The Court of Appeal has largely upheld an order requiring UPC Communications Ireland Ltd to warn fixed broadband subscribers identified by music companies as allegedly sharing copyrighted recordings online. It removed a clause requiring a review after five years and a clause addressing costs in future cases against subscribers.
The judgment, delivered by Gerard Hogan on 28 July 2016, dismissed UPC’s appeal subject to those changes. The court held that the High Court had jurisdiction under section 40(5A) of the Copyright and Related Rights Act 2000 to make an injunction against a non-infringing internet service provider, and that the graduated response scheme met the applicable EU law requirements.
Under the scheme, Sony Music Entertainment (Ireland) Ltd, Universal Music Ireland Ltd and Warner Music Ireland Ltd may send infringement notifications to UPC. After the first and second notifications concerning a subscriber, UPC must send warning letters. After a third, it must notify the music companies, which may apply to court to identify the subscriber and seek an order terminating internet service or other relief. The scheme is capped at 2,500 notifications a month and excludes business users.
The High Court order requires the music companies to pay 20% of UPC’s qualifying capital expenditure, capped at €940,000 and payable in five annual instalments. UPC bears the operating costs of communicating with subscribers. The Court of Appeal accepted the High Court’s assessment that the scheme was necessary and not unnecessarily costly or complicated, and that its cost-sharing arrangement was fair and proportionate.
The appeal court agreed that subscriber access could not be suspended or terminated under the scheme without the prior, fair and impartial procedure required by EU law. The order instead leaves the music companies to seek subscriber identification and any termination order through court applications. The court also found that the scheme did not require prohibited general monitoring of users.
Hogan said the High Court’s five-year review provision was unnecessary because the order already allowed the parties to apply to vary or discharge it if circumstances materially changed. He also concluded that the High Court should not make an anticipatory costs order for future proceedings. The order may note UPC’s position on costs, but the court should not dictate the costs outcome in cases that have not yet been brought.
The Court of Appeal declined UPC’s request to refer questions to the Court of Justice of the European Union, finding that the relevant principles had already been established and that the appeal court was not a court of last resort for that purpose.