Last month TorrentFreak reported on DigiProtect, the anti-piracy company with the tagline “Turn Piracy Into Profit”. A manager from DigiProtect revealed some of the inner workings on how the company operates but according to a lawyer who defends alleged file-sharers, he may have revealed just a little too much.
At an increasing rate copyright is ‘used’ as a tool to carefully extract money from file-sharers, instead of protecting the creative works of artists. The anti-piracy outfit DigiProtect is one of the companies that uses copyright for this new purpose.
“We get the legal rights from the companies to distribute these movies to stores, and with these rights we can sue illegal downloaders,” said Digiprotect’s account manager Thomas Hein as he explained how his operation works. “Then we take legal action in every country possible, concentrating on the places where such action will be profitable.”
“No one working for DigiProtect has a fixed salary. If we make money, everybody makes money. If we don’t, nobody does. This means the lawyers, sales people and customers. It’s all about how much money can be recouped and then sharing it,” he added, crucially.
And here lies the problem. According to lawyer Christian Solmecke of Wilde & Beuger law firm in Germany, the law requires such an operation to have an RVG agreement, which is part of the mechanism to regulate attorney’s fees. Since no-one can say how much the lawyers get paid, this causes difficulty.
“The interview creates the impression that no RVG agreement was entered into by DigiProtect and the law firms who admonish users [threaten with pay-up-or-else letters]. The report relating that the money thus earned is shared, rather suggests a success fee. Such an agreement is illegal. An admonishment based on it would equally be illegal and admonishing expenses would not have to be paid,” Solmecke notes.
DigiProtect have been pretty open about their aim of generating profit for their own company and their partners – indeed, its tagline is Turn Piracy Into Profit. This may also cause problems for their lawyer partners.
“If the admonishment serves solely the purpose of generating gains, it may furthermore be repudiated for reasons of abuse of legal right,” says Solmecke.
DigiProtect partners with lawyers ACS:Law in UK and presumably operates in a similar manner, sharing profits from those who ultimately pay up on the threats.
Update: Aldor Nini from Easycom contacted TorrentFreak with his view on this article. It’s a long read but interesting nonetheless
Our company develops end-user software, custom B2B solutions and sometimes we do also create software for anti-piracy purposes. We’re not related with DigiProtect, nor do we have any business or private relatinoship with them, but we’re very specialized in the German law together with our law-firm in Germany. The German RVG states, that the lawyer should be compensated by the RVG, that’s true. The RVG does also allow the lawyer to be compensated by additional charges like working hours for special tasks, this is also very usual.
The lawyers, in case of DigiProtect, might have the right to be compensated by a fee, defined in the RVG and calculated by the value of the case, but they’re not obliged to charge their clients with that fee (invoice them) – except in case if it is an ongoing trial at the court.
They are not allowed to benefit from the licence fees the user pay (like having an agreement that they will get 20% of the fee DigiProtect earns on top), but they might be able to compensate this by defining that they’ve worked 3 more hours on various cases and add a fee of e.g. 200 EUR on top of that.
Their statement that no-one will benefit from the business if no-one is going to pay that fees is also accurate, because the german RVG is just the minimum of a fee that a lawyer should get. The RVG is not meant to let the lawyer survive until he gets retired. At least, that’s the truth many lawyers have to experience in Germany. The more people pay the fees, the more the lawyers do also benefit from it, this is normal, because the more work they have to do, also based on working hours, which they can charge on top. If no-one would pay it, the client wouldn’t allow extra hours to be charged on such cases. All in all, this is definitely not an illegal behavior.