QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
MR JUSTICE BARLING
| KAREN MURPHY
|- and -
|MEDIA PROTECTION SERVICES LIMITED
Mr N Green QC, Mr E Jenkins QC and Mr A Robertson and Miss C May (instructed by Russell-Cooke LLP) for the Respondent
Hearing dates: 25, 26 June 2008
Crown Copyright ©
Lord Justice Stanley Burnton :
"dishonestly received a programme included in a broadcasting service provided from a place in the United Kingdom with intent to avoid payment of any charge applicable to the reception of the programme."
The Crown Court reduced the sentence imposed by the Magistrates so that the Appellant was fined £1,000 for each offence, and confirmed the order that the Appellant pay £5,000 towards the cost of the prosecution.
"The Premier League (referred to as FAPL in the papers from time to time) owns the intellectual property rights in relation to the screening of live Premier League football matches. It grants exclusive licences to licensees to screen live Premier League matches in the licensees' respective territories. In the United Kingdom and Ireland at all relevant times the sole licensee was BSkyB.
The programmes received by Ms Murphy had been uplinked to a satellite, the NOVA [i.e., the Hotbird] satellite, by a Greek television programme provider called NOVA. NOVA is the licensee for Greece for the football league's material. It provides viewers with a satellite dish, decoder and decoder card. NOVA viewers watching live Premier League games will see a special logo, the "Live S7" logo, on their screen.
NOVA uses conditional access technology (CAT) via satellite, which means that the viewer needs a decoder card to watch the live Premier League games. These cards are authorised by the licence for use in the territory of the licensee.
BSkyB also uses CAT via satellite. It provides decoder cards in return for subscriptions paid by the viewer (whether domestic or non-domestic) and retains ownership of the cards. Without such a card a viewer is not entitled to watch BSkyB Premier League games, and he is not entitled to use the card outside the territory for which BSkyB is licensed.
Both the BSkyB satellite and the NOVA satellite have a "footprint" extending beyond the territorial limit of the licences they enjoy from the Premier League. Any person within a broadcaster's "footprint" who has the appropriate satellite dish, decoder box and decryption card is technically capable of viewing the programmes provided by that broadcaster as part of its broadcasting service.
On 19th August 2006 and 25th September 2006, two matches, Bolton Wanderers v. Tottenham Hotspur and Portsmouth v. Bolton Wanderers, were screened on television sets at Ms Murphy's Public House, the Red White and Blue at Southsea in Hampshire.
So far as the making of the programmes was concerned, BSkyB had provided the crew, cameras and other equipment at the grounds of both games for the purpose of capturing the visual images and ambient sound from the grounds and its onward transmission to the viewers. The visual images and ambient sound from the grounds were seen at the same time wherever in the world the live Premier League games were being screened. The director chose the visual images to be screened by selecting the visual images captured by specific cameras. The sequence of images accompanied by ambient sound was sent to the BT Tower, from where feeds were sent to BSkyB and to the Premier League at Chiswick. At BSkyB, additional material (including a commentary) and the BSkyB live logo were added in real time to the feed and sent on to the satellite ground station at Chilworth in Hampshire, from where it was uploaded to the Astra satellite from which it was transmitted to BSkyB's subscribers for live Premier League matches. At Chiswick, the Premier League adds an English commentary to the feed, which is then encrypted and sent to NOVA in Greece by a satellite link. NOVA add material to the feed (including an optional Greek commentary and their "Live S7" logo) and from time to time other material such as advertisements. The material assembled in this way is then uplinked to the NOVA satellite with a view to its ultimate reception by subscribers to the NOVA satellite service.
The visual images and ambient sound captured at the grounds are thus identical in the uplinks from BSkyB and from NOVA to their respective satellites, save that the visual images will have the broadcaster's logo added. The additional material (advertisements and the like) is different, as are the respective English commentaries, BSkyB's originating in-house and NOVA's originating with the Premier League.
When the two premiership matches to which we have referred were transmitted and received, Ms Murphy did not have a subscription with BSkyB. She had cancelled that subscription on the grounds of expense on becoming licensee of the Red White and Blue. She did have a satellite dish, a decoder box and a NOVA viewing card that enabled her to receive and view programmes originating with the NOVA satellite. The television pictures of the two matches both carried the "Live S7" logo, confirming that the signals had come via NOVA."
"Members of the public are able to watch SuperSport channels by subscribing to the relevant NOVA bouquet of channels. These subscriptions are available, together with NOVA decoder cards, set top decoder boxes and other associated hardware, from about 1600 retail outlets in Greece. They may be taken out for up to 12 months and the subscriber must provide a name, local Greek address, and a local Greek telephone number. Subscriptions can be taken out for private or commercial purposes. In the case of a private subscription the subscription agreement provides the subscriber is only permitted to view the NOVA bouquet of channels for his and his family's personal use and only at his home or workplace."
"The Subscriber is obliged to use the access card for access to the Subscriber Services, exclusively and solely in his residence or his workplace for use exclusively and solely by himself and his family. The usage in coffee shops, hotels, specific recreation places and in every place and for any usage which is not agreed herein, as well as the temporary or systematic commercial exploitation of the Subscription Services, is indicatively prohibited. The Subscriber assumes the obligation to notify to [Multichoice Hellas] any change in the address of his residence or his workplace, which has been reported in the signing hereof."
"... the fact that the NOVA cards were procured and activated by providing false names and addresses."
In support of this the Respondent referred to the second witness statement of the same witness at para.18. There the witness states:
"... the NOVA Greece smartcard flow to the UK has been determined to be as follows:
18.1 In respect of each card, a person establishes a legitimate subscription account (generally on a pre-paid 12 month basis) in Greece using false data identifying that person as being a resident of Greece.
18.2 This person either directly or via a middleman establishes a sales point in the UK, either via a website, local kiosk or word of mouth to solicit persons or pubs etc who wish to illegally view the NOVA Greece service in the UK.
18.3 Once a person, pub or other establishment (i.e. 'client') in the UK agrees to purchase such a smartcard, the smartcard associated with a new account is activated by a local caller in Greece based upon the previously provided false or misleading subscription data.
18.4 The smartcard is taken out of Greece and delivered to the client for use in a compatible set top box and satellite system that is set up to receive NOVA Greece satellite signals."
"Overall, and having heard Mr Papastathopoulos, I do not accept that NOVA has consented explicitly or implicitly, to the sale or use of NOVA cards outside Greece. Nor do I accept it has turned a 'blind eye' to such activities or encouraged them or created any expectation they are acceptable."
"A person who dishonestly receives a programme included in a broadcasting service provided from a place in the United Kingdom with intent to avoid payment of any charge applicable to the reception of the programme commits an offence and is liable on summary conviction to a fine not exceeding level 5 on the standard scale."
The case stated
"Does the requisite intent to avoid any charge applicable to the reception of the programme within s.297(1) apply to circumstances where the Appellant paid a charge to AV Station and then receives the programme from NOVA, a foreign broadcaster, does not pay any other fee to any other broadcaster, in this case BSkyB as the domestic broadcaster in question?"
"The requisite intent to avoid a charge is proved if it is shown that the defendant knows that the broadcaster has the exclusive right in this country and makes a charge for reception of its broadcasts, and he or she makes arrangements to receive its broadcasts without paying that charge. The fact that a charge is paid to a broadcaster who the defendant knows does not have the right to broadcast in this country is not inconsistent with an intent to avoid the UK broadcaster's charge."
The EC law arguments
"The objective of this Directive is to approximate provisions in the Member States concerning measures against illicit devices which give unauthorised access to protected services."
"Member States shall prohibit on their territory all of the following activities:
(a) the manufacture, import, distribution, sale, rental or possession for commercial purposes of illicit devices;
(b) the installation, maintenance or replacement for commercial purposes of an illicit device;
(c) the use of commercial communications to promote illicit devices."
"Internal market principles
1. Each Member State shall take the measures necessary to prohibit on its territory the activities listed in Article 4, and to provide for the sanctions and remedies laid down in Article 5.
2. Without prejudice to paragraph 1, Member States may not:
(a) restrict the provision of protected services, or associated services, which originate in another Member State; or
(b) restrict the free movement of conditional access devices;
for reasons falling within the field coordinated by this Directive."
"illicit device shall mean any equipment or software designed or adapted to give access to a protected service in an intelligible form without the authorisation of the service provider."
i) "Illicit device" is limited to "pirate" devices and
ii) Article 3(2)(b) prohibits Member States from restricting the free movement of any conditional access device which is not an illicit device.
i) The perceived "mischief" to which the Directive is directed are the disparities between national measures designed to protect services based on conditional access devices.
ii) Such disparities create obstacles to free movement and therefore to the creation of the internal market which require to be addressed by approximation of national rules relating to the marketing of "illicit devices".
iii) To this end Member States are required to take certain measures against the manufacture, marketing, possession etc of "illicit devices" (Articles 3.1 and 4).
iv) These measures, albeit clearly capable of affecting cross-border provision and reception of goods and services, are considered by the Community legislature to be justified and proportionate as a matter of EC law (see for example recitals 11 to 15 and 21).
v) Article 3(2) appears to be doing no more than making clear what would otherwise be implicit, namely, that save as provided by Article 3(1) the Directive is not to be taken as requiring or authorising restrictions on cross-border trade in protected services and conditional access devices (including at least theoretically) illicit devices.
vi) In other words, the Directive provides for some limited derogations from the application of the free movement principle, in the case of "illicit devices" only, with the aim of removing the existing disparities between national measures which themselves create obstacles to the internal market.
Free movement of goods and services Articles 28 to 30 and 49 EC Treaty
"It follows, however, from the Court' s case-law that national measures liable to hinder or make less attractive the exercise of fundamental freedoms guaranteed by the Treaty must fulfil four conditions: (i) they must be applied in a non-discriminatory manner; (ii) they must be justified by imperative requirements in the general interest; (iii) they must be suitable for securing the attainment of the objective which they pursue; and (iv) they must not go beyond what is necessary in order to attain it."
Section 297(1) is discriminatory
"... the mere fact that the owner of the copyright in a film has granted to a sole licensee the exclusive right to exhibit that film in the territory of a Member State and, consequently, to prohibit during a specified period, its showing by others, is not sufficient to justify the finding that such a contract must be regarded as the purpose, the means or the result of an agreement, decision or concerted practice prohibited by the Treaty."
"The court has consistently held (CF. joined cases 56 and 58/64 Consten & Grundig v Commission  ECR 299) that absolute territorial protection granted to a licensee in order to enable parallel imports to be controlled and prevented results in the artificial maintenance of separate national markets, contrary to the Treaty ."
It should be noted that in the Coditel cases the licence was open, not closed.
"It is apparent from the foregoing that the parties are approaching the issue from fundamentally different perspectives as to the correct legal approach. The defendants say that Community policy as to cross border broadcasting is evident from the series of legislative measures to which I have referred and, in the event the interpretation of Directive 98/84/EC for which they contend is correct, it may be presumed that the export restriction has, as its object, the restriction and distortion of competition and it is enough to show there is a danger that trade between Member States will be appreciably affected. The claimants, on the other hand, say that it is inherent in the specific subject matter and essential function of copyright for broadcasts that rights may be licensed to exclusive licensees in particular Member States. In short, exclusive licenses of performing rights do not per se infringe Article 81, even though they confer absolute territorial protection and might prevent transmission into a neighbouring state. This, it seems to me, is a question which is so intimately tied to the other issues of interpretation I have discussed that I believe it too should be referred to the Court of Justice. I would ask the Court what legal test the national court should apply and the circumstances it should take into consideration in deciding whether the export restriction engages Article 81."
Reference to the ECJ.
i) Both sides have emphasised the importance of the questions of EC law which are raised. We are told that a good many prosecutions are awaiting the outcome of the current appeal. These are cases in respect of which the EC law issues are material. (There will of course also be prosecutions under s. 297(1) which do not involve any issues of EC law. We refer again to these below.) Moreover the EC law issues in this case are clearly such that their resolution may well have a substantial impact on the way in which programmes of the kind with which this case is concerned are licensed and broadcast throughout the EU, and on the ways in which the intellectual property rights in question are remunerated and in which competition takes place in the relevant markets. This possible impact would clearly also have consequences for consumers throughout the EU, and in particular for the variety and availability of the relevant services to the public and the prices charged for them.
ii) The answers to the questions of EC law raised are not clear. In each case there are respectable arguments on both sides. Nor are any of the issues so clearly governed by existing ECJ case law as to render a reference empty of purpose. The issues are neither acte claire nor acte ιclairι. They are of such a nature that in our view authoritative guidance on them from the ECJ is required.
iii) As explained earlier, the facts relevant to this case have been ascertained to the extent necessary in order to formulate appropriate questions for the ECJ, the answers to which will enable this Court to resolve this appeal.
iv) It is possible that it will appear from the judgment of the ECJ that insufficient inquiry into the facts was made in the court below. However, it is clearly important to obtain the comprehensive opinion of the Court on the legal issues that we now see do arise. Whether there should be any further factual inquiry may be determined after the Court has given its judgment. Against that, it would be quite wrong for this appeal to fail on the basis of what was subsequently found to be an incorrect application of EC law.
v) We have also taken account of the desirability of resolving this appeal, including the issues of EC law which arise, as expeditiously as possible given the importance of the case. If we were not to make a reference and had decided these issues ourselves it is highly likely that a petition would be lodged with the Appeal Committee of the House of Lords along with an incidental petition for a preliminary reference. In those circumstances the Appeal Committee would be subject to Article 234(3) of the Treaty with the result that a reference to the ECJ at that stage would be a very real possibility. Such a situation would prolong both the delay and the legal uncertainty. Referring the issue at the present stage avoids the risk of such additional delay with all the additional expense which it would entail.
vi) A reference at the present stage has a further advantage. It means that it can be sent to the ECJ at about the same time as the reference which is being made by Kitchin J in the FAPL case. This opens the possibility, if not of formal joinder of the cases in the ECJ, of at least informal co-ordination of written and oral pleadings before the same chamber of that Court. Such co-ordination can bring obvious benefits to the parties, any interveners and the ECJ itself. While there is not complete commonality of issues as between this appeal and the FAPL case, there is sufficient overlap of issues raised to make co-ordination of the references highly desirable.
Other prosecutions under s. 297(1)
"It is a fundamental principle of the law of the European Union ... recognised in s.2(1) of the European Communities Act 1972, that if national legislation infringes directly enforceable Community rights, the national court is obliged to disapply the offending provision. The provision is not made void but it must be treated as being (as Lord Bridge of Harwich put it in R v Secretary of State for Transport, ex parte Factortame  2 AC 85, 140):
'without prejudice to the directly enforceable Community rights of nationals of any Member State of the EEC.'"
"... when deciding an issue concerning a situation which lies outside the scope of Community law, the national court is not required, under Community law, either to interpret its legislation in a way conforming with Community law or to disapply that legislation. Where a particular provision must be disapplied in a situation covered by Community law but that same provision could remain applicable to a situation not so covered, it is for the competent body of the state concerned to remove that legal uncertainty insofar as it might affect rights deriving from Community rules."
By way of example, the issues of EC law raised in the present case do not affect prosecutions resulting from the dishonest use of decoder cards which are "pirate" or counterfeit or which have been stolen.