Bread & Kaya 27: Cyberlaw in the Covid-19 Era Pt3

• MalaysiaKini’s contempt case, Federal Court’s rationale for judgement
• On the horizon: Taxi association’s RM100m class-action lawsuit against Grab

In this conclusion of my 2020 review of significant legal cases in the Malaysian cyber world, I am looking at some cybercrime cases, MalaysiaKini’s contempt case and how the courts are relying on AI to meet out punishment. I conclude by flagging some interesting cases which will be played out this year.

My conclusion is that the Malaysian judiciary is now getting a much better grip on how to deal with conflict and disagreements in the cyber world

Ed: Read Also: 2020 Cyberlaw Cases: Cyberlaw in the Covid-19 Era

Bread & Kaya 27: Cyberlaw cases in the Covid-19 Era, Pt2 

Cybercrime

In PP v. Mohamad Faezi bin Abd Latif [2020] 5 LNS 42, the learned Sessions Court Judge produced a helpful table consisting of sentences for those who had pleaded guilty at first instance under a section 233(1)(a) of the Communications and Multimedia Act 1998 charge. The table is reproduced below (together with the sentence in that case):

Notwithstanding the sentencing trends above, the learned Sessions Court Judge stated that the sentencing trends merely serve as a guide on the prevailing trends and the range thereof. It does not in any way take precedence over the Court’s judicial discretion on sentencing. The learned Sessions Court Judge stated that “sentences are not binding precedents, but are merely historical statements of what has happened in the past”.

Contempt proceedings against Malaysiakini

In Peguam Negara Malaysia v. Mkini Dotcom Sdn Bhd & Anor [2020] 7 CLJ 173, the Attorney General obtained an ex parte order for leave to initiate contempt proceedings against the operator of the online news portal Malaysiakini (1^st Respondent) and its Chief Editor (2^nd Respondent) in the Federal Court for certain contemptuous comments made by the readers of Malaysiakini. The Respondents filed an application to set aside the ex parte order. In dismissing the said application to set aside the ex parte order, the Federal Court held that the Respondents were the publisher of the comments based on the following facts:

(1) the 1st Respondent facilitated publication;

(2) the editorial policy allowed editing, removing and modifying of comments;

(3) only upon being made aware by the police, the 1^st Respondent indeed removed the comments; and

(4) evidence revealing that the editors of the 1^st Respondent reviewed postings on a daily basis.

The Federal Court also held that, by virtue of section 114A of the Evidence Act 1950, the Respondents are presumed to have published the impugned comments. The Federal Court found that a prima facie case of contempt in the form of scandalising the Court had been made out.

The matter was then heard by a seven-judge panel on the issue of whether the Respondents are liable for contempt of court over the readers’ comments (Peguam Negara Malaysia v. Mkini Dotcom Sdn Bhd & Anor [2021] 1 LNS 89). The Federal Court recognised that there were difficulties faced by the Court in pinning down the role of publication on the internet content provider when the comments were made and posted by third parties. The Federal Court held that the Malaysian Parliament must had resolved this difficulty by enacting section 114A of the Evidence Act 1950.

In rebutting the presumption, the Respondents relied mainly on three measures to safeguards itself from pre- and post-publication comments by third party subscribers. The first by its terms and conditions warning subscribers that abusive posting offending any law or which create unpleasantness would be banned. Second, it installs a filter program which disallows the use of certain foul words. Failing that filter any article or comment would not get posted. This filter program is also used to review third party comments. Third is the peer reporting system. This process entails other users or readers of the online news portal to report on offensive comments. Only upon the receipt of such report will an editor immediately examine and decide on the removal of the same. It is for this reason, the 1^st Respondent reserves the right to remove or modify comments posted at its discretion. In this way, the 1^st Respondent’s take down policy would be effectively implemented.

The Respondents also argued that it is not practical or possible for the 1^st respondent to moderate all the comments posted by third parties as they have a high volume of about 2,000 comments received per day with 25,000 online subscribers. The process of peer reporting is thus resorted to.

Nevertheless, the Federal Court found that the Respondents had failed to rebut the presumption of publication under section 114A of the Evidence Act 1950. The Federal Court held that the 1^st Respondent is the owner of its website, publishes articles of public importance, allows subscribers to post comments to generate discussions. It designs its online platform for such purpose and decides to filter foul words and rely on all the three measures it has taken.

In other words, the 1^st Respondent designs and controls its online platform in the way it chooses.  It has full control of what is publishable and what is not. It must carry with it, the risks that follow from allowing the way its platform operates. The 1^st Respondent cannot be heard to say that its filter system failed to filter offensive comment when it deliberately chooses only to filter foul language but not offensive substance. The 1^st Respondent cannot be allowed to turn their news portal into a runaway train, destroying anything and everything in its path, only because their riders are the ones creating such havoc albeit made possible by their train.

As for the 2^nd Respondent, the Federal Court held that section 114A is not applicable to the Chief Editor as there was no evidence to show that he was owner or the host or the editor on the online news portal and that he is the person who reserves the sole discretion to edit or completely remove any comments by a third party. Therefore, the 2^nd Respondent is found not guilty of contempt of court.

The Federal Court meted out a sentence of RM500,000 against the 1^st Respondent to serve public interest, where the sentence must not be too lenient in order to provide a deterrence effect. The Respondents’ unreserved apology, and their cooperation with the police and the courts were also taken into account. The contempt committed was much more severe than previous cases on contempt, stating that there were baseless allegations of corruption, and that the comments made were “beyond any bound of decency”. The 1^st Respondent subsequently managed to raise more than RM500,000 through public donations within hours of the Federal Court’s sentencing.

The use of Court’s “Artificial Intelligence” (AI) system in Criminal Proceedings

Last year, I reported about the use of artificial intelligence system to aid judges in passing sentence for criminal cases in respect of drug possession under section 12 of the Dangerous Drugs Act 1952 and section 376 of the Penal Code. There is now more information about this system as it is published by the learned Magistrate Jessica Ombou Kakayun in her judgment of Public Prosecutor v Denis P. Modili [2020] 5 LNS 21.

According to her judgment, to analyse and provide the recommendations to pass the sentence, the artificial intelligence system requires important information called parameters. For instance, under Section 12(2) of the Dangerous Drugs Act 1952, information regarding the weight of the drugs, the age and employment record of the accused are required. Once this crucial information is entered into the system, the artificial intelligence system will generate its own recommendations (either the sentence of fine or imprisonment) and this will reflect in a percentage form. Whichever percentage is higher, the recommendations provided are mere guidelines to assist the presiding judge to decide in applying the correct sentencing principles according to past precedents. This, in turn, will avoid disparity of sentences among the judicial officers. By meting the sentences accordingly, this will likely reduce any possible upcoming appeal to the higher courts since a uniform standard of sentencing principles is applied. The issue of sentencing principle being manifestly inadequate or excessive by the presiding officer will lessen and/or even be avoided in the future.

In Public Prosecutor v Denis P. Modili (supra), the counsel of the accused objected to the use of the artificial intelligence system in determining the sentence of the accused on the grounds that the use of the artificial intelligence system is a breach of Article 5(1) of the Federal Constitution which provides that that no person shall be deprived of his life or personal liberty, and Article 8 of the Federal Constitution which provides that all persons are equal before the law and entitled to the equal protection of the law. Further, the use of artificial intelligence system by the Court will influence the outcome and thus is prejudicial to the accused.

However, the learned Magistrate held that the issue of breach of constitutional rights is not within her competent jurisdiction. The matter should be decided by the higher court. Nevertheless, the learned Magistrate held that the artificial intelligence system is a mere guideline to assist the Court so as not to depart from the true spirit of a reasonable sentencing principle. The presiding officer may agree or depart from the sentence recommended by the artificial intelligence system. Ultimately, the sole discretion rests on the presiding judge in determining the sentence of the accused. Accordingly, the accused was sentenced to 12 months imprisonment notwithstanding that the artificial intelligence system recommended that the accused to be sentenced to 10 months.

However, on appeal to the High Court, the learned High Court judge allowed the appeal and reduced the sentence to 6 months. However, no reason was given for the reduction of the sentence and the issue of constitutionality was not addressed by the Court. 

Guidelines on Digital Assets

Towards the end of 2020, Securities Commission Malaysia issued the revised Guidelines on Digital Assets to regulate Initial Exchange Offerings (IEO) and Digital Asset Custodians (DAC). The aim is to promote responsible innovation in the digital asset space, while managing emerging risks and safeguarding the interests of issuers and investors.

The guideline is applicable to the following parties: a body corporate that seeks to raise funds through a digital token offering, a person who seeks to operate an IEO platform, and a person intending to provide the services of safekeeping, storing, holding or maintaining custody of digital assets for another person.

The guideline provides, among others, that IEO platform operators will be required to conduct due diligence on the issuer, review the issuer’s proposal and disclosures in the “whitepaper”, and assess the issuer’s ability to comply with the requirements of the guidelines and the SC’s Guidelines on Prevention of Money Laundering and Terrorism Financing.

In closing

In 2021, we can expect more interesting developments in the cyberlaw and IT sphere.

• In the e-hailing sector, Loh Guet Ching v. Myteksi Sdn. Bhd. (Berniaga atas nama Grab) & 2 Ors (Kuala Lumpur High Court Suit No. WA-25-296-10/2020) is an interesting case on the position of e-hailing drivers vis-a-vis e-hailing companies. Ms Loh brought a case against Grab at the Labour Department after she was terminated as an e-hailing driver. She had alleged that she is an employee, thus entitled to bring an action against Grab for unlawful dismissal. However, the Minister of Transport refused to refer the matter to the Industrial Court. A judicial review application was thereafter brought against the Director General of the Department of Industrial Relations, among others. While the matter is still pending before the High Court, perhaps the recent UK Supreme Court decision, Uber BV and others v. Aslam and others [2021] UKSC 5, would have some bearing on this case, where the UK Supreme Court upheld the UK’s Employment Tribunal’s decision that Uber drivers are considered workers rather than self-employed.

• Another e-hailing case is Gabungan Pertubuhan Teksi, Kereta Sewa, Limosin Dan Teksi Lapangan Terbang SeMalaysia-GTSM v. Grabcar Sdn Bhd (Kuala Lumpur High Court Suit No. WA-22NCvC-801-12/2020), where a RM100 million class-action lawsuit was mounted by Malaysian Association of Taxi, Rental Car, Limousine and Airport Taxi against Grabcar. The association claimed that Grabcar was running an illegal e-hailing service which contravened the Transport Act 2012, the Competition Act 2010 and the Federal Constitution. Grabcar’s service was alleged to be in violation of the right to livelihood, rights and interests of taxi drivers. As at the time of writing, the matter is still pending in Court.

• The Court of Appeal recently affirmed the High Court’s previous decision in Robert Ong Thien Cheng v. Luno Pte Ltd & Anor [2020] 3 AMR 143 and held that intangible cryptocurrency such as bitcoin falls within the ambit of “things” under section 73 of the Contracts Act 1950. The decision gives certainty to the modern business world whilst adapting to the digital revolution. The Malaysian courts are seemingly moving in the right direction to keep up with this digital age.

• The Government has also recently gazetted the Emergency (Essential Powers) (No. 2) Ordinance 2021 under the current state of emergency. This Ordinance reproduced a large section of the Anti-Fake News Act 2018, which was repealed by the Pakatan Harapan government.

However, unlike its predecessor, this Ordinance is limited to “fake news” relating to Covid-19 or the proclamation of emergency. There are also no illustrations of what could amount to an offence unlike its predecessor. Nevertheless, spreading fake news about the effect of Covid-19 vaccines or that certain persons had contracted Covid-19 would clearly be an offence under the Ordinance.

In respect of “proclamation of emergency”, it was reported by Malaysiakini that the de facto Minister of Law, Takiyuddin Hassan said that it is fake news to claim that the Government sought an emergency declaration because it lost its majority in the Dewan Rakyat. Those spreading "fake news", whether in Malaysia or outside Malaysia, will face a fine not exceeding RM100,000, or an imprisonment for a term not exceeding 3 years, or both. Those providing financial assistance in spreading fake news or failing to remove any publication containing fake news will also commit an offence amounting to a fine not exceeding RM500,000, or an imprisonment for a term not exceeding 6 years, or both.

Foong Cheng Leong is an Advocate and Solicitor of the High Court of Malaya. He blogs at foongchengleong.com, and tweets at @FCLCo. www.linkedin.com/in/foongchengleong/

“Foong’s Malaysia Cyber, Electronic Evidence and Information Technology Law” is now available on Thomson Reuters' website and selected bookstores. This is the only book on cyberlaw and electronic evidence in Malaysia​