AFACT Lawsuit
On 20 November 2008 the Australian Federation Against Copyright Theft (AFACT) filed a lawsuit against iiNet in the Federal Court of Australia claiming that iiNet infringed copyright by failing to prevent its subscribers from downloading pirated material using the BitTorrent peer-to-peer protocol. The lawsuit was co-filed by 34 film and affiliated companies including Village Roadshow, Universal Pictures, Warner Bros. and 20th Century Fox as well the Seven Network, an Australian television broadcaster, and alleges breach of copyright on a number of popular movies and television shows.
In response, iiNet issued a statement indicating that iiNet had been passing on the reports of infringement received from AFACT to law enforcement authorities, and that iiNet could not disconnect a customer's phone line based on an allegation unproven in the courts. Michael Malone, Managing Director of iiNet, went on to state that "AFACT is arguing that they don't want to talk to the police, and we should just cut the customers off". However, the Statement of Claim filed at the Federal Court does not indicate AFACT are asking for users to be disconnected but that iiNet subscribers are "prevented" from committing copyright infringement.
The case is regarded as a test case for copyright infringement in Australia, and AFACT is being represented by the same law firm that successfully sued the makers of Kazaa in 2005.
In 2010, Justice Cowdroy in the Federal Court found in favour of iiNet, noting that while iiNet users did infringe, this was not the responsibility of iiNet to deal with.
On 20 April 2012 the High Court of Australia confirmed the intervening Federal Court Full Bench decision affirming the first instance decision of Cowdroy, though not supporting all his reasons. Roadshow Films Pty Ltd v iiNet Ltd HCA 16 (20 April 2012). In his reasoning, Gummow J. noted in particular the current legislation did not provide a mechanism to deal with peer-to-peer infringements and it needed to be addressed by legislature.
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