Monday, 27 October 2014 07:31

iiNet Downloaders Club - not that kind of club? Featured

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iiNet and copyright infringement is back in the news, with the owners of the Dallas Buyers Club movie applying to the Federal Court to force iiNet to divulge contact details for IP addresses alleged to have downloaded the movie.

Copyright infringement is a hot topic in today’s world, where Hollywood studios and TV production companies face higher levels of piracy than ever before, eating into box office receipts, licensing fees, profits and revenues.

One of the world’s biggest nations for piracy is said to be Australia, primarily because of the fact both movie studios and TV networks can take much longer to legally make content available down under than is the case in the US, often at much higher prices.

Naturally, movie studios see this as no excuse, with Dallas Buyers Club LLC - the owners of the rights to the Academy Award winning film starring Matthew McConaughey, Jared Leto, Jennifer Garner and others - taking matters into their own hands.

It appears this is being done to both scare off future potential downloaders and to try recovering some of the monies lost through the scourge of piracy, in a practice dubbed “speculative invoicing”,

which Australia’s second largest ISP, iiNet, explains “commonly involves sending intimidating letters of demand to subscribers seeking significant sums for an alleged infringement”, as happens overseas, with “these letters often threaten court action and point to high monetary penalties if sums are not paid.”

Indeed, iiNet’s Chief Regulatory Office, Steve Dalby, has issued a blog post about the actions of Dallas Buyers Club LLC , stating that it is “not an action against iiNet” itself, but an application “to the Federal Court for iiNet and a number of other providers to reveal details of people they suspect of infringing copyright on their film.”

In plain English, as opposed to the legalese being spoken in courts, iiNet explains that: “Dallas Buyers Club wants the names and contact details of our customers they believe may have illegally shared their film.”

This is called “preliminary discovery”, a practice said to be used “in a wide range of cases where the identity of the person or company you may want to take legal action against is unknown.”

Unsurprisingly, given iiNet’s previous court wins against the movie industry, it has “decided to oppose this discovery application.”

Part of the reason why movie studios and their law firms are targeting ISPs for customer details behind IP addresses, in this case by Sydney-based lawfirm Marque Lawyers, is because people are using the bittorrent protocol which openly shares the IP address details of people who are sharing and downloading files.

This is like openly telling people you are “stealing” content as you are doing it, so it is no surprise to see intellectual property owners taking matters into their own hands.

The Hollywood Reporter notes that, in the US, some ISP customers targeted by Dallas Buyers Club LLC’s actions have seen “ISP customers have paid up to $6,132 (AUS $7,000) to Dallas Buyers Club after receiving such letters, to "settle" cases before they go to court.”

Hollywood Reporter also states that, in the US, 3700 defendants have been targeted with over 136 lawsuits in 11 states, with this strategy untested in Australia.

iiNet says it would “never disclose customer details to a third party, such as movie studio, unless ordered to do so by a court”, but at the same time it takes “seriously both our customers’ privacy and our legal obligations.”

iiNet is also very careful to note that it does not “support or condone copyright infringement”, and that its “contract terms require that our customers must not use our service to commit an offence or infringe another person’s rights – this includes copyright infringement. We also have a policy that applies to people who infringe the law.”

However iiNet is against the principle of movie studios demanding customer details, especially if they are not prepared “to allow the alleged infringer their day in court”, with iiNet saying it has “serious concerns about Dallas Buyers Club’s intentions.”

Those concerns revolve around the previously mentioned “speculative invoicing”, which as seen in The Hollywood Reporter’s report, has already worked to extract thousands of dollars from various people in receipt of those invoices simply to avoid court action.

Specific concerns iiNet raises include users potentially being “subject to intimidation by excessive claims for damages, as made by Dallas Buyers Club in other countries”, or incorrect identification of alleged infringers, especially in the case of shared Wi-Fi in homes, schools, cafes or elsewhere.

Any date for the hearing of the Federal Court to determine whether customer info should be handed over by ISPs likely won’t take place until next year, but if Dallas Buyers Club LLC succeeds in its action, iiNet says it “will be obliged to comply with any court orders issued – such as to hand over the requested customer details”.

If that happens, iiNet says it expects “these customers to face letters of demand, such as those we’ve seen overseas”, and has concern that “such a development would open the floodgates to further claims by other rights-holders, leading to more Australians being intimidated to pay exorbitant amounts in an attempt to avoid improbable litigation.”

However, if iiNet wins, it says it “will not be ordered to hand over our customers’ details”, but that even so, “rights holders may continue to bring these types of applications to pursue alleged infringers”.

Thus the importance of this test case and the court’s reasoning, however iiNet says it will “continue to defend the privacy of its customers’ personal details as we are entitled to do so under Australian law.”

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Alex Zaharov-Reutt

One of Australia’s best-known technology journalists and consumer tech experts, Alex has appeared in his capacity as technology expert on all of Australia’s free-to-air and pay TV networks on all the major news and current affairs programs, on commercial and public radio, and technology, lifestyle and reality TV shows. Visit Alex at Twitter here.

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