U.S. cancels internet piracy notices while Canadians still get notices demanding settlement fees

After years of frustration and less than stellar results, a major U.S. anti-piracy group has given up its campaign targeting internet pirates. But in Canada, the chase goes on.

The U.S. Center for Copyright Information (CCI) has decided to stop sending warning alerts to Americans suspected of illegally downloading content.

No clear reason was given for abandoning ship. But CCI member, the Motion Picture Association of America, said that while the alert system was effective, it failed to stop serious offenders. 

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"A persistent group of hard-core, repeat infringers are unlikely to change their behavior," said the association's general counsel Steven Fabrizio in a statement.

"These repeat infringers are the ones who drive ongoing and problematic" piracy, he added.

Ending the program shows the difficulty content creators are grappling with, trying to curb internet piracy.

Canada also has a notice system in which suspected pirates often receive threatening letters. And while that system continues, it's been heavily criticized.

Some consumer rights advocates say it's out of control, claiming some notices are unjustly demanding money.

"It is just open to abuse," says Allen Mendelsohn, a Montreal lawyer specializing in internet law.

U.S. system 'a sham'?

The U.S. alert system was a voluntary initiative set up four years ago by major internet providers and content creators.

The providers agreed to send educational notices to customers whose internet accounts had been used to download infringing material — anything from movies to music.

After receiving six alerts, customers could face repercussions such as having their internet service temporarily downgraded.

The program was blasted by critics. In 2015, the Internet Security Task Force (ISTF), a group of independent movie studios, issued a statement condemning it as "a sham."

The ISTF complained the system was toothless and that providers were only sending notices to a small number of offenders.

The task force praised Canada's notice system, which is overseen by the federal government. Initiated in 2015 under the Copyright Modernization Act, it legally requires internet providers to forward warning letters to suspected pirates.

You don't have to pay

So does Canada run a model system? Not according to critics who claim it's being abused.

Like the U.S. system, the Canadian version was set up to educate pirates and encourage them to stop. However, Ottawa chose to place no clear controls over a warning letter's content.

"So, people sending the notices can pretty much write what they damn well please in those notices, including falsehoods," says Mendelsohn.

Some anti-piracy firms, on behalf of movie studios, routinely send out letters demanding hundreds of dollars in "settlement fees" from Canadians for alleged illegal downloads. And if they don't pay up, recipients are told they could face legal action and big fines.

The problem is, no one is obligated to pay a settlement — not even a penny. Internet service providers make this clear in the preamble they attach to every notice, which they are required to forward to subscribers.

But some people are still unsure of their rights, and in some cases say they are being falsely accused.

When Teresa O'Shea received a notice in late October demanding a payment of $334.62, she panicked. The 51-year old who lives alone in Trail, B.C., claims she has never illegally downloaded anything in her life.

"It just kind of freaked me out," she says.

Her internet provider emailed her the notice, but it was penned by Montreal-based anti-piracy firm Canipre on behalf of a film distributor. The letter said her internet account was used to illegally obtain a copy of Green Room, a horror movie involving a young punk rock band.

"I just thought, 'This is ridiculous. I didn't do it,'" says O'Shea, who believes her account was hacked.

She didn't want to pay the fee but also feared that not paying would lead to even more trouble.

"It still obviously makes you worried," she says. "'Oh my god, now they're going to come after me,' that was my first thought."

'When you steal, you should pay'

Mendelsohn says it's unlikely O'Shea would face any repercussions — even if she were guilty. The people writing the letter don't know her identity and would probably never recoup their costs if they launched a legal battle.

"They are preying on people's lack of knowledge about the situation," says Mendelsohn.

He joins other critics who want the government to rewrite the rules, explicitly laying out what can't be included in the notices — including cash demands.

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But Canipre says it's not breaking any rules and is simply trying to recoup what the industry has lost.

"It's not about a cash grab," says Barry Logan, the company's managing director. "It's about a recovery of loss. And when you steal, you should pay."

Logan, too, believes there are faults with Canada's notice system — he claims it's too weak. He says culprits should also get hit with a fine.

"It should be like parking tickets and speeding and other kinds of provincial offences," he says.

For now, Ottawa is refusing to budge. Innovation, Science and Economic Development Canada told CBC News it plans to review the notice regime, but not until late this year or perhaps in early 2018.

Media spreads the message

In the meantime, Mendelsohn says he has seen one positive development. He reports that fewer people are contacting him because they received a letter asking for a settlement fee and want to know if they must pay it.

Mendelsohn believes this could be because of current media attention about the notice system and consumer rights.

"People are definitely more informed," he says.

Those people include O'Shea. On the day she received a request for a settlement fee, she also heard a CBC Radio report about the issue. She says that gave her reassurance that she didn't have to pay up.