Internet Law

ISP Not Liable for Customers' Illegally Downloaded Movies, Court Rules

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In a movie-downloading case that observers say could help set global industry policy, an Internet service provider in Australia has been held not liable for the activities of its customers even though the court found there was illegal file-sharing on a “large scale.”

Top Hollywood studios had sought to win damages over consumers who used BitTorrent software to download well-known films and television programs and force the ISP to shut down their accounts. But representatives of the provider, iiNet Ltd., said it had not encouraged or supported illegal activities, and the Federal Court in Sydney today agreed that it wasn’t the Perth-based ISP’s fault that individual users violated copyright law, reports Bloomberg.

“It is impossible to conclude that iiNet has authorized copyright infringement … [it] did not have relevant power to prevent infringements occurring,” said Justice Dennis Cowdroy.

In addition to dismissing the case against iiNet, he also required the plaintiff studios to pay the company’s court costs, reports ABC News.

In a lengthy post this afternoon discussing the history of the case, the Law & Disorder blog of Ars Technica says the case is the first of its kind worldwide and describes the judge’s “magisterial” 200-page ruling as a crushing blow for the film industry.

“If copyright holders want justice for illegal file-sharing,” the Law & Disorder post sums up, “they need to start by targeting the right people: those who committed the infringement.”

Studios referred requests for comment to the Australian Federation Against Copyright Theft, which took a leading role in the case. Its executive director, Neil Gane, said the group will review the court’s decision before talking about what the next step might be in the case, Bloomberg reports. However, he expressed confidence that the Australian government would not want to see “rampant copyright infringement” continue unabated.

“It is no doubt a win for ISPs and a huge disappointment for owners of copyright content,” says intellectual property partner Andrew Wiseman of Allens Arthur Robinson. “The content providers are not in the business of suing their customers,” he tells Bloomberg, ” but if they can’t get the conduit, they might go for the end user.”

Additional coverage:

Billboard (Jan. 28): “Australian Court Fast-tracks iiNet Ruling”

Computerworld (Australia): “ISPs won’t need to be cops: iiNet”

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