Entertainment Industry's Coordinated Effort To Blame Third Parties Taking Shape

from the they're-everywhere dept

We’ve noted that the entertainment industry lobbyists (driven mainly by the MPAA and the RIAA) are pretty good at having a fairly global strategy when it comes to implementing the next bad idea. Whenever they support something, you quickly see something similar pop up around the globe — sometimes with slight variations, which often allow them to test the waters to see how far they can go, in order to later use any such successes to convince other countries to go even further. It’s why you saw copyright extension show up around the globe, it’s why three strikes showed up around the globe… and now it’s why blaming third parties and making them liable for copyright infringement is showing up around the globe. In the US, it’s the PROTECT IP Act, which puts an astounding burden on third party tech companies — namely “information location tools,” payment processors and ad firms — in an effort to make them cut off those accused (not found guilty) of copyright infringement. And, we just noted that efforts are underway for something similar in the UK.

However, over in the Netherlands, they’re trying something slightly different. The anti-piracy group BREIN, which apparently gets plenty of funding from the MPAA, is simply going to start suing such third parties. BREIN has announced that it will sue third party payment processors if they don’t cancel accounts associated with those accused of copyright infringement. Notice that in this case, they’re not talking about a new law, but using existing laws to put liability on such third parties. It’s an impressive strategy effort by old Hollywood, but it suffers the same fatal flaw as its other plans. Nothing in this will make anyone want to buy. And, at the same time, the risk of getting a false positive is pretty high. But that’s apparently a small price to pay for thinking you’re stopping infringement.

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Comments on “Entertainment Industry's Coordinated Effort To Blame Third Parties Taking Shape”

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105 Comments
Anonymoussays:

Funny. Mastercard supports the Protect IP Act. And the other payment processors seem poised to follow suit. Like the banks understand their corporate responsibility in combatting money laundering, payment processors also understand that they have a responsibility not to be enablers of infringement and counterfeiting. The concept has already been accepted by them, it’s just a few of the details that need to be worked out. Then they will join the growing number of voices in supporting the bill.

And by the way, the payment processors already maintain a vast database of entities that they won’t process for. The infrastructure is already in place. So much for your laughable, “astounding burden”.

Anonymoussays:

Re: Re: Re: Re:

And this part does not worry you?

“in an effort to make them cut off those accused (not found guilty) of copyright infringement”

Do you not understand that an alleged pirate site has the same rights under Rule 65 of the Rules of Civil Procedure as any other civil litigant in the US? The law states that there has to be a good faith effort demonstrated to serve the website’s owner. Problem is, these guys ignore DMCA takedown notices and don’t answer summons. Then they thumb their noses as they’re outside the reach of the US legal system. What is the rightsholder supposed to do? The rogue site owner has EVERY opportunity to come forward and defend himself before any order is served on a payment processor, ad network or search engine. But they won’t because they know they’re in violation of US law, so they hide.

btr1701says:

Re: Re: Re: Re: Re: Re:

The rogue site owner

What exactly is a ‘rogue site’? Either a site is legal or it isn’t. If it’s illegal, then prosecute and shut it down. If it isn’t illegal, then it has violated no laws and shouldn’t be subject to any sanction whatsoever.

This whole ‘rogue site’ nonsense is nothing but a euphemism for ‘a site that is doing stuff we don’t like but not breaking any law, but we want to punish them anyway’.

Anonymoussays:

Re: Re: Re:2 Re: Re: Re: Re:

What exactly is a ‘rogue site’? Either a site is legal or it isn’t. If it’s illegal, then prosecute and shut it down. If it isn’t illegal, then it has violated no laws and shouldn’t be subject to any sanction whatsoever.

A rogue site operates in violation of US law outside the reach of US law enforcement. That’s why the proposed responses under Protect IP entail orders for US-based enablers to cease doing business with these guys.

Anonymoussays:

Re: Re: Re:2 Re: Re: Re: Re:

What exactly is a ‘rogue site’? Either a site is legal or it isn’t. If it’s illegal, then prosecute and shut it down. If it isn’t illegal, then it has violated no laws and shouldn’t be subject to any sanction whatsoever.

A rogue site operates in violation of US law outside the reach of US law enforcement. That’s why the proposed responses under Protect IP entail orders for US-based enablers to cease doing business with these guys.

Anonymoussays:

Re: Re: Re: Re:

“the banks understand their corporate responsibility”

OMG ! That is too funny! … You’ve out done yourself with this one. – The only problem is, I think you were serious.

Nice out-of-context quoting. The full sentence was:

“Like the banks understand their corporate responsibility in combatting money laundering, payment processors also understand that they have a responsibility not to be enablers of infringement and counterfeiting.”

Perhaps you’d like to back you bullshit up with a few well-researched citations about problems with American banks and money laundering. You’ll note a strong correlation between the following acts and instances of money laundering by US banks:

Bank Secrecy Act (1970)

Established requirements for recordkeeping and reporting by private individuals, banks and other financial institutions
Designed to help identify the source, volume, and movement of currency and other monetary instruments transported or transmitted into or out of the United States or deposited in financial institutions
Required banks to (1) report cash transactions over $10,000 using the Currency Transaction Report; (2) properly identify persons conducting transactions; and (3) maintain a paper trail by keeping appropriate records of financial transactions

Money Laundering Control Act (1986)

Established money laundering as a federal crime
Prohibited structuring transactions to evade CTR filings
Introduced civil and criminal forfeiture for BSA violations
Directed banks to establish and maintain procedures to ensure and monitor compliance with the reporting and recordkeeping requirements of the BSA

Anti-Drug Abuse Act of 1988

Expanded the definition of financial institution to include businesses such as car dealers and real estate closing personnel and required them to file reports on large currency transactions
Required the verification of identity of purchasers of monetary instruments over $3,000

Annunzio-Wylie Anti-Money Laundering Act (1992)

Strengthened the sanctions for BSA violations
Required Suspicious Activity Reports and eliminated previously used Criminal Referral Forms
Required verification and recordkeeping for wire transfers
Established the Bank Secrecy Act Advisory Group (BSAAG)

Money Laundering Suppression Act (1994)

Required banking agencies to review and enhance training, and develop anti-money laundering examination procedures
Required banking agencies to review and enhance procedures for referring cases to appropriate law enforcement agencies
Streamlined CTR exemption process
Required each Money Services Business (MSB) to be registered by an owner or controlling person of the MSB
Required every MSB to maintain a list of businesses authorized to act as agents in connection with the financial services offered by the MSB
Made operating an unregistered MSB a federal crime
Recommended that states adopt uniform laws applicable to MSBs
Money Laundering and Financial Crimes Strategy Act (1998)

Required banking agencies to develop anti-money laundering training for examiners
Required the Department of the Treasury and other agencies to develop a National Money Laundering Strategy
Created the High Intensity Money Laundering and Related Financial Crime Area (HIFCA) Task Forces to concentrate law enforcement efforts at the federal, state and local levels in zones where money laundering is prevalent. HIFCAs may be defined geographically or they can also be created to address money laundering in an industry sector, a financial institution, or group of financial institutions.

Uniting and Strengthening America by Providing Appropriate Tools to Restrict, Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act)

[Title III of the USA PATRIOT Act is referred to as the International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001]
Criminalized the financing of terrorism and augmented the existing BSA framework by strengthening customer identification procedures
Prohibited financial institutions from engaging in business with foreign shell banks
Required financial institutions to have due diligence procedures (and enhanced due diligence procedures for foreign correspondent and private banking accounts)
Improved information sharing between financial institutions and the U.S. government by requiring government-institution information sharing and voluntary information sharing among financial institutions
Expanded the anti-money laundering program requirements to all financial institutions
Increased civil and criminal penalties for money laundering
Provided the Secretary of the Treasury with the authority to impose “special measures” on jurisdictions, institutions, or transactions that are of “primary money laundering concern”
Facilitated records access and required banks to respond to regulatory requests for information within 120 hours
Required federal banking agencies to consider a bank’s AML record when reviewing bank mergers, acquisitions, and other applications for business combinations

Intelligence Reform & Terrorism Prevention Act of 2004

Amended the BSA to require the Secretary of the Treasury to prescribe regulations requiring certain financial institutions to report cross-border electronic transmittals of funds, if the Secretary determines that such reporting is “reasonably necessary” to aid in the fight against money laundering and terrorist financing

The eejitsays:

Re: Re: Re: Re: Re: Re:

Dude, the banks in America were engaged in essentially widespread fraud, through such wonders as robosigning, muddling toxic assets with safe assets, foreclosing on the wrong properties (even ones where no mortgage was held for decades).

And then, when the shit hit the fan, they ran to government and demanded a bailout, and after they got it, paid a political party in the US to demand small government and de-regulation.

Yeah, they’re really fucking corporately responsible.

Jaysays:

Re: Re: Re:4 Re: Re: Re: Re: Re: Re:

If you look into Freddie and Fannie, it’s mainly how the government set them up to take loans from most investment banks.

The rules were enacted by Congress and basically nothing has been done to repeal them, merely add more rules to the mix.

Is it fraud? I don’t think I have to answer that question.

Remember, the first rule of economics is “People respond to incentives”.

The first rule of politics is “Ignore the first rule of economics”.

abc gumsays:

Re: Re: Re:5 Re: Re: Re: Re: Re: Re: Re:

You have overlooked a large portion of the banking BS which raised hell recently. There was rampant fraud and no one is being held accountable. Whether the government is complicit or not is rather immaterial at this point. I find it hard to believe that Congress ordered the fraudulent assessment of risk associated with the investments being hawked at the time. So, please save your apologies for someone who might care.

Anonymoussays:

Re: Re: Re:2 Re: Re: Re: Re:

@Eejit

The discussion and my point was limited to a strong positive correlation between a decrease of money laundering in the US, and banks cooperation in enforcement of money laundering laws. You are either incredibly stupid or simply have no rebuttal to the point and go off on a tangent over banks (many) other misdeeds.

Graesays:

Re: Re:

That’s nice. What about “information location tools” and ad agencies?

Also payment processors may already have the infrastructure for maintaining a list of “banned” entities; but assuming that there’s no extra work & cost involved to setup access for the organizations that are going to handing out accusations of copyright infringement is naive. Unless you’re going to cite some insider source at Mastercard/Visa/Paypal/etc that shows otherwise?

Anonymoussays:

Re: Re: Re: Re:

That’s nice. What about “information location tools” and ad agencies?

Also payment processors may already have the infrastructure for maintaining a list of “banned” entities; but assuming that there’s no extra work & cost involved to setup access for the organizations that are going to handing out accusations of copyright infringement is naive. Unless you’re going to cite some insider source at Mastercard/Visa/Paypal/etc that shows otherwise?

Information location tools are already blocking sites. Try finding child porn using one of them. Infrastructure is there.

And none of these actions can unilaterally be enforced on the corporate enablers. First a rightsholder or US Attorney has to go before a judge and obtain a ruling that the website meets the definition of a rogue site (dedicated to infringing activity, no other commercial purpose) Then the rightsholder has to also obtain the judges permission to serve an order on the payment processor or ad network. Only the US Attorney can seek an order against a search engine (for now at least).

Anonymoussays:

Re: Re:

Like the banks understand their corporate responsibility in combatting money laundering, payment processors also understand that they have a responsibility not to be enablers of infringement and counterfeiting.””

Riiiiiiiight that is why American banks launder billions for the drugs cartels each year and the US government does nothing to stop the practice LoL
http://www.bloomberg.com/news/2010-06-29/banks-financing-mexico-s-drug-cartels-admitted-in-wells-fargo-s-u-s-deal.html

Anonymoussays:

Re: Re: Re: Re:

Funny American Express is against it, I guess not all payment processors are onboard of your little scam.

True. But in the political calculus of Washington, if one member of an industry supports a bill that politicians want to pass, then the objections of rest of the industry is largely ignored. When Amex goes to the Hill to whine what they hear is that Mastercard has the same business issues as you yet supports the bill. What’s your problem Amex? Remember, this bill is also about counterfeit good and medicine. The payment processors don’t give a shit about pirated movies versus bogus Viagra. So it’s pretty tough for Amex to hold its position and facilitate the sale of dangerous medications, unsafe consumer goods (and pirated movies and music

AG Wrightsays:

What part of free do you not understand?

Let’s all face it. Nobody is making money from making torrents of movies and music available. It’s made available by the users sharing over their internet connection.
The web sites like ThePirateBay and others may make some money from advertising but it’s not so much that it’s over seas investments in any large way.

Anonymoussays:

Re: Re: What part of free do you not understand?

Let’s all face it. Nobody is making money from making torrents of movies and music available.

Perhaps you missed articles about Ninjavideo who reportedly made half a million dollars over three years. If you think that 90% of the infringing websites aren’t in it for the money you are deluded.

Josef Anvilsays:

Re: Re: Re: Re: What part of free do you not understand?

This is classic….. I love that AC pointed out Ninjavideo.

“Perhaps you missed articles about Ninjavideo who reportedly made half a million dollars over three years. If you think that 90% of the infringing websites aren’t in it for the money you are deluded.”

Let’s look at that. They made half a million over 3 years, but it wasn’t from anyone buying the content. In fact, if the nimrods in Hollywood made their own sites and offered the content behind a small paywall, the could probably make a mint in advertising dollars for offering a better service than the pirates and still not impact their box office sales.

Now for the fun part. Ninjavideo is pretty typical as far as piracy sites go.

Could someone please explain the connection between these pirate sites and organized crime / terrorism???????

Anonymoussays:

This will have no effect whatever on piracy. The huge misconception that the copyright holders are trying to pass off is that piracy is making money off their products.

Anyone that knows of piracy knows also that no money passes hands for such. You can not make an income off no money, no matter how it is turned around nor how many times it is said over and over. It doesn’t change the facts.

Where money does come in is for hosting services, domains, and the like. If you think for one minute those sites have their names plastered all over the place to send donations, you’re living in a fool’s paradise. Email addresses can be changed very easily. So can contact info.

The smart sites don’t advertise at all; as in not one ad or commercial.

out_of_the_bluesays:

"Nothing in this will make anyone want to buy." -- So?

“It’s an impressive strategy effort by old Hollywood, but it suffers the same fatal flaw as its other plans.”

You’ve got yet another wrong notion or two here. Hollywood, or whoever, isn’t much concerned with whether anyone /wants/ to buy, only in effectively forcing buying — rather than some getting content for free. Let’s assume a certain level of entertainment-watching (somewhere between a minimum of looking at the walls and a maximum of every waking moment). Then, IF the “free” content were cut off, Hollywood could expect a rise of paying customers in this entertainment-addicted culture.

2nd, “old Hollywood” seems to be innovating on new uses of existing law — and importantly as noted above — of getting third-parties to cut off the funding mechanisms. At least TRY to remember those people are vitally interested in the problem, it’s their income pipeline, they’re going to make efforts to keep the gravy train running.

By the way, “AG Wright”: ALL pirate sites attempt to “monetize” infringing file-sharing; only a few small sites are paying for the privilege of putting up links. Sheesh.

abc gumsays:

Re: Re: "Nothing in this will make anyone want to buy." -- So?

“isn’t much concerned with whether anyone /wants/ to buy, only in effectively forcing buying”

And they will force me how?

“Let’s assume a certain level of entertainment-watching”

And herein lies your logic flaw

“(somewhere between a minimum of looking at the walls and a maximum of every waking moment)”

Yes, because there is nothing else to do all day long.

JMTsays:

Re: Re: "Nothing in this will make anyone want to buy." -- So?

“Hollywood, or whoever, isn’t much concerned with whether anyone /wants/ to buy, only in effectively forcing buying — rather than some getting content for free.”

You cannot force someone to buy music and movies, and you cannot legislate away what people want and what technology allows. With the current level of ill-will towards Big Content it’s crazy to think we’d all just give in and go back to paying for shiny discs or, even dumber, paying shiny-disc prices for digital content that costs a fraction of the price of a disc to distribute. Perhaps if their anti-piracy efforts were matched with a genuine willingness to embrace new ways of providing content in ways that approach the convenience, portability and price of unauthorised sources (i.e. compete!), you might have a case. But they don’t, so you don’t.

“At least TRY to remember those people are vitally interested in the problem, it’s their income pipeline, they’re going to make efforts to keep the gravy train running.”

It’s a shame they completely fail to see that the gravy train has fallen off the rails and tipped all the gravy out. The only thing that gave Big Content their power over the people for a few decades was the level of technology available to consumers. Current and future technology will never allow them to go back to the old days. The legacy players have to find a new source of income or they will inevitably be replaced by those who have.

Anonymoussays:

Re: Re: Re: Re: "Nothing in this will make anyone want to buy." -- So?

You cannot force someone to buy music and movies, and you cannot legislate away what people want and what technology allows. With the current level of ill-will towards Big Content it’s crazy to think we’d all just give in and go back to paying for shiny discs or, even dumber, paying shiny-disc prices for digital content that costs a fraction of the price of a disc to distribute.

So don’t buy. But don’t steal either.

Perhaps if their anti-piracy efforts were matched with a genuine willingness to embrace new ways of providing content in ways that approach the convenience, portability and price of unauthorised sources (i.e. compete!), you might have a case. But they don’t, so you don’t.

Piracy itself represents a significant deterrent to the creation of new distribution models. It’s very daunting for a start-up to go head-to-head with a pirate site when the legit guy has to pay for the content he has to distribute and rogue site operator doesn’t. Stop blaming it on faulty distribution. Piracy is the single biggest barrier for new innovators to enter the market because they can’t afford to compete with free. There are some companies that are large enough and well-capitalized enough to slug it out. But all of Masnick’s beloved “tech entrepreneurs” would get slaughtered by rogue sites if they came into the market as an online distributor and didn’t have a ton of cash backing them.

Anonymoussays:

Re: Re: Re: Re: Re: Re: "Nothing in this will make anyone want to buy." -- So?

you can keep using the same old “stealing” and “Piracy is killing me” argument until the chickens come home. It still won’t make them facts despite Hollywood propaganda. (ouch; how ironic, Hollywood is slipping in the Propaganda department lately isn’t it.)

Anonymoussays:

Re: Re: Re: Re: Re: Re: "Nothing in this will make anyone want to buy." -- So?

It is daunting, not impossible, what it is impossible it is to survive the prices that monopolies ask for something that is truly impossible to get over it, competing with pirates is a walk in the pak compared to that.

That is why everybody should pirate.
http://www.bdlot.com/dvd-iso-master/

Anonymoussays:

Re: Re: Re: Re: "Nothing in this will make anyone want to buy." -- So?

“The only thing that gave Big Content their power over the people for a few decades was the level of technology available to consumers”

Flip that around, and you put consumers in charge and guess what? They are in charge of nothing, because the “big content” that they wanted is gone. Pyrrhic victory if there ever was one, you end up in charge of Corey Smith and Amanda Palmer. Congrats, you get everything you worked for.

What will always rebalance things is the need for and desire for that “big content” stuff. That won’t go away, but without money to make it, it doesn’t happen.

Oh yeah, the “everyone can do it” mentality? Yup… who paid to build the tools they are using to do it? “big content”.

JMTsays:

Re: Re: Re: Re: Re: Re: "Nothing in this will make anyone want to buy." -- So?

“Flip that around, and you put consumers in charge and guess what?”

Who said anything about being in charge? We simply have more choices now, and the legacy players are adapting very poorly to this loss of control.

“What will always rebalance things is the need for and desire for that “big content” stuff. That won’t go away, but without money to make it, it doesn’t happen.”

Eventually there won’t be “Big Content” like there is now, the market will be far more distributed. I have absolutely no concerns about quality content suddenly drying up. It would be completely against human nature for talented creators to stop just producing en masse, and it’s crazy arrogant for anyone to claim “it won’t happen without us” as you seem to be.

Anonymoussays:

Re: Re: "Nothing in this will make anyone want to buy." -- So?

“By the way, “AG Wright”: ALL pirate sites attempt to “monetize” infringing file-sharing; only a few small sites are paying for the privilege of putting up links. Sheesh.”

Yah right.
Did you know people can create anonymous forums that are hosted nowhere? nowhere one can seize them, when the forum is distributed you will have a hard time trying to stop millions of IP’s distributing the same exact content.

Anonymoussays:

“third party processors” is a joke, right?

You cannot get Mastercard processing without showing them what you are processing for. There are various classifications (many), and online transactions without the card for memberships or online digital media sales is one of the highest risk ones. Normally, they can only be handled by a small number of acquiring banks, or entities called IPSPs (as resellers).

There is no way that Mastercard (or the others) would intentionally approve a pirate site. So the only way these sites have processing is a failure by MC to monitor it’s merchants. They will very quickly fold and lock the accounts down.

Sorry Mike, there is no “third party” here, just front and center first party processing.

hmmsays:

the slow downward spiral

firstly you kick people off the net when ACCUSED of infringement (not convicted)

Then you can imprison people for an ACCUSATION of owning child porn/armed robbery (no conviction)

Then you can just dispense with the court system altogether as just a waste of time

THEN you can just execute people based on a word from those in power

Every single time there’s been a slippery slope and someone has stepped over the edge, they’ve never managed to claw their way back up until they hit the bottom…….

Anonymoussays:

Talk about a job killer!!! I will close down my company, lay everyone off and go out of business. It is a pain in the ass to be in business right now anyway. You work way too hard for way too little. Instead of expanding my hosting / streaming company by buying new hardware, upgrading my OS and hiring more people to help generate more business, I am going to go into the trenches and hope I can still pay the bills. We used to sell online Radio Station streaming, but now all the land line stations are all so paranoid because they don’t even understand their own licenses.
Of course TechDirt and the press in general fear-mongering on issues that aren’t even law, only being tossed around as a maybe, isn’t helping the situation. The more negative and confusing press the copyright issue gets the worse the Internet business gets. I have called hundreds of Land Line Radio Stations offering streaming services and everyone of them ask: “What about the DMCA and my license?” They don’t understand their licensing and the RIAA doesn’t help. ASCAP doesn’t help, BMI doesn’t help (they won’t even return emails on owed royalties) Their is no help unless you get a lawyer. Then Different Lawyers and Judges interpret the license differently. How can you beat it? I refuse to join a crooked operation.

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