Contract & Property Law, Criminal Law

When ignorance is an excuse

The recent victory of one of Australia’s biggest ISPs, iiNet, against claims of copyright infringements of major film studios through iiNet’s peer-to-peer network, shows how difficult it is to hold an internet service provider liable.

The plaintiffs alleged that iiNet had authorised illegal file sharing and did not react promptly to warning notices sent to the respective customers (for instance by shutting down their accounts). The Court however held that mere indifference does not constitute authorisation (as required by the respective Copyright Act).

This sounds suspiciously like the old argument that manufacturers of photocopiers can not be held liable when their products are used for forgeries. Of course, when it comes to ISPs, such argument does not really work because an ISP retains control of what happens on its servers, whereas a photocopier manufacturer does not. But given the millions of users,  how much control does an ISP effectively have? And at what stage can or should they intervene if they come across suspicious behaviour?

In NZ, the recent amendments to the Copyright Act introduced a three-strike system for copyright infringers. However, the amendments did leave the safe-harbour provision in section 92B Copyright Act 1994 untouched, which basically says that mere knowledge of an infringement (even through notification of the warning notice) does not mean the ISP has authorised the infringement. This is almost exactly the same statutory basis as under the Australian legislation. 

However, it is important to note that in the iiNet case the Court found that the warning notices were not specified enough, hence did not provide iiNet with sufficient information to act upon. Given the new statutory regime under the NZ Copyright Act, it is therefore safe to say that if a NZ ISP receives notice of warnings which comply with the requirements under the Act, any continuation of providing services to the infringer would very likely result in the ISP being held liable for all infringements as of that point.

So ignorance is still no excuse once you have been given all the information.

http://www.claytonutz.com/publications/news/201204/20/iinets_high_court_win_means_isps_must_still_tread_carefully_on_copyright_infringement.page#page=1