AUSSIE pirates beware.

While the bid by the makers of the Oscar-winning film Dallas Buyers Club to sue people it believes illegally downloaded the movie may have hit a major hurdle this week, the race is not quite over yet.

This week’s Federal Court ruling ended Dallas Buyers Club LLC’s attempts to seek extra damages from illegal downloaders but it also effectively gave the studio that owns the rights to the film, Voltage Pictures, an ultimatum.Comply or have the entire case thrown out.

According to Professor Michael Fraser from University of Technology, Sydney, DBC still had the option of pressing ahead with matter, it just won’t be able to argue for extra damages, and it will still have to foot a bond.In April Justice Nye Perram granted DBC’s request for the names and addresses of 4726 Aussies accused of pirating the film, provided it put up a $600,000 bond.

The bond was put in place by the court to stop DBC from speculative invoicing, a tactic by which a letter demanding a large sum is sent out in the hope the person will pay up rather than contest the figure.Justice Perram also granted the claim for the cost of renting the film, as well as out-of-pocket expenses and insisted on vetoing the letters before being sent.

But the film studio went back to court seeking to reduce the bond to $60,000 by only gaining access to 472 names (10 per cent of names for 10 per cent of bond).In addition, DBC also wanted to be able claim an amount based on each person who had accessed the uploaded film, a claim for punitive damages depending on how many copies of non-DBC copyrighted works had been downloaded by each infringer and for damages relating to the costs of obtaining to user’s details.

The company also argued that each person who uploaded the movie to a torrenting website, such as The Pirate Bay, would need to pay for a “worldwide non-exclusive distribution agreement”.

Justice Perram wrote in his judgment that he thought this request was “wholly unrealistic; indeed, I went so far as to describe it as surreal.”
He dismissed DBC’s application and issued an ultimatum to DBC to comply or the entire case would be thrown out.

Professor Fraser, who was a founder and chief executive officer of Copyright Agency Limited, told news.com.au the judge effectively ruled against the extra damages claims because DBC did not plead for them in the original hearing.
He also said the case appeared to be more about what kind of letter DBC/Voltage Pictures wanted to send the alleged downloaders, rather than about copyright.He explained the judge did grant them the right to claim the cost of renting the film as well as court costs.

“I don’t know what they will do of course, but they will have to come back by the date set in order to do that,” he said. “The ball is in Dallas Buyer’s court. It’s up to them.“It’s not necessarily the case that this is the end of the proceedings.

“They may take on board what the judge has said and proceed in accordance with that decision then test out the actual copyright issue.
“I think its possible they might comply and there will be letters sent out in a way that has been approved by the court.
“But we also don’t want to see speculative invoicing and I think the court has made sure that doesn’t happen. But we also don’t want to give a green light to massive piracy either.”

Professor Fraser said another avenue open for copyright holders such as DBC was the stalled Copyright Notice Scheme Industry Code.
For the past year, debate over who would bear the burden of the costs associated with having to track down and identify illegal downloaders has held up the implementation of a controversial three-strikes notification policy.

Australian internet service providers put together the code in a bid to reduce online piracy.
Under the code, customers suspected of illegally downloading content would be hit with a series of escalating infringement notices from ISPs.

After the first breach, a customer would be emailed a standardised “education” notice and if they continued to breach copyright laws they would be sent a “warning” notice followed by a “final” notice.

The ISPs plan to detect illegal downloading through customers’ internet protocol (IP) addresses, and then send warning letters to the account holder.
The email must be sent within seven days of the infringement and include the title of the work, and the date and time of when the downloading occurred.

The final notice, which does not have to carry the ISP’s branding, warns that the account holder could be taken to court and recommends they “seek independent legal advice”.The “three strikes and you’re out” scheme can then kick off a “facilitated preliminary discovery process”, which obliges the ISP to serve up the customer’s identity to the rights holder.

If a customer receives three notices within 12 months, the owners of the content — such as Hollywood studios or record companies — can then apply to a court to access the customer’s name, address and contact details and launch legal action against them.The code was meant to be implemented in September but has stalled over the dispute between the ISPs and copyright holders over who should foot the bill for the process.

Professor Fraser said the code has been submitted to the Australian Communications Media Authority by the parties but it hasn’t been registered because there still hasn’t been agreement over who should fund what.He said if film studios such as DBC wanted to pursue illegal downloaders through the avenue then they need to come back to the negotiating table.He also said if no agreement could be reached then perhaps the Communications Minister, Mitch Fifield, should intervene.

“In my opinion I think the costs should be shared but I also think the ISPs have an obligation to provide a lawful, safe, secure environment through their service for their customers and the community at large,” he said. “It’s been a stand-off for such a long time perhaps the Communications Minister might intervene in the absence of an agreement.”

Professor Fraser said if the code was registered then it would become the mainstream way of dealing with illegal downloaders however legal action would still be an option for film studios.