Federal Court: iiNet did not infringe copyright

Justice Cowdroy today handed iiNet a sound victory in the Australian ISP’s long-running battle against a coalition of film and television studios finding that iiNet did not authorise copyright infringement carried out by its customers.

The studios first dragged iiNet (and its chief executive Michael Malone pictured right) into the Federal Court back in November 2008 arguing that the ISP infinged copyright by failing to take reasonable steps – including enforcing its own terms and conditions – to prevent customers copying films and TV shows over its network.

However in a packed courtroom in Sydney today Justice Cowdroy said he found that iiNet did not authorise the infringement of the studios’ copyright.

“The mere provision of access to the internet is not an authorisation of infringement” he said.

Cowdroy made it clear that the means of infringing the studios’ copyright was the use by iiNet customers of the BitTorrent file-sharing system. “iiNet has no control over BitTorrent” he said.

The judge added that the notification scheme proposed by the studios and their representative the Australian Federation Against Copyright Theft (AFACT) for ISPs to notify their customers of a breach of copyright and take action such as suspending or terminating their accounts was not a reasonable process.

While the judge noted that his reasons for making the finding were “complicated and lengthy” they hinged on the idea that iiNet had done no more than provide an internet service to its users.

This differed from the previous Kazaa case Cowdroy said in that the Kazaa organisation was encouraging its users to breach copyright.

Cowdroy noted separately that the Telecommunications Act would not have prevented iiNet from acting on the AFACT notices of infringement as iiNet had claimed. However he noted that this fact did not end up being relevant to the case as iiNet did not authorise a breach of copyright.

Similarly Cowdroy noted iiNet did have a repeat infringer policy for its customers and would have been entitled to shelter under the ‘safe harbour’ provisions of the Copyright Act. However similarly as iiNet did not authorise the infringement of copyright this was not revelant to the case.

Ultimately Cowdroy concluded that there was enough evidence to show widespread copyright infringement occurring “worldwide”. However he said this cannot necessitate or compel a finding of authorisation of infringement of copyright in the case and said the infringements of copyright were “significantly” less than AFACT had alleged.

The justice also found that when ISP customers used BitTorrent to download copyrighted material they were making one copy only of the material. In addition he pointed out BitTorrent itself could be used for legitimate purposes.

Cowdroy ordered that the studios’ application be dismissed and that they pay iiNet’s legal costs.