ISP Did Not Authorise Customers' Copyright Infringement, Says Australian Court

An ISP was not liable for the copyright infringement of its customers, an Australian court has ruled, in what the judge claimed was the world's first full trial of its kind. Australian and UK law on copyright liability are very similar.

Roadshow Films lost its case against internet service provider (ISP) iiNet in the Federal Court of Australia when the judge ruled that iiNet's provision of internet access did not mean that it had 'authorised' the copyright infringing behaviour of its subscribers.

In a double victory for ISPs the judge said that even if he had agreed that the ISP had shared culpability for the copyright infringements it would not have been liable because it had an adequate policy for dealing with infringement in place and so enjoyed 'safe harbour' under Australia's copyright law.

The case will be vital in clarifying ISPs' obligations in relation to the unauthorised use of copyright material under Australian law. It could be influential in cases before other countries' courts. Industries based on copyrighted material, such as the music and film industries, are increasingly calling for ISPs to be involved in policing their users' activities and preventing infringement.

The UK, France and other countries are in the process of passing laws that demand that ISPs warn and eventually disconnect the connection used by subscribers accused of copyright infringement.

Australian Federal Court judge Dennis Cowdroy, though, said in a summary he produced of his ruling that it was not the ISP's job to protect the business interests of the film company.

"The evidence establishes that copyright infringement of [Roadshow's] films is occurring on a large scale, and I infer that such infringements are occurring worldwide. However, such fact does not necessitate or compel, and can never necessitate or compel, a finding of authorisation, merely because it is felt that ‘something must be done’ to stop the infringements'," he said. "The law recognises no positive obligation on any person to protect the copyright of another. The law only recognises a prohibition on the doing of copyright acts without the licence of the copyright owner or exclusive licensee, or the authorisation of those acts. In the circumstances outlined above and discussed in greater detail in my judgment, it is impossible to conclude that iiNet has authorised copyright infringement."

Like UK copyright law, the Australian Copyright Act prohibits the doing, or the authorising of the doing, of anything that infringes someone else's copyright. It was Roadshow's claim that iiNet authorised the infringement of the copyright in its films by allowing subscribers to upload and download unlicensed copies of them on a peer to peer bit torrent system and by not preventing the activity when informed of it.

"While I find that iiNet had knowledge of infringements occurring, and did not act to stop them, such findings do not necessitate a finding of authorisation. I find that iiNet did not authorise the infringements of copyright of the iiNet users," said Judge Cowdroy.

"In the law of authorisation, there is a distinction to be drawn between the provision of the ‘means’ of infringement compared to the provision of a precondition to infringement occurring," he said. "I find that the mere provision of access to the internet is not the ‘means’ of infringement. There does not appear to be any way to infringe the applicants’ copyright from the mere use of the internet."

"Rather, the ‘means’ by which the applicants’ copyright is infringed is an iiNet user’s use of the constituent parts of the BitTorrent system. iiNet has no control over the BitTorrent system and is not responsible for the operation of the BitTorrent system," he said.

The judge said that iiNet could not be said to have authorised infringement because it did not approve or sanction the users' activity.

"I find that iiNet simply cannot be seen as sanctioning, approving or countenancing copyright infringement. The requisite element of favouring infringement on the evidence simply does not exist," he said. "The evidence establishes that iiNet has done no more than to provide an internet service to its users."

Intellectual property law expert Kim Walker of Pinsent Masons, the law firm behind OUT-LAW.COM, said that this ruling could influence decisions in UK courts.

"It could have an impact in the UK, though only a persuasive one," he said. "Australian judgments are not binding on UK courts but the wording of the relevant provision of the Copyright Act in Australia is very similar to the wording of the UK Copyright Act. It looks to me as though it's a well-argued, detailed, fully argued case."

"I think this will reassure ISPs that, provided they don't structure their sites in any way that could be said to be facilitating file sharing, they won't be liable," said Walker. "The judge said here that iiNet was a pure ISP, it gave people access to the internet and therefore they got access to copyright material."

The judge even ruled on an issue which he did not have to consider, given that he had already said that iiNet's behaviour was not copyright infringement. He considered whether or not iiNet would have deserved 'safe harbour' even if it had been responsible for authorising copyright infringement.

In many legal systems, including the UK's, ISPs are entitled to 'safe harbour' protection from liability for the activities of their users as long as they are simply a channel through which those users act and as long as they have appropriate policies in place to deal with illegal behaviour.

"I find that iiNet did have a repeat infringer policy which was reasonably implemented and that iiNet would therefore have been entitled to take advantage of the safe harbour provisions in … the Copyright Act if it needed to do so," said the judge's ruling. "While iiNet did not have a policy of the kind that the applicants believed was required, it does not follow that iiNet did not have a policy which complied with the safe harbour provisions."

Walker said that ISPs can take comfort from the ruling. "I think that provided you are a vanilla ISP, you have a reasonably sensible notice and takedown policy and you enforce it and use it then this case seems to indicate that you'll be fine," said Walker.