P2P OPERATOR KURO FOUND GUILTY IN TAIPEI COURT

UNCLAS TAIPEI 003777

SIPDIS

STATE FOR EAP/RSP/TC AND EB/TPP/IPE, STATE PASS AIT/W AND
USTR, USTR FOR WINTERS AND WINELAND, USDOC FOR
4431/ITA/MAC/OPB/TAIWAN/MBMORGAN

E.O. 12958: N/A
TAGS: KIPR TW IPR
SUBJECT: P2P OPERATOR KURO FOUND GUILTY IN TAIPEI COURT

REF: TAIPEI 2909


1. On September 9, Taipei District Court found Peer to Peer
(P2P) website operator Kuro guilty of enabling users to
violate Taiwan's copyright law. Almost two years after
Taiwan prosecutors filed a criminal case based on complaints
from the International Federation of Phonographic Industries
(IFPI),the Court sentenced Kuro President Chen Shou-teng to
two years in prison and each of his two sons, Chen Guo-hsiung
and Chen Guo-hua to three years in prison. The Court fined
Kuro NT$3 million (about US$93,000). The Court also
sentenced Chen Jia-huei, a Kuro user named in the complaint
for downloading 900 songs, to four months. Chen Jia-huei's
sentence can be commuted to a fine of NT$300 per day
(US$9.24) and three years probation. Criminal sentences of
up to six months can be commuted by paying the daily fine.


2. The Taipei District Court decision comes two months after
the seemingly contradictory June decision of the Shilin
District Court that P2P file sharing web site EZPeer was not
guilty of copyright violation for allowing users to use its
service to download and trade copyrighted materials. It also
follows just days after an Australian court ruled that P2P
pioneer Kazaa was liable for the copyright infringing
activities of its members.


3. The decision, while not banning P2P software, cited
Kuro's primary service as providing paying members with the
ability to swap copyrighted materials as violating several
provisions of Taiwan's copyright law. In differentiating
between its decision and the decision of the Shilin court in
the EZPeer case, the Taipei District Court noted that Kuro,
in its advertisements and on its website, encouraged users to
engage in illegal downloading of copyrighted materials.


4. Comment: This is a welcome decision from the Taipei
District Court and, at first reading, appears to track with
the recent US decision in the Grokster case which found that
Grokster was liable for the copyright infringing actions of
its members in part due to its promotion of
copyright-violating activities. The Taiwan Intellectual
Property Office (TIPO) and IFPI welcomed this decision,
especially as both were disappointed with the judgment of the
Shilin court in the EZPeer case. Kuro, meanwhile, has not
yet issued a public statement but is virtually certain to
appeal. End comment.
KEEGAN