Copyright Infringement

25 February 2005

Tomas Rudenstam

A Swedish student involved in cracking software was recently exonerated by a District Court from charges of copyright infringement. The student was a member of a global group, a “warez-group”, on the internet and was charged in Sweden on request by a court in Virginia, USA on the grounds of infringing a number of copyrights held by US companies. The District Court held that the student, by making the cracked software available for the other members of the warez-group on a number of restricted servers, did not make the software available to the public.

“Warez-groups” consist of members around the world that communicate through FTP-servers. A password and an approved IP address are needed in order to access the FTP servers. Such groups normally “crack” software and release it under the group’s name on the internet for anyone to use free of charge. “Cracking” means creating a program that circumvents the software’s existing access or copy protection. The warez-groups compete with each other in providing the latest and best cracked software.

During an infiltration operation by the US police against the warez-group “Drink or Die” (DOD), the student accepted a laptop as payment for future software cracking. By giving the infiltrating police officer his address, in order to receive the laptop, the student was identified and later arrested.

According to the Swedish Copyright Act, the copyright includes the exclusive right to control the work by reproducing it and by making it available to the public. It is illegal to commit an act which infringes this copyright if the act is committed wilfully or as a result of gross negligence.

There are special provisions in the Copyright Act on software that entitle the person who has acquired the right to use the software to make copies and adoptions that are necessary in order for the program to obtain interoperability with other programs or to correct errors, e.g. so-called reverse engineering.

The prosecutor claimed, before the District Court, that the student without consent reproduced the programs by downloading them from the FTP servers and later made the cracked programs available to the public by uploading the cracked programs back to the FTP servers.

The student admitted to downloading and cracking the programs but claimed that he made copies in accordance with the special provisions of the Copyright Act and never intended to make the cracked programs available to the public since the FTP servers could only be accessed by members of DOD. The cracked programs were mostly demo and evaluation versions which are free to download from publicly available websites.

The District Court held that the cracking of the programs in question was to be considered as permitted reverse engineering, as mentioned in the special provisions on software in the Copyright Act.

The number of members with access to the FTP servers was not established in the investigation so the court made an estimation of 50-100 members, based on information given by the prosecutor. Making the software available to this number of persons on restricted servers was not considered the same as making the software available to the public, according to the District Court.

The case was appealed in the Court of Appeal. In the appeal, the prosecutor claimed that the student was not entitled in the first place to make copies by downloading the programs to his computer, since the only purpose of the download was to crack the programs, not to use them. Since the student is not entitled to make individual copies, the provisions concerning reverse engineering are not applicable. By uploading the cracked programs to the FTP servers to people unknown to him, the student must have been aware of the possibility that the software would be further distributed to the public.

The prosecutor also claimed that the student had an economic interest in the cracking the software, e.g. by accepting the laptop and by having access to “free” copyright material on the FTP servers.