Modchips: Is the tide is turning?

I have finally managed to go through Stevens v Sony Computer Entertainment, the ruling from the High Court of Australia regarding modchips. In case you are too bored to check on Wikipedia, a modchip is a modification to a built-in technical protection measure in a computer game console (like PlayStation, Xbox or Game Cube).

In this case, Mr. Stevens sold unauthorised copies of PlayStation games, for which he was not sued. Sony initiated the case against him because he also sold modchips to circumvent the copy protection mechanism in the PlayStation. Sony alleged that this was in voilation of s 116A of the Copyrigbht Act as ammended by the Copyright Amendment Act 2000. This was one of the many legislations passed as a result of the WIPO Copyright Treaty, which states in Art. 11 that "Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights..."

The case is long and a recommended read for anyone interested in this subject, particularly because it involves a primary ruling and then an appeal by Stevens at Federal level. There are two different interpretations of the legislative meaning of technical protection measure, sometimes with a tremendous care to distinguishing whether a TPM device inhibits copyright infringement or outright prohibits it. The High Court solves the apparent dispute by stating that the language in the legislation is ambiguous, something that has already been subject to criticism even in the European version of the legislation. The High Court then rules towards a more balanced definition of TPM than present in the law for these reasons:

209. If the definition of TPM were to be read expansively, so as to include devices designed to prevent access to material, with no inherent or necessary link to the prevention or inhibition of infringement of copyright, this would expand the ambit of the definition beyond that naturally indicated by the text of s 10(1) of the Copyright Act. It could interfere with the fair dealing provisions in Div 3 of Pt III of the Copyright Act and thereby alter the balance struck by the law in this country. [...]

211. Avoiding over-wide operation: There is an additional reason for preferring the more confined interpretation of the definition of TPM in the Copyright Act. This is because the wider view urged by Sony would have the result of affording Sony, and other rights holders in its position, a de facto control over access to copyrighted works or materials that would permit the achievement of economic ends additional to, but different from, those ordinarily protected by copyright law. If the present case is taken as an illustration, Sony's interpretation would permit the effective enforcement, through a technological measure, of the division of global markets designated by Sony. It would have the effect of imposing, at least potentially, differential price structures in those separate markets. In short, it would give Sony broader powers over pricing of its products in its self-designated markets than the Copyright Act in Australia would ordinarily allow[157].

This is an utterly refreshing ruling, and I'm sure that it will generate a lot of talk for those looking for balance in copyright legislation.