Joint Strategic Plan on Intellectual Property Enforcement to turn up the heat on Russian File Sharing Sites

June 24, 2010


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We have had some calls very recently regarding the new Joint Strategic Plan on Intellectual Property Enforcementannounced by Victoria Espinel (sometimes called the Copyright Czar). 

One focus of this new report is Russia and its apparent tolerance of commercial file sharing websites.  These websites are located within Russia, but sell copyrighted material around the world purportedly under Russian copyright law. 

This activity has earned Russia a place on the Office of the United States Trade Representatives “Notorious Market List” of countries that are allowing violations of international copyright law. 

A particular facet of Russian Copyright law has in the past been of particular concern to the Recording Industry of America (RIAA), the Motion Picture Association of America (MPAA) and the United States Government. At least one reading of Russian Copyright law indicates that there is a compulsory license whereby anyone can sell a copyrighted work as long as they pay compensation under a license obtained from the Russian Government. 

 This compensation is paid to the Russian Organization for Multimedia and Digital Systems (ROMS).  The compensation generally amounts to 15% of sales, it is then distributed by ROMS (although the recipients often decline to accept it) to the copyright holders. 

 These Russian Copyright principals have been exploited by a spate of gray market websites that operate out of Russia under these compulsory licenses.  Essentially they set up shop and sell unprotected MP3s (and more lately Hollywood feature films that are still in the theaters) to anyone, anywhere who will pay the very modest fee to download from their library.  There are websites operating out of Russia right now that sell songs to individuals in the United States for 9 Cents a song.

The first website to gain international notoriety using this business model was allofmp3.com (now defunct).  Allofmp3.com encountered many legal difficulties.  There was a lawsuit filed in the Southern District of New York for over 1.5 trillion dollars, although pressure brought to bear on the Russian government by the United States is often credited with causing the website’s closure .

The business model of selling the work of others using Russian copyright law to an international audience has not disappeared however.  Many other websites exploiting this same interpretation of Russian law have come into being in the wake of the demise of allofmp3.com, a list of which can be found on Wikipedia.

Westlaw does not carry Russian statutes.   We do have a couple of treatises that have a great deal of information regarding Russian intellectual property law.  The two treatises are Corporate Counsel’s Guide to Doing Business in Russia (CCGRUSSIA) (there is also a Corporate Counsel’s Guide for China), and Copyright Throughout the World (COPYWORLD).  Copyright Throughout the World has a very detailed look at Russian Copyright law in Chapter 30.