זכויות יוצרים, קניין רוחני, דיני מדיה ואינטרנט - עו"ד טוני גרינמן

Internet Law: Draft E-Commerce Bill Adresses ISP Liability

March, 2006
by Tony Greenman, attorney at law
 
 
At the end of 2005, the Ministry of Justice circulated a draft e-commerce bill. The bill designed to tackle a limited number of issues in e-commerce, including e-contract formation and ISP obligations to users in regard to personally identifying data, contains an important section on ISP liability.
 
To date, in the absence of any legislation on the matter, some lower courts have issued inconsistent rulings on this matter. The first case to deal with the issue, Borochov v. Poran, involved a defamation claim stemming from a publication posted on a deaf and mute forum. The magistrate, Justice Amir of the Kefar Saba Magistrates Court, adopted a strict "notice and takedown" standard. The justice held that the ISP – in that case the operator of the forum - would not be liable for defamatory statements published on the forum unless and until the aggrieved party notified him of the claimed defamation and demanded that he take it down, and then only if the publication is prima facie defamatory. If, upon receipt of such notice, the ISP timely took down the publication it would be exempt from liability
 
In the later Sudri case, Justice Ronen of the Tel-Aviv District Court adopted a broader exemption which resembles the almost total exemption granted to ISP's in defamation cases under section 230 of the U.S. CDA. In that case, which involved a forum called "Hyde Park", the Justice likened the site of the ISP to a virtual city square in which people were free to post notices. Emphasizing the fact that the ISP exercised no editorial control over the independent publications, Justice Ronen held that it should not bear liability for their contents.
 
Both of the above cases dealt with defamation claims. No case to date has tackled the issue of ISP liability for copyright infringement committed by others using the facilities of the ISP.
 
Another point of note is that in both of the above cases the ISP was acting as a hosting service. No case to date has dealt with liability of access providers or caching services.
 
The draft bill adopts a somewhat stricter standard than that adopted in either of the above cases. This standard, similar to, and in fact based on the rules for ISP liability adopted in the European E-Commerce Directive, would apply equally to claims for defamation and for copyright infringement.
 
The draft refers to three kinds of ISP's: Access providers; Prociders of hosting services; and providers of caching facilities.

Access providers will be exempt from liability for information created by another party and transmitted through their facilities if they neither instigated the transfer of the information nor choose the addressee and provided that they did not create or change the information.
 
Caching service providers will be exempt for liability for information created by others and cached through their facilities if: 1) they did not change the information; 2) they adhere to industry standards for refreshing cached information; and 3) they timely remove or block access to information upon receipt of notice that the cached information has been removed from its original location due to an infringement.
 
Hosting service providers will be exempt from liability for information created by others and stored on their facilities under the following cumulative conditions: 1) the creator of the information does not act for or under the direction of the IS; 2) the ISP does not know or have reason to know of the infringing nature of the information; 3) upon receipt of notice of the claimed infringement, the ISP timely removes or disables access to the information. It will be noted that this exemption is conditional upon notice only where the ISP does not have knowledge or reason to know of the infringement. However, the proposed law is silent as to whether the ISP will have an active duty to monitor content. This issue should be clarified during the legislation process.
 
The notice and takedown provisions include giving of notice to the publisher who may demand restoration of the information if he gives notice of his intent to challenge the claim. Still, much has to be clarified as to this process, including the form of the notice, timeframes and the onus of commencing such legal proceedings.
 
The proposed bill is an important step forward in clarifying this important legal issue. Still the brevity of the law is its enemy as too many important questions are left unanswered, It is to be hoped that the legislative process will cure these faults.
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