Major film and television studios represented by the Australian Federation Against Copyright Theft (AFACT) have today lost their battle against the third largest internet service provider (ISP) in Australia, iiNet Limited.
This case (Roadshow Films Pty Ltd v iiNet Limited (No. 3)  FCA 24) considered whether the ISP authorised the infringement of copyright of its users or subscribers when they downloaded films and television programs in a manner which infringed copyright. Under Australian copyright law, a person who authorises the infringement of copyright is treated as if they themselves infringed copyright directly.
AFACT conducted investigations into copyright infringement occurring by means of a peer to peer system known as the BitTorrent protocol by subscribers and users of iiNet’s services. The information generated from these investigations was then sent to iiNet by AFACT, with a demand that iiNet take action to stop the infringements occurring.
The evidence on infringement in this case showed that the BitTorrent protocol was being used by those accessing the internet through iiNet’s facilities to download the applicants’ films and television shows. The critical issue in this proceeding was whether iiNet, by failing to take any steps to stop the infringing conduct, authorised the copyright infringement of the iiNet users.
Justice Cowdroy found that iiNet had knowledge of infringements occurring, and did not act to stop them. However, he decided that iiNet did not authorise the copyright infringement, and commented that the copyright infringements occurred directly as a result of the use of the BitTorrent system, not the use of the internet, and iiNet did not create and did not control the BitTorrent system. Further, he found that iiNet did not have relevant power to prevent those infringements occurring and did not sanction, approve or countenance the copyright infringement.
His Honour also commented that the result of the proceeding would disappoint the members of the AFACT as the evidence established that copyright infringement was occurring on a large scale. However, he went further to state that this does not necessitate or compel a finding of authorisation, merely because it is felt that ‘something must be done’ to stop the infringements.
His Honour also commented that the proceeding attracted widespread interest both in Australia and abroad and that as far as he was aware, this trial, involving suit against an ISP claiming copyright infringement on its part due to alleged authorisation of the copyright infringement of its users, is the first trial of its kind in the world to proceed to hearing and judgment.