The Digital Millennium Copyright Act (DMCA) is a tool that is frequently used at the intersection of copyrighted works and digital technology. Nigel Jones has worked successfully with both plaintiffs and defendants in cases involving the DMCA. For example, while working for DISH Network in its anti-piracy efforts, Mr. Jones helped DISH Network amass judgements of over $1B. As another example, Nigel Jones helped defendant Tri-State Surgical fend off a DMCA claim of tens of millions of dollars for allegedly circumventing the copy protection mechanisms built into a software application.
Point 4 Data Corporation et al v. Tri-State Surgical Supply & Equipment Ltd., et al
Plaintiffs Point 4 Corporation and Dynamic Concepts sued Tri-State Surgical for tens of millions of dollars, alleging that Tri-State had circumvented the copy protection of an accounting software package. Nigel Jones was retained by the defendants to help them understand and respond to the plaintiffs’ technical claims.
At the heart of the case was a security dongle that plaintiffs supplied with their software in order to impose license restrictions. The defendants had continual problems with the dongle malfunctioning, resulting in their accounting and order taking system being inaccessible. After a particularly long outage, Tri-State paid a third-party to modify the binary image of the underlying software such that the dongle was no longer operative. When the plaintiffs became aware of this modification, they sued under various statutes, including claiming statutory damages under the DMCA for every time a Tri-State employee logged on to the software.
After examining the dongle and the relevant software, Nigel Jones was able to show a number of key things, including:
- That the dongle was being operated outside its design envelope and thus random startup failures were to be expected, consistent with the defendants’ experience. Since the DMCA has a specific exclusion for malfunctioning dongles, this was a very important finding.
- That despite the dongle no longer being operative, Tri-State’s computer configuration was such that Tri-State was still abiding by the terms of the license agreement in terms of the number of users. This finding effectively eliminated the plaintiffs’ claims that Tri-State should be forced to pay for an unlimited user license.
- That the actual security used by the plaintiffs was obsolete and easily circumvented, thus undercutting the plaintiffs’ claims for damages necessary to re-engineer their security systems.
After a multi-year litigation, the trial court ultimately entered judgement in Tri-State’s favor. Tri-State is now seeking an award of fees incurred in defending themselves against this action.
DISH Network v. NDS
Nigel Jones was a key expert witness for the victorious defendant in a case described by media as the largest corporate espionage case in U.S. history. Mr. Jones was retained by News Corporation’s NDS Group (now known as Cisco Videoscape) in a $1.6B piracy lawsuit brought by DISH Network (formerly EchoStar) in the U.S. District Court for the Central District of California. Mr. Jones analyzed the source code in the smart card at issue, and investigated the hacks that were promulgated on the Internet, allegedly by the defendant. He demonstrated to the jury both errors in the opposing experts’ analysis and also that the hack did not emanate from the defendant’s reverse engineering.
After a five-week trial and six hours of deliberations, jurors ruled in favor of NDS on most of the allegations. In denying many of the claims, the jury awarded actual damages of $45.69 (or statutory damages of $1,000), relating to a single incident involving a test card used by NDS. The Daily Journal called the victory one of the top 10 California defense verdicts of 2008.
The Ninth Circuit further awarded defendant NDS $18M in costs, stating in its decision that “There is no question that NDS successfully defended against all of EchoStar’s claims based on or related to its theory that NDS was responsible for the compromise of EchoStar’s satellite television programming security system.”
Subsequent to the Ninth Circuit’s decision, DISH Network retained Nigel Jones as an expert in a series of cases against vendors of Free to Air Satellite TV receivers.
DISH Network v. Sonicview
After Nigel Jones helped NDS defeat DISH Network in a major corporate espionage trial, DISH Network was sufficiently impressed with his work to turn to him for help in defeating piracy of their satellite TV signal by so-called Free to Air Satellite TV receivers.
The distributors of the receivers in question alleged the product had a legitimate use. However, it was known the receivers were widely used for DISH Network piracy. Thus the essential question to be answered was, “Is there evidence to either support or disprove the hypothesis that these receivers were designed explicitly for piracy?” The analysis involved studying the hardware in the receivers and investigating the factory and pirate firmware. This case was challenging in that it required extensive knowledge of hardware, firmware, and manufacturing methods.
After performing detailed analysis on dozens of receivers, Mr. Jones was able to clearly demonstrate that they were indeed designed for piracy. This first case settled shortly after the submission of his report, with an agreed judgment in the amount of $106M being entered, along with a permanent injunction barring any further importation, distribution, or other trafficking in the illicit receivers.
Mr. Jones has generated detailed reports in support of multiple cases in both the USA and Canada. Using his reports in this and related cases, DISH Network has won a series of judgments including $121.7M against Panarex, $626M against Global Technologies, $214M against Viewtech, $65M against Sonicview, and $27M against Vicxon Corporation. More importantly, this string of legal victories has led to FTA piracy being reduced to negligible levels. In all cases the court relied heavily on the expert opinion of Mr. Jones.