A trader who sold TV boxes which allowed viewers to watch subscription films and football for free has been given a suspended jail term.
Brian Thompson had denied breaking the law by selling Kodi boxes, setting up the prospect of a landmark court trial.
But appearing at Teesside Crown Court he changed his plea to guilty.
The 55 year old, who runs Cut Price Tomo’s TV store in Middlesbrough, was given an 18-month prison sentence, suspended for two years.
Thompson, of Barnaby Avenue, Middlesbrough, admitted one count of selling and one count of advertising devices “designed, produced or adapted for the purpose of enabling or facilitating the circumvention of effective technological measures”.
He had previously claimed the law was a “grey area” and said he wanted to know whether he was “doing anything illegal”.
The court heard Thompson had sold an estimated 400 boxes – earning him about £40,000.
The Federation Against Copyright Theft (FACT) believes more than one million illegal Kodi TV boxes have been sold in the UK in the past two years.
What are Kodi boxes?
Some shops sell ready-to-use set-top boxes or television sticks preloaded with the Kodi software.
They are also known as Android boxes, because many of the devices run Android as their primary operating system.
The developers behind Kodi say their software does not contain any content of its own and is designed to play legally owned media or content “freely available” on the internet.
However the software can be modified with third-party add-ons that provide access to illegal copies of films and TV series, or provide free access to subscription television channels.
Some traders sell Kodi boxes preloaded with third-party add-ons that can access pirated content. It is the sale of these “fully-loaded” boxes which was the subject of the case against Mr Thompson.