LEAKED documents from the US Embassy in Canberra reveal that Hollywood studios chose to go after third-largest internet provider iiNet, rather than Telstra, in a hard-fought online copyright case set to be heard for a third time by the High Court in Sydney.
The group of 34 companies, including Village Roadshow and the Seven Network, has this month been granted special leave to appeal a full bench Federal Court decision in February upholding Justice Dennis Cowdroy’s landmark 2010 ruling that Perth-based ISP iiNet had not authorised its customers to infringe copyright online.
Wikileak’s latest release of cables includes one dated November 30, 2008 – just 10 days after the Australian Federation Against Copyright Theft (AFACT) filed legal action claiming iiNet had infringed copyright by not taking reasonable steps to prevent unauthorised use of films and TV programs by its customers.
And the cable, from US Ambassador Robert McCallum, shows the studios wanted to avoid a stoush with “the big guns” Telstra BigPond, which holds about half of the local market.
“We will monitor this case as it unfolds, for its intellectual property rights implications and also to see whether the ‘AFACT vs the local ISP’ featured attraction spawns a ‘giant American bullies vs little Aussie battlers’ sequel,” it says.
The cable also confirms AFACT filed the case on behalf of the Motion Picture Association of America (MPAA) and its international affiliate, the Motion Picture Association (MPA).
“Despite the lead role of AFACT and the inclusion of Australian companies Roadshow and Seven, this is an MPAA/American studios production,” the cable says.
“Mike Ellis, the Singapore-based president for Asia-Pacific of the MPA, confirmed that AFACT is essentially MPAA’s Australian subcontractor, acting on behalf of the six American studios involved (Universal Pictures, Warner Bros, Paramount Pictures, Sony Pictures Entertainment, Twentieth Century Fox and Disney).”
The cable says MPAA prefers that its leading role not be made public.
“AFACT and MPAA worked hard to get Village Roadshow and the Seven Network to agree to be the public Australian faces on the case to make it clear there are Australian equities at stake, and this isn’t just Hollywood ‘bullying some poor little Australian ISP’,” it says.
The cable says it was clear Ellis did not want to “begin by tangling with Telstra, the still dominant player in telephony and internet, and a company with the financial resources and demonstrated willingness to fight hard and dirty, in court and out”.
The MPA boss claimed that iiNet users “had a particularly high copyright violation rate, and its management has been consistently unhelpful” in pursuing infringements.
“Ellis said AFACT delivered to iiNet every week for five weeks a telephone directory-sized list of violations complete with a DVD containing gigabytes of data on infringers using its network,” the cable says.
But when Federal Court Justice Dennis Cowdroy dismissed the Hollywood studios allegations in his February 2010 ruling, another cable sent from the US Embassy expressed disappointment.
“The hope for AFACT and the big studios was that a favourable decision would have established an international precedent that could have forced ISPs to tightly police the activities of their customers,” it says.
“The studios must now look for other ways to protect their commercial interests. AFACT will likely increase its lobbying of the Australian government for legislative changes.
“In the meantime, the problem will persist and probably worsen with the advent of the high-speed National Broadband Network, as the speeds at which copyright theft can take place will literally multiply.”
The High Court hearing of the case is set to start on September 9.