Sony Computer Entertainment Australia (SCE) has won the battle in the ongoing war against games pirates, with the Federal Court awarding indemnity costs against three people found to have imported and sold pirated PlayStation software.
Sony is now entitled to recover the full costs of litigation from Mohamed Dannoun, Janan Diab and Ahmad Haddad - estimated by SCE lawyers Allens Arthur Robinson to be $150,000. The amount represents the first substantial fine to be awarded in Sony's crackdown against game pirates.
"We are very glad about the decision," said SCE managing director Michael Ephraim. "It will get a strong message out to those who pirate software and it gives us the legal firepower to keep doing what we have been doing."
In January last year, SCE was given leave to take action against market operator Paddy's Markets for allowing Mohamed Dannoun to sell pirated copies of its PlayStation computer games. This was settled in August, when the company teamed up with the market operator to stamp out software piracy.
Federal Court Judge Justice Lindgren granted leave for SCE to include the operator as an additional respondent to Dannoun, who was ordered to pay a fine of $3500 plus indemnities after he was found selling illegal games in breach of court orders.
For a party to be awarded indemnity costs, the "circumstances must be special [and] must take the case of the ordinary category of case", said Justice Lindgren, who found that the way Dannoun had flouted his operations and his denials in the witness box justified special consideration.
The Court has yet to award damages. The hearing will take place later this year. The case against Dannoun has been running since April 1999 and has taken a number of twists and turns. Many of the importations were made using different aliases or with the help of associates, although Dannoun denied any involvement or knowledge of this throughout the case. However, based on evidence gathered by SCE and the Australian Customs Service, Justice Lindgren found Dannoun actually orchestrated the operation.
"It took a fair bit of investigation to track Mr Dannoun down," said Miriam Stiel, senior associate at Allens Arthur Robinson. "The case sets a precedent. Naturally judgements have to be considered on a case-by-case basis, but it certainly reflects the seriousness of the matter."
However Sony's Ephraim believes there is still a lot of work to be done to stamp out piracy, particularly in the government sector. A report from the Andrews Committee tabled in November recommended that more should be done to protect intellectual property, but action has yet to be taken.
"For one Dannoun I guarantee there are several others," Ephraim said. "If you look at the law, the maximum penalty is five years and a $60,000 fine. But in the history of Australia, no-one has been put in prison. The penalties have not been reviewed in over a decade. If you think about the IT revolution in that time, it has been a major oversight by the government."