Newzbin, a major indexer of Usenet newsgroup binaries, has been hammered by a UK judge. Though the site claimed to be nothing more than a "Google for Usenet" that indexed all sorts of useful material, the judge found that site operators knew about copyright infringement, did nothing to stop it, and in fact designed a site meant to encourage it.
Newzbin made it simple for Usenet users to access binary files. Without the service, it could be tedious to collect and decode the many parts of a video file, for instance; even finding them was difficult, since Usenet lacks good search features. Newzbin did the hard work of sorting through Usenet uploads, collecting the useful information, and packaging it into a tiny NZB file. Newsreaders that could handle such files would then be able to grab every part of a movie at once and reassemble it with minimal effort.
Newzbin hosted no content of its own, but it made plenty of money from this curating service by charging 30 pence a week for access. According to court documents, the company pulled down more than £1 million in 2009, with £415,000 doled out to stakeholders, and another £360,000 in profit.
It almost goes without saying that much of the activity of Usenet binary groups involves the illegal distribution of copyrighted works. Movie studios sued the site in London; a trial was held in February and March, and Mr. Justice Kitchin has just handed down his verdict: Newzbin was liable for infringement, despite hosting no files.
Both Newzbin and The Pirate Bay mounted the same "we're just like Google!" defenses; neither worked, nor did the Grokster defense in the US. Judges do care—a lot—about companies that appear to make a business of infringing activity, while still accepting the idea of safe harbors in cases where "infringement" does not appear to be the main activity.
People are searching for... home movies?
Chris Elsworth, the main operator of Newzbin, said repeatedly at trial that infringing content was only a small part of what he indexed, that he had no knowledge of infringement occurring on the service, and that Newzbin's categories for "CAM," "screener," "telesync," "DVD," R5 retail," Blu-ray," and "HD DVD" really didn't suggest any evidence of infringement.
The studios said this was laughable. They produced a survey of 50,000 Newzbin "reports" on Usenet movie content. 97.5 percent of them contained a link to a valid Internet Movie Database entry, something editors routinely supplied when curating material—and which the judge took as strong evidence that the content in question was a commercial film.
Another 0.7 percent had a valid Amazon link, while "a further 1.5 percent were shown to be commercially available upon further investigation." What remained? 0.3 percent of the content.
The judge wasn't buying Newzbin's "We're shocked, SHOCKED!" defense. In his decision, he cites several exchanges between the studios' lawyer and Elsworth that the judge found literally incredible. Elsworth insisted that he had no idea copyright infringement was why people signed up for Newzbin, and he disputed whether his editors did anything to make such infringement easier. When asked about 2006 forum posts in which an editor requested that Newzbin add "attribute" tags for HD DVD and Blu-ray, the studio lawyer tried to show that Elsworth knew such items were likely infringing.
Q. And in fact you know that's what's intended to go in there are movies that are released on those formats, don't you?
A. After reading this post, I do see that he looks like he is intending to put commercial movies in those formats.
Q. You've always intended that, haven't you?
A. No, I generate the attributes on—whenever the editors ask for them. I don't know what they're going to put in them.
Q. Is that your evidence? So when you add Blu-ray and HD DVD, you've got no idea—you had no idea that movies were being released on them and that that was what the categories were intended for, is that your evidence?
A. It's not a given that a Blu-ray media disc will contain a copyright movie. There are plenty, I'm sure, of copyright-free Blu-rays that people would want to put in there.
The lawyer pressed Elsworth on this argument, asking what else might conceivably be intended if not commercial films?
A. No, I would not say that person had copyright infringement in mind. I would say that person looks like he just wants to report Blu-rays. He cites a reason for adding the Blu-ray category as they are being cracked but he does not cite a specific intention to report copyrighted Blu-rays.
Q. Well, what else would it be?
A. I don't know.
Q. Why would it be Blu-rays that would need cracking?
A. I don't know.
Q. You can't come up with any explanation other than a copyright-protected commercial movie, can you?
A. No.
Also in 2006, Elsworth was asked about some new functionality that would let Newzbin users search inside the NFO files associated with many Usenet movie uploads for names of specific "stars." Didn't this indicate to Elsworth that people were interested in copyright infringement? Elsworth insisted valiantly that no... it might have referred to people starring in "home movies."
Q. So what this person is envisaging is searching under a movie star?
A. He's envisioning searching on anybody who may be in a video file, yes.
Q. Well, a movie star; who stars in it, "who stars in the movie."
A. That's the wording he uses, yes.
Q. He's talking about searching for a movie star?
A. That's not necessarily true.
Q. What else does it mean?
A. You can star in a home video.
Q. An NFO file contains who stars in the movie. Are you suggesting that what he might have in mind is some unknown ten year old, say, starring in the movie which has been filmed on a camcorder by their parents?
A. I'm suggesting that "movie" is a very broad definition of a video, and "starring" and you can star in any sort of video, not just a commercially released video.
Q. Of course, what we're envisaging here is people who are third parties to the video or the movie searching for it. So the unknown person who is starring in a movie, they are not going to be known, so you won't know the name to search for, will you?
A. It depends if you are a friend or family of the star of the home video.
Q. They'll give it to you then; you won't be searching on Newzbin for it, will you?
A. Perhaps.
Q. It's quite plain that what this person has in mind is a facility which will enable him, because he has favourite movie stars, to acquire movies in that way, using your site, is it not?
A. I don't agree with that, no.
A skeptical judge
The judge found this evidence "simply not credible."
In fact, the judge found large parts of testimony from Newzbin's owners to be disingenuous. For instance, the site says all the right things about not allowing copyright infringement, but the judge concluded that "this warning is entirely cosmetic and is neither intended to be nor is in fact acted upon by its editors."
The judge then suggested that if Elsworth were serious about not trafficking in things like warez, that he might stop indexing groups like alt.binaries.warez. Elsworth "had no satisfactory explanation" for not doing this, wrote the judge, except that "on occasion these newsgroups contain noninfringing material too."
When it came to taking down links to copyrighted content, Newzbin would do it—but only if companies mailed a complaint about a specific file by registered post to a given address. The judge concluded that "this cumbersome process is entirely cosmetic and designed to render it impractical for rights holders to secure the removal of entries relating to infringing material from the Newzbin indexes."
Finally, the judge noted that Nezbin wasn't truly a "Google for Usenet"; instead, all of its main features were targeted at indexing binaries, while text posts got short shrift. The end result was the conclusion that Newzbin was liable for copyright infringement "because it has authorised the copying of the claimants' files; has procured and engaged with its premium members in a common design to copy the claimants' files; and has communicated the claimants' files to the public."
The judge agreed to an injunction against Newzbin that would bar it from hosting links to all films owned by the movies studios in the case, but the judge balked at the studios' request for a blanket ban on all infringing material. Damages will be decided later.
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