Movie Studios Lose Appeal in Aussie ISP Piracy Case

IT Management

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The High Court of Australia has soundly rejected the notion that internet service providers (ISP's) are responsible for their subscribers' copyright violations. In a unanimous decision by the seven justices of the High Court, the case brought by several Hollywood studios against an Australian ISP for its user's piracy was dismissed. The case had previously been dismissed by a lower court, but this dismissal is final, as the High Court is the highest appeals court in Australia.

A judgement summary provided by the High Court describes how the case began. The lawsuit was brought against the ISP, iiNet, when it ignored letters the Australian Federation Against Copyright Theft (AFACT) sent them alleging that their subscribers were using Bit Torrent to pirate copyrighted material. The "AFACT notices" demanded that iiNet take action, but the ISP did nothing.

The lawyers for the studios argued that iiNet had authorized its users to infringe on the studio's copyrighted material, which, under Australian law, would make them as guilty as the pirates themselves. The claim was that the ISP had the power to prevent subscribers from pirating by shutting down their accounts. The judges, however, rejected this notion, differentiating the ability to prevent piracy from a formal authorization of piracy. From the summary:

The Court observed that iiNet had no direct technical power to prevent its customers from using the BitTorrent system to infringe copyright in the appellants' films. Rather, the extent of iiNet's power to prevent its customers from infringing the appellants' copyright was limited to an indirect power to terminate its contractual relationship with its customers. Further, the Court held that the information contained in the AFACT notices, as and when they were served, did not provide iiNet with a reasonable basis for sending warning notices to individual customers containing threats to suspend or terminate those customers' accounts. For these reasons, the Court held that it could not be inferred from iiNet's inactivity after receiving the AFACT notices that iiNet had authorised any act of infringement of copyright in the appellants' films by its customers.

It will be interesting to see if this precedent, that ISP's are not responsible for their customer's actions over the ISP's services, will influence decisions in other countries. Earlier this month a court in the U.S. rejected a similar plea from copyright holders to subpoena ISP's to reveal their subscriber's personal identity. It is also worth noting that not all ISP's hold firm and go to court for their subscribers the way iiNet has. Many providers in the U.S. take letters such as the "AFACT notices" seriously, and threaten their paying subscribers with throttling or service termination.

What do you think? Has the High Court of Australia made the right decision, or is iiNet harboring pirates? Let me know in the comments section below.

(via The Sydney Morning Herald; photo courtesy of the High Court of Australia)