 |  In common with most broadly comparable countries, internet users in Denmark enjoy movies and TV shows, music, videogames, and ebooks.
The problem for rightsholders is that a subset of the population prefers not to pay for the privilege. Local anti-piracy group Rights Alliance (Rettigheds Alliancen) mitigates all types of piracy but for the past few years, has maintained a keen focus on torrent sites. Working in partnership with the Danish government's SØIK IP-Task Force, Rights Alliance forced several sites to close down and successfully prosecuted site operators, staff members, and users who uploaded content to those sites. In 2021, Rights Alliance targeted specialized servers that not only supply content to torrent sites but also play a role in boosting download times while improving security. Seedbox Providers Appear in the Crosshairs In basic terms, every BitTorrent user already operates a potential 'seedbox'. A computer (box) loaded with a correctly-configured torrent client and content to upload can 'seed' or share content with others. However, the term 'seedbox' usually refers to a pre-configured remote server running a torrent client. Accessed via a web interface in the user's browser, these remote torrent clients have several advantages, including 24/7/365 uptime, high-speed connections, and depending on the provider and many other factors, varying levels of protection against rightsholders' lawsuits. In 2021, news broke that six people had been arrested in Denmark due to their alleged connections to several local torrent sites. Among them was Kasper Nielsen of internet services company HNielsen Networks, a supplier of servers under various brands that could be configured for 'seedbox' purposes. Available information indicated that the servers had been used by an unknown number of users to share content on private torrent sites ShareUniversity, Superbits and DanishBytes. Prosecution Targeting the operator of a service provider, offering access to fundamentally legal servers and software, isn't the same as targeting a user of those services who act as direct infringers. In order to hold a third party liable for someone else's infringement, rightsholders usually need to show negligence or demonstrate that the provider or similar third party is somehow complicit. In Denmark, the bar has been set fairly low. In 2015, a man was arrested for running a site that carried no pirate software but did advise users how to use piracy app Popcorn Time. The case went all the way to the Supreme Court, and the man ultimately received a six-month conditional sentence for contributory infringement. When Rights Alliance filed its criminal complaint against HNielsen Networks, the anti-piracy group referenced the landmark Filmspeler case which involved the sale of piracy-configured media players. Seedbox Seller Sentenced According to statements published by Rights Alliance and NSK (Særlig Kriminalitet) Denmark's Special Crime Unit, Nielsen was convicted yesterday for selling seedboxes in the knowledge they were being used by others to share movies, TV shows, eBooks and other content, without permission from rightsholders. "On February 28, the Court in Aalborg ruled against the Danish owner behind a seedbox company for, in the period November 2020 to May 2021, having sold seedboxes and server capacity to an unknown number of people, knowing that they were used for illegal sharing of no less than 3,838 copyright-protected works on the Danish and Nordic file sharing services ShareUniversity, Superbits and DanishBytes," Rights Alliance reports. Nielsen was handed a three-month conditional (suspended) sentence and a confiscation order for DKK 300,000 (around $42,600), the amount users had paid his company to access the seedbox servers. The 35-year-old must also pay compensation of DKK 298,660 to Rights Alliance. "Providers of seedboxes have a responsibility to ensure that their services are not used for illegal uploading and downloading of copyrighted content, which the Rights Alliance can clearly see that they are doing," says Maria Fredenslund, Director of Rights Alliance. "Therefore, this case helps to send a signal to other providers that you cannot deliberately sell services to the illegal market." Defendant Did Not Contest The Case Since court documents are yet to be published and Rights Alliance was unable to share copies with TorrentFreak, we asked Nielsen if he could provide more background detail on the case. An important detail is that Neilsen was advised by his lawyers to take a plea deal, and did so at any early stage. This came to light when we requested details relating to the Rights Alliance claim that "no less than 3,838 copyright-protected works" were shared on the torrent sites. Since 3,838 is pretty specific number, how was that proven? The simple answer is that when Nielsen took the plea deal, there was no need to prove anything in court. The 3,838 figure and any evidence related to 'knowledge' of infringement carried out by seedbox customers on the sites, were accepted as true. In respect of the 3,838 titles shared on the sites, there was apparently no indication of how many clients were sharing that content, so one user per title was assumed. No data is available to confirm or deny that claim but Neilsen says that the decision yesterday renders that moot, and he's pleased the case is all over. "I am quite happy that the case is over and that I can now focus on the future for myself and my company. The sentence is what we aimed for. The financial side is naturally tedious but we'll overcome that," he says. From: TF, for the latest news on copyright battles, piracy and more. |  Over the past several years, several videogame companies have taken cheaters to court in the United States.
In 2021, American videogame companies Bungie and Ubisoft joined forces in a lawsuit against "Ring-1", a developer and distributor of cheat software targeting Destiny 2, Rainbox Six Seige, and other popular titles. Bungie and Ubisoft identified four defendants who allegedly ran the cheating business. Filed at a California federal court, their complaint named Andrew Thorpe (aka 'Krypto'), Jonathan Aguedo (aka 'Overpowered'), Wesam Mohammed (aka 'Grizzly'), and Ahmad Mohammed as key players. Three Settlements Aguedo and the two Mohammeds were tracked down in the United States and eventually admitted their wrongdoing. This resulted in settlement agreements totaling $600,000 in damages. Thorpe, a resident of the UK, was the only defendant who failed to respond to the allegations, despite being properly informed. In the absence of a formal defense, Bungie and Ubisoft asked the court to issue a default judgment. According to the videogame companies, Mr. Thorpe was a "prominent" member of Ring-1 who, among other things, "ran" the group's official website. This claim was corroborated by the testimony of one of the co-defendants. Bungie and Ubisoft requested $2.2 million in damages, a figure that includes compensation for several claims, including copyright infringement and trafficking in circumvention devices. Unrepresented defendants run the risk of evidence weighing in favor of the plaintiffs. In this case, however, U.S. District Court Judge Edward Chen took a more balanced approach. Court Denies Default Judgement After reviewing the arguments and evidence presented by the videogame companies, Judge Chen denied their motion for default judgment. This means that the fourth and final defendant won't be required to pay any damages. The key issue at stake is whether the California federal court has personal jurisdiction over the UK resident. Specifically, Bungie and Ubisoft were required to show that he was a key player who directed his actions at the United States. In his order, Judge Chen first considers the role of the defendant, relying on the evidence provided by the game companies. This evidence failed to show that Mr. Thorpe was a prominent Ring-1 member. "Mr. Thorpe is not an original developer of the software or an original participant in the Ring-1 enterprise, but only joined after Ring-1 had already attracted many users," Judge Chen writes. "His role at the Ring-1 enterprise appears to be akin to a customer service representative. For example, customers have asked him for information related to the Cheating Software such as its features, operations, and updates." Jurisdiction Bungie and Ubisoft argued that the defendant's actions were targeted at the U.S., based on the notion that the broader actions of Ring-1 can be attributed to him. That goes too far in this case, as the court fails to see him as a leader. Co-defendant Mr. Agueda testified that Mr. Thorpe ran the Ring-1 website. However, Judge Chen believes that the term "run" is vague and is therefore insufficient to consider the defendant an alter ego for the entire Ring-1 group. Instead, the court decided to evaluate whether Mr. Thorpe specifically directed his personal actions at the U.S., which would be sufficient to establish personal jurisdiction. Again, Judge Chen found the evidence unconvincing. "First, contrary to what Plaintiffs argue, the fact that the two Plaintiffs are located in the United States does not mean that Mr. Thorpe has thereby targeted the United States," Judge Chen writes. Second, Mr. Thorpe may have assisted customers, but there is no evidence that any of those customers were based in the United States. More fundamentally, there is nothing to indicate that Mr. Thorpe reached out and solicited those customers. Rather, the evidence indicates that the customers reached out to him. Insufficient Evidence Judge Chen ultimately decided that there wasn't enough evidence to conclude that Mr. Thorpe purposefully directed his activities at the United States. As such, the court doesn't have personal jurisdiction over the UK resident. That left no other option than to deny Bungie and Ubisoft's motion for default judgment and the $2.2 million in compensation they requested. "Without the requisite minimum contacts, the Court does not have specific personal jurisdiction over Thorpe pursuant to Rule 4(k)(2), and thus a default judgment is not warranted," the order reads. In a footnote, Judge Chen writes that the injunctions awarded against the other defendants – prohibiting the Ring-1 members from engaging in any infringing conduct going forward – also apply to Mr. Thorpe but notes that his court has no power to enforce compliance. Whether Mr. Thorpe is still part of the operation is unknown but, despite the previous settlements, the Ring-1 continues to be online and publicly accessible to this day. The ruling in this lawsuit stands in sharp contrast with the criminal conviction of Gary Bowser, who was a relatively low-level 'salesperson' of the Team-Xecuter 'hacking' group. Last year, a U.S. court sentenced the Canadian to 40 months in prison for that role. — A copy of U.S. District Court Judge Edward Chan's order, denying the motion for a default judgment, is available here (pdf) From: TF, for the latest news on copyright battles, piracy and more. |  In September 2021, a grand jury returned a 62-count indictment charging Bill Omar Carrasquillo with crimes related to his Gears-branded IPTV services.
Better known online as YouTuber 'Omi in a Hellcat,' Carrasquillo ran an illegal internet-based television and movie streaming service using video content fraudulently obtained from cable providers. From March 2016 through November 2019, Carrasquillo and his co-defendants opened fraudulent accounts with TV providers Charter Communications, Comcast, DirecTV, Frontier Corporation, and Verizon Fios. These companies supplied hundreds of set-top boxes and similar equipment to multiple properties owned by Carrasquillo. At these locations, content supplied by the TV providers had its copy protection stripped before being transmitted, stored, and then retransmitted to Gears subscribers using servers and other hardware controlled by Carrasquillo and his co-defendants. U.S. Government Attorneys Submit Sentencing Memorandum In a sentencing memorandum submitted in a Pennsylvania federal court on Tuesday, U.S. government attorneys say the infringement amount associated with the defendants' services had been "conservatively" calculated at $176 million. "Carrasquillo personally profited from the conspiracy in an amount of $30,095,204," the memorandum notes. 62 Count Indictment The original indictment charged Carrasquillo with a laundry list of crimes: Conspiracy to commit copyright infringement, circumvention of access controls, access device fraud, wire fraud, criminal circumvention of copyright protection measures under the DMCA, and 20 counts of criminal copyright infringement. And the list continued: six counts of wire fraud, three counts of false statements to a bank, 19 counts of monetary transactions from specified unlawful activity, two counts of false statements, two counts of removal of property and, finally, four counts of tax evasion. Carrasquillo's Plea Agreement Carrasquillo and the government subsequently entered into a written plea agreement, the details of which are now revealed for the first time. On February 1, 2022, Carrasquillo pled guilty to the following: - 1. Conspiracy to commit felony & misdemeanor copyright infringement, circumvention of access controls, access device fraud, & wire fraud from March 2016 through November 23, 2019, in violation of 18 U.S.C. § 371
- 2. Circumvention of an access control device, from March 2016 through November 23, 2019, in violation of 17 U.S.C. §§ 1201(a)(1)(A), 1204(a)(1) and 18 U.S.C. § 2
- 3. Reproduction of a protected work (felony copyright infringement via reproduction of copyrighted video works) from May 24, 2019 to November 20, 2019, in violation of 17 U.S.C. § 506(a)(1)(A) and 18 U.S.C. §§ 2319(b)(1) and 2
- 4. Public performance of a protected work (misdemeanor copyright infringement through via "streaming" of copyrighted video works) of three specific copyrighted video works between February 11, 2019, and November 20, 2019, in violation of 17 U.S.C. § 506(a)(1)(A) and 18 U.S.C. §§ 2319(b)(3) and 2 (Counts 4, 13, and 18)
- 5. Access device fraud from June 6, 2018 through June 5, 20198, in violation of 18 U.S.C. §§ 1029(a)(2), (c)(1)(a)(i) and 2
- 6. A wire fraud scheme against the victim cable companies from March 2016 through November 23, 2019, in violation of 18 U.S.C. § 1343
- 7. False statements to a bank June 14, 2019, in violation of 18 U.S.C. §§ 1014 and 2; and
- Engaging in monetary transactions derived from specified unlawful activity (money laundering) on December 20, 2018, in violation of 18 U.S.C. § 1957
- 9. False statement, in violation of 18 U.S.C. § 1001
- 10. Tax evasion, in violation of 26 U.S.C. § 7201
Carrasquillo agreed to forfeit $5,895,507.76 in cash seized from his bank accounts.
The YouTuber also agreed to forfeit more than 50 vehicles (including his infamous supercar collection), and close to 50 real properties, most with Philadelphia addresses. Carrasquillo agreed to the entry of a forfeiture money judgment of all of the proceeds he received from his Gears TV empire, and to pay restitution to the victims in an amount to be ordered by the court. Possible 98 Years' Imprisonment, $3.5 Million in Fines Having pled guilty to crimes carrying a maximum sentence of 98 years in prison, Carrasquillo's focus will be on convincing the court that a much shorter sentence will be sufficient. Meanwhile, the U.S. government's sentencing submission attempts to quantify the scale of Carrasquillo's offending to arrive at a suitable sentence, all things considered. Carrasquillo's pirate service relied on the decoding, copying, and retransmission of more than three years of cable programming broadcast on hundreds of channels. Each channel aired different programs 24 hours a day, seven days a week. That is a huge amount of infringement but almost impossible to quantify. "Assuming each channel aired only one show per hour each day, and further assuming that the Gears Service had illicitly transmitted only 100 channels, if the infringement amount were calculated based on the total number of times the defendants copied and transmitted an infringing copyrighted television program to one of their subscribers, the government would have to determine the individual retail value of an astounding 3,066,000 programs," the government explains. Quantifying Infringement Amount The government details two options for calculating the overall infringement amount. The first method begins with subscription fees paid to the Gears service (around $34,826,402) and divides that by $19 (subscription price per month) to arrive at a total of 1,832,968 'subscriber months'. The cost of a subscription in the legal market is estimated at $120.68 per month, so when multiplied by all of Gears' 'subscriber months', the government reaches a total estimated infringement amount of $221,202,578. The second approach is more straightforward. Using a customer database seized from the defendants (which does not include start/end dates for 148,807 customers who purchased subscriptions from resellers, the government estimates a total of 1,390,595 'subscriber months'. Multiplying that figure by a legal monthly subscription cost of $120.68, the total estimated infringement amounts to $167,817,004. Government Believes 15 Years+ in Prison is Appropriate In summary, Carrasquillo's infringement was massive and complicated by other offenses, such as money laundering and tax evasion, etc. The government says that advisory guidelines indicate a sentence of 292 to 365 months but concedes that even the lower figure (24 years in prison) would be "highly unusual" for a copyright matter. "Accordingly, based on Carrasquillo's leadership of this organization, his culpability, the seriousness of his offense conduct, and his existing criminal record, the government calculates his advisory sentence range to be 188 – 235 months' imprisonment (15 years and 8 months – 19 years and 7 months)," the sentencing memorandum concludes. Carrasquillo will be sentenced next month. From: TF, for the latest news on copyright battles, piracy and more. | | |
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