Tuesday, February 2, 2021

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IPTV Provider Omniverse Wins $50m To Pay Hollywood's $50m Piracy Damages
Andy Maxwell, 02 Feb 09:26 PM

When the Alliance For Creativity and Entertainment (ACE) sued IPTV provider Omniverse One World Television and its owner in a California court in early 2019, the case looked relatively straightforward. But that wasn't to be the case.

Omniverse Believed It Was Fully Licensed

According to ACE, Omniverse was a supplier of infringing content to third-party suppliers including the previously-sued Dragon Box, HDHomerun, Flixon TV, and SkyStream TV, who in turn offered packages to their customers.

However, unlike most entities sued by ACE, Omniverse owner Jason DeMeo insisted his company had acquired the necessary rights to the content offered by his platform. He pointed to a licensing deal with cable provider Hovsat, which in turn was supposed to have a deal with DirecTV to distribute TV content.

Questions were raised over the validity of these agreements and Omniverse eventually threw in the towel, agreeing to pay $50 million in copyright infringement damages to ACE.

Omniverse Goes After Hovsat

With Omniverse blaming Hovast for its predicament, including an unpaid $50 million bill, Hovsat's presence was required in court. However, the company and its supposed owner Shant Hovanian failed to respond, which prompted Omniverse to demand $50 million in damages from Hovsat to settle its colossal Hollywood debt.

Last March the court denied Omniverse's motion for default judgment on the grounds that it could not determine that defendant Hovsat had been properly served. The court did, however, suggest alternative means to serve Hovsat via a state official or agency, which Omniverse did in early September 2020.

In a memorandum supporting a motion for default judgment filed in December 2020, Omniverse explained that it paid Hovsat up to $46,000 in licensing fees every month and believed that DirecTV was getting its share too. But that turned out not to be the case, meaning that Omniverse was left unlicensed through Hovsat's failures and liable to pay Hollywood $50 million in infringement damages.

Among other issues, Omniverse accused Hovsat of breach of contract, negligent and fraudulent misrepresentations, and breach of Warranty of Title and Against Infringement.

"Had HovSat not made the misrepresentations regarding acquiring the distribution licenses for the copyrighted content, and thus not breached their contract with Omniverse, Omniverse would have never been subject to the above-caption lawsuit raised by Plaintiffs," the memorandum reads.

"It logically follows that HovSat's misrepresentations thus proximately and directly caused the $50,000,000 in damages suffered by Omniverse."

Hovsat Must Pay Omniverse $50 Million in Damages

In default judgment handed down by District Judge Michael W. Fitzgerald yesterday, it is noted that Hovsat was served with process through alternative means but failed to plead or otherwise defend the action. Having considered Omniverse's motion, the Judge found in favor of the former IPTV provider.

The Court found in favor of Omniverse on six counts, including breach of the implied warranty of title and against infringement under UCC § 2-312. Hovsat was ordered to pay $50 million in order to settle them all.

Whether Hovsat will quickly pay Omniverse (so that in turn Omniverse can settle with Hollywood) remains unclear but a lack of interest in the court process thus far tends to suggest otherwise.

Omniverse's motion and the $50 million default judgment can be found here (1,2 pdf)

From: TF, for the latest news on copyright battles, piracy and more.

Tech Giants Warn US of Hostile Copyright Environment in EU and Russia
Ernesto Van der Sar, 02 Feb 11:58 AM

tech giantsIn recent years many countries around the world have tightened their copyright laws to curb the threat of online piracy.

These new regulations aim to help copyright holders, often by creating new obligations and restrictions for online service providers that host, link to, or just pass on infringing material.

The European Union, for example, approved the EU Copyright Directive which is currently being implemented by member states. This includes "Article 17" which requires many online services to license content from copyright holders. If that is not possible, online services should ensure that infringing content is taken down and not re-uploaded to their services.

Hostile Environment

Copyright holders are happy with the legislation but many tech companies see it as a threat. And it's not the only copyright-related change they are concerned about. This week, the Computer & Communications Industry Association (CCIA) informed the US Trade Representative that big tech is facing an increasingly hostile environment abroad.

"U.S. firms operating as online intermediaries face an increasingly hostile environment in a variety of international markets. This impedes U.S. Internet companies from expanding services abroad," CCIA writes.

The industry group, which represents tech giants including Amazon, Cloudflare, Facebook and Google, shared its concerns in response to the USTR's Special 301 Report inquiry. This annual report aims to highlight copyright-related barriers US companies face in other countries.

Traditionally, the Special 301 Report has been used to lobby for stricter copyright regulation. However, the tech companies argue that some countries have gone too far.

"These adverse conditions manifest through court decisions and new copyright regulations that depart from global norms on intermediary responsibility. In the case of the EU's copyright reform, the motivation to target primarily U.S. firms is clear," CCIA writes.

EU's 'Upload Filters'

The EU's Article 17 is mentioned as one of the major stumbling blocks. The new legislation creates "unreasonable" and "technically impractical" obligations that will make it harder for US companies to operate in Europe, CCIA warns. This includes potential upload filters.

"Online services will likely have to use filtering technologies in order to comply with the requirements under Article 17. While Article 17 avoids the word 'filter', practically speaking, content-based filtering will be required if a service is to have any hope of achieving compliance. This upends longstanding global norms on intermediary liability," CCIA writes.

These requirements go above and beyond the DMCA-style notice-and-takedown policies that were the international standard over the past two decades. If U.S. companies want to avoid liability going forward, they will have to switch to a more restrictive notice-and-staydown approach instead.

Russia's Mirrors Law

The EU Copyright Directive is not the only 'hostile' copyright change CCIA highlights. The group is also concerned about Russia's 'Mirrors Law' that requires search engines to remove pirate sites and their mirrors from their results within 24 hours after being notified.

This 'problematic' law was also highlighted in a separate USTR submission from the Internet Association, which also represents Google and other big tech companies. The group warns that the Mirrors Law leads to overbroad removal of content that would remain online in the US.

"In practice, this law has resulted in overbroad removal and delisting requests for general-purpose websites that would not be subject to removal under Section 512 of the Copyright Act or other parts of U.S. copyright law," the Internet Association writes.

"As USTR has noted elsewhere, 24 hours is an insufficient amount of time for service providers to review these types of requests. Also, the principle of removing entire websites that include a proportionally minor amount of potentially infringing content was squarely rejected by the U.S. Congress during the debate over the Stop Online Piracy Act in the 112th Congress."

USTR Should Recognize Liability Concerns

Both industry groups highlight a variety of other smaller and larger copyright-related obstacles, including blocking requirements and increased liability in countries such as Brazil, Spain, Greece and India. These often are much stricter than in the US, which is seen as a problem.

The Internet Association and CCIA urge the US Government to hear their concerns and use the Special 301 Report to highlight these 'hostile' environments that hurt innovation.

"In the 2021 Special 301 Report, USTR should recognize the concerns of U.S. Internet services who not only hold intellectual property and value its protection, but also rely on innovation-enabling provisions that reflect the digital age," CCIA concludes.

A copy of CCIA's submission for the USTR's Special 301 Report is available here (pdf). The Internet Association's submission can be found here (pdf)

From: TF, for the latest news on copyright battles, piracy and more.

 
 
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