generation that has grown up expecting such easy access, that may be a difficult prospect to contemplate.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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