BT and TalkTalk lose Digital Economy Act appeal

BT and TalkTalk have lost yet another appeal against the Digital Economy Act.

BT and TalkTalk have lost the latest in a string of court battles against the Digital Economy Act.

In their latest appeal, as before, the ISPs had argued that the copyright crackdown legislation was inconsistent with EU law on privacy, freedom of information and the responsibilities of ISPs in monitoring what their customers do online.

BT and TalkTalk lost the battle in a judgment from the Court of Appeal on Tuesday, although the latter company indicated that it still intended to fight the Digital Economy Act somehow.

"We're disappointed that our appeal was unsuccessful though we welcome the additional legal clarity that has been provided for all parties," TalkTalk said in a statement. "We are reviewing this long and complex judgment and are considering our options. Though we have lost this appeal we will continue fighting to defend our customers' rights against this ill-judged legislation."

The ISPs had asked the High Court judges to refer the case to the European Court of Justice (ECJ) if they were in any doubt about the Act's conformity with EU law, but the judges said they were in no doubt at all.

Though we have lost this appeal we will continue fighting to defend our customers' rights against this ill-judged legislation.

– TalkTalk

The Department for Culture, Media and Sport (DCMS), the government department that was fighting against the ISPs' appeal, said it was "pleased the Appeal Court has upheld the original ruling that the Digital Economy Act is a lawful and proportionate response to the threat posed by online piracy".

Rights-holder groups, which have always been staunch supporters of the Act, also welcomed the judgment. Richard Mollett, a former BPI lobbyist and failed parliamentary candidate and now chief executive of the Publishers Association, said he looked forward to working with the ISPs in implementing the Act.

"Today's judgment should mean that once and for all BT and TalkTalk recognise that they have to work constructively with rights holders to help deliver an effective and proportionate solution to online copyright infringement," Mollett said in a statement.

New regime for online copyright enforcement

The Digital Economy Act was fast-tracked into law during the so-called wash-up period just ahead of the 2010 general election, meaning it did not have to receive lengthy scrutiny before being approved.

The Act sets out a new regime for online copyright enforcement in the UK. Ofcom is still formulating the details of how this will work — the BT and TalkTalk appeals have held the process up by more than a year — but it will be a phased approach.

Identification of alleged infringers will be the responsibility of the rights holders, who will tell ISPs which of their customers are suspected of unlawfully downloading copyrighted material.

In the first, year-long phase of the scheme, ISPs will need to write to those customers and warn them that they are suspected of unlawful file-sharing. After that year, if so-called piracy is not down by 70 percent or more, the next phase will begin.

The general plan is for repeat downloaders of copyrighted material to be hit with some sort of sanction, possibly including suspension of their internet access. However, it will be up to the business secretary to finalise which penalties can be applied.

Policing customers

Whatever happens, those accused of piracy will have to pay a £20 fee to defend themselves — TalkTalk has previously suggested that this is a 'guilty-until-proven-innocent' policy.

BT and TalkTalk have always argued that they should not be put in the position of policing their customers, and have also fought against the idea that they should have to pay for the systems to allow this to happen.

The ISPs prompted a judicial review of the Act in 2010 but lost. They applied for an appeal and were initially turned down, although they were subsequently allowed to launch the appeal after all.

Following what may be the ISPs' final defeat on Tuesday, digital rights activists said the Digital Economy Act remained a bad law and still needed a "proper, evidence-based review".

"The Department for Culture, Media and Sport had no evidence when they wrote this Act, except for the numbers they were given by a couple of industry trade bodies," Peter Bradwell of the Open Rights Group said. "This is a policy made on hearsay and assumptions, not proper facts or analysis."

"Significant problems remain," Bradwell added. "Publicly available Wi-Fi will be put at risk. Weak evidence could be used to penalise people accused of copyright infringement. And people will have to pay £20 for the privilege of defending themselves against these accusations."