In an unexpected development, [Neil Stanley Higgs], aka Mr. Modchips, was cleared of his previous convictions in British courts for selling modchips for the Xbox 360 as well as modded consoles.
Notably, the prosecution did not argue that he infringed copyrights, but merely facilitated copyright infringement by selling modchips that circumvent the Xbox’s ETM. Since the copyright infringement argument was not made, existing law continues to hold sellers of pirated games and owners of modded consoles responsible for infringing the copyrights of game developers, as they are the ones who illegally copy the software. Pirated game sellers’ violation of the law is plain to see, but owners are still held responsible the moment they place the pirated disc into the loading tray and boot it up. The infringement in these cases occurs exactly when any part of the pirated game is loaded onto the console’s RAM, as this is considered another illegal copy.
[Higgs]‘s charges hinged on whether the Xbox’s piracy prevention methods were intended to completely prevent pirated games from being played or merely act as a hindrance. The court felt it was the latter, and so they reversed the charges.