Kabushi Kaisha Sony Computer Entertainment Inc v Owen (t/a Neo Technologies)
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Sony makes and sells the Playstation 2. To play a game on it, you insert a CD or DVD which contains the game program. The games are created by Sony or by third parties. Each game has a code embedded into the CD or DVD and the console looks for these codes when a disk is loaded. These codes do not form part of the data that is copied when an ordinary computer accesses the CD or DVD, so owners of PC’s with an ordinary CD burner would not be able to make a copy disk that would run in a Playstation 2. It also means that the Playstation 2 will not run any software other than that which has authorised codes on the CD or DVD.
Sony has divided the world into three regions, basically Japan, the USA and the “PAL countries”. Slightly different consoles are sold in these regions, and each console requires a different code, so that games bought in one region cannot run on a console bought in another region. This is know as “regional control”.
The Defendant imported a chip from Russia called “Messiah”. A user can put this in a Playstation 2 and the consequence is that codes are bypassed. It works by simply bypassing the authorisation process. It does not copy any data from the games disk. The Defendant wanted to sell this chip in the UK.
The Defendant said that the Messiah chip went beyond just bypassing copy protection. The Messiah chip would enable the user to run software produced by people who had no relation with Sony on the console. It also enabled users to run games that were held on backup disks, which might be used if the original became corrupted or destroyed. Further it enabled the European (PAL) console to play games imported from outside Europe. There was evidence in particular that people might play “Hong Kong Silvers” – pirate games and pornographic games. Lastly, the Messiah would enable a console to play “swaps”, where two users make copy disks of different games and then swap them.
Sony said that it did not matter that there were uses that did not infringe its rights. The important point was the Defendant knew that use would include acts infringing copyright and in practice, the majority of consoles fitted with Messiah would be used for these infringing uses.
Sony relied on section 296 of the Copyright, Designs and Patents Act 1988 (CDPA):
“(1) This section applies where copies of a copyright work are issued to the public by or with the licence of the copyright owner in an electronic form which is copy protected.
(2) The person issuing the copies to the public has the same rights against the person who, knowing or having reason to believe that it will be used to make infringing copies (a) makes, imports, sells or lets for hire, offers or exposes for sale or hire, or advertises for sale or hire any device or means specifically designed or adapted to circumvent the form of copy protection employed; or (b) publishes information intended to enable or assist a person or persons to circumvent that form of copy-protection as a copyright owner has in respect of an infringement of copyright.
(4) References in this section to copy-protection include any device or means intended to prevent or restrict copying of the work or to impair the quality of copies made.”
There were two questions. First, did it matter that there might be some lawful uses, given that there were some which were not? Secondly, what, if any, was the extent of any lawful use?
In relation to the first, in the view of Jacob J. it did not matter that after the act of circumventing the copy protection, there were some uses that were actually lawful. The wrongful act was the very act of circumventing the protection, not the purpose you might have in mind when doing it.
In answer to the second question, one would have to shut one’s eyes to reality to imagine that the scale of swapping by users would be trivial if the Messiah chip were made widely available. A number of arguments were run and Jacob J. dealt with them.
The argument was that the mere import by an individual of a CD or DVD sold lawfully in, say, Japan would not infringe copyright. Section 22 provides:
“The copyright in a work is infringed by a person who without the licence of the copyright owner imports into the United Kingdom otherwise than for his private and domestic use an article which is, and which knows or has reason to believe is, an infringing copy of the work.”
Assuming a person had imported for private and domestic use, section 50C then provides:
“It is not an infringement of the copyright for a lawful user of a copy of a computer program to copy or adapt it provided that the copying or adapting is necessary for his lawful use and (b) is not prohibited under the term or condition of an agreement regulating the circumstances in which his use is lawful.”
In fact, the real question was whether an importer of a non-PAL game would have any right to play the game in this country, in other words, was there a licence to use the copyright work in this country?
The answer was, no. The games were sold with a marking showing the location where they could be used. The licensee had to prove the licence to use, and given that copyright was inherently territorial, a licence was necessary in every jurisdiction where use was intended. There was no such licence here.
Section 50A provides:
“It is not an infringement of copyright for a lawful user of a copy of a computer program to make any backup copy of it which it is necessary for him to have for the purposes of his normal use.”
This section presupposes someone having a licence and the physical hardware to enable the copy to be made. In this case, the licence was simply to use the particular disk – that was all you got when you bought the game. The fact was, if you spoiled your CD music recording, you had to go and buy another copy of it. The same was true of a CD containing a game. Backups are not “necessary” at all.
The decision stands as a fairly straight interpretation and application of the relevant sections of the Copyright Designs and Patents Act 1988 (as amended). As such there is little to comment on legally. However it will stand for many as an annoyance in confirming that users in this country cannot buy cheap DVD’s, games etc. from around the world where the producers have used technical means to impose regional control.
An interesting contrast may be drawn with the Amstrad cases of a few years ago – Amstrad Consumer Electronics plc v The British Phonograph Industry Limited  FSR 159 and CBS Songs Limited v Amstrad Consumer Electronics plc  3 All ER 151. The cases were not identical. In the first, an action was brought by BPS in relation to Amstrad’s then revolutionary twin cassette deck machines which worked at double speed to allow quicker copying – the advertising being to the effect that it was now possible to make recordings of other cassette tapes. Nowadays, it all seems rather quaint. It was held that just supplying such machines, even if they were likely to be used to make unlawful copies, was insufficient to make the supplier an infringer of copyright itself. In the second case, CBS alleged that Amstrad was inciting others to commit an offence under the Copyright Act 1956. It was held in that case that that Act created a criminal offence which did not give a party a civil action.
In the House of Lords, the consolidated appeals are reported at  AC 1013. The House of Lords took a very narrow view of what was meant by “authorise”. While the Lords accepted the dangers to copyright owners by the relatively modern phenomenon of mass home copying, they adopted the existing definition of authorisation, as in Falcon v Famous Players Film Co.  2 KB 474, so that
“to authorise means to grant or purport to grant to a third person the right to do the act complained of, whether the intention is that the grantee shall do the act on his own account, or only on account that of the grantor …”
Accordingly, the sale of the equipment was not infringing by authorising. Further, advertising, even the provocative advertising that Amstrad had adopted suggesting that illegal copying might be facilitated, was still not an infringement. However, it should be noted that Amstrad’s advertisements contained a footnote to the effect that it was up to the individual user to obtain authorisation to make some copies, and Amstrad had no right to grant such permissions. Indeed, it would be fair to say that the emphasis given in the House of Lords was directed to the fact that the tape machines had both legal and illegal uses and the manufacturer could not control what the individual user did.
This attitude could be compared with the case now being reported. The argument that there were legitimate uses was met with short shrift in the judgment, with Jacob J. observing that the overwhelming probability was that most uses would in fact be unlawful. With the mass availability not only to make, but also to make quickly and cheaply, copies of copyright works, there seems by this case to be something of a seismic shift in judicial attitudes to such actions, or at least to the actions of those who would supply individuals with the necessary equipment.
Perhaps one other result of the decision is worth bearing in mind and that relates to the right to make backup copies. This is implemented by section 50A, subsection (1) of which Jacob J. cites in his judgment. Subsection (3) also provides:
“Where an act is permitted under this section, it is irrelevant whether or not there exists any term or condition in an agreement which purports to prohibit or restrict the act (such terms being, by virtue of section 296A, void).”
For the sake of completeness, section 296A(1) provides:
“Where a person has the use of a computer program under an agreement, any term or condition in the agreement shall be void in so far as it purports to prohibit or restrict (a) the making of any back up copy of the program which it is necessary for him to have for the purposes of the agreed use …”
A restrictive meaning is given in the judgment to “necessary” in section 50A – “backup copy of which it is necessary for him to have for the purposes of his normal use”. Jacob J. cites from Copinger & Skone James on this point. Reference is made in that work to the Software Directive (Directive 91/250/EEC) at article 5. The work comments that making backup copies is no doubt highly desirable, but not strictly necessary. It argues that the words should be interpreted to include use which, whilst not strictly necessary, is nevertheless highly desirable. Jacob J. dismisses this argument.
“The fact is that if you spoil your CD, which has a recording of music on it, you have to go and buy another. The same is true of a CD carrying a game. Backups are not necessary at all.”
Perhaps an observation on these comments is necessary. I downloaded and fired up Real’s latest player on my PC at home (it’s free on the web at www.real.com). With it I could rip tracks off CD’s and store them on my hard drive (or removable media), burn tracks to another CD on my CD-R/CD-RW player, transfer them to and from a portable mp3 jukebox. While playing an mp3 file, if I went online, the names for the tracks would be found and entered automatically for me, music by similar artists would be recommended and locations of sample mp3’s for download are easy to find. Information is also provided about the track I am playing, such as release date and label – an image of the album cover is even downloaded to the Real player to aid my listening enjoyment. Gadget-man I may be, but even I was amazed at the possibilities.
While Jacob J. is correct in that there was no term in Sony’s licence restricting or prohibiting use, by making it technically impossible to make copies this was achieving the same thing. If a standard software licence, that hardly anyone bothers to read, contained a clause preventing the making of backup copies, section 296A would bite and the clause would be ineffective. However, if the supplier makes it clear to the user that the licence does not permit the making of any copies to begin with and the licence relates only to the particular physical disk that has been supplied, and it is technically impossible to make any copies anyway, this seems to be unaffected by the legal provisions just considered. Curious.