IPTV Operator Who Was Sentenced For One Week of Piracy is Less Lucky at Court of Appeal

A man convicted of copyright infringement violations while operating a pirate IPTV service, had his sentence significantly increased this week by a Swedish court of appeal. A lower court previously held that the defendant had infringed the rights of major movie and TV companies, but due to limited evidence, only for a week. The court of appeal disagreed after his own use of the service was uncovered during a police raid.

Referred to in legal papers as simply J.E., the defendant was targeted in Sweden by local anti-piracy group Rattighetsalliansen (Rights Alliance) on behalf of major movie and TV show companies Svensk Filmindustri and Nordisk Film.

The plaintiffs’ claim stated that J.E., either intentionally or with gross negligence, acted alone or in concert with others, to infringe their copyrights in cinematographic works.

They alleged that between August 20, 2020, and May 17, 2022, J.E. made movies available to the public through a popular pirate IPTV service, Scandinavian IPTV. In the alternative, the plaintiffs said that through his conduct, J.E. encouraged someone else to infringe their rights in 19 movies via the Scandinavian IPTV service.

Suspect Arrested in May 2022

On May 5, 2022, Swedish police arrested J.E. in his absence, with a physical arrest executed on May 17, almost two weeks later. During questioning, J.E. initially denied the offenses, but anti-piracy group Rights Alliance had already amassed considerable evidence.

Scandinavian IPTV wasn’t officially registered as a company. However, via a ProtonMail email address, American Express payment cards, and a Stripe account, Rights Alliance was able to link J.E. to the unlicensed platform.

An analysis of various items of seized equipment revealed telephone messages, sent and received by J.E., which discussed the IPTV business. Information on J.E.’s computer revealed similar evidence in the form of IPTV-related account logins.

A financial investigation indicated that payments totaling SEK 5.5 million (~US$5.2m) had been made to J.E.’s two PayPal accounts, with the funds subsequently transferred to six bank accounts he also operated. IPTV boxes and associated invoices were also seized.

Previously, Rights Alliance had carried out test purchases to show that the service infringed the plaintiffs’ rights by making available around 19 sample movies. That period of testing – or rather the months preceding it – would soon limit the scope of the prosecution’s case.

Patent and Market Court Convicts

In its judgment handed down in April 2023, Sweden’s Patent and Market Court found J.E. guilty of violating the Copyright Act. The defendant received a suspended prison sentence and was ordered to pay 60 daily fines totaling SEK 34,800, around US$3,300 at today’s rates.

He was also ordered to compensate Svensk Filmindustri (SEK 63,000 / US$6,000) and Nordisk Film (SEK 191,500 / US$18,600), with SEK 5,000 (US$4,760) forfeited to the state as proceeds of crime, and an additional SEK 150,000 (US$14,280) to cover legal costs. These amounts were a far cry from those demanded by the plaintiffs.

Svensk Filmindustri had requested compensation of SEK 910,000 (US$86,700), Nordisk Film requested (Danish) DKK 2,355,000 (US$338,000). Yet, despite what amounted to a confession, both realized much smaller amounts. Something had gone wrong.

Confession vs. Evidence

J.E. admitted launching Scandinavian IPTV in 2019 and a Rights Alliance investigator confirmed that the service had attracted attention after appearing close to the top of Google search results.

By August 2020, a “large number of payments” for IPTV subscriptions had been received by J.E., including a one-month subscription purchased covertly by Rights Alliance on August 20, 2020, which was used to the monitor the service for the next seven days. To the standard required in a criminal case, that was the extent of the evidence, as the judgment explained:

The prosecutor has claimed that the access for which J.E. is to be held responsible has been going on for almost two years. During the preliminary investigation, checks were made to ensure that Scandinavian IPTV’s website was still up and running, but there was no documentation that the films in question had been available on the service after August 27, 2020.

 

Photographs from the search of J.E.’s home on May 17, 2022, show some of the films being played on a TV screen. However, there is no information that the films were played via Scandinavian IPTV’s service, nor has this been alleged by the prosecutor. Under these circumstances, with the strict evidentiary requirements that prevail in criminal cases, it cannot be considered proven that J.E. made the films available after August 27, 2020

The end result was a conviction for copyright infringement, but only for the violations carried out during the evidenced seven-day period. J.E. also had a clean record, with the court noting that “neither the nature of the crime nor the severity of the punishment justifies a prison sentence.”

Calculations presented by the plaintiffs, to demonstrate the value of the film works infringed, were acceptable to the court; however, since infringement could only be established for a week, compensation was reduced to one tenth of the amounts requested.

Patent and Market Court of Appeal

Following an appeal, an amended judgment was handed down Wednesday by the Patent and Market Court of Appeal. Taking into account changes in the wording of the Copyright Act during a now extended period of offending, the Court took a much firmer line.

J.E. was sentenced for violations of the Copyright Act committed between August 28 and August 31, 2020, and during the period September 1, 2020, to May 17, 2022. The Court of Appeal increased the number of daily fines from 60 to 100, for a new total of SEK 58,000 (US$5,520) versus SEK 34,800 (US$3,300) ordered in the previous judgment.

Compensation amounts were also amended in favor of the plaintiffs. (Nordisk award in Danish currency)

• Svensk Filmindustri: SEK 747,500 / US$71,200 | (previously SEK 63,000 / US$6,000)

• Nordisk Film: DKK 2,032,500 / US$291,700 | (previously SEK 191,500 / US$18,600)

The prosecutor’s appeal of the earlier judgment stated that J.E. should be convicted of copyright infringement entirely in accordance with the indictment. Whether J.E. was convicted for the entire period claimed in the indictment or the very short period evidenced in the case, the prosecutor argued that SEK 4,000,000 (US$381,000) should be forfeited as proceeds of crime.

J.E.’s appeal requested the dismissal of the indictment in its entirety, along with the individual claims for compensation and the claim for confiscation of property as proceeds of crime.

Court of Appeal Considered Evidence Obtained During the Raid

In respect of the infringement period, limited by the lower court on evidential grounds, the Court of Appeal disagreed on the scope of the offending by considering evidence obtained by the police.

When J.E.’s home was raided on May 17, 2022, officers searched for the plaintiffs’ films on an IPTV device found on site. All but two of the films existed and were playable. At the time, J.E. claimed that the device used a service other than Scandinavian IPTV, but the Court dismissed that claim as unlikely.

In summary, the Court of Appeal found that, contrary to the conclusion of the lower court, J.E. should be convicted for infringing copyright for the entire period of time stated in the indictment.

The Court also found that the plaintiffs suffered reputational damage, for which J.E. should pay compensation: Svensk Filmindustri SEK 152,500 (US$14,500), and Nordisk Film SEK 252,500 (US$24,000), amounts that are included in the totals above.

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