Law firm Gallant Macmillan hoped that the Court would order the ISPs to hand over the identities of tens of thousands of alleged filesharers so that Ministry of Sound can prise cash settlements out of them.

But following the security breach at lawyers ACS:Law, BT and their subsidiary Plusnet refused to cooperate citing data protection concerns. BT’s request for an adjournment of the hearing was granted and was set to resume on January 12th 2011.

However, according to Ministry of Sound, its planned shakedown of file-sharers has been hit with a catastrophic failure. In an announcement today, the label has revealed that BT has deleted most of the records that Ministry of Sound requires for pursuing alleged file-sharers should it have been successful at the January hearing.

In what will be seen as a major and expensive setback for their campaign, the label notes says that it discovered in legal correspondence that BT had failed to preserve over 20,000 of the 25,000 customer records which Ministry of Sound had originally requested.

“Whilst Ministry of Sound were happy to incur substantial legal costs to access 25,000 names it is simply not economic to pursue the 5,000 remaining illegal uploaders,” the company said in a statement.

“It is very disappointing that BT decided not to preserve the identities of the illegal uploaders. Given that less than 20% of the names remain and BT costs have soared from a few thousand pounds to several hundred thousand pounds, it makes no economic sense to continue with this application,” said Ministry of Sound CEO Lohan Presencer.

BT, however, seem puzzled by Ministry of Sound’s announcement.

“We’re surprised at this claim since we provided a similar number of customer details to comply with a court order earlier this year for Ministry of Sound and there was no suggestion then that this was a problem for them,” the company told TorrentFreak in a statement.

“All such information is automatically deleted from our systems after 90 days in accordance with our data retention policy; the Ministry of Sound and its solicitors are well aware of this. Upon request from Ministry of Sound we saved as much of the specific data sought as we reasonably could and any not preserved must have been too old. Our door remains open to Ministry of Sound and any other rights holder who wants to enforce their rights in a fair way through an established legal process.”

Despite the setback, Ministry of Sound CEO Lohan Presencer said the company will persist.

“We are more determined than ever to go after internet users who illegally upload our copyrighted material. We will be making further applications for information from all ISPs. Every time that a track or album is uploaded to the web it is depriving artists of royalties and reducing the money which we can invest in new British talent,” he added.

Although Ministry of Sound endlessly go on about artists suffering and how piracy hinders the nurturing of talent, there is a little known fact about their claims which makes their strategy very unusual indeed – they aren’t claiming for an infringement on music copyrights at all.

Since Ministry of Sound do not own the copyright for the tracks they appear to be requesting cash settlements for, they have presented their case to the court on the basis that they own the ‘intellectual property’ in the album’s tracklisting. That’s right, MoS are claiming copyright infringement on the order of tracks as they appear in their compilation albums.

Of course, not a word of this is mentioned in the settlement offers they send to alleged infringers, the implication all along is that the claim is for music. You couldn’t make it up – but lawyers can and do.

Both Ministry of Sound and their lawyers Gallant MacMillan were subjected to Operation Payback DDoS attacks last month.

Updated: Below is a further statement from BT, sent to TorrentFreak a few minutes ago.

The Ministry of Sound’s decision is clearly a matter for them. It’s a shame though that, in this instance, our concerns over the current process will not be examined by the Court. However, it remains our intention to ensure our broadband customers are adequately protected so that rights holders can pursue their claims for copyright infringement without causing unnecessary worry to innocent people.

BT believes that with appropriate safeguards to protect customers’ rights, confidence in the Norwich Pharmacal process can be restored so that rights holders can feel able to use it to seek redress for online copyright infringement. The safeguards we aim to establish via the Court are on the security of data handling, a threshold for providing a customer’s details based on a minimum number of separate incidents, the tone of contact with broadband subscribers and a reasonable approach to financial compensation sought.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Lawyers Gallant Macmillan hoped that the Court would order the ISPs to hand over the identities of hundreds of alleged filesharers so that Ministry of Sound can prise a cash settlement out of them.

However, in contrast to their earlier stances, BT and and their subsidiary Plusnet refused to cooperate. Their concerns stemmed from the catastrophric data security breach at lawyers ACS:Law last month.

Chief Master Winegarten, who hears most if not all of these types of cases in the UK, granted BT’s request for an adjournment of the hearing.

In a statement, Plusnet’s COO Richard Fletcher wrote: “The incident involving the ACS:Law data leak has further damaged people’s confidence in the current process.

“We’re pleased that the court has agreed to an adjournment so that our concerns can be examined by the court, this will then act as a precedent/test case for the future.

“We want to ensure broadband subscribers are adequately protected so that rights holders can pursue their claims for copyright infringement without causing unnecessary worry to innocent people. We have not simply consented to these orders in the past, we have asked for stricter terms as public concern has risen. The data leak with ACS:Law prompted us to take further action today.”

Fletcher’s statement, which echoed that from parent company BT, added that the companies were also seeking a moratorium on outstanding applications and orders. This could potentially be good news for those subscribers whose identities have already been handed over to lawyers in the UK, but are yet to receive letters.

The hearing will continue on January 12th 2011. At this stage it seems unlikely that any more court orders of this type will be granted in the meantime, bringing a temporary halt to the ‘Speculative Invoicing’ of alleged file-sharers in the UK.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

The continuation of the hearing between Ministry of Sound Recordings Ltd and ISP Plusnet Plc will go ahead at London’s High Court. Gallant Macmillan hope that the judge, Chief Master Winegarten, will order Plusnet to hand over the identities of hundreds of alleged filesharers so that Ministry of Sound can prise a cash settlement out of them, ACS:Law style.

To give Gallant Macmillan something to think about, on Saturday the leaders of Operation Payback decided on a new target. At 2pm EST (7pm GMT) Sunday October 3rd (yesterday), the website of Gallant Macmillan was destined to become the next target of a DDoS attack, coordinated from the Operation Payback homepage.

But Gallant Macmillan’s web admin had other ideas. Fairly quickly the GMLegal.co.uk site began returning the ‘Invalid Hostname’ error.

“This suggests that an administrator has manually pulled the website off the server, although the domain is still pointing to the same server,” a leader of Operation Payback told TorrentFreak.

Nevertheless, Gallant Macmillan (and their mail service housed on the same server) remained the target but then, shortly before the attack was due to start, the law firm took an unexpected action.

“An hour before the attack, GMLegal.co.uk changed their DNS records to point to 127.0.0.1, effectively surrendering,” we were informed.

But a new target had already been chosen, one that didn’t have any time to prepare. Minutes after 7pm GMT, the website of Ministry of Sound, which ordered the action against alleged file-sharers, was taken offline by a huge DDoS attack. The payment site of the company was also targeted, along with its operations in other countries.

This is the first time that a site that actually makes money from selling music has been targeted in Operation Payback and the attack will have a direct financial consequence for Ministry of Sound which turns over around £80 million worldwide.

At the time of writing, some 12 hours after the attack began, much of MoS’s online operations remain down. If Operation Payback wanted to give MoS something to think about in court today, they will have achieved their aim, especially if the judge doesn’t give them an easy ride.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

The hearing, Ministry of Sound Recordings Ltd v Plusnet Plc, went ahead at 2:30pm in London before judge Chief Master Winegarten (CMW). Other ISPs detailed were BT, Sky and O2/Be Unlimited.

Gallant Macmillan’s legal team expected a walk in the park that day, and why shouldn’t they? Plusnet, a subsidiary of telecoms giant BT, had already agreed that they would not contest the application. The judge, however, had other ideas.

The judge voiced concerns about the amount of mail he had received from Internet subscribers who had been previously wrongly accused. “There wouldn’t be this hue and cry unless you were pursuing people who were innocent,” he told the applicants.

Instead of going ahead and ordering Plusnet to hand over the information to Gallant Macmilan, the judge explained that he had received by letter “concerns from the public” that must first be addressed. The applicant (MoS) was ordered to respond to those concerns by 27th September and the hearing itself was adjourned to be concluded 4th October 2010 – this coming Monday.

Then last weekend, all hell broke loose. While recovering from a DDoS attack, ACS:Law gave a very clear demonstration of how securely they had been holding onto highly personal and sensitive data by publishing their email backups to the public. Not only were the internal workings of the company put on show, but thousands of ISP subscriber identities (Plusnet customers included) were spilled onto the Internet, many of them linked to pornographic content.

Only after these events did the authorities in the UK sit up and listen and ISPs other than TalkTalk and Virgin Media air concerns about these law firms and their actions.

Nevertheless, while Andrew Crossley of ACS:Law sees his company and quite possibly his career in ruins before him, Gallant Macmillan remain undeterred. They will go to the High Court on Monday as planned and demand subscriber identities from Plusnet armed with a case as weak as that presented by ACS:Law, with evidence acknowledged by experts as incapable of identifying an infringer, and employing equally untested data handling, processing and security procedures.

After initially giving ACS:Law and Gallant Macmillan an easy ride, Plusnet now say they will resist applications to hand over customer details to them in future. TorrentFreak has been speaking with Plusnet throughout the week and have asked them on a number of occasions if they will send a proper lawyer to the High Court on Monday prepared to fight the application, but up to now they haven’t been able to give us reassurances that will happen. They have confirmed, however, that they will ask for an adjournment of the hearing to assess the position.

Sadly that may well be too little, too late, and the judge may have no other option but to grant Gallant Macmillan’s application if Plusnet don’t go equipped with a proper lawyer to defend. If they don’t (and end up handing over more details as a result) it will be a PR disaster for the company and the whole speculative invoicing model will be back on track in the UK.

Gallant will write to hundreds of people, scaring the living daylights out of many of them, with letters containing barely understandable legal jargon and veiled threats which to the layman suggest that ruination is round the corner, unless they pay up a few hundred pounds to make it all go away.

It is exactly this sort of behavior and (ab)uses of the legal system which have caused the Anonymous masses and their growing numbers of sympathizers to become absolutely incandescent with rage.

“Gallant Macmillan’s actions are likely to attract the ire of users of 4chan, who are currently targeting firms involved in combating online piracy,” wrote the BBC yesterday. TorrentFreak can confirm that the BBC are correct (pic) in that assumption.

At 2pm EST (7pm GMT) Sunday October 3rd (tomorrow), the website of Gallant Macmillan will become the next target of a DDoS attack, coordinated from the Operation Payback homepage.

“We as Anonymous are asserting the basic right of a free society – that authorities exist to serve people, not to terrify and cow them,” a leader of the operation told TorrentFreak in a statement. “We are reminding these firms who use fear on us that they should instead fear us. We ask everyone that ever receives a letter from them not to pay up, and not to give in.”

Interestingly, the site that Gallant Macmillan has been using for its speculative invoicing scheme, Pay to Play, has been taken down.

Update:Anonymous: Their site is now producing an “Invalid Hostname” error. This suggests that an administrator has manually pulled the website off the server, although the domain is still pointing to the same server. There is not yet any evidence that this was the result of an early DDoS attack, however it could be because the administrator wanted to avoid the planned DDoS attack and thus pulled the site offline on purpose.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

On Monday, lawyers Gallant Macmillan were in court on behalf of their client Ministry of Sound, a huge independent music label, to extract yet more identities of alleged file-sharers from UK ISPs.

The hearing, Ministry of Sound Recordings Ltd v Plusnet Plc, went ahead at 2:30pm in London before judge Chief Master Winegarten (CMW). Other ISPs detailed were BT, Sky and O2/Be Unlimited.

Among those who have been tirelessly campaigning against these actions, it’s long been hoped that CMW, a senior high court judge with a wealth of experience in this area, would take a more critical approach with these cases than he has done in the past. On Monday, for once, things didn’t go quite to plan for the applicants.

Although it’s thought that more than 100,000 identities have been handed over to lawyers like Gallant Macmillan and ACS:Law, worryingly CMW confirmed during the hearing that he didn’t possess the technical expertise to assess the nature or reliability of the evidence being used in the cases.

Not only that, CMW also told the court that he had been surprised at the amount of mail he had received from concerned individuals and remarked that this wouldn’t happen if there wasn’t a large degree of misaccusation.

“There wouldn’t be this hue and cry unless you were pursuing people who were innocent,” he told the applicants.

Condemning the actions as a “huge sledgehammer to crack a nut”, CMW pondered, “I can’t understand why in these thousands – hundreds of thousands – [of letters sent out] no-one has been sued.”

Of course, anyone following these cases knows why. This is all about money and one successfully contested case means the whole scheme comes to an end and these companies aren’t going to risk that.

However, there could be a light at the end of the tunnel. Chief Master Winegarten told the court Monday that once the Digital Economy Act is fully in force, further applications for court orders of this nature may not be successful.

CMW also refused to grant Ministry of Sound’s (MoS) application for a court order. He explained that he had received by letter “concerns from the public” that must be addressed before he could agree to it. The applicant (MoS) must respond on that by 27th September. The hearing itself was adjourned to be concluded 4th October 2010.

This decision to delay by CMW is particularly unusual and suggests that he is becoming more concerned by these actions. It is, however, commendable that he is doing so because without him trying to at least offer some protection to the public, these court orders would simply be granted.

The reason? Almost universally the UK’s ISPs have shown absolutely no desire to protect their customers, despite being well aware that people are being wrongfully accused. As an example, let’s look at Plusnet, the ISP shown as the primary target in this application by Ministry of Sound.

For months now there has been a storm brewing among Plusnet’s customer base. Dissent against the company’s approach to its handling of these court orders and particularly its relationship with ACS:Law has generated a near 40 page and often heated discussion on its customer service forums.

TorrentFreak has been in contact with Richard Fletcher of Plusnet previously but it seems that for legal reasons, whatever they might be, he hasn’t really been able to answer either our questions or those posed by Plusnet customers. Today there will be many more.

Despite promising that a member of their group’s legal team would be present in court to hear this Ministry of Sound application Monday, no one with any legal ability was sent, just a single observer who sat at the back in silence. On Monday evening, Richard Fletcher posted the following response:

I know a number of you have expressed disappointment at our approach, and that we are co-operating wholly with ACS:Law – I wish to be clear that Plusnet consider each application for Norwich Pharmacal Relief [court orders to reveal customer identities], however the decision as to whether a Norwich Pharamcal Order should be made, or not is a decision for the Court and Plusnet only disclose information when it is compelled to do so by the Court.

However, as TorrentFreak pointed out to Richard in an email yesterday morning (we also asked several questions and provided a summary of what happened in court Monday but have yet to receive a reply), this statement is missing the point somewhat.

The facts are that the judge hearing this case cannot find against the applicant (Ministry of Sound) because the ISP (Plusnet) is the defendant and Plusnet as a company are privately agreeing not to contest these court orders even before they are formally asked for in court. This type of agreement was illustrated very clearly when Plusnet didn’t even bother to send a lawyer.

While we all know that an ISP must comply with a court order once it’s issued, Plusnet and virtually every other ISP in the UK are giving the likes of Gallant Macmillan and ACS:Law a free ride by agreeing not to contest in advance.

But it doesn’t have to be this way. ISP TalkTalk have told TorrentFreak time and again that they refuse to cooperate with these companies and – surprise, surprise – TalkTalk are never required to hand over the details of their customers since they are never included on a court order application. All this despite being one of the country’s largest ISPs.

While the dawning of the Digital Economy Act may put an end to the schemes of ACS:Law and Gallant Macmillan, that time is still a while off and in the meantime many more thousands of people will receive letters and untold numbers of those will be wrongly accused as has been the case up to now.

It is clear. The country’s ISPs, Plusnet included, have the power to do something about this. Do the ISPs share the reservations of Chief Master Winegarten? Will they have the courage to add momentum to his concerns?

Will any UK ISP have the courage to oppose the next court order application based on Chief Master Winegarten’s concerns? If you are one such ISP, tell us. We’ll be happy to let the world know about it.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

For 3 years threatening letters have been dropping through the doors of UK Internet users warning them that unless they pay up a huge fee, they could be ruined through the courts. As we now know, those threats have continually come to nothing and the lawyers involved have been subjected to unprecedented levels of complaints and bad publicity.

But as they say in Britain, “where there’s muck, there’s brass”, and that’s enough to attract more lawyers and more rightsholders to this most profitable of honeypots.

Last week, BeingThreatened, a consumer group dedicated to supporting those wrongfully accused in these cases, informed TorrentFreak of a new entrant to the market.

According to their website, Gallant Macmillan “is a niche media and litigation law practice with an international focus,” which claims to offer lawyers with skills in “reputation management, commercial litigation and intellectual property.”

The law firm lists many high-profile companies as its clients including The Jerusalem Post, Claims Direct, Ted Baker, Kookai and airport giants Servisair, but of current interest is its work with night club and dance label, Ministry of Sound.

“Unlawful file-sharing is a serious problem for Ministry of Sound, reducing income for the musicians and composers it works with and diminishing the funds needed to invest in new talent,” states the settlement letter sent out to unlucky recipients during the last week.

Accused of sharing the £8.75 Ministry of Sound – The Annual 2010, recipients are given the option to settle out of court for £375, an amount Gallant Macmillan says is intended to cover various costs including damages, evidence collection, dealing with ISPs, court attendances and sending the letter of claim.

“This offer to settle remains open only 21 days from the date of this letter,” warn the lawyers. Failure to comply, of course, means that they “reserve the right” to commence proceedings.

It has been well documented that other lawyers previously involved in this type of work, such as ACS:Law, have been heavily reported both to the government and to organizations such as the Solicitors Regulatory Authority (SRA). Indeed, ACS:Law have proven record-breaking in this respect.

However, when looking at the website set up by Gallant Macmillan (GM) for the purposes of this work, it seems that they have done their homework on the problems and criticisms faced by other companies.

Perhaps in a preemptive move, rather than hiding the fact that they are regulated by the SRA, the company mention it prominently on every page of their site, often twice.

While ACS:Law act on behalf of “middle man” companies behind which rights-holders have the opportunity to shield their identities and reputations to some extent, GM say they will only act for brand owners “who are prepared to sue in their own names” and will not represent companies seeking settlements over porn movies.

GM also appear to be trying to show a more, for want of a better word, ‘humane’ approach to their dealings with settlement recipients.

“We understand that threatening legal proceedings can be distressing. Whilst committed to act in our client’s best interests, we strive to communicate with the recipients of our letters in a respectful and courteous fashion,” write the company.

Although thus far GM only detail a time and date for single infringement on the letters seen by TorrentFreak, the company claim that their focus is the pursuit of what they describe as “multiple offenders”.

A huge criticism of both ACS:Law and previously Davenport Lyons is that the companies make threats of taking people to court but never do. It seems that GM wish to address this too.

“If we are unable to reach an agreement with the recipient of our letters, and still consider that our client has a good claim, we shall sue,” they state. “We recognise that it is not appropriate to make threats of proceedings and to not then follow through with those threats in appropriate cases.”

Another little twist to the approach is that while other lawyers demand that letter recipients delete the material they are accused of sharing from their hard drives, Gallant Macmillan say that as part of the settlement those accused can keep the album they are accused of sharing, in this case a Ministry of Sound compilation. At £375, this must be the most expensive album ever.

Despite the very clear attempts at presenting a more acceptable side to the copyright settlement business, thus far the ‘meat’ of this operation seems to be no different to those that have gone before. It will remain to be seen if Gallant Macmillan will weather the storm that caused lawyers Tilly Bailey and Irvine to jump ship.

All letter recipients are advised to read the Speculative Invoicing Handbook. It was written with earlier cases in mind, but is just as relevant today.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.