All you need to know about the Dallas Buyers Club saga

You would have heard by now that Dallas Buyers Club LLC (“Dallas”) is sending letters of demand to Internet subscribers for alleged illegal downloading of the movie Dallas Buyers Club. This is something new. Thus far, aside from the Odex saga which shall be explained below, individual downloaders have not been targeted for legal action by copyright holders in Singapore.

Identification of the downloaders

It has been reported that more than 500 Singapore Internet Protocol (IP) addresses of Internet subscribers have been identified as illegal downloaders. There are several ways this could have been done.

This has likely been done through software that tracks the downloader’s IP address on BitTorrent, a common channel for downloading files online. Due to the nature of Bitorrent, many downloaders are also “seeders” who share parts of the downloaded file with other downloaders. The IP addresses of BitTorrent users are publicly available when they seed.

Next, Dallas applied for a court order for Singtel, Starhub, and M1 to turn over the information of the subscribers linked to the IP addresses identified. Singtel contested the court order, but the court order stood, and hence Dallas obtained the subscriber information of those IP addresses.

Sending letters of demand

Based on the subscriber information, Samuel Seow Law Corporation, which represents Dallas, sent out letters of demand, asking for a written offer of damages and costs within three days of receiving the letter.

The legal speculation: What happens if the case goes to court?

What should you do if you have received such a letter of demand? Unfortunately, because this is the first of its kind, there is a lot of guesswork as to how the courts will decide should it reach a trial. Many lawyers have been interviewed in the press and their views are summarised below.

Difficulty in linking the IP address to the downloader: The subscriber who has the IP address identified may not be the downloader. That is because families share the same Wi-Fi connection, and if there is no password on the connection, then the download could have been made by anyone in the area. Friends and relatives may also visit the home and use the Wi-fi. It is not clear how it can be proven that a person is the downloader based on the IP address.

The amount of damages to be awarded is difficult to determine: Normal damages are based on compensation for actual or foreseeable loss, but in this case, it could be that each downloader only downloaded one copy for his own use. The loss would only be a small amount if calculated in this way. Dallas can opt to claim for statutory damages, which is provided for under the Copyright Act. For statutory damages, the court may grant up to $10,000 per infringing article. However, there is also no precedent to indicate what kind of statutory damages a single movie download could incur.

Groundless threats of legal proceedings: Section 200 of the Copyright Act potentially allows subscribers who are wrongfully threatened with letters of demand to claim against Dallas for “groundless threat of infringement”.

The reality

The sad reality is that the legal analysis may not be relevant. After all, the individual subscriber may not have financial means to take the case to court, and would rather pay a small sum to settle the case.

Dallas is likely to be open to settlement too, because going to court is more expensive than just sending out letters of demand. If the case goes to court, the company may have to provide security for costs, which could be a significant sum of money. Security for costs ensures that the defendants’ legal costs are covered if Dallas loses the suit, and usually applies where the firm filing the lawsuit is not based in Singapore. Dallas could have already succeeded in scaring potential downloaders.

The Odex saga

The Odex saga provides some clues for what might happen. Odex is a Singapore-based company that virtually distributes sub-licensed Japanese anime. In 2007, it hit the news for initiating legal action against certain internet service providers to obtain the personal information of downloaders, just as Dallas did.

Eventually, in Odex’s case against Pacific Internet, the court found that Odex was not the correct party to obtain the personal information of subscribers as it was only a sub-licensee. However, the Japanese anime studios who were the copyright owners, were authorised to obtain the personal information of subscribers directly. What is worth noting is that many of the individuals contacted by Odex, and subsequently by the Japanese anime studios, chose to settle out of court for thousands of dollars, signing non-disclosure agreements in the process (according to Wikipedia).

Going by the Odex example, for better or for worse, the Dallas Buyers Club saga may never reach the courts.