Wednesday, November 25, 2015

CEG TEK Settlement Demands: What are They?

I frequently get calls from individuals who ask me about an email they received from their ISP.  In it, their ISP informs them that they have been accused of copyright infringement, and the email includes information about the infringement in the lower portion of the email.  Most often, the email includes something called a "Case #" and a password.  Then the email invites you to visit and pay them some money.

Everyone who gets one of these immediately freaks out and thinks they've been sued for copyright infringement and their life is over.  They see visions of $150,000 default judgments dancing in their heads.  Wait. Before you freak out, go read my post about catastrophizing and calm down.

You have not been sued  

What you got is something referred to in the law as a DMCA takedown notice.  It is not notice of a lawsuit.  It's not even notice that a lawsuit is about to be filed.  It is a notice that a copyright owner is required to send to an Internet service provider -- like Comcast or Charter -- about suspected copyright infringement using that ISP's service.  In other words, it's actually a notice to Comcast (not you) telling Comcast that someone is suspected of using their service to violate the copyright laws.

Why Did Comcast Get It?

Why did Comcast get that notice?  Well, because the copyright laws obligate the ISP to do something about it or else the ISP is liable for the copyright infringement.  Let me say that another way.

Let's assume that someone (a subscriber) actually committed copyright infringement using the ISP's service.  That's a pretty big assumption because they are very often wrong, but let's make that assumption now.  Under the DMCA, the ISP is immune from liability for copyright infringement committed by any of the ISP's subscribers.  In other words, the subscriber might be liable for copyright infringement, but the ISP is not, as long as the ISP does what the DMCA requires.

So what is the ISP required to do to ensure that it is not liable for its subscriber's infringement?  One thing is respond promptly when a copyright owner gives the ISP notice of copyright infringement.  So when CEG TEK sends one of these notices to Comcast, unless Comcast honors that notice and does something about it, Comcast will be liable for its subscriber's infringement.  And since Comcast has lots of money (probably a lot more than any one of its subscribers), CEG TEK sends the notice to Comcast to try and make Comcast liable for its subscriber's infringement.  And unless Comcast (or whatever ISP) does something about the notice, then Comcast will be on the hook for potentially lots of money.  ISPs don't like that idea.

Why Did You Get It? 

Why did Comcast (or whoever your ISP is) send you the notice?  Well, to put it bluntly, because CEG TEK asked them to.  Note that I said the ISP has to do something to try and stop the alleged infringement or else the ISP becomes liable itself.  Coincidentally, CEG TEK includes right in its DMCA takedown notice a request for the ISP to forward that notice on to the subscriber directly.  

Now since the ISP is required to do something about the allegation of infringement, it might as well do exactly what CEG TEK asked. So the ISP sends the notice to the subscriber.  That way the ISP remains immune to liability.  And that is why you got a copy of the notice that was intended for your ISP.

What Should You Do About It?

This is the million dollar question.  All the people who call me ask:  What should I do?  And again, there is not one good answer.  What you should do typically depends on whether you did it or not.  

If you didn't do what you are accused of doing, the answer is simple.  Don't do anything.  In my opinion, if you know there is no way you are responsible for the copyright infringement you are accused of in that notice, then ignore it.  Some people worry too much to just let it go, but as far as I'm concerned you should not even consider paying a dime for something you know you didn't do.  

If maybe you did do it, then consider your options.  Or if maybe someone you know did it, again consider the options.  What are those options?  You have two:  Ignore the notice or pay the money.  That's it.  Two very clear options.  

Most people understand those are the options, but what they really want to know is how likely are they to get in real trouble if they pick Option A and ignore it.  If they don't pay, are they likely to get in even bigger trouble later?  I can't say yes, but I can't say no either.  CEG TEK (or at least its founder, Ira Siegel) used to file lots of copyright infringement suits.  I'm sure they made good money doing it, but they also got some heat too.

But it does not appear that CEG TEK is filing many suits these days.  It seems they are content to accept voluntary payments by people who receive these notices.  Does that mean they won't start suing people again?  Some other smart people suggest that they almost have to in order to compete with the other copyright assertion folks.  That logic makes some sense, but if they aren't suing people now, the real question is how risk averse are you?

What Is Peace-Of-Mind Worth To You?

So if you got one of these notices and you did what you are accused of doing, ask yourself how much risk are you willing to tolerate?  Some people I speak to say they are willing to risk being sued because the risk is fairly low.  For those people, that's the right decision.  Other people I speak with say that the peace-of-mind of knowing that this issue is behind them is worth the two or three hundred dollars that CEG TEK is demanding.  

Don't get me wrong.  Three hundred dollars is a fair amount of money.  But it's nothing compared to what the other copyright assertion companies demand when they file suit.  Make no mistake about it:  If you turn your back on the settlement number now, it will not be there later if a law suit gets filed.  

So you have to decide for yourself if you are comfortable with a small risk of paying a lot more money later in a messy law suit, versus the certainty of being out of pocket a few hundred dollars now but with peace-of-mind.  For many people, they kick the can and take their chances.  And so far, that risk has probably been worth it.  I am unaware of any lawsuits that CEG TEK has filed lately.  But if that notice is keeping you up at night, as they sometimes do, consider paying the money just to ease your mind.  The stress and heartburn just aren't worth a few hundred dollars.

I have to wrap up by reiterating my earlier advice:  If you didn't do what you are accused of, you should not even consider paying a dime.  Nothing.  Nada.  

Rest assured that sometimes these bittorrent "investigations" just get it wrong.  I have spoken with many accused people who denied doing anything wrong.  Sometimes I can tell they just don't want to admit it, but many times it is clear they didn't do it.  Little old ladies who live alone and need help to check their email on their ten-year-old computer didn't do it.  I never, never, never recommend that those people should even consider paying.  

Hopefully this has helped at least some of you better understand what that email means, and what you should do about it.