251,287 cables indexed
Reference ID: 08CANBERRA1197
Subject: FILM/TV INDUSTRY FILES COPYRIGHT CASE AGAINST AUSSIE ISP
Origin: Embassy Canberra, Australia Classification: CONFIDENTIAL
Created:30 Nov 2008 Released:29 Aug 2011
Tags: AS, ECON, ECPS, ETRD, KIPR

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C O N F I D E N T I A L CANBERRA 001197


SIPDIS

STATE PLEASE PASS USTR

E.O. 12958: DECL: 12/01/2018
TAGS: KIPR, ECPS, ECON, ETRD, AS
SUBJECT: FILM/TV INDUSTRY FILES COPYRIGHT CASE AGAINST
AUSSIE ISP

REF: CANBERRA 1173 (NOTAL)

Classified By: AMBASSADOR ROBERT D. MCCALLUM JR, REASON 1.4 (B, D)

1. (C) Summary: On November 20 several media companies filed
legal action against Australia's #3 internet service provider
(ISP) iiNet, seeking a ruling that iiNet has infringed
copyright by not taking reasonable steps to prevent
unauthorized use of films and TV programs by its customers.
This is the first such case filed in Australia. The case was
filed by the Australian Federation Against Copyright Theft
(AFACT) on behalf of the Motion Picture Association of
America (MPAA) and its international affiliate, the Motion
Picture Association (MPA), but does not want that fact to be
broadcasted. Initial reactions support MPAA's claim that it
has a strong legal case. End Summary.

A NEW LEGAL CHALLENGE AGAINST PIRACY AIMS AT ISP

2. (U) On November 20 the Australian Federation Against
Copyright Theft (AFACT) announced that several media firms
had filed a case in the Federal Court of Australia against
iiNet, Australia's third largest ISP, for "failing to take
reasonable steps, including enforcing its own terms and
conditions, to prevent known unauthorised use of copies of
the companies' films and TV programs by iiNet's customers via
its network." The action was filed by Village Roadshow (an
Australian company that produces and distributes movies and
DVDs, among other activities), Universal Pictures, Warner
Brothers Entertainment, Paramount Pictures, Sony Pictures
Entertainment, Twentieth Century Fox Film Corp., Disney
Enterprises, and the Seven Network (one of Australia's three
major over-the-air television networks and a licensee of some
of the infringed works). Proceedings will be back before the
court on December 17; a ruling is unlikely before the end of
2009.

3. (U) This is the first such case to be filed in Australian
courts. iiNet claims that it is protected by the "safe
harbor" provisions of the Copyright Act - i.e., ISPs are
merely common carriers of traffic, so the dispute is between
copyright owners and violators. iiNet said in its media
release response that it routinely turns over to the police
evidence of piracy on its network.

THE REST OF THE STORY

4. (C) Despite the lead role of AFACT and the inclusion of
Australian companies Village Roadshow and the Seven Network,
this is an MPAA/American studios production. Mike Ellis, the
Singapore-based President for Asia Pacific of the Motion
Picture Association, briefed Ambassador on the filing on
November 26. Ellis confirmed that MPAA was the mover behind
AFACT's case (AFACT is essentially MPAA's Australian
subcontractor; MPAA/MPA have no independent, formal presence
here), acting on behalf of the six American studios involved.
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."

5. (C) Why iiNet? Ellis said they were the right target on
several levels. First, they are big enough to be important -
iiNet is the third largest ISP in Australia. (Telstra,
owners of top Australian ISP BigPond which has about half of
the market, are the "big guns", Ellis admitted. It was clear
Ellis did not want to begin by tangling with Telstra,
Australia's former telecom monopoly and 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.) Ellis also said iiNet users had a
particularly high copyright violation rate, and that its
management has been consistently unhelpful on copyright
infringements.

6. (C) Ellis described the case as "very strong." He said
AFACT delivered to iiNet every week for five weeks a
"telephone directory"-sized list of violations complete with
a DVD with "gigabytes" of data on infringers using iiNet's
network. Ellis said iiNet did nothing against any of its
users after being presented with this and other evidence.
AFACT/MPAA have hired Australia's top copyright lawyer,
Michael Williams of Gilbert & Tobin, to represent them in
this case. Williams, well-known to the Mission and highly
respected in the Australian legal community, was the lawyer
behind the successful Cooper and Kazaa IPR cases in
Australia.

7. (C) Ellis said he had told Communications Minister Stephen
Conroy a few months ago that absent action by the ISPs or
GOA, the industry "would have to do something" rather than
let movies and TV "go the way of music" on the internet. He
said Conroy had been clear that he "had other priorities"
(i.e., rolling out the National Broadband Network, reftel).
Ellis said MPAA did not see any role for Embassy at this
time, but wanted to keep us informed.

REACTION MIXED

8. (SBU) Media reaction to the case has been mixed. It
includes some predictable criticisms of AFACT's resort to
legal challenges as doomed to be ineffective, and
exhortations that the best way to combat piracy is for the
movie and TV industries to adapt to the digital age and make
their products more readily available for download at
reasonable prices and conditions. A couple of legal analysts
writing on copyright and media-oriented Australian websites
have concluded that iiNet's position is very weak, in
particular its reliance on "safe harbor" provisions. They
noted that AFACT had given iiNet five thick logbooks and DVDs
full of data about iiNet users infringing movie and TV
program copyrights. However, they also recognize that this
is the first case filed under the relevant portions of the
Copyright Act since it was amended in 2007 - so there is no
legal precedent.

9. (C) Comment: Ellis and MPAA see this as a major test
case, and not necessarily their final legal move in
Australia, which does have very high rates of illegal movie
and television show downloads, in part because of the
sometimes long gaps between their release in the US and their
arrival in Australian theaters or on local television. Ellis
said it could be followed up by similar filings in other
Commonwealth countries. We will monitor this case as it
unfolds, for its IPR implications and also to see whether or
not the "AFACT vs. the local ISP" featured attraction spawns
a "giant American bullies vs. little Aussie battlers" sequel.
Qa "giant American bullies vs. little Aussie battlers" sequel.
End comment.

MCCALLUM