VPN used in “support” of a copyright claim?!.

It’s usually VPN versus copyright and not the other way around. The technology is frequently used to overcome certain technical limitations, including geographical restrictions with respect to online content, broadcasts, etc.

In the case which is still pending in Moldovan courts VPN was apparently used to initiate a copyright claim against an online TV streaming service. 

Circumstances of the case

A Moldovan company (let’s call it “A”) is a representative in Moldova of a number of foreign TV channels. According to courts’ decisions, it had a number of contracts signed with the respective broadcasters from abroad. In January 2018, the company discovered a web streaming service that broadcasted (for a fee) the same TV channels to which “A” claimed distribution and retransmission rights in Moldova. 

The service was provided by a company registered in Canada. But it also claimed on its website to have a company registered in Moldova as its “European operator” (we will collectively call them “Defendants”)

“A” claimed that Defendants breached A’s broadcasting rights in Moldova with respect to the related TV channels by making them available for watching in Moldova through their streaming service. In order to prove it, “A” with the help of a natural person registered a profile on Defendants’ website, paid the required fee, and got access to the online broadcasts of the channels in question. Later it submitted a claim for damages to the Chisinau court. The mere fact of accessing the online streams of the TV channels was confirmed by a bailiff whose reports served as evidence for the claimant in the court.

Trial and appeal

The first instance court allowed the claim and awarded the requested damages to the claimant (“A”). 

However, the Chisinau Court of Appeal repealed the judgment and dismissed the initial claim. The Court of Appeal based its decision on two major points:

1) The contracts signed by “A” with the original broadcasters apparently did not provide for an exclusive licence for retransmission in Moldova. Given that the licence was non-exclusive, the Court of Appeal stated that “A” could not claim damages on his own behalf from third parties exercising the same rights on the territory of Moldova. This right can only be claimed by the copyright owner or the exclusive licensee.

2) What is more interesting is that “A” in order to demonstrate the alleged violation by Defendants used …VPN (which allows to hide your IP address and substitute it with an IP from another country to overcome geographical or other restrictions based on IP). 

This fact was not even mentioned in the first instance’s judgment. However, at the appeal, the Court referred to the evidence provided by the Defendants that “A” used VPN services to hide its Moldovan IP address and substituted it with an IP from the USA to use the respective streaming services. Apparently, the service was not available in Moldova if used with Moldovan IP address. And in order to overcome this restriction, “A” used VPN passing off as a user from the US. Yet when creating the profile and making the payment, it was done with the use of a Moldovan IP. 

As a result, the Court of Appeal dismissed “A’s” claims. 

Supreme Court

“A” appealed against the decision to the Supreme Court. The latter decided to quash the Decision of the Court of Appeal and remitted it back to the appeal stage for reconsideration. 

The only basis for that was that the Court of Appeal when issuing its decision made a reference to “copyright” and relevant “author’s rights”, while the rights in question constituted related (neighbouring) rights of broadcasters (and not authors). 

Although it was apparently “A” who based his claim on the copyright and the rights belonging to authors rather than broadcasters’ related rights, the Supreme Court considered that the Court of Appeal made an error of law. The Supreme Court decided that the mistake was substantial and could not be rectified by it, and sent the case back to the Court of Appeal (in our view wrongly) for reconsideration without having addressed the merits. 

The Court of Appeal will now have to re-examine the matter. But it is for the first time that we see a case in which an allegation of a violation of broadcasting rights is made by making use of a technology frequently employed for overcoming restrictions and breaching copyright…

* This post is prepared by Alexei Ghertescu. He can be contacted by email: a.ghertescu@grlegal.md. To learn more about the services we provide in the area of copyright and intellectual property law in general, see here.