iiNet (ASX:IIN) has won against the Australian Federation Against Copyright Theft (AFACT) in the High Court in an online piracy case launched over three years ago.
Representing a number of high-profile movie studios, AFACT took iiNet to the Federal Court in November 2008 over illegal downloads by the ISP’s user base. The anti-piracy group said iiNet was responsible for the copyright infringements because it failed to stop its subscribers from downloading movies illegally.
This, according to AFACT, is tantamount to authorising the copyright infringements.
iiNet won the case in the Federal Court and again in the Full Court. The High Court was the last line of appeal for AFACT and the hearing occurred in Canberra at the end of 2011.
Today, the High Court upheld the Federal Court’s verdict and dismissed AFACT's appeal. It was a unanimous decision by the five judges that presided over the case.
"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," the High Court said in a statement.
"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."
The High Court also said the infringement notices issued by AFACT to iiNet did not provide the ISP with "a reasonable basis" for sending service suspension or termination notices to its customers.
"For these reasons, the Court held 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."
To date, the court battle has cost iiNet $9 million. A portion of the costs will be recovered, according to the ISP.
The Pirate Party Australia was pleased with the High Court result.
"We reiterate that ISPs behave similarly to the postal service – they are the carriers of the message, and that message should remain private," Pirate Party secretary, Brendon Molloy, said in a statement.
"It is not their business to police users, but merely to comply where necessary with authorities. ISPs are not, and should never be, responsible to anyone other than their subscribers and local law enforcement agencies."
Both AFACT and iiNet will be holding media conferences to comment on the decision this afternoon.
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