A two-terabyte disk can hold roughly half a million songs. If you calculate that at the market price of 1 euro per song, the damages for having a 2 TB disk full of music would be half a million euro.
Would that be proportionate or not? Remember that this is not an extreme example, it is something that lots of teenagers do. Would it really be proportionate that the family would have to sell their house and all their possessions if they were found out?
Under current European laws, damages are (at least in principle) limited to actual losses that the party that wins can show that he has actually suffered. They have to be proportional. Not even the lawyers for a film or record company would be able to convince a European court that they have actually lost half a million euro in non-purchases from a teenager who has never seen that kind of money in his life.
But according to ACTA, the film or record companies would no longer have to prove that they have actually lost the money. All they need to do is to multiply the number of songs with the price for one song to get the amount of damages measured by the suggested retail price.
A half million euro claim against a teenager with a 2 TB disk would be considered disproportionate and absurd by any European court today. With ACTA, awarding those damages becomes mandatory.
The copyright lobby knows this, or course. They have been deeply involved in the ACTA negotiations since day one. It is only the citizens and the elected members of parliaments that have been kept in the dark for as long as possible. The plan was to get ACTA signed, sealed, and delivered before too many elected politicians in parliaments knew the real consequences of ACTA as well.
We must now make sure that that plan does not work.
Due Process
In Sweden, with nine million inhabitants, about ten people get struck by lightning every year, and one or two of them die. This is of course very tragic, but this one-in-a-million risk is not enough to make people think that they themselves will get struck by lightning, and it is not enough to make them modify their behavior in any significant way. You will not see anybody wearing a protective hat with a lightning conductor if you walk down the streets of Stockholm.
Before 2011, the risk of getting convicted of illegal file sharing was about as high as the risk of getting killed by lightning. It happened at most to one or two people per year, so it was not something that anybody would seriously expect to happen to themselves.
In 2011, with three special prosecutors and ten police investigators focusing on file sharing crimes, the number of convictions went up to 8. Put in another way, this rather massive deployment of scarce judicial resources (which could otherwise have been spent on other crimes) only managed to get the risk of getting convicted for file sharing up to the risk of getting struck by lightning, as opposed to getting struck and killed. This is a considerable increase, but it is not enough to make file sharers modify their behavior in any significant way. Some may take the (sensible) precaution of spending five euros per month for an anonymizing service to hide their IP number, but a potential risk at the same level as the risk of getting struck by lightning will not make anybody stop sharing files.
To put the number of convictions in perspective, Swedish news agency TT reported that about 20% of the Swedish population, or 1.4 million people, are file sharing according to national statistics. About one third of them, or about half a million Swedes, are estimated to do it at a level that would render them prison sentences if they were found out. But of course, the vast majority of them never will be.
“We would need thousands of prosecutors” one of the three special file sharing prosecutors told the news agency, in full knowledge that this will never happen.
From the big film and record companies’ perspective, using the courts to provide deterrence simply doesn’t work. Deterrence has no effect unless the risk of getting caught is larger than microscopic. It isn’t today. The judicial system does not have the capacity to bring entire generations to court at the same time. Cases going through the system are burdened with way too much debris like “evidence”, “due process”, and other red tape to create the volumes that the film and record companies need to ascertain effective deterrence. Unfortunately, they have realized this.
Therefore, they wish to make this whole process more efficient. In the US, their wishes have largely come true. The reason that the Jammie Thomas case got media attention wasn’t that it was the first, or that the claims made by the record company were unusually outrageous. Those were exactly the same claims that the record companies had already made in thousands of similar cases. The Jammie Thomas case got attention because she was the first defendant that pleaded not guilty, and stood up to the music and film industry associations. Instead of folding and paying the offered settlement, she took this case to court.
Let’s recap the numbers: The record company sued Thomas for $3.6 million, but offered a settlement out of court for $2,000. It is not difficult to understand why most people simply pay up, even if they are innocent. The mere threat of a costly court case and the risk of losing millions outweigh the relatively minor cost of a settlement. It’s often smarter to just pay the blackmailer and move on.
Yes, blackmail. Organized blackmail. That is what this is all about. US record companies has sued 80-year old grandmothers, people with no computers and, in a few cases, long-dead people. By forcing ISPs to giving up customer records, these mass-mailed threats have evolved to a large industry in itself. There’s no reason to be particular about who receives the threats, just send them out and wait for the protection money to roll in. There is no incentive to make sure that the defendants are actually guilty of anything, since the record companies never stand to lose anything.
The key to this strategy for the rights holders is that they can force the Internet service providers to disclose the name of the customer behind a certain IP number that is used on the Internet. If they have this, they can turn copyright enforcement from a cost to a profit center in its own right. Since only a small fraction of citizens who get a threatening legal letter are prepared to take the risk, and have the resources, to oppose it in court, the limited number of cases that the court system can process per year is not a problem for the scheme to work. To the rights holders, it’s free money in exchange for a postage stamp.
The extent of this practice in Europe varies between the member states. In 2010, Danish film maker Lars von Trier made more money from threatening to sue people for allegedly downloading his film “Antichrist” illegally, than he got from box office returns and video and DVD sales combined. The business idea was completely straight-forward. All he had to do was to send out letters saying “pay us 1,200 euro immediately, or we’ll sue you for five times that amount”. Over 600 German recipients of the letter were sufficiently scared by the threat of a costly legal process to pay up. Even if some of them were in fact innocent, or if they just felt that 1,200 euro was a pretty unreasonable punishment for having watched a movie (that wasn’t even particularly successful at the box office) for free, they decided it was not worth the risk to have their day in court.
Sweden, on the other hand, has so far mostly been spared this type of behavior by the rights holders. This is because we used to have laws that prevented the Internet service providers from disclosing information about which of its customers had a certain IP number at a certain time, according to Swedish data protection laws. Instead, the film and record companies have had to file a criminal complaint and let the police investigate if a crime has been committed. This is not enough for the rights holders, since the criminal justice system does not have the capacity to get the volumes up to the level that the rights holders want.