Thursday, March 9, 2023

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EU Upload Filters Mark the End For File-Sharing Site Hellspy
Ernesto Van der Sar, 09 Mar 12:57 PM

hellspyTo the global audience, Hellspy may not be a household name, but in the Czech Republic, it's widely known.

Founded in 2009, the file-sharing and hosting platform grew out to become one of the country's most-visited websites. This didn't go unnoticed by copyright holders, including the RIAA, who repeatedly complained about widespread piracy on the platform.

Operating in the face of legal pressure is a challenge, but Hellspy always felt that it had the law on its side. If users uploaded copyright-infringing content, the company would swiftly remove it after being notified by rightsholders.

EU Copyright 'Filter' Directive

This approach worked well for Hellspy and its parent company, I&Q Group. However, when the new EU Copyright Directive passed a few years ago, dark clouds started to form. The indirect upload filter requirements it contained were particularly troublesome.

Article 17 of the Copyright Directive requires online services to license content from copyright holders. If that is not possible, service providers must ensure that infringing content is taken down and prevented from being re-uploaded to their services.

Many operators of online services interpret this as an indirect upload filter requirement, as that is the only way to ensure that content remains off the platform.

Voluntary Filters

Hellspy also came to this conclusion. Late last year it decided to voluntarily implement filtering technology. This was much needed, as the Czech Republic planned to update its copyright law in January 2023, to comply with the new EU rules.

The upload filters were implemented in collaboration with the local Association of Commercial Television (AKTV). According to early comments from I&Q Group CEO, Jan Hřebabecký, these appeared to be working well.

"[T]hey provide relatively easy and effective filtering of copyrighted content, which is especially important for services of our type in light of the upcoming amendment to the copyright law, which imposes new obligations on us in this area," Hřebabecký said.

Hellspy stressed that wasn't happy with these changes but it respected the law. This meant that upload filters were the only viable way to keep the service afloat.

Hellspy Announces Shutdown

Fast forward a few weeks, and Hellspy reached an entirely different conclusion. The site notes that the new legislation places disproportionate burdens on user-generated content platforms. And despite its earlier commitment to start filtering, it has now chosen to shut down.

"Given the legislative situation in the Czech Republic and the maximum transparency of Hellspy to our users, we want to inform you about the end of Hellspy on 1.4.2023," the site wrote in an email to its users, shared by novinky.cz.

hellspy mail

While announcements involving April 1st should always be treated with caution, there are no apparent signs that Hellspy is joking. According to the email, users can request a refund if their paid access plan extends beyond the shutdown date.

Traffic Plummeted

The file-sharing site doesn't go into detail to explain why it chose to shut down after all. The initial reaction suggested that the technical filtering implementation wasn't particularly problematic.

In addition to the filters, Hellspy reportedly disabled the search functionality as well. These measures had a direct impact on visitor numbers, which plummeted to new lows in recent months. This is likely to have factored into the shutdown decision.

Hellspy is not the only Czech file-sharing platform that has responded to the new law. Ulož.to, which refuses to implement upload filters, remains online but now points its users to a third-party site to search for content.

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

Omi in a Hellcat Handed 66 Months in Prison For Pirate IPTV, Forfeits $30m
Andy Maxwell, 08 Mar 07:53 PM

omi in a hellcat carAfter entering a guilty plea some time ago, former pirate IPTV service operator Bill Omar Carrasquillo was sentenced Tuesday in a Philadelphia court.

Last month the U.S. government called for 15.5 years in prison for crimes related to Carrasquillo's pirate IPTV service, Gears TV, which was shut down by the FBI in 2019.

That was still a far cry from the 500+ years thrown around in the earlier stages of the case, but after causing an estimated $167 million in damages to TV providers Charter Communications, Comcast, DirecTV, Frontier Corporation, and Verizon Fios, perhaps not completely out of the question.

Plea Agreement

Some details were already settled prior to sentencing. In Carrasquillo's plea agreement, the YouTuber acknowledged a laundry list of crimes, from the most serious copyright offenses to fraud and money laundering crimes.

Among them, conspiracy to commit felony & misdemeanor copyright infringement, circumvention of access controls, access device fraud, & wire fraud, circumvention of an access control device, reproduction of a protected work, public performance of a protected work, and wire fraud against the cable companies. Other crimes included making false statements to a bank, money laundering, and tax evasion.

Financial penalties included forfeiture of just over $30 million, including $5.89 million in cash seized from bank accounts, Carrasquillo's now-famous supercar collection, and multiple pieces of real estate in the Philadelphia area.

Hearing in Philadelphia

In a hearing scheduled for 2:30pm yesterday at the United States District Court for the Eastern District of Pennsylvania, Carrasquillo appeared in courtroom 16A before Judge Harvey Bartle III.

In a sentencing memorandum for the defense, details of Carrasquillo's early life – most of which had already been made public by Carrasquillo in videos posted to social media – make for depressing reading.

One of 38 children, Carrasquillo had no stable care or supervision. Physically and sexually abused by family members, Carrasquillo was intentionally committed to mental health facilities by one supposed caregiver, purely for the purposes of obtaining prescriptions for narcotics which were then sold.

Carrasquillo's mother was deported for various crimes and then died as a result of drug addiction. The only constant in his life was his father, who taught a 12-year-old Carrasquillo how to cook crack and sell drugs.

"Omar battles constant battles of depression because he questions his own self-worth. He could have easily accepted that there is no 'better' for him," his attorney said, adding: "HE DID NOT!"

"He began to look for opportunities that did not require formal training or a high school diploma. He found passion and love in the business of marketing and internet sales."

Despite no formal training or schooling beyond the 11th grade, Carrasquillo developed a highly successful YouTube channel and a construction company, among other legal businesses. The story of how he entered the IPTV business and generated millions in profit is well-documented, but today his "legal loophole" theory has been discarded.

"Omar is not asking for a pass," his attorney assured the Court. "Protected works should not be copied. Period. He crossed the line and he knew he should not have."

Sentencing

All parties agreed that the TV companies are entitled to restitution and together they will receive $$10,761,573.20. A similar position was adopted for the IRS, which is entitled to restitution in the amount of $5,717,912.02.

From 500+ years imprisonment through to a theoretical 98 years for the crimes listed in the plea agreement, the U.S. government recently acknowledged that the advisory guidelines of 24 years would be "highly unusual" for a copyright matter. Instead, government attorneys recommended a sentence of between 188 and 235 months.

When sentencing Carrasquillo Tuesday, Judge Harvey Bartle III decided that 66 months would be enough to punish Carrasquillo and send a deterrent message to any of his followers considering the same type of behavior.

Carrasquillo: Judge Was "Super Fair"

In video recorded outside the Court, Carrasquillo said he'd been dreading the sentencing hearing but is pleased with the outcome.

"I feel like the Judge was super fair. He heard everyone's testimony about my character [from] everyone who came to Court. The judge ordered me to 66 months of federal prison, which I thought was fair, especially how much money I made," he said.

"I've got to pay ten point something million in restitution [to the TV companies] which they already have, which will be applied. And I got to pay another $5.7 million in restitution to the IRS. So you know, I'll be home in the next two to three years."

After being raided by the FBI in 2019 and being charged in 2021, Carrasquillo said the day had "been a long time coming."

"You know, the Judge was super lenient but fair, but also [wanted to] deter other people from committing the same type of TV piracy that I committed. But it's over," he said.

"I already know what I'm doing, I know what I'm getting. There's no more stress, no more nothing. I know when I come home, everything will be fine. I'm good. 66 months was super fair. And you know, it sucks for my kids, but I'm happy with it."

Well-known for his ability to transform dust into gold and losses into wins, Carrasquillo revisited his well-documented struggles with weight and noted an opportunity ahead.

"It's probably salvation for my fat ass to lose some weight anyway," he said.

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

DNS Resolver Quad9 Loses Global Pirate Site Blocking Case Against Sony
Ernesto Van der Sar, 08 Mar 01:01 PM

quad9In 2021, Sony Music obtained an injunction ordering DNS resolver Quad9 to block the popular pirate site Canna.to.

The injunction, issued by the District Court of Hamburg, required the Swiss DNS resolver to block its users from accessing the site to prevent the distribution of pirated copies of Evanescence's album "The Bitter Truth".

Quad9 Appeals Site Blocking Injunction

The Quad9 Foundation fiercely opposed the injunction. The not-for-profit foundation submitted an appeal to the Court hoping to overturn the blocking order, arguing that the decision set a dangerous precedent.

The DNS resolver stressed that it doesn't condone piracy. However, it believes that enforcing blocking measures through third-party intermediaries, that don't host any content, is a step too far.

This initial objection failed; the Regional Court in Hamburg upheld the blocking injunction last December. However, this was only a preliminary proceeding and Quad9 promised to continue the legal battle, warning of a broad impact on the Internet ecosystem.

Sony Files Main Proceeding

After Sony's preliminary victory, the music company initiated a main proceeding at the Leipzig court. This was the next step in the legal process and allowed both sides to provide more evidence and expert opinions.

Sony, for example, referenced earlier jurisprudence where Germany's Federal Court ruled that services such as YouTube can be held liable for copyright infringement if they fail to properly respond to copyright holder complaints.

Quad9's expert, Prof. Dr. Ruth Janal, contested this line of reasoning, noting that, under EU law, DNS resolvers shouldn't be treated in the same fashion as platforms that actually host content

Quad9 is more akin to a mere conduit service than a hosting provider, Prof. Janal countered. Courts could instead require Quad9 to take action through a "no-fault" injunction, a process that's already used in ISP blocking orders. In those cases, however, the intermediary isn't held liable for pirating users.

Court Confirms DNS Blocking Requirement

After hearing both sides, the Regional Court of Leipzig ultimately handed a win to Sony. This means that Quad9 is required to block the music piracy site canna.to globally. If not, those responsible face a hefty fine, or even a prison sentence.

"The defendant is liable as a perpetrator because it makes its DNS resolver available to Internet users and, through this, it refers to the canna.to service with the infringing download offers relating to the music album in dispute," the Court writes.

Judge Werner argues that Quad9 should have taken action when the copyright holder alerted it to a pirated copy of the Evanescence album. Its intentional failure to act makes the DNS resolver liable.

quad

In its defense, Quad9 warned that blocking measures have a significant impact on its system architecture and performance. The Court wasn't receptive to this argument, as the DNS resolver already actively blocks malware as one of its features.

Thus far, Quad9 has blocked Canna.to only for German users. However, the court order suggests that a global blocking order is reasonable and warranted, which is in line with Sony Music's demands.

"It would also be harmless if, in accordance with the defendant's argument, websites were blocked globally and irrespective of a specific jurisdiction for all Internet users who use the defendant's DNS resolver.

"Even worldwide, no legitimate interest of Internet users in accessing this website with obviously exclusively illegal offers is apparent, so that the question of overblocking does not arise," Judge Werner adds.

'Absurdly Extreme'

Quad9 is disappointed with the verdict. According to the non-profit foundation, the court order opens the door to widespread global blocking orders that go far beyond the jurisdiction they're issued in.

"Quad9 believes this is an exceptionally dangerous precedent that could lead to future global-reaching commercialized and political censorship if DNS blocking is applied globally without geographic limitations to certain jurisdictions."

In addition, the DNS resolver believes that the Court mistakenly labels the service as a liable 'wrongdoer'. Expanding liability to seemingly neutral services that don't host any content is "absurdly extreme", Quad9 notes.

"To put this into perspective, applying wrongdoer liability in this setting is akin to charging a pen manufacturer with fraud because a stranger forged documents while using the manufacturer's writing utensil," the Foundation writes.

Quad9 Continues to Fight

According to Quad9, Sony Music hand-picked a relatively small player with limited means, to obtain a favorable precedent. However, Quad9 isn't giving up the fight. The company will appeal the judgment at the Dresden Court of Appeal, with help from the German Society for Freedom Rights (GFF).

GFF project coordinator Felix Reda, who previously served as a Member of the European Parliament for the Pirate Party, believes that the Leipzig Regional Court has made a glaring error of judgment.

"It treats Quad9 as if the service itself were committing copyright infringement, even though it merely resolves a website name into an IP address," Reda tells TorrentFreak.

"If one follows this reasoning, the copyright liability of completely neutral infrastructure services like Quad9 would be even stricter than that of social networks, whose copyright liability was extended by the controversial EU Copyright Directive."

In common with Prof. Janal, Reda stresses that Quad9 should receive similar treatment as ISPs, instead of equating the service to a hosting provider.

"The Digital Services Act makes it unequivocally clear that the liability rules for Internet access providers apply to DNS services. We are confident that this misinterpretation of European and German legal principles will be overturned by the Court of Appeals," he notes.

For now, Quad9 says it will comply with the court order. This means that it will block access to the Canna.to domain. Whether this will make much of a difference is unknown, as the site moved to the Canna-Power.to domain name a while ago.

A copy of the Regional Court of Leipzig's order is available here (German, pdf) and a translated English copy can be found here (pdf)

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

 
 
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