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Old 16-06-12, 02:06   #1
 
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Pirate DepositFiles Settles Multi Million Dollar Piracy Lawsuit

DepositFiles Settles Multi Million Dollar Piracy Lawsuit

Posted: 14 Jun 2012

As one of the largest files-sharing sites on the Internet, DepositFiles is visited by millions of users per day.

After the Megaupload shutdown the cyberlocker appeared to be one of the top alternatives. Aside from attracting new users, the site also grabbed the attention of Hollywood with the MPAA describing it as one of prime targets that should be dealt with next.

This is exactly what adult magazine publisher Perfect 10 has tried to do over the past months. June last year Perfect 10 filed a complaint against DepositFiles’ parent company, the Seychelles-based Kalmet Investments.

The publisher described DepositFiles as a “pirate website that sells access to large amounts of unauthorized intellectual property to the public without paying the rightful owners of that property” and demanded millions in damages for facilitating copyright infringement.

DepositFiles disputed the accusations, and both parties have been trying to convince the California District Court that they are right ever since. Earlier this year a schedule was setup to move the case to trial, but a recent filing reveals that this is not going to happen.

Both parties have reached a settlement that will be made official shortly. They therefore asked the Court to cancel all planned actions.

“Plaintiff Perfect 10, Inc. and defendant Kalmet Investments, Limited have reached a settlement in principle of this entire action. The parties are in the process of drafting a written settlement agreement and expect to execute it shortly.”

“The parties expect that all conditions of the settlement agreement will be met on or before July 16, 2012. Accordingly, the parties jointly move the Court to vacate all pre-trial dates so that they can devote all efforts to settlement efforts.”

Details on the settlement have not been disclosed, but it’s not unlikely that DepositFiles paid a sum of money to make the case go away. TorrentFreak contacted DepositFiles for a comment on the decision to settle but we were told that the company “cannot legally disclose anything on the issue.”

Perfect 10 are no strangers to lawsuits. From 2005 to the present day they have sued several huge companies for either allegedly using their images without permission or somehow being connected to infringements.

Notable among them are Google, Microsoft, Amazon and Yandex (for providing search engine results), Giganews, Megaupload, RapidShare, DepositFiles (hosting files) and Mastercard, Visa and CCBill for providing payment services for allegedly infringing sites.

Last month Perfect 10 added to this ever-growing list by suing the microblogging platform Tumblr.

A few settlements aside, the adult magazine publisher hasn’t been very successful in court. In 2010 Perfect 10 lost its case against RapidShare with the court ruling that the cyberlocker was not guilty of copyright infringement. Still, the legal endeavors must be successful enough for them to keep on going.

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Old 17-06-12, 09:05   #2
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

While the regular industry is not doing well in the western world, the lawyer "industry" is growing.

Not to use the word "extortion" and 'mob practices" but these people are trying to get money every way possible, as long as they don't have to make a honest living.
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Old 17-06-12, 19:20   #3
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

Perfect 10 is a prime example of an extortion troll. Their original site is one of xx images. Since they weren't doing all that well after a short time on the net, the new money making venture was to become an infringement troll. Basically the same as all of them; pay us to make it go away.

In it's past history, the part that refers to it not doing so well in it's cases, was that Perfect 10 tried to sue search engines for thumbnail reproductions, leading to it's images. The final outcome of the attempt was a court ruling that thumbnails were fair use and could not be used as a copyright infringement.

Most likely, Deposit Files has weighed how much it will cost to fight this in court (even though the end is likely that they would win the case), the possible outcome of negative publicity, the possible exposure of it's business model to investigation lines that might give other trolls ammunition (RIAA and MPAA), and decided that it's cheaper to pay up than to take the risk.

What is being exposed here, is that both copyright and patent protections are now acting as hindrances to innovation. This means that over the long haul, should this behavior continue, far less new products will come to the market for you to buy. The cost of innovation has to be weighed against the cost of production and the court fight. Those that can't innovate are preying on those that can.

In the end, it will take both the Supreme Court to rule on some form of protections against trolling and likely the Patent Office will have to make major steps in what qualifies as a patentable idea and stricter enforcement on what passes the patent process.
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Old 17-06-12, 20:28   #4
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

This reminds me of a ruling by a judge here.

In a case, the accused got off because the judge ruled that the picture on a website was virtual and not a real picture.

A virtual picture can be manipulated, altered with Photoshop, ect.

A lot of people can't grasp that virtual means virtual. This is where the lawyers smell money because the law does'nt know how to deal with this..

If you download something from the internet, it is not stolen, because the original is still there.
Did you copy the original? Not really, because you don't have access to the original (A physical item).
Did you copy a virtual copy? You probably did.
Maybe you borrowed something virtual and when it was trash you deleted it.

And there is so much trash arround on digital media.
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Old 17-06-12, 21:09   #5
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

Think a little deeper to understand that the internet is a game changer.

The browser/internet can not operate without being one vast copying machine. To look at a website, you must necessarily take a copy as it exists. This includes any copyrighted images for you to see it. The law has not yet caught up with the new technology as it usually takes between years and a decade to do so. Despite the fact we all use the net regularly, we often do not consider just how new the internet really is.

The argument you make on theft I've made many times. Sites supporting infringement as fair use for personal activity also make it for the same reason. Even the New Zealand government took this approach to claim that Kim Dotcoms' data wasn't stolen by the US when a copy was shipped to the US. The physical drives are still in the possession of the New Zealand authorities so it could not be stolen. It shows governments attempting to come to the realization that their laws no longer work without sorely needed updating to reflect the internet usage.
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Old 18-06-12, 10:31   #6
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

<<To look at a website, you must necessarily take a copy as it exists. This includes any copyrighted images for you to see it>>

I agree. Nobody knows if there is copyright on the images. The owner of the copyrighted images should register them as having copyright on them and in digital form, put a watermark on them as being copyrighted, with the name of the owner.

<<Even the New Zealand government took this approach to claim that Kim Dotcoms' data wasn't stolen by the US when a copy was shipped to the US. The physical drives are still in the possession of the New Zealand authorities so it could not be stolen>>

There you go. Should'nt this work both ways? I don't think MegaUpload had any stolen physical drives in their servers. The original media is still in the hands of the owner.
That is my point, we are talking about something virtual.

Because of lack of inspiration, the music, and movie industry bring out too much rubbish.
Because of that, sales go down, so the directors in the industry, with only interest in money, and not in the arts, bring their lawyer friends in, to squize some extra cash out of the public.

Many people download something to try it, look at it or listen to it, to see if it is any good, before they buy. It was normal in the old days. "Try before you buy"

Here, we are allowed to download from the internet, but only for personal use, at home.
We are not allowed to distribute. (sound a little bit like drug abuse)
We also pay extra for blank DVD's, memory stick's, new hard disks, to compensate for copyright.

The industry should review their business model and change it accordingly to the new technology. Same for the judicial system.
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Old 18-06-12, 18:56   #7
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Default Re: DepositFiles Settles Multi Million Dollar Piracy Lawsuit

A very nice, reasoned, response you've made, Al.Ternat. One I might add that on the whole I agree with.

I won't go into the details, it's too consuming and takes up too much space to actually supply examples along with the reasoning behind why it's not working in the court of law and why the entertainment industries are pushing this as they are.

I could also give you the reasons why the music industry isn't doing as well financially as it's heydays, and that the picture they paint is not accurate. It's for consumption to the public and for 'evidence' to point to when they need a new law; not necessarily the facts.

As in the past, the entertainment industry has had to be dragged, kicking and screaming all the while, into the newest technology. Sometimes they are successful in killing off new technology before makes it to the market where Average Joe can afford it. An example is DAT audio tape. Sometimes they just have to live with it being legal and then discover it's a gold mine. Such as the VCR, which had both the movie industry and the music industry after killing the technology. Only after it being ruled legal, was the best profit line to come to the movie business ever.

The point you make of 'try before you buy' is a valid one. Here you no longer hear the new stuff on the radio. Since payolla is illegal now, it is 'paid advertising' that is how it is done. The clue is the announcement of the artist and title that makes it legal. It's the same songs hour after hour. Two new songs a week exchanged with two old songs going off. The internet allows you to hear before you buy and the downloaders are the most fervent and avid fans. When you take them to court, you are suing your best customers. Name a business that survives that in the long haul.
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