Four major music companies will be able to continue to implement a “three strikes and you’re out” agreement with Eircom which cuts off the broadband connection of people repeatedly sharing music online.

The Supreme Court today upheld a challenge by four music companies to a notice of the Data Protection Commissioner which they feared would effectively unwind their “three strikes and you’re out” agreement with Eircom aimed at combating the widespread illegal downloading of music.

The companies claimed the commissioner’s enforcement notice of December 5th, 2011, directing Eircom to stop implementing the three strikes agreement, arising from his view it breached data protection and privacy laws, amounted to an unlawful and irrational attempt to reopen data protection issues already determined in their favour by the High Court.

In a High Court judgment of June 2012, Mr Justice Peter Charleton ruled as invalid the enforcement notice due to its failure to include any reasons specifying what provisions of the Data Protection Acts had been contravened by the protocol.

The state of the relevant law, particularly regarding the potential conflict between the privacy rights of some people and the intellectual property rights of others, had been “regrettably misconstrued” by the Commissioner, he said. “The law does not set intellectual property rights at naught because of the involvement of the internet.”

He dismissed further arguments the companies’ decision to seek judicial review of the Commissioner’s decision amounted to an abuse of process in circumstances where the the enforcement order had been appealed by Eircom to the Circuit Court.

The Supreme Court today unanimously dismissed the Commissioner’s appeal against the High Court decision.

Giving the judgment, Mr Justice Frank Clarke, with whom Mr Justice Niall Fennelly and Mr Justice Donal O’Donnell agreed, said significant and important questions relating to music piracy and intellectual property rights lay at the heart of the appeal.

Those issues could be summarised into the question whether the protocol, the product of a private contractual arrangement, could legitimately result in a subscriber to an internet service provider having their broadband terminated.

However, the specific questions the Supreme Court had to answer were much narrower, he said.

These were whether the trial judge had correctly quashed the notice on the basis of absence of reasons and whether judicial review was appropriate in this matter.

He found the trial judge correctly concluded there was “a complete absence of reasons” and therefore, the notice was unlawful and made in breach of Section 10.4 of the Data Protection Acts. It was particularly important Section 10 required such a notice to specify the reasons for the Commissioner having formed an opinion there has been a breach of data protection laws, he said.

He was not convinced, as argued on behalf of the commissioner, the reasons for the notice were obvious form the process engaged in. Legal certainty requires the reasons can be determined “with some reasonable measure of precision”, he said.

On the evidence and materials available, it was not inherently obvious why the protocol would involve a breach of date protection law, he added. The protocol, he noted, worked via Eircom getting IP addresses of suspected illegal downloaders from the record companies, writing an appropriate letter to the customer involved and invoking suspension or termination provisions as appropriate.

It was also relevant, while the enforcement notice was issued to Eircom, the music companies were potentially affected by it and, as such, were entitled to known the reasons so as to consider what legal options might be open to them.

The judge also ruled this was one of those cases where, exceptional to the general rule, the music companies were entitled to maintain judicial review proceedings despite the “highly conditional availability” of a statutory appeal against the commissioner’s notice and the fact the companies sought initially to join that appeal. Eircom had a right of appeal against the notice but the record companies had not, although it was possible they might be joined as a notice party, the judge said.

The proceedings were taken by EMI Records (Ireland), Sony Music Entertainment Ireland, Universal Music Ireland and Warner Music Ireland.

The enforcement notice was issued following the Commissioner’s investigation into a complaint from an Eircom subscriber about receiving a notification under the three strikes protocol, agreed with Eircom under a January 2009 settlement of court actions by the companies against it.

In January 2011, the Commissioner notified Eircom of a complaint by a subscriber who received a notification under the protocol but insisted he was not engaged in any illegal downloading.

Eircom investigated and told the commissioner in February 2011 it had discovered, due to a “minor technical issue”, its notification to that subscriber and 390 others was incorrectly issued but the relevant accounts would be amended to remove any record of infringement.

In September 2011, the Commissioner told Eircom the complainant subscriber had restated his original complaint and alleged Eircom’s monitoring of his internet use breached his data protection rights.

The Commissioner contended the monitoring activities being carried out by Eircom as an agent of the music companies under the settlement scheme were not permitted unless the internet users in question had consented to such monitoring.

Four major music companies will be able to continue to implement a “three strikes and you’re out” agreement with Eircom which cuts off the broadband connection of people repeatedly sharing music online.

The Supreme Court today upheld a challenge by four music companies to a notice of the Data Protection Commissioner which they feared would effectively unwind their “three strikes and you’re out” agreement with Eircom aimed at combating the widespread illegal downloading of music.

The companies claimed the commissioner’s enforcement notice of December 5th, 2011, directing Eircom to stop implementing the three strikes agreement, arising from his view it breached data protection and privacy laws, amounted to an unlawful and irrational attempt to reopen data protection issues already determined in their favour by the High Court.

In a High Court judgment of June 2012, Mr Justice Peter Charleton ruled as invalid the enforcement notice due to its failure to include any reasons specifying what provisions of the Data Protection Acts had been contravened by the protocol.

The state of the relevant law, particularly regarding the potential conflict between the privacy rights of some people and the intellectual property rights of others, had been “regrettably misconstrued” by the Commissioner, he said. “The law does not set intellectual property rights at naught because of the involvement of the internet.”

He dismissed further arguments the companies’ decision to seek judicial review of the Commissioner’s decision amounted to an abuse of process in circumstances where the the enforcement order had been appealed by Eircom to the Circuit Court.

The Supreme Court today unanimously dismissed the Commissioner’s appeal against the High Court decision.

Giving the judgment, Mr Justice Frank Clarke, with whom Mr Justice Nial Fennelly and Mr Justice Donal O’Donnell agreed, said significant and important questions relating to music piracy and intellectual property rights lay at the heart of the appeal.

Those issues could be summarised into the question whether the protocol, the product of a private contractual arrangement, could legitimately result in a subscriber to an internet service provider having their broadband terminated.

However, the specific questions the Supreme Court had to answer were much narrower, he said.

These were whether the trial judge had correctly quashed the notice on the basis of absence of reasons and whether judicial reveiw was appropriate in this matter.

He found the trial judge correctly concluded there was “a complete absence of reasons” and therfore, the notice was unlawful and made in breach of Section 10.4 of the Data Protection Acts. It was particularly important Section 10 required such a notice to specify the reasons for the Commissioner having formed an opinion there has been a breach of data protection laws, he said.

He was not convinced, as argued on behalf of the commissioner, the reasons for the notice were obvious form the process engaged in. Legal certainty requires the reasons can be determined “with some reasonable measure of precision”, he said.

On the evidence and materials available, it was not inherently obvious why the protocol would involve a breach of date protection law, he added. The protocol, he noted, worked via Eircom getting IP addresses of suspected illegal downloaders from the record companies, writing an appropriate letter to the customer involved and invoking suspension or termination provisions as appropriate.

It was also relevant, while the enforcement notice was issued to Eircom, the music companies were potentially affected by it and, as such, were entitled to known the reasons so as to consider what legal options might be open to them.

The judge also ruled this was one of those cases where, exceptional to the general rule, the music companies were entitled to maintain judicial review proceedings despite the “highly conditional availaibility” of a statutory appeal against the commissioner’s notice and the fact the companies sought initially to join that appeal. Eircom had a right of appeal against the notice but the record companies had not, although it was possible they might be joined as a notice party, the judge said.

The proceedings were taken by EMI Records (Ireland), Sony Music Entertainment Ireland, Universal Music Ireland and Warner Music Ireland.

The enforcement notice was issued following the commissioner’s investigation into a complaint from an Eircom subscriber about receiving a notification under the three strikes protocol, agreed with Eircom under a January 2009 settlement of court actions by the companies against it.

In January 2011, the Commissioner notified Eircom of a complaint by a subscriber who received a notification under the protocol but insisted he was not engaged in any illegal downloading.

Eircom investigated and told the commissioner in February 2011 it had discovered, due to a “minor technical issue”, its notification to that subscriber and 390 others was incorrectly issued but the relevant accounts would be amended to remove any record of infringement.

In September 2011, the Commissioner told Eircom the complainant subscriber had restated his original complaint and alleged Eircom’s monitoring of his internet use breached his data protection rights.

The Commissioner contended the monitoring activities being carried out by Eircom as an agent of the music companies under the settlement scheme were not permitted unless the internet users in question had consented to such monitoring.