Out-Law / Your Daily Need-To-Know

Judge quashes mod chip seller's conviction, blames prosecution error

Out-Law News | 30 Jun 2008 | 3:06 pm | 2 min. read

A man who ran a business selling computer chips that helped games consoles play pirated games has had his conviction for copyright infringement overturned on appeal. The High Court judge called him "fortunate" and criticised the prosecution case.

Neil Higgs ran a business called Mr Modchips selling computer chips that helped consoles to play computer games that were fitted with copy protection. It allowed users to play legitimate games from other parts of the world whose use was supposed to be geographically restricted and also pirated games.

He faced criminal prosecution under the Copyright, Designs and Patents Act and was convicted last year. That conviction was quashed on appeal, though, because the prosecution failed to make the right arguments in court, Lord Justice Jacob said.

The case rested on the status of copy-protection technology, referred to in the Act as 'effective technological measures'.

Higgs was said to have breached section 296ZB of the Copyright Act, which says that someone has committed an offence if they manufacture or distribute anything which is "primarily designed, produced, or adapted for the purpose of enabling or facilitating the circumvention of effective technological measures [ETMs]".

The prosecution argued that Higgs was guilty because he made technology available that encouraged and exploited a market in pirated games which would depend on the circumvention of ETMs.

Lord Justice Jacobs said that this was not the right argument to make, and that the prosecution had, crucially, not proved that the ETMs actually worked.

"Is it enough if the technological measure is a discouragement or general commercial hindrance to copyright infringement or must it be a measure which physically prevents it?" he said in his ruling. "To our minds the position is clear – it is the latter."

He said that it was open to the prosecution to make a much more convincing argument, which was that Higgs's technology allowed the playing of pirated games which itself involved an infringement because it necessitates the copying of a game in the console from the CD-Rom.

"It may well be that if the legislation had been less complex and/or the Crown had had greater opportunity to consider the details of copyright law the case would have been proved on the basis that merely playing a pirated game involves making a copy in the console and thus involves infringement," wrote Lord Justice Jacob.

"Mr Higgs is a fortunate man … he may also be fortunate that, at least this far, he has not been sued in the civil courts," he wrote in his ruling.

The judge said that if the prosecution had argued that the use of a modified console involved infringement of copyright for which Higgs bore some responsibility then it may have met with success.

"If such had been contended and proved (as it would seem very probably it could have been), it is difficult to see what defence there might have been," said Lord Justice Jacob.

Computer consoles and games are divided into three regions, the US, Japan and the rest of the world. The machines are told only to play original bought copies of games from the same region as the player.

Mod chips allow a machine to be used to play games from another region or games that are unauthorised copies, so the selling of mod chips is a threat to the business models of console manufacturers who often sell machines at a loss in order to make profits on the games.

Higgs's business was in supplying mod chips, fitting them to customers' machines and selling machines with chips already fitted to them.