Archive for April, 2010

Digital Economy Act – Part 2 – the death knell to free wifi?

As I blogged a couple of weeks ago, one of the major problems with the Digital Economy Act is that as it was rushed through parliament, it is drafted in very vague terms, with much of the (important) detail left to yet to be drafted regulations.

This impression of legislation being drafted on the back of a cigarette packet as the doors of Parliament are locked can also be found in Section 10. This Section allows for “technical obligations” to be placed on ISPs to take “technical measures” on the Internet connections of those deemed to have carried out multiple copyright infringements. “Technical measures” essentially means: 1. a limitation on the speed of the connection; 2. prevention of access to particular material; or 3. outright suspension of the connection.

This has been glibly referred to in the media over the last few months as a “3 strikes” test – implying that the third “technical measure” – disconnection – would occur only upon the third occasion of copyright infringement. Inevitably the reality is nowhere near as straightforward. (Things might be clearer if we had access to the “Code of Initial Obligations” – between rights holders and ISPs – that the Act refers to, but unsurprisingly it hasn’t been written yet.)

The process envisaged by the Act is that rights holders notify ISPs of copyright breaches, and ISPs pass on these notifications to subscribers. The ISPs can also be compelled to provide rights holders with a “copyright infringement list” which matches specific subscribers to specific copyright breaches (without actually identifying the subscribers). The rights holder then presumably picks out the biggest infringers and applies for court orders to compel the ISP to identify them. Once identified the subscriber can be sued for copyright infringement.

Simultaneously Ofcom is to prepare regular reports for the Secretary of State, describing the number of copyright infringement reports received by ISPs, the relative ease of obtaining the relevant copyright works legally, an assessment of the extent to which legal proceedings have already been brought against infringers, and so on. Based on these reports the Secretary of State can then order Ofcom to impose “technical obligations” on the ISP (and, therefore, “technical measures” on subscribers).

Why the concern? The subscriber will be the person who has a contract with the ISP for the Internet connection. But in many instances, the person carrying out the alleged infringement may not be the subscriber. Understandably, in light of these provisions, businesses that offer free (or paid-for) Wi-Fi (such as coffee shops, bars and libraries) have expressed serious concerns about being held liable for copyright infringement carried out by visitors to their premises, as they won’t be able to identify those users. The same issue applies for residential customers with insecure Wi-Fi networks. Internet subscribers in general are going to have to cease providing open access or implement complex and expensive security measures on their connections to make it more difficult for their neighbours and others to use their connection for copyright infringement.

ISP Talk Talk has severely criticised the Act, and has pledged to its customers that if it is instructed to disconnect an subscriber from the internet due to alleged copyright infringement, then it will refuse to do so and will “see the rights holders in court”.

Once again, it appears that the Act has been drafted without considering how Internet access actually works – with the “pain” falling on ISPs. It remains to be seen whether it achieves its aims, or simply leads to more people being pursued for infringements that they did not commit.

Coca Cola vs Coca Colla

The BBC today reports on the international expansion aspirations of a Bolivian drinks manufacturer that is marketing a new energy drink under the brand of “Coca Colla”. Apparently, the name was chosen because the drink is made from the coca leaf, and in honour of the Andean tribes called the Colla people, who cultivate the coca plants.

Oddly, the article focuses on the impact of international restrictions on trading products containing derivatives of coca leaf (the coca leaf is more commonly associated with cocaine, and is on the UN’s list of “dangerous drugs”) rather than the small matter of trade mark law. I’m not sure what trade mark laws apply in Bolivia, where the drink is apparently competing against a number of better known brands. However, I’m pretty sure that a well known Atlanta based soft drinks manufacturer would be miffed by an upstart selling a dark, sugary drink, in red and white branding under the name of “Coca Colla”, and would quickly be instructing its lawyers to raise proceedings for trade mark infringement!

This is slightly ironic as when lawyers explain to clients how trade mark law works, they often tend to give the hypothetical example of the world’s most popular soft drink and a rival sold under a confusingly similar name, using red and white packaging. It appears that it is now not so hypothetical after all.

See John’s previous blog for more on how trade mark law applies to these sorts of cases.

Volcanoes, force majeure and business continuity

As a follow-up to Douglas’s post yesterday on Force majeure and Icelandic volcanoes, I thought I would add some additional comments.

I am aware of one incident involving a supplier claiming relief for a force majeure event. This followed a fire, which destroyed the supplier’s premises. Despite the supplier having an obligation to have in place a business continuity plan, the supplier claimed that the right of relief for the force majeure event (the fire) trumped its failure to have in place appropriate fire prevention systems, and therefore it was not liable to the losses incurred by the customer as a consequence of the fire. It is for this reason that it is crucial that you consider the interaction between a supplier’s obligations to have in place business continuity and disaster recovery procedures, and the relief that it is entitled to in the event of a force majeure event. This requires a careful review of the drafting of these clauses.

Following on from this, Douglas and I were discussing the potential impact of the erruption of the Eyjafjallajoekull volcano*. The prolonged closure of civil aviation space is likely to impact mainly upon the physical movement of goods, rather than people or information (data can be sent electronically, and people can video or tele-conference). For example, if your supplier has a service level obligation to replace a defective component within 48 hours, but is unable to meet that because it cannot get the replacement component flown over from the manufacturer in the USA, is that force majeure? Possibly yes.

It is for this reason that it is important that you properly scrutinise your supplier’s business continuity plans, and ensure that the supplier’s plan is sufficient and proportionate for the service you require (bearing in mind that if you don’t identify a deficiency until the plan is implemented, then there won’t be much you can do about it – at least in the short term).

For example, should you be requiring your suppliers to maintain a local (within driving distance) parts bin to guard against supply-chain problems? If your supplier otherwise proposes a just-in-time approach, and the supported system is business critical, then this may well be prudent to specify this.

*For those of you wondering how you pronounce “Eyjafjallajoekull”, the New York Times has a useful summary. My favourite tip is that is sounds like “Hey ya fergot la yoghurt”.

Force Majeure and Icelandic Volcanoes

The recent no fly zone across (most of) Europe because of the Icelandic volcano has made me think about force majeure clauses (sometimes known as “Act of God” clauses). 

A force majeure clause is a clause in a contract that excuses a contract breach where the “breaching party” cannot perform because of an event outside its reasonable control.  So for example, if I had an obligation to you to supply 10,000 widgets by 1 May 2010, but my factory was struck by lightning and burned to the ground in the middle of April, then the force majeure clause might protect me from your claim for contract breach.     

Is the no fly zone a force majeure event?  It might prevent an individual or an air-freight item getting somewhere in time, which might otherwise be a contract breach.  So possibly, yes. 

However, you have to check the drafting of the relevant clause carefully.  Also if the contract has no force majeure clause then there is no relief (the Courts do not imply them).

All that said in my 15 years of being an IT lawyer I have never seen a force majeure clause used in defence of a “you didn’t perform” claim.  My colleagues in litigation echo this, i.e. it’s not something they see used very often. 

One final thought on this.  Force majeure clauses are often considered to be contract “boiler plate”.  That is, relatively standard clauses towards the rear of the contract.  Sometimes contract reviewers have “switched off” by the time they get to the force majeure clause.  That can be dangerous because sneaky lawyers can hide nasty stuff in the force majeure clause.  In fact when acting for suppliers I have been known to slip some stuff in there myself. 

This is particularly relevant in the area of telecoms / internet services / hosted services / SaaS where I have seen some events included in the definitions of force majeure that I think the supplier should be on the hook for.  Something to watch out for.

New sanctions for breach of data protection legislation

Last week saw some important changes in the powers of the Information Commissioner to enforce data protection legislation.

We have just issued an update explaining those changes. It’s worthwhile reading for all organisations which handle personal data – information about identifiable, living individuals, whether staff, clients/service users, contacts or otherwise. 

The main point to note is that, for the first time, a deliberate or reckless, serious failure to comply with any of the eight data protection principles in the Data Protection Act 1998 (the “DPA”) could result in a fine of up to £500,000.  So, for example, a failure to put in place adequate systems to protect against the theft or loss of personal data, or to ensure that personal data is only shared with other organisations to the extent permitted by the DPA, could now result in a very substantial fine.

The amounts involved look set to persuade even the most reluctant of organisations to pay more attention to data protection compliance. If the threat of regulatory sanction still doesn’t seem real at this early stage in the new regime, it no doubt will when the first fines have been handed out. Those on the receiving end will be faced not only with paying them, but also with the negative publicity and related legal and commercial problems which a penalty of this nature could bring.

No time like the present then to have a look at your policies, procedures and practices relevant to the handling of personal data and identify (and prioritise) any issues which require to be addressed.

Digital Economy Act – Part 1 – Impact on Site Owners (and ISPs)

The Digital Economy Act is one of the final Acts of the present Parliament, and if you are interested in web technology and the knowledge economy, then it’s easily one of the most controversial.   Rather worryingly, despite the controversy,  it was rushed through during the so-called “wash-up” period without meaningful debate. 

Why the controversy?  Well the Act contains fairly vague powers to shut down web-sites and cut-off internet access. This post deals with the former.  I will blog about cutting off internet access later. 

 Under Section 17, the Secretary of State can put in place regulations permitting rights holders (effectively record companies, movie producers and newspapers) to obtain Court orders that require an Internet Service Provider (“ISP”) to shut down “locations on the internet which the court is satisfied has been, is being or is likely to be used for or in connection with an activity that infringes copyright”.  

Section 17 is currently so vaguely worded that you could make a case for its’ application to Google, YouTube, Facebook, or pretty much any other site .  Of course, its hard to say what this means in practice because the regulations, i.e. the detail,  have not been written yet.  

However, I suspect a lot of the “pain” will fall on ISPs. This is an increasing trend. 

Overall, one of the most concerning things about the Act (besides the drafting) is that it has exposed an apparent lack of expertise within government as to how web technology and the knowledge economy actually operates.  In a recent lapse, Stephen Timms, Minister for Digital Britain, referred to an IP address as an “Intellectual Property address”. Given the Act that Mr Timms has just helped to introduce, this is either deeply amusing or deeply concerning – probably both.  

I have discussed the law, but it’s another matter entirely as to whether websites can actually be blocked.   In my experience the people who run the sort of sites that the rights holders hate tend to be 2 steps ahead of the game. 

I will rant about the risk of my internet connection being throttled or cut in a couple of days.  


Adwords and the Election – Labour bids for “David Cameron”

As a follow up to my blog on adwords where I talked about bidding for a competitor’s brand, I thought you might like this article from the BBC

So both Labour and Anne Summers appear to be bidding for the search term “David Cameron”.

I have thought of about 10 Anne Summers jokes to use here – but I am self censoring. Feel free to add your own in the comments (although I reserve the right not to publish these).

This also reminds me of the huge part Google and Youtube played in the last US presidential election.  No doubt each party will  have its own team search engine optimisers and web spinners (spiders?) working on this election.

Also as an aside one of my contacts from the pub ( tells me that your Google ranking shoots up if you have a link to a properly tagged youtube video. I don’t know if this is true but given that Google owns Youtube it sounds credible.

Have a good weekend.

Brodies’ Techbloggers battle the Cybermen (picture)

Eleanor and Douglas came across this Techblog reader in Festival Square in Edinburgh earlier today…

click on the image to see a higher resolution version.

Twitter: @BrodiesTechBlog feed

April 2010
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