E-Privacy Goes Mobile

Although most readers of this blog will be familiar, to some extent, with the Privacy and Electronic Communications (EC Directive) Regulations 2003 (“PECR”), they are a rarely sighted beast in the reported jurisprudence. Panopticon is aware of individual damages claims brought in the County Courts for small sums, but even they are few and far between.

The recent judgment of Nicholas Lavender QC, sitting as Deputy, in Lebara Mobile Ltd & others v Lycamobile UK Ltd & others [2015] EWHC 3318 (Ch) is accordingly worth a read for a glimpse into how PECR may have a part to play in major commercial disputes.

The judgment concerns as application for a interim injunction sought by Lebara to prevent Lyca’s continued use of blocking software applied to the SIM cards of Lyca customers, which prevent Lyca customers downloading (or even visiting the Lebara website to read about) a Lebara app which permits free Lebara-to-Lebara calls. It does this by tracking the website use of its customers over the 3G network and block access to Lebara’s website without informing customers that ether is a block. The technical details are complicated and it is unnecessary to set them all out in this post.

Lebara brought a claim on numerous grounds under English and various foreign laws. Under English it relied on conspiracy to injure, inference with its business by unlawful means, unlawful means conspiracy and breach of PECR. PECR had two roles in the claim: not only was it a free-standing claim (breach of regulation 30), but breaches of regulation 7 (and Articles 5 and 6 of the underlying Directive 2002/58/EC) were said to be some of the unlawful means relied on in the economic tort claims.

Given that the application was for interim relief, the question for the Court was whether those claims gave rise to serious issues to be tried, as opposed t essentially unarguable claims. The post would be extremely long if all of the various economic tort claims, and the underlying unlawful means alleged, were gone through, so the avid reader is preferred to the judgment instead. Focus here will just be on the involvement of PECR.

As a form of unlawful means, Article 5 and 6 of the PECR Directive were relied on by Lebara. Article 5 requires measures to be taken which prohibit the inception or surveillance of communications and related traffic data. Article 6 extends that to consent. The Judge considered the focus of the argument really be on Article 5, because Lyca argued that the regulation 7(1) PECR (implementing Article 6) applies only to the traffic data relating to subscribers or users, and that a website address is not data relating to that subscriber or user because it does not identify them. (Identification being a requirement by virtue of regulation 7(1)(b) and (c). As a result, Lebara argued that regulation 7 had to be interpreted more purposively, which does not require identification, in order to ensure Article 5 was correctly implemented under the Marleasing principle. This is a complicated argument, and it was only briefly summarised by the Judge, who held it to be sufficiently arguable to amount to a serious issue to be tried at [85]. If the matter goes to trial, it has the potential to say interesting things about PECR and its application to internet tracking.

The Court was prepared to assume for the purposes of a serious issue to be tried that other Member States would have implemented the PECR Directive, such that there would also be a serious issue to be tried under the law of those States, but noted that there was no evidence yet before the Court to determine the point and it could not be assumed at the trial.

It is also interesting to note at [96] that the breach of confidence allegation was closely wrapped up with the content of the PECR arguments, and so also gave rise to a serious issue to be tried, including, for example, whether website names constitute confidential information.

The Judge was clearly less impressed by the free-standing reliance on regulation 30 of PECR, noting that it required Lebara to be within the class of persons intended to benefit from the right to bring claims for compensation, and that there was no clear indication from the Directive that breaches of the Articles 5 and 6 were intended to sound in damages. A contrast was drawn with regulation 22 (prohibition on spam emails), which did have such purposive support, particularly in recital (28). The Judge concluded at [108] that he doubted there was a serious issue to be tried but did not decide the point.

In the event, the Judge declined to grant an injunction applying the balance of convenience test, so the block Lyca (modified in the course of litigation) remains in place until any trial. It would be interesting to see if the case fights; a judgment would be worth a read.

However, such a trail may be overtaken by events. Of some interest may be the acknowledgment by both parties at [25]-[27] that the block imposed by Lyca would be rendered unlawful when a new proposed EU regulation came into force in April 2016. This so-called ‘net neutrality’ Regulation. This too will be something to watch out for.