Dallas Buyers Club dismissed from Federal Court

The Australian Federal Court has dismissed DBC's attempts to claim damages from the 5,000 people who downloaded the movie, with the case to be thrown out unless DBC makes an application by mid February.
Written by Corinne Reichert, Contributor

The Australian Federal Court has ruled that Dallas Buyers Club (DBC) will not be permitted to claim damages from the almost 5,000 people who allegedly infringed on the studio's copyright by downloading the film of the same name.

Unless DBC makes an application or files for leave to appeal the Federal Court's decision to the Full Court -- for which Perram noted he would be inclined to give leave -- the proceeding will be dismissed in its entirety with costs midday, February 11, 2016.

In his judgment on the matter, Justice Nye Perram said he would have allowed DBC to send letters seeking damages from those who allegedly infringed its copyright as long as it only sought damages based on the retail price of the film and the costs associated with obtaining each infringer's details.

However, DBC continued fighting for additional damages based on a one-off rental fee and a licence fee for uploading activity -- something that Perram ruled to be "untenable claims" in August, therefore not allowing the company to send letters seeking damages from infringers.

DBC last week returned to the Federal Court in an effort to extract these additional damages, citing recent precedent supporting its claim.

"It would get us both rental fee for use of the one-off copy, and it would also give us the licence fee that would be reasonably available for the uploading, which was Part B in Your Honour's reasoning," DBC told Perram J last week.

"We will set out in our submissions what is a very modest claim."

Counsel representing the internet service providers (ISPs) disagreed with DBC's argument, saying the claim would not be modest.

DBC also referred to the Aristocrat Technologies Australia v DAP Services precedent, wherein it was ruled that in cases of flagrant copyright infringement where compensatory damages are inadequate, the court may award higher additional damages.

Had its arguments been successful, it would have seen DBC claim total damages from each infringer based on the cost of legally purchasing the film; a one-off rental fee; a licence fee for uploading activity; and damages covering the cost it took for DBC to obtain that infringer's details.

DBC last week also requested that the court lift its stay on 10 percent of the IP addresses -- all iiNet customers -- from which it would seek additional damages for the time being, along with 10 percent of the AU$600,000 bond put in place by Perram to ensure DBC did not contact the infringers to seek additional damages.

On Wednesday, Perram ruled that the law had not "materially changed" to justify him lifting his stay. He reaffirmed that there is no way to determine a reasonable licence fee for downloading the movie, and allowing DBC and iiNet to argue over this in court could prolong the case to the detriment of the public.

"It needs to be kept in mind that what is before the court is a preliminary discovery application, not Ben-Hur," Perram said.

"The interests of justice are not served in comparatively modest procedural litigation such as the instant case by permitting no stone to go unturned. The enterprises of the parties must be kept proportionate to what they are arguing about."

Perram said there would also be no way for DBC to discover each individual infringer's uploading activity, meaning DBC could not claim damages under this head.

Perram also declined to lift the bond.

In April, Perram ruled that ISPs iiNet, Dodo, Internode, Adam, Amnet, and Wideband were to disclose the customer details associated with 4,726 IP addresses that had allegedly breached the copyright of Dallas Buyers Club by downloading infringing copies of the film.

However, the court also ordered the film studio to pay the ISPs' court costs and provide draft copies of the phone scripts and letters it intended to send to copyright infringers for court approval before the customer information would be provided.

This decision was aimed at preventing Voltage, DBC's parent studio, from using "speculative invoicing" through which alleged copyright infringers in the US have been asked to either compensate Voltage by up to $9,000, or potentially have to pay hundreds of thousands of dollars in damages under court order.

While the draft letters did ask for information on each infringer's wage, they did not mention a financial amount for compensation, with DBC saying that the fines would not be doled out in a "one-size-fits-all" approach, and would rather be calculated using a formula for each infringer.

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