iiNet, AFACT prepare for High Court battle

The High Court showdown this December between iiNet and the league of content owners that is the Australian Federation Against Copyright Theft (AFACT) is expected to be a short and sharp battle, but the case will likely shape copyright law in this country for years to come.

(Fight Club image by Polina Sergeeva, CC2.0)

The whole saga started with a 2008 case that alleged iiNet had authorised its customers' copyright infringements by not acting on notices provided to it by AFACT.

In what will be the final legal appeal by AFACT against the Federal Court's two rulings in iiNet's favour, the High Court will hear both sides of the argument over 1 December and 2 December.

It is expected that five High Court judges will reside over the case, one of them being Justice Robert French, as well as Justice Susan Crennan having decided to hear the case in August. The remaining three judges are as yet unknown; however, it is understood that Justice William Gummow — who has a strong intellectual property background — will have a strong interest in being a part of the hearing.

The first day is likely to be dominated by AFACT's opening arguments, based on 20 pages worth of documentation lodged with the High Court in early September. The Media, Entertainment and Arts Alliance; the Screen Actors Guild; the Australian Recording Industry Association; and the Australian Performing Rights Association have also made submissions as interveners in support of AFACT's position.

On Wednesday, iiNet lodged its own extended 30-page submission, outlining its proposed arguments, which will counter those put forward by AFACT and the interveners.

After AFACT speaks in the court, iiNet will explain its case and then the interveners will be allowed to speak for 15 minutes each to the High Court. It is expected that a number of organisations will speak on behalf of iiNet, although only the Australian Digital Alliance is known at this stage.

This will be the first time the High Court has examined copyright law since the High Court ruled against the University of New South Wales in 1975 (University of NSW vs. Moorhouse), finding that by providing photocopiers in its library, the university had authorised its students' copyright infringement of books they had photocopied.

iiNet intends to argue that the ruling for Moorhouse is not appropriate for this case, as "reason to suspect" copyright infringement is not grounds enough to act in the way that AFACT had asked internet service providers (ISPs) to act: implementing a graduated response scheme of warning, suspending and ultimately terminating customers who are alleged to have infringed on copyright.

Such a scheme would also not be possible to implement, according to iiNet, which said it was receiving around 2000 infringement notices per month from AFACT.

The biggest battleground, however, will be around whether iiNet had sufficient evidence to act on AFACT notices notifying the ISP its customers were infringing on copyright and whether — given that evidence — it would be reasonable for iiNet to act on that evidence given the costs and complexity involved.

In the appeal judgement, Justice Arthur Emmett found that if iiNet was provided with "unequivocal and cogent evidence of the alleged primary acts of infringement by use of the iiNet service in question" and information on how that evidence was gathered so that iiNet could verify the claims but still didn't act, then the provider could be found to have authorised infringement.

He also said that copyright owners such as AFACT should be required to reimburse ISPs for the cost of verifying user infringements and the cost of establishing and maintaining a system to monitor internet use to determine infringements. He said the copyright owner should also protect the ISP from loss if the company mistakenly suspends or terminates the internet service of a user who the copyright owner alleged to have infringed on copyright.

ISPs believe that AFACT will now have refined its infringement notices based on this judgement, which means that any future case will likely be more successful for the federation. On the issue of cost reimbursement, however, AFACT seems reluctant to pay ISPs the costs associated with investigating and prosecuting customers for copyright infringement.

In its oral submissions before the High Court, iiNet will bring up the UK system for disconnecting copyright infringers, as well as the recently implemented New Zealand three-strikes law.

iiNet intends to highlight that the maximum suspension for a user's account under this system is six months, and the content owners such as AFACT are required to pay an ISP NZ$25 per infringement notice. At 2000 infringement notices per month, this would be $50,000 per month for AFACT.

In the meantime, iiNet has said it has beefed up its repeat infringement policy, and updated training manuals for dealing with customers who the ISP suspects has infringed on copyright. The company has begun issuing stern warnings to customers it believes to have infringed, such as those who indicate to the company that they engage in copyright infringement, but iiNet has not terminated any customers' accounts.

iiNet was also one of a number of ISPs to meet with the attorney-general last month to discuss copyright issues ahead of the High Court case in December.