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How the battle was won: Gadens lawyer deconstructs Stevens v Sony, by Nathan Mattock
17 Oct 2005
At 10am on 6 October 2005, Mr Eddie Stevens and Gadens Lawyers attended the High Court of Australia to collect the much anticipated judgment on Stevens’ four-year battle against the multinational corporation Sony.
After losing the first appeal in the Federal Court, Mr Stevens had nowhere else to turn but the High Court. Fortunately for Mr Stevens, the High Court agreed with him. All six judges ruled that Sony’s Playstation did not warrant the protection of the Copyright Act which Sony had contended. Mr Stevens has been heralded around the world as a champion of consumer rights.
For Sony, it’s game over. Mr Stevens is not liable to them for damages or costs as a result of any breach of the Copyright Act.
Sony’s Playstation - the so-called anti-piracy device
Sony’s Playstation games contain a large amount of data which, when loaded into a Playstation console, enable a user to play a computer game. Within this large amount of data is an extremely small piece of information known as an "access code". Without this access code the game cannot be played in a Playstation console.
An important feature of the access code is that it only permits the owner of the game to play the game in a designated console. Through this Sony has been able to divide the world into different regions, vary its prices in each region and only allow a consumer to play a game from his or her region on his or her regional console. This means a consumer in Australia cannot buy a legitimate game from the USA or Japan and play that game on an Australian console.
The access code cannot be copied by conventional means. The remainder of the disc (which stores the computer game) data can be copied, but not the access code.
It is this access code and its interaction with the console which Sony argued was an anti-piracy device, designed in its ordinary course of operation to prevent or inhibit the infringement of copyright.
A significant aspect of Sony’s argument (which ultimately caused it to fail) was that the access code did not prevent a person from illegally copying a Playstation game. The access code only prevented the person from playing the illegal copy of the game in a Playstation console.
Mr Stevens’ chip
To get around Sony’s access code, Mr Stevens installed a computer chip or "mod chip" into Playstation consoles. This chip enabled a person to play a game purchased from a different region in his or her console. The chip, as an unfortunate by-product, also enabled a person to play a pirated game in a console.
The case brought by Sony – trapping Mr Stevens
In 2001, Sony sent lawyers from a Sydney law firm to Mr Stevens’ rented house to purchase mod chips from Mr Stevens. Using that information, Sony commenced Federal Court proceedings against Mr Stevens claiming that the sale of mod chips by Mr Stevens constituted a breach of provisions of the Copyright Act.
Sony’s case can be split into three parts. Sony’s arguments are as follows.
- The access code used by Sony constituted a "technological protection measure" as defined in the Copyright Act and the mod chip sold by Mr Stevens was a "circumvention device" which was illegal.
- The playing by a consumer of a game constituted an illegal copy of the game into RAM, which Sony had the right to control by the use of the access code. The access code therefore is a "technological protection measure" which prevents the making of a copy of a film embodied in the RAM.
- A computer game is also a cinematograph film, of which a substantial part is copied into RAM when played. The Copyright Act treats the infringement of copyright in cinematograph films differently to that of computer games.
Mr Stevens’ defence to these three claims are:
- Sony’s access code was not a "technological protection measure" because it did not prevent or inhibit the making of an illegal copy of a game. Sony’s access code only prevented the playing of the illegal game.
- By playing a game, a user does not make an illegal copy of the game into the RAM of the console because the game could not be "reproduced". This is a requirement of the Copyright Act.
- Sony did not prove that a "substantial" part of the film was copied into RAM (assuming that a game is also a film).
The High Court: 6 – 0, Stevens wins
The High Court delivered its unanimous judgment in favour of Mr Stevens.
Technological Protection Measure
The judgment deals with the technical aspects of Sony’s access code, which Sony argued was a "technological protection measure". The important aspect of the definition of a technological protection measure, which the High Court considered in this case, was whether the device used by Sony "prevented or inhibited the infringement of copyright in a work".
The High Court held that Sony’s device did not prevent or inhibit the infringement of copyright. Sony’s device only prevented or inhibited the playing of an infringing copy of a game. The distinction lies in the fact that a person can illegally copy a Playstation game without any impediment. This is not like DVDs which are encrypted and encoded so that a copy of the movie cannot be made. The Sony Playstation access code only prevented the person playing the illegal copy, once made. The access code did not prevent piracy.
The High Court also said that if they adopted Sony’s arguments it would produce a result where a lawful use of the mod chip; that is, playing a game legitimately purchased in another country would be unlawful. Sony’s attempt to segment the market using its access code and outlawing "mod chips" was struck down by the High Court. A consumer who buys a game in the USA or Japan has a legitimate right to play that game on his or her Australian console and modify his or her machine to enable him or her to do so.
A salient aspect of the legislation which persuaded the court to reject Sony’s argument was that criminal sanctions apply to the selling of devices (circumvention devices) which "get around" technological protection measures. Given the severity of the outcome the High Court used "caution in accepting any loose, albeit ‘practical construction’" propounded by Sony.
Sony argued that in practice the access code prevents or inhibits infringement because if a person is unable to play the pirated game the infringement of copyright is impractical. The High Court disagreed.
To add a little spice to the reasons of the court, Justice Kirby also noted that there may be some constitutional limits which may constrain the government from enacting amendments to the Copyright Act to keep copyright owners, like Sony, happy following this judgment.
Copying into RAM
The High Court rejected Sony’s argument that by playing a Playstation game the person using the game is making a copy of the game in RAM, which is an illegal copy. The definition of what constitutes an illegal copy in the Copyright Act hinges on the words "material form". The important aspect of this definition is that in order for an illegal copy to be made in RAM the work must be able to be "reproduced" from the copy.
In the DVD case (AVRA v Warner – in which Gadens Lawyers also acted) and in the Stevens case, the courts held that a copy into RAM was temporary, ephemeral and a copy cannot be made from the RAM without the use of additional hardware or software to extract the copy. For those reasons Sony failed. The court held that a copy made of a game in the RAM is not an illegal copy.
Copying of a cinematograph film
Sony also argued that the playing of a game constituted a copy of a substantial part of a cinematograph film. Interestingly, and it looks like the next test case in the games area, the High Court expressed some doubt (but did not decide) about whether a computer game was also a film under the Copyright Act. In earlier cases in the Federal Court, the court held that a computer game was also a film. This seems strange to the lay person, and strange to many lawyers as well!
In short, the High Court agreed with Mr Stevens that in order for Sony to succeed a "substantial part" of the film must be reproduced in RAM. Unfortunately for Sony, it failed to prove that case.
Of interest is Justice McHugh’s reasons for rejecting the argument that a computer game when played in the RAM is a "cinematograph film". If any new case were to run before the lower courts in Australia, a very strong case could be put for following Justice McHugh’s reasons and rejecting the argument that a computer game is also a "cinematograph film".
Stevens to celebrate
The victory by Mr Stevens has been heralded around the world. Tributes to Mr Stevens’ tenacity, guts and will to fight a large multi-national company have flowed thick and fast. Mr Stevens deserves all the credit that has come his way. He worked hard, never gave up, and as he said after the High Court judgment was handed down, "If you believe something is right, why would you not fight it?".
For more information, contact Nathan Mattock, Sydney Litigation Division.
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