A ruling by a court in Frankfurt on January 29th could now have put DigiProtect’s “Turn Piracy Into Profit” mass-warning business model into jeopardy.

An individual was sent a letter by the lawyer Udo Kornmeier on behalf of DigiProtect. The letter contained accusations of illicit file-sharing including a customary cash payment demand of around 651 euros to cover legal costs based on an infringement claim of 10,000 euros. It was accompanied by a demand to pay a further 150 euros in order to acquire a license from the copyright holder for the material downloaded.

While the file-sharer didn’t contest the 150 euro license fee, he refused to pay the 651 euros legal bill. DigiProtect’s lawyers countered with an offer for him to pay 450 euros plus the 150 euros license fee. Again the file-sharer rejected the offer.

DigiProtect then went on to sue the man for 651.80 euros and the case went to court.

In court the judge asked DigiProtect and its lawyers to open up their books to show what legal costs were actually incurred (and paid) to perform legal actions against the file-sharer and send him the letters. Both DigiProtect and their lawyer refused to submit the information.

During the hearing the judge discovered that the relationship between DigiProtect and its lawyers was covered by an agreement similar to the one it had previously with lawyers Davenport Lyons for their UK operations. The details of that arrangement were leaked out last year by a disgruntled insider and revealed some embarrassing truths about the operation.

DigiProtect and its German lawyer refused to allow the agreement between them to be shown in court which meant that the true costs of pursuing the file-sharer remained unproven.

The judge said that even if DigiProtect had paid 651.80 euros to its lawyers to pursue the file-sharer, these cannot be considered as involuntary damages since DigiProtect paid this fee to its lawyer voluntarily. Therefore the only involuntary damages in this case was the 150 euros rights holder licensing fee.

Due to this lack of transparency, the judge decided that the file-sharer did not have to pay DigiProtect the claimed 651.80 euros legal action costs, only the 150 euros licensing fee.

Clearly, if the lawyers can’t get their sizable share of the spoils in this “Turn Piracy Into Profit” operation, the whole business plan falls down. There was certainly no profit to be made from this file-sharer – time will tell if this effect ripples on to other cases.

Article from: TorrentFreak, check out our new blog at FreakBits.

Last year several studios including Village Roadshow, Universal Pictures, Warner Bros Entertainment, Paramount Pictures, Sony Pictures Entertainment, Twentieth Century Fox Film Corporation, Disney Enterprises, Inc. and the Seven Network took legal action against iiNet, claiming that the ISP did nothing to stop its customers from sharing copyright media via BitTorrent.

The ISP refuted the claim with a multi-layered defense, which was heard then adjourned in November 2009.

Passing his verdict today, Justice Cowdroy ruled that while the studio’s copyrights had indeed been infringed upon, iiNet did not authorize the copyright infringing activities of its subscribers and therefore the ISP could not be held responsible.

Notably, Justice Cowdroy said that iiNet had no control over BitTorrent networks and the ISP was covered under so-called “safe harbor” provisions.

“It is impossible to conclude that iiNet has authorised copyright infringement … [iiNet] did not have relevant power to prevent infringements occurring,” Justice Cowdroy said in his judgment.

AFACT had insisited during the original court case that iiNet should forward copyright infringement warnings to its customers on behalf of AFACT members, but the judge ruled that this was not the way copyright infringements should be handled.

Electronic Frontiers Australia said the outcome of the case was the “application of common sense” and Pirate Party Australia also welcomed the decision.

“This is a good decision by Justice Cowdroy, and reflects that there is no legal basis or obligation for any ISP to act in the interest of copyright holders, or to expect that they should disconnect any entity upon allegation of infringement without judicial oversight and due process,” said Rodney Serkowski, Party Secretary.

“Essentially an ISP should be considered similar to the postal service – they simply carry data in the form of packets, and that communication should be considered private,” he added.

In a statement, iiNet said it had “never supported or encouraged breaches of the law, including infringement of the Copyright Act of the Telecommunications Act,” adding that the company had always been a “good corporate citizen and an even better copyright citizen.”

After the huge distraction of this prolonged legal battle, iiNet said it would now like to get on with business, adding that it looks forward to working with the entertainment industry to make content available legally to reduce illicit file-sharing.

AFACT executive director, Neil Gane, said his group was extremely disappointed with the Court’s ruling.

“Today’s decision is a set back for the 50,000 Australians employed in the film industry,” he said in a statement.

“But we believe this decision was based on a technical finding centered on the Court’s interpretation of the how infringements occur and the ISPs’ ability to control them. We are confident that the Government does not intend a policy outcome where rampant copyright infringement is allowed to continue unaddressed and unabated via the iiNet network,” he added.

AFACT will have to pay all of iiNet’s substantial legal costs. Thus far, the group has declined to confirm whether it will appeal the Court’s decision.

Article from: TorrentFreak, check out our new blog at FreakBits.

Yesterday the music industry lobby group IFPI presented its 2009 figures, again putting the blame for decreased physical sales on file-sharers. Unfortunately, most mainstream media outlets simply reposted the IFPI press release and their flawed analysis. In general, no effort is made to actually balance out or check the message being sent out to millions of readers.

In their annual Digital Music Report, IFPI states that file-sharers are half as likely to buy physical CDs than the average music buyer. Although the report is about digital music, they carefully avoid saying anything about file-sharers and digital sales. That would actually show a completely different picture as we will explain below.

The music group made this statement based on an IFPI-commissioned study that was executed by Jupiter research. Although IFPI refused to share the entire research report with TorrentFreak, we can conclude the following from the two pages that were published online.

Compared to music buyers, music sharers (pirates) are…

* 31% more likely to buy single tracks online.
* 33% more likely to buy music albums online.
* 100% more likely to pay for music subscription services.
* 60% more likely to pay for music on mobile phone.

These figures (as reported by the music industry) clearly show that file-sharers buy more digital music than the average music buyer. In fact, the group that makes up the music buyers category actually includes the buying file-sharers, so the difference between music sharers and non-sharing music buyers would be even more pronounced.

How can this be true and why was there no mention of this in the Digital Music Report? They must be spending less on digital music then, right? But again, this is not the case at all. On average, file-sharers actually spend more than non-sharing music buyers. At least that’s what Mark Mulligan, Vice President and Research Director at Forrester Research who conducted the study for IFPI told us.

Mulligan has his hands tied and couldn’t say much about the findings without IFPI’s approval, but we managed to get confirmation that paying file-sharers are the music industry’s best customers. “A significant share of music buyers are file sharers also. These music buyers tend to be higher spending music buyers,” Mulligan told TorrentFreak.

So why do file-sharers download music without paying? According to the annual IFPI report, one of the main reasons people share music is because it’s free. This leads the music industry group to conclude that they are cheapskates and not willing to pay for music at all. But, as the above clearly shows, they are misinterpreting this finding, and we’d like to explain why.

In the digital age, people’s demand for music has changed significantly, but their budgets are still limited. The average file-sharer is currently spending $100 a year on music according to IFPI’s own research, not really a group that can be classified as freeloaders. However, their demand for music simply exceeds their budget and that’s where they start downloading music on file-sharing sites, because it’s free.

Just to be clear on our motivation to balance the ‘facts’ as reported by IFPI. We are not advocating that all music should be free and neither do most of the music lovers who share files online. However, the music industry continues to ignore that file-sharing is much more of a signal from the market that it is the increased demand for music that fuels piracy.

The solution to the problem is relatively easy. Start offering more unlimited and unrestricted music services and piracy will go into a free-fall. File-sharers are already paying for digital music, and they pay more than the average music consumer. File-sharing is simply a market signal showing that there is a need to compensate for the lack of high quality and affordable subscription services.

If anything, the music industry should have more respect for file-sharers, as they are their most valuable consumers. They are ahead of the curve and actually leading the way for the future of digital music, buying more digital music than anyone else. It’s the music industry that has to change, not the other way around.

Article from: TorrentFreak, check out our new blog at FreakBits.

The project was supposed to generate a healthy revenue stream to support the company in tough economic times. A few months later, however, the project has been canceled and the site closed, as the company focuses on other ways of satisfying its users.

“Over the past six months, we prioritized our projects to focus development on features that were gaining significant traction with our community. As part of this prioritization, StudioHD was closed in November,” a spokesman at Vuze told TorrentFreak.

Although Vuze officially claims that the closure of StudioHD is a matter of changed priorities, we assume that it was not as profitable as the company had projected. This is not really a big surprise, as even the ‘free’ adult torrent sites are having trouble keeping up with the increasing popularity of adult video streaming sites.

The Vuze spokesman told TorrentFreak that the company will instead focus on integrating devices and torrent search capabilities into its client.

“Almost half our active community use Vuze Device integrations to watch their media on screens other than their computers (iPhone, iPod, PS3, Xbox 360 etc). They’ve successfully transferred more than 50m files to other screens since launch last March.”

In addition to the successful device integration, the built-in search capabilities using existing torrent sites such as isoHunt and BTjunkie, has gained in use significantly. Three quarter of all Vuze users are searching for torrents using the feature, compared to 55% a year ago.

Ironically, this integrated search allows users to find thousands of adult torrents that can be downloaded for free. No paid subscription needed. Could that be one of the reasons why the StudioHD subscription service was canceled?

Article from: TorrentFreak, check out our new blog at FreakBits.

There are 74 proposed amendments to the Bill.

In terms of file-sharing, amendments are suggested to the section which obliges ISPs to inform their customers that an infringement has taken place via their account.

In addition to informing subscribers who have allegedly infringed themselves or subscribers who allow another individual to use their account to infringe, the following category is proposed:

“..infringement of the owner’s copyright appears to have taken place through peer-to-peer filesharing networks on a subscriber’s IP address;”

This means that all copyright infringements that occur on an IP-address will be attributed to the person who pays for the account.

As pointed out by PaidContent, this addition is “sure to rile campaigners who protest that IP numbers do not correspond to identity.”

However, another amendment asks for the removal of the clause which allows action to be taken against subscribers whose connection was used to infringe copyright by someone other than the subscriber.

Amendment 52, proposed by Lord Lucas, states that the copyright infringement reports sent to ISPs by rights holders should also set out “the value of the infringement on the basis described in the initial obligations.”

This is an interesting one. When an anti-piracy company working on behalf of the music and movie industries track an infringement, it is only possible for them to track a single infringement, for example, the uploading of one track, movie, or part thereof. It is impossible for them to prove any additional infringement took place, i.e uploading the same to others.

This means that not only will the reported loss per infringement be very low, but it could also force the rightsholders to claim that an upload to the anti-piracy company equates to a lost sale.

Amendment 71 from Lord Whitty asks for the section below to be completely removed;

…the number and nature of copyright infringement reports relating to the subscriber may be taken into account for the purposes of any technical measures.

Should the amendment be accepted, this suggests that taking technical measures (3 strikes, throttling) on the basis that a subscriber has been ‘caught’ multiple times, will be disallowed.

There are also amendments tabled to change a number of instances where the term “infringement” should be changed to read “infringement allegations”.

The next sitting of the committee stage will be heard January 12th.

Article from: TorrentFreak, check out our new blog at FreakBits.

In five days the game’s worldwide sales climbed to $550 million, crushing previous record holders Harry Potter and the Half-Blood Prince (only $394m) and The Dark Knight (just $203.8m).

“In just five days of sell through Call of Duty: Modern Warfare 2 has become the largest entertainment launch in history and a pop culture phenomenon,” Activision CEO Bobby Kotick said commenting on the game’s success. This is, of course, reflected in the number of pirated copies being traded on BitTorrent.

With 4.1 million unauthorized downloads of the PC version alone, the game more than doubles the achievement of last year’s ‘winner‘ Spore. Modern Warfare 2 leads both the PC and Xbox 360 lists, by a landslide.

The overall trend across all platforms is that, unlike last year, all of the games are 2009 releases. What makes Modern Warfare 2’s chart-topping even more impressive is that this has been achieved after just two months of availability. We further see that the figures for the most downloaded titles have more than doubled compared to last year, equaling the growth in uTorrent users.

PC games are by far the most downloaded titles, with on average more than three times the number of downloads compared to Xbox 360 and Wii releases. As expected, Mario titles are in high demand on the Wii.

The data for these lists is collected by TorrentFreak from several sources, including reports from all public BitTorrent trackers. All the data is carefully checked and possible inaccuracies are systematically corrected.

Article from: TorrentFreak, check out our new blog at FreakBits.

In one of the class action suits that were brought about from the long-running incident, Comcast has now agreed to settle, meaning those affected may be eligible for compensation.

About two and a half years ago, reports surfaced on what appeared to be the throttling of BitTorrent connections by Comcast. The throttling, first discovered by Rob Toplowski, was confirmed by TorrentFreak, and was first reported in August 2007. Other news agencies picked it up later, especially after tests by the EFF and Associated Press confirmed events and included reports that other network based activity was also affected.

Comcast long-denied any wrongdoing, but a leaked memo revealed that the company went as far as instructing its front-line staff to lie about the issue. Then the FCC got involved and things deteriorated. At a hearing at Harvard, Comcast packed the venue with people they bussed in, but it didn’t stop the BitTorrent throttling practice being termed a ‘hacker technique’.

Eventually, some assurances were made, and the FCC ordered Comcast to stop using Sandvine. Meanwhile lawsuits had been filed. One of these, Hart vs Comcast of Alameda, attained class action status, and there is now a proposed settlement.

Comcast has agreed to put $16M into a fund to pay BitTorrent users that were inconvenienced by the ‘network management’.

The downside is the size of the settlement. If you qualify, you can receive a maximum of $16, yet still Comcast refuses to accept it did anything wrong. The administrators of the settlement have set up a website to deal with questions about the case which can be found at www.p2pcongestionsettlement.com

It’s not hard to imagine that some customers will feel this doesn’t go far enough, and undoubtedly the discussion on this topic will continue. For the affected Comcast users there is still time to decide how to proceed – the deadline for claims is August 14th 2010. Meanwhile, network neutrality remains a pipe dream for most people.

Article from: TorrentFreak, check out our new blog at FreakBits.

When it comes to copyright policy, there appears to be only one set of people the government is willing to listen to, and that’s the copyright lobbyists groups. Groups that don’t represent the creators as much as those that manage the creators; the middlemen. And so it is with the attendees of today’s meeting with US Vice President Joe Biden.

Biden, whose political career – like many US politicians – has been partly funded by pro-copyright groups, came out to say that he is offended by the “flat unadulterated theft” some call piracy. A bold statement, but not really that surprising when you take a look at the one-sided list of attendees.

There are no consumer groups, no technology companies, and few representatives of the artistic creators themselves. There are plenty of are representatives of middlemen companies though. Companies that make their money from managing, distributing and promoting, tasks that are increasingly being made obsolete with technological progress.

We’re talking about the likes of Sony’s Michael Lynton, who on behalf of an industry that’s having one of it’s best ever years, plead poverty less than two months ago. And Edgar Bronfman, head of WMG – you remember, the company that claimed copyrights that aren’t theirs.

What will have been on the agenda? Well, probably no items on how factually inaccurate the recent CBS piece was, or how anti-piracy studies would be improved with the release of supporting data. Instead, it will be the likes of future anti-piracy laws such as ACTA, and questioning the ability to introduce similar legislation to France and the UK.

Not that we will find out though, as apparently the press has been kicked out. Perhaps, like ACTA, this is a national security issue too. After all, who says terrorists don’t download Die Hard films for training purposes?

Article from: TorrentFreak, check out our new blog at FreakBits.

While the evidence gathering techniques differ from agency to agency, they all have one thing in common. None of them can provide proof that the account holder has actually committed copyright infringement. In fact, some anti-piracy outfits cannot even prove that the IP-address they have on file was used in an actual file transfer, although they claim otherwise.

The Video Protection Alliance’ (VPA) belongs to the latter group. Instead of simply warning the alleged infringers, they take it one step further and actually ask for cash to settle immediately on behalf of the copyright holder, a known extortion-like technique that is also used by spammers.

The process used by VPA and others is simple. Their software monitors BitTorrent swarms and other file-sharing networks and records the IP-addresses of those people who share their clients’ copyright works. It then automatically sends an email to the ISP linked to the IP-address with a request to forward it to the associated customer.

“Someone using this account has engaged in illegal copying or distribution (downloading or uploading) of [title],” the VPA writes in one copyright/settlement notice, adding: “The information in this notification is accurate.”

But is it really accurate? We beg to differ and we’re certainly not the only ones.

As outlined in an elaborate article posted on on Freedom to Tinker earlier this week, the VPA does not verify whether the IP-address is actually uploading or downloading content. They simply take it from the swarm list reported by the tracker.

This is wrong for several reasons. First of all, some trackers are known to insert random IP-addresses into swarm reports to provide plausible deniability. Secondly, anyone can easily create a url that would put someone in the swarm list when it’s clicked. This link can be posted everywhere on the Internet and it wouldn’t even require the recipient to have a BitTorrent client installed.

Of course, this information is nothing new to people who are familiar with these anti-piracy evidence gathering techniques. Last year researchers from the University of Washington revealed the same flaws, but outfits such as VPA apparently don’t see the need to back up their claims with solid evidence.

Meanwhile, hundreds of thousands of these notices are sent out every year, some of which include cash requests to settle the case. Even worse perhaps, in countries that adopt three-strike legislation millions face the threat of being disconnected by their ISP, based on shoddy and unverified evidence, and without judicial oversight.

Unfortunately, the outfits that collect the evidence for the copyright holders are not very open about the techniques they use. When the RIAA’s evidence was disputed (pdf) in court earlier this year they decided to drop the case and settle with prejudice for $0.00. How convenient.

Article from: TorrentFreak, check out our new blog at FreakBits.

Although there is an insistence that the project is aimed at reducing piracy, in reality piracy is the scheme’s lifeblood, providing healthy profits for all concerned, except the original rightsholders that is.

On November 19th at the Royal Courts of Justice in London, ACS:Law made NPO (Norwich Pharmacal Order) applications in order to force ISPs to hand over the names and addresses of subscribers the company claims infringed their client’s rights.

The NPO’s related to approximately 25,000 IP addresses harvested from UK ISP BT’s subscriber base and a further 5,000 from various other ISPs, covering approximately 291 movie titles.

Present at the hearing before Chief Master Winegarten (CMW) were Andrew Crossley and Terence Tsang from ACS:Law, representatives from UK ISP BT and three representatives from consumer outfit Which?, who previously made official complaints regarding the conduct of Davenport Lyons. Also present were two individuals previously wrongly accused, who are regulars at the support site BeingThreatened.com.

Before the hearing began, CMW noted that he had received letters of complaint from the public about the scheme. As reported to TorrentFreak by those present, during the hearing Andrew Crossley made some interesting comments.

After CMW expressed interest in what happens to an accused infringer after the court order is granted and a letter sent, Crossley said that his company was not suggesting that the recipient is definitely guilty in all cases, but the Internet account holder who receives the letter could perhaps help them to identify the person who had actually carried out the infringement.

It is worth noting that ISP account holders are not liable for copyright infringement carried out on his/her connection if a) they did not carry it out themselves or b) did not authorize any infringement. If they did neither they can simply write back to ACS:Law explaining that the accusation against them has been made in error.

Furthermore, if the account holder does not know who did carry out the infringement, they should state in their reply that is the case. It is then up to ACS:Law to find the real infringer based on their evidence they hold. This is impossible for them without the account holder pointing the finger.

In justifying his application for the court order, Crossley said that they do it because “businesses are failing, jobs are being lost,” while citing dubious IFPI statistics (95% of all music is pirated) to justify his case.

CMW asked Crossley how long the scheme would continue for, who replied “…for as long as P2P file-sharing continues Master.”

Another NPO was applied for by ACS:Law on behalf of a new-comer to the scheme, a company called Media C.A.T. Ltd.

Little is known about them and their website is currently suspended, but searches reveal that the company is involved in the premium SMS market – one page states “Premium Rate Telephone Riches – How To Make £500 A Week” – quite what they have to do copyright holders and anti-piracy is unclear. It does appear, however, that their Managing Director Lee Bowden has previous links to Andrew Crossley and, just like him, will be in this for the money.

When CMW asked why rightsholders were dealing with Media C.A.T and not directly with DigiProtect, Crossley said that “[Media C.A.T] happen to operate in the UK…dealing with UK companies…”

In referring to the scheme ACS:Law and DigiProtect operate in respect of these hardcore porn titles, Crossley tried to suggest that they were doing a public service by helping to prevent the sharing of restricted movies on P2P.

CMW responded by noting that “[this is] not a moral crusade” and that in his opinion, ACS:Law and DigiProtect were doing this “…because you want the money.”

Recipients of past and future letters are invited to view the excellent BeingThreatened website, whose users provided invaluable help in compiling this report.

Article from: TorrentFreak, check out our new blog at FreakBits.

The case continued in the Federal Court, with iiNet barrister Richard Cobden beginning his closing submissions.

Referring to the allegations by AFACT that it detected around 97,000 instances of copyright infringement carried out by iiNet subscribers, Cobden said that there was actually only sufficient evidence to prove that a single subscriber had carried out any. That individual was the mole planted by AFACT and DtecNet to carry out deliberate ‘infringements’ on behalf of the plaintiffs.

iiNet’s protection under Safe Harbor provisions which limit a carrier’s liability under the Copyright Act remained intact, since no infringer had been identified other than AFACT’s own investigator. Since he was authorized by the plaintiffs, he committed no offenses and could not even be accurately categorized as an infringer. On this basis, iiNet did not disconnect him.

Cobden admitted that AFACT’s method of counting infringements indicated that it’s possible that from a sample of 20 iiNet users, on average they could have downloaded two to three movies each in the reported monitoring period of 59 weeks.

“It’s clear from the accounts that ultimately the [infringing] activity is likely to account for a very modest percentage of that user’s activity [and] a very modest percentage of their quota,” said Cobden as reported by ITNews.

Cobden went on to say that this didn’t amount to the “dramatic” amounts of infringement alleged by AFACT, so there was no evidence that this activity drove the uptake of iiNet high-bandwidth accounts from which the ISP profited.

Disconnecting users on such limited numbers of infringements shown on the sample accounts would have been a disproportionate response, he added.

The iiNet barrister also spoke in detail on iiNet’s privacy responsibilities under Section 112E of Australia’s Telecommunications Act, which he said undermined AFACT’s claims that by not complying with its requests it authorized the infringing activities of its subscribers. Detailed information on this key aspect of iiNet’s defense can be found here.

iiNet was never legally obliged to deal with AFACT infringement notices, Cobden told the court, noting that the law concerning copyright “authorization” does not require any ISP to suspend or terminate a customer’s account.

Cobden attacked allegations by AFACT that iiNet’s business model relies on illegal file-sharing, saying that the anti-piracy outfit had a distorted view of the world.

“In many ways the applicants look at everything that iiNet does entirely through the prism of their own concern for copyright infringement,” he said, noting that the company had been in business for many years and had simply kept up with offerings from its rivals Telstra and Optus.

“Once you take that prism away and look at it in terms of business and keeping up-to-date with technologies, and keeping its customers happy, almost every document, internal document, takes on an entirely different reflection,” he added, as quoted by ZDNet.

Cobden said there was zero evidence to back up AFACT allegations that iiNet users burned downloaded material onto CDs and DVDs and distributed them. This, he said, significantly decreased the number of copyright infringements claimed by AFACT.

iiNet’s legal team will continue with their closing submissions next week.

Article from: TorrentFreak, check out our new blog at FreakBits.

Just over a month has passed since the first stable public release of the software and PeerBlock has now managed to clock up more than 100,000 downloads. To mark this milestone, TorrentFreak caught up with Mark from the project for the lowdown.

Mark told us that the creation of PeerBlock was inspired by him upgrading his PC from 32 to 64 bit in order to utilize 6gb of RAM. Everything worked fine – until he tried to get PeerGuardian (another IP blocker) to work.

Having hacked away and jumped through hoops to get around driver-signing it would still only work half the time and often crashed without warning. As a software engineer who has worked in the commercial sector for more than 13 years, Mark – who admits to being “an arrogant bastard who truly believes he can do just about anything better than just about anybody,” decided he could find a solution. It was “put up or shut up time,” he told TorrentFreak.

Noticing that the PeerGuardian code was open-source but hadn’t been touched for a couple of years, Mark contacted another developer who had the same thing in mind, but having heard nothing back, he went at it alone.

“I started setting up a Sourceforge.net project for it so we could get free source-control, but they took too long to set it up for me so I instead created a project over at Google Code where it was ready within minutes,” he told us.

Having heard from a few people who were interested in helping out with the development side – “night_stalker_z” who’d earlier started trying to hack the PG2 code into shape, “DarC” / “DisCoStu” who wanted to help out with fixing up the installer, XhmikosR who rewrote the installer, and some testers, things moved forward.

After facing troubles due to the lack of a “signed driver” for 64-bit versions of Vista (which resulted in Mark having to set up a registered company before they were allowed to buy a $230 code-signing certificate), a couple of blogs wrote articles on PeerBlock which attracted some much-needed publicity to the project. This resulted in 10,000 downloads in just one weekend.

“We’re still getting donations from people and we now have enough to pay for next year’s annual code-signing certificate, and we’re saving up to be able to rent our own VPS with full root access etc, upon which we’ll be able to build a ‘real’ online-update system, a custom web-app to tie our forums/issue-tracker/website all together, and some other neat things,” Mark explains.

The first stable release of PeerBlock came out on September 27th, and as of November 5th had clocked up an impressive 100,000 downloads. The site now receives up to 7,000 visitors each day.

Aside from fixing one or two bugs, the team has lots of new features planned for PeerBlock. Anyone that has tried to surf the web with a blocklist in place will know how painful that can be, so PeerBlock will have some new features which allow the “whitelisting” of certain apps, such as a browser, the creation of a proxy server to let users configure PeerBlock to listen on certain ports, possibly an integral “AdMuncher” style ad-blocking feature on a per URL basis (as opposed to just an IP-address), and an encrypted chat feature.

TorrentFreak asked Mark why users should choose PeerBlock over the competition.

“Well, first off we need to ask ‘Who IS the competition?’ The only ones I’m really aware of are: Protowall by the folks over at Bluetack which is closed-source and I don’t believe was ever updated for Vista, and Outpost Firewall, which is closed-source and basically just a hack add-on to a more professional firewall product,” he responded, while noting that uTorrent’s built-in IP-filtering feature only handles one manually-updated list.

“We protect your entire machine, and give you the option to try out any P2P app you want – this freedom of choice is a very important thing, I think. And since it does everything automatically, including list-updates, it’s one less thing to think about,” he added.

Another important question relates to the blocklists that have to be used in conjunction with PeerBlock in order for it to block anything.

He told TorrentFreak that he’s a big fan of iblocklist, who serve up a staggering 10TB of blocklists every month for free. The site doesn’t create the lists, but does offer those from Bluetack, including the Level1 list (renamed to ‘P2P’ in PG2/PeerBlock, which contains both Gov and Anti-P2P IP-addresses) and others.

Mark admits that even in a best case scenario, the available blocklists aren’t 100% effective. That said, there have been studies which show that using blocklists along with software such as PeerBlock can help speed up downloads, but no-one knows how many of the potential “bad IPs” are covered by currently available blocklists.

P2P aside, Mark says there has been feedback to suggest that PeerBlock discovered a Conficker infection on a user’s machine that their anti-virus programs missed, and can also stop ads appearing in browsers that lack in-built blocking.

One other exciting thing for the future of PeerBlock is porting it to the Mac. Mark says they’re saving all the donations for additional development and this is the most-requested request right now.

Users of PeerBlock are encouraged to give as much feedback as possible to Mark’s team, via their forums, IRC (#peerblock on freenode.net) or email.

PeerBlock can be downloaded here.

Article from: TorrentFreak, check out our new blog at FreakBits.

The case continued in the Federal Court, with AFACT making its closing submissions and tearing into iiNet witnesses CEO Michael Malone and chief regulatory officer Steve Dalby.

The film industry, represented by chief barrister Tony Bannon, labeled Malone’s evidence as “incredible”, “evasive” and unreliable. Bannon said iiNet gave nothing but excuses for not acting on such notices and that Malone’s assertion that copyright laws should should be changed or an industry code introduced before he could act on infringement notices were “extreme”.

Since only Malone and Dalby appeared for cross-examination on behalf of iiNet, Bannon took the opportunity to criticize the company for not putting forward other staff from the company, who, Bannon claimed, would be better placed to answer the questions during the trial.

Bannon said this had put Malone and Dalby in the position of providing evidence on matters they knew nothing about, citing the pair’s lack of BitTorrent knowledge as a prime example.

“To put forward these two gentleman as the extent of familiarity of BitTorrent in the company is an entirely inaccurate picture of a company which plainly has a mass of technical expertise,” said Bannon, as reported by ITNews.

“It beggars belief that a company which paints itself as an Internet pioneer doesn’t have a level of knowledge within that company that knows exactly how the BitTorrent client works,” he added.

On an earlier claim where the iiNet CEO claimed to understand the BitTorrent protocol by not the operation of a torrent client, Bannon said it was a nonsense, to which insult to injury was added when it was revealed that iiNet operated its own BitTorrent tracker.

Bannon said it was clear to him that the only individuals in the court who claimed to know little to nothing about torrents were Malone and Dalby, but in reality the company understood the system perfectly well. Its motive for this stance, he said, was so that the company could distance itself from the accusations of authorizing the copyright infringements of their customers.

Bannon also heavily criticized Dalby’s evidence when he claimed to have the company’s policy on taking action only against repeat infringers “in his head”, insisting that no such policy exists.

iiNet is also asking the court to find its own terms and conditions both unenforceable and unreasonable, said Bannon as quoted by CW.

Although iiNet has asserted time and again in the case, that if a court ruled that someone had infringed copyright the ISP would disconnect them, the AFACT barrister said that iiNet’s own terms alone gave them the right to disconnect copyright infringers, and dismissed the ISP’s claims that the clause was unenforceable.

AFACT claims that iiNet engaged in secondary acts of infringement when it failed to stop its subscribers sharing illicit files on their network, citing the legal principles established in the 1975 case known as University of NSW v Moorhouse, details of which can be found here.

According to another report, the case could run over into a fifth week to 19th November and beyond to allow enough time for iiNet lawyers to prepare the company’s closing submissions.

The case continues.

Article from: TorrentFreak, check out our new blog at FreakBits.

The case continued Friday in the Federal Court, with iiNet’s chief regulatory officer, Steve Dalby, taking the stand following his first appearance Thursday afternoon.

Yesterday, Dalby recalled having difficulty in understanding some of the terminology utilized by AFACT in the infringement notice spreadsheets it submitted to iiNet.

Dalby told AFACT barrister Tony Bannon that iiNet had told AFACT there was an issue with some items being unclear in the spreadsheets.

“There was no legend associated with this spreadsheet. I had to make an assumption. We asked AFACT for more information,” ITNews quotes Dalby as saying.

Bannon then criticized Dalby for not being specific and expecting AFACT to guess at which terms were not understood, but Dalby pointed out that he expected AFACT to contact the ISP for clarification.

Further discussion took place on the issue of IP addresses and how iiNet allocates them to customers. Time and again, Dalby explained that IP addresses are allocated to a customer account and they do not necessarily represent any particular computer that the customer may use.

In what is becoming a recurring theme, today Dalby told the court that iiNet had no intention of forwarding AFACT’s copyright infringement notices to its customers purely on their allegations.

“Our position was that we should not be doing AFACT’s work,” said Dalby. “If we had received authorization by way of court order, that would have changed our position.”

AFACT went on to tender a draft e-security code of practice from the Internet Industry Association (IIA) created earlier this year. It proposes that in future, ISPs could contact, and maybe even disconnect subscribers, who have malware-ridden computers which negatively affect networks. Despite Justice Cowdroy indicating that its relevance was peripheral to the case and wouldn’t but much use when he comes to make his decision, it was allowed.

Dalby said he believed that iiNet had not been involved in the draft and he was personally unfamiliar with it. CW reports that he had been quoted on the issue in the media, but Dalby said that it was a regular occurrence for the press to call him to comment on issues he was not yet familiar with, and in this particular case his comments were “neutral and non-committal”.

In September we reported that Australia’s Internet Industry Association (IIA) felt it had something to offer these court proceedings. IIA applied to be amicus curiae, a ‘friend of the court’, but AFACT objected, insisting the group would not be impartial and would favor iiNet.

The decision on whether this will be allowed or not has been delayed until next week.

In an indication that AFACT still objects to an IIA appearance, Bannon said that “….there’s a conceivable possibility they don’t want to add anything other than to say ‘hear, hear’,” apparently to the amusement of the court.

AFACT barristers are scheduled to make their closing statements next Monday afternoon.

Article from: TorrentFreak, check out our new blog at FreakBits.

The case continued Thursday in the Federal Court, with iiNet CEO Michael Malone taking the stand for the fourth consecutive day, and possibly his last.

Not unusually for a copyright trial involving BitTorrent, the issue of The Pirate Bay was raised.

Yesterday AFACT barrister Tony Bannon incorrectly suggested that iiNet’s very own BitTorrent tracker’s functionality had been taken down, later to discover that in fact the court’s network blocked BitTorrent transfers.

Bannon indicated that he would like to be able to give a courtroom demonstration of The Pirate Bay Thursday, and the judge agreed that it would be possible to lift the block so he could do so.

According to ITNews, Bannon was today true to his word.

After the demo, Bannon enquired of Malone whether iiNet had a desire for its subscribers to be able to access the world’s largest tracker, “…when the only purpose it serves is providing a way to download unauthorized copies of films?”

This question was met with objection from iiNet barrister Richard Cobden, who argued that customer “desire” was irrelevant to the case. The judge, Justice Cowdroy, was also keen to discover the relevance.

Bannon then became the latest in a long line of movie and music industry lawyers to reveal that should his clients win the case, they will take legal action to have not only the world’s largest tracker blocked from iiNet’s customers, but other similar sites.

He also revealed that around 50% of the alleged copyright infringements in the case came courtesy of The Pirate Bay.

Then Bannon attempted to show that by allowing its customers to access The Pirate Bay, iiNet effectively sanctioned and authorized their infringing activities.

“We seek Mr Malone’s position as to whether or not his customers should have access to sites such as this,” said Bannon.

However, after legal argument, Bannon withdrew the question.

Malone did, however, concede that iiNet had taken no steps to block The Pirate Bay, but qualified this by indicating that the company didn’t possess the means to do so. Bannon asked if it was technically possible and Malone replied that he could achieve a primitive block with additional equipment, but even that could be easily circumvented

“To completely and conclusively block access to The Pirate Bay, I believe it to be beyond our technical capability or of any ISP,” replied Malone.

Asked by Cobden if iiNet had ever blocked any web sites, Malone said the company had not.

This technical inability led to iiNet pulling out of the Australian government’s filtering trials, reports ComputerWorld. Malone has been an outspoken critic of the filtering scheme, labeling it “fundamentally flawed” and saying his company would only participate in the trials to prove that filtering would fail.

The case continues.

Article from: TorrentFreak, check out our new blog at FreakBits.

The case continued Wednesday in the Federal Court, with iiNet CEO Michael Malone taking the stand for the third consecutive day.

Again AFACT barrister Tony Bannon tried to portray iiNet as an encourager of copyright infringement on its network, by referring to iiNet marketing where the ISP measures bandwidth in terms of how much music or TV episodes people can download. Malone said the company did this simply to give a customer an easier barometer by which to measure their consumption.

When questioned on the music aspect, Malone said the company referred to legal downloads, such as those from iTunes. Bannon countered by saying this could not be the case, since iiNet did not count downloads from iTunes towards a customer’s bandwidth quota.

According to iTWire, a welcome email from iiNet to new customers ended with, “Thanks for choosing iiNet. Happy downloading.”

By drawing attention to the above ponts, AFACT hopes to show that iiNet encouraged infringements, thereby losing its safe habor protection as a carrier.

CW reports that AFACT presented press articles regarding the levels of BitTorrent transfers on the Internet, in the context of actions taken by ISPs in order to limit P2P traffic.

In one article, Malone had said that BitTorrent transfers accounted for around 50% of all Internet traffic and admitted in court that BitTorrent had been used on iiNet’s network since it became available. He went on to agree that while much of this traffic involved the transfer of movies and TV shows, he didn’t feel that “..every young person in Australia is downloading illegally using BitTorrent.”

One exchange apparently raised a laugh in the courtroom when Bannon accused Malone of attracting heavy-usage customers in order to boost iiNet profits.

“I would prefer [those customers] go to someone else and let someone else be sued,” said Malone.

“And you’re happy to take their money in the meantime?” Bannon asked.

“Yes,” he replied.

Yet again, Bannon raised the issue of iiNet’s failure to forward AFACT copyright infringement allegations to its customers. However, an email presented from the Internet Industry Association’s Peter Coroneos, indicated that he was concerned that doing so could lead to an assumption that ISPs are responsible for the actions of their customers.

In the email exchange with Malone, Coroneos said it would be preferable and advantageous for all involved if the content owners could provide some legal alternatives.

After Bannon showed the court documentation showing policies in place at rival ISPs to deal with allegations of copyright infringement, Malone again confirmed that iiNet has no formal policy on how to deal with these type of allegations, noting that the company had yet to be presented with evidence of what he described as a “repeat infringer”.

Earlier in the case, Malone had defined a repeat infringer as one who had been proven as such by a court, but Bannon mocked Malone, asking if the iiNet CEO had just heard what he’d said and would he like to think about the question again for a moment.

Malone said he didn’t and Bannon accused him of treating the proceedings as a game.

The case continues tomorrow.

Article from: TorrentFreak, check out our new blog at FreakBits.

As anonymous investors pulled out and promises from the shareholders that they would come up with the funds themselves came to nothing, the deadline for the sale passed and the site stayed in the hands of Reservella, the Seychelles-based holding company that acquired The Pirate Bay two years ago.

But for those missing the optimistic press releases, bold statements and dramas of the attempted purchase by GGF, today brings good news.

According to a report, Reservella – with a helping hand from ex-Pirate Bay spokesman Peter Sunde – are in fresh talks with four potential buyers.

While the identities of two of the parties remains unknown, hints have been dropped about the other pair.

The first, GamersGate, is a Swedish company specializing in online computer games. Its CEO Theodore Bergquist, however, is playing his cards close to his chest.

“We are looking at many potential deals,” Bergquist told Di. “All I can say is that The Pirate Bay is an interesting brand loaded with great potential for those who deal with it properly.”

Holding a B.A. degree from Stockholm University, Bergquist joined Paradox Entertainment in May 2001 as CEO and was responsible for overall strategy, financial performance and growth initiatives. In 2004 he acquired the Interactive division of Paradox Entertainment and in April 2006 he became CEO of GamersGate, which was initially Paradox’s digital distribution portal.

Bergquist reported earlier this year that GamersGate had achieved 100% growth in business during 2008, both in terms of revenue and in the amount of new customers and titles on the site. The company is aiming at achieving up to 200% more during 2009. Owning The Pirate Bay’s domain would certainly help them achieve that.

The second potential buyer is a rather more familiar name – the utterly resilient Hans Pandeya.

Article from: TorrentFreak, check out our new blog at FreakBits.

Svenne-Redcross is a movie release group who have been active for nearly ten years, a long time to remain undetected and uninfiltrated. Their first serious release was a DVDRip (converted to SVCD) of ‘Richard Gere’s Dr T and the Women’ in December 2000. Its last appears to be Swedish movie ‘Johan Falk – GSI ‘ released just over two weeks ago.

But, as they say, all good things come to an end.

Scene release groups use NFOs, which are small text files commonly used to provide information about pirate releases. The NFO’s can also be used as a so-called ‘Scene Notice’, a type of message which can be passed around Scene groups to inform them of important information – even if half the time they are simply used to flame other groups or individuals.

This weekend Svenne released an NFO/Scene notice themselves, but the content was highly unusual, even if it started off with bad, if unremarkable news;

“After ten years on the Scene we’re stepping down and leaving it forever,” the group wrote. “We have been exposed by the Swedish Antipiracy Bureau whom have identified all of our members and sites.”

The Swedish Antipiracy Bureau – Antipiratbyrån (APB) – is home to the infamous Henrik Pontén who has taken many actions against pirates, including a raid earlier this year against a large Swedish topsite.

At the time Pontén said that APB had managed to identify the people running the server and noted that it was now up to the police to investigate. But strangely, even though APB appear to know a lot about Svenne, it seems that the police won’t be getting involved.

“The good thing is that we have had the possibility to make a settlement. Our activity is immediately ceased,” Svenne announced.

Why APB have offered Svenne a deal is unclear, and there is currently little public knowledge of its nature or the terms imposed. However, what is clear is that APB required Svenne to do some public grovelling – it’s hard to imagine that they would make this kind of statement voluntarily, especially since just 2 weeks ago they said how proud they were of their achievements;

“We apologies to all Swedish and foreign movie producers for the damage we have caused,” wrote the group. But they didn’t stop there – APB also required some valuable FUD to be spread, to scare others in The Scene;

“Those of you who are still involved in the Scene – close down. None of you are safe out there,” warns Svenne in their apparent neck-saving statement.

Of course, while this announcement seems designed to spread fear, the threat may not be entirely hollow. Svenne has connections to lots of other groups, so the strong possibility remains that some of those could be compromised too.

Article from: TorrentFreak, check out our new blog at FreakBits.

Those uncertainties seemed to fade a little recently when the company’s shareholders agreed on the deal two weeks ago. However, some of the shareholders decided to pay the money needed to make the sale from their own pockets after several investors walked away, and thus far nothing has been paid.

Because the company failed to provide evidence that the funds were in place, trading in GGF stock was stopped by equity marketplace ‘Aktietorget’ in August, which caused a problem with the acquisition since half of the payment for The Pirate Bay is set to be made in shares.

GGF CEO Hans Pandeya said at the time he was confident that trading would resume soon since it was all one big misunderstanding. However, today news broke indicating it won’t resume, as Aktietorget has decided to kick GGF off the Swedish stock market.

“The alleged infringements have been serious. They give a systematic impression of a lack of accountability and of an almost casual and unsuspecting approach to the disclosure requirements,” AktieTorget commented on their decision to remove the company from the stock exchange.

“The Aktietorget board regrets that the company has misled the market through its lack of disclosure, which prompted a number of investors to do business they probably would not have done if they were properly informed,” they add.

Without shares to trade the company suddenly has to raise twice as much money, which seems to be an impossible task without any outside investors and with the company’s CEO in personal financial trouble. All this makes the sale of The Pirate Bay yet more uncertain.

GGF CEO Hans Pandeya was not available for comment and representatives of The Pirate Bay could not be reached. If we receive a response from either of them we will update the article accordingly.

Update: Pandeya responded to the news and says the deal is still on.

“GGFs managed to get enough investors to pay the entire amount in cash, i.e. 60m Swedish kroner and the seller faxed confirmation of acceptance to Aktietorget. We even had a clause that if investors dropped out, I would put the balance and if I could not, I have pledged my GGF shares as security. The transaction is guaranteed, It cannot be stopped,” Pandeya explained.

“I liked the stunt with the MC, car and boat. Gives the impression I am broke. Well, I provided security worth three times the amount to the debt agency – and they agreed. However, they were keen to take the stuff that makes spectacular pics to entertaining stories and stole my boat after our agreement,” he added.

“we will be closing the deal within the next two weeks,” Pandeya concluded.

Article from: TorrentFreak, check out our new blog at FreakBits.

On day two of the trial the prosecutor announced that half of the charges against the four defendants had been dropped. The prosecutor couldn’t prove that the .torrent files that were submitted as evidence actually used The Pirate Bay’s tracker, and he had to let go of all charges that accused the Pirate Bay folks of ‘assisting copyright infringement’.

What remained is the claim that they were ‘assisting in making copyright content available’. The prosecution argued that this was indeed the case and brought in screenshots of websites and torrent files in as evidence, and the judge agreed with this assessment.

On April 17th all four defendants were found guilty and sentenced to one year in prison and a fine of $905,000 to cover the entertainment industry’s damages. Despite this verdict The Pirate Bay continued to operate while the defense filed for an appeal.

For a while it looked like there could even be a retrial instead of an appeal, since judge Tomas Norström was involved with pro-copyright lobby groups and never declared these activities before he took on the case. The Appeal Court investigated the bias issue and ruled that the judge’s ties to these groups did not influence his judgment.

Instead of a retrial there will be an appeal, and the Court announced this week that it has two weeks set aside for the case starting November 9. The defense team is not happy with the dates, and Peter Sunde – one of the defendants – told TorrentFreak that the defense team will try to get the appeal date postponed because several of the people involved have other obligations.

The appeal will be handled by judge Ulrika Ihrfelt who was previously removed from the bias investigation of Pirate Bay judge Tomas Norström, because she was linked to pro-copyright groups herself. Nevertheless, handling the appeal doesn’t seem to be a problem. This is guaranteed to cause some controversy in the months to come.

Article from: TorrentFreak, check out our new blog at FreakBits.