Sharman considers appeal over Aust court ruling

Sharman Networks is considering applying for leave to appeal yesterday's Federal Court decision allowing the admission of evidence obtained under a civil search order to a music industry court action against it.

Sharman Networks is considering applying for leave to appeal yesterday's Federal Court decision allowing the admission of evidence obtained under a civil search order to a music industry court action against it.

In a statement issued after the court proceedings, lawyers for Sharman Networks claimed the court decision -- in which Justice Murray Wilcox ruled that the civil search orders obtained by the music industry's local subsidiaries should not be set aside -- did not represent a "clear win for either side".

Sharman is being represented in the case by a team from Phillips Fox, headed by QC Francis Douglas.

The lawyers said the material seized would remain in the hands of independent lawyers and access to that material negotiated between the parties.

"It effectively means that material seized will not be handed over to the record industry plaintiffs, rather, both parties will discuss a regime of access," they stated.

"In reality, this is a way of converting the 'shock and awe' tactics employed by the plaintiffs by using the Anton Piller order into a more formal, appropriate legal process akin to discovery.

However, the lawyers said they were concerned about the precedent set by the decision, as they described the Anton Piller orders as "draconian".

"It opens the door for any person or business in Australia involved in the development of new technology to have their homes and offices raided by large multinationals, and property taken, without due process," they said.

The chief executive officer, of Sharman Networks, Nikki Hemming, said the company had complied with legal proceedings up until the Anton Piller order and had full intentions of complying in the future.

"We remain outraged at the heavy-handed tactics that have been used by the record industry to obtain information that we would have provided through the normal, appropriate court process", said Hemming. "In his ruling, Justice Wilcox acknowledged that Sharman has complied with legal proceedings in the past and that the company would conduct itself in the same manner in Australia.

She says the multinational record companies were just "forum shopping" for an appropriate jurisdiction as they "continue to lose their cases overseas," adding that the record companies should be taking advantage of the new opportunities provided by software such as Kazaa.

"It's time for the record labels to take their business back from their lawyers and capitalise on this new opportunity," said Hemming.

However, the general manager of the music industry's piracy investigations unit, Michael Speck, said "the industry is committed to the growth of legal online music providers and stopping Kazaa's illegal activities is a necessary step in that process".

The case is scheduled to continue in court on 23 March.