201511.27
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Dallas Buyers Club case – What’s all the fuss about?

by in General

If you are not a movie buff or go to the movies occasionally, you are probably wondering what all the fuss is about the Dallas Buyers Club court action! If you download movies from the internet, should you be worried?

If you don’t already know, the Dallas Buyers Club is a movie that is the subject of a court action by the owners of the movie, Voltage Pictures, to obtain the identities of people who downloaded the movie over the internet so they can pursue them either for payment or legal redress.

How do you do this? Download a movie form the internet? You can do it legally through subscription websites or illegally through software that allows illegal downloading of movies for free.

Since the release of the Dallas Buyers Club movie, Voltage Pictures, has been trying to identify the owners of 4726 IP addresses who the company alleges downloaded and shared illegal copies of the movie using software such as BitTorrent, the software company, named in this case.

There is some consumer uncertainty about the legalities of downloading movies over the internet.

Is downloading movies stealing? Can you go to jail? Can you be contacted by owners of the movies, asked to pay for the download and be up for a big bill?

You will be happy to know you can’t go to jail because there are no laws in Australia that criminalise downloading and watching movies for personal use. Copyright owners of movie content can pursue you in the civil court for damages arising out of copyright infringement.

So why is the Dallas Buyers Club case relevant to Australians who download movies?

A lot of Australians download movies, legally and illegally.

It is expensive to subscribe to the whole of Foxtel to be able to see one movie. Being able to download a movie onto your computer from the internet is an attractive proposition.

Until recently, there was only Foxtel. Now we have other players in subscription content services that are more affordable such as Netflix.

Secondly, movies are released much later in Australia than other parts of the world and consumers use downloads to view movies sooner rather than later.

Therefore, a lot of Australians are impacted by the outcomes of the Dallas Buyers Club case and any change in Australian law that deal with downloading movies from the internet.

When internet service provider iiNet refused to hand over the identities and contact details of the 4700 odd Australian internet users who had downloaded and/shared the Dallas Buyers Club, Voltage Pictures made an application to the Federal Court to compel iiNet to hand over this information.

The Federal Court agreed that iiNet should hand over subscriber details. However, the court made this decision on the express condition that any communication sent to the iiNet account holders must first be approved by the Court.

The end of “speculating invoicing” – critical to consumer protection

The judge imposed on Voltage Pictures an express condition of obtaining court approval on all letters to account holders to protect the account holders from “speculative invoicing”.

Speculative invoicing is a practice whereby copyright owners send offers to settle claims for grossly disproportionate amounts, resembling extortion-like behaviour, typically threatening consumers with expensive legal action if they don’t settle on the copyright owner’s terms.

Voltage Pictures has a history of speculative invoicing, attracting substantial international criticism, having filed massive copyright infringement lawsuits against ordinary personal use consumers in the US, for example naming nearly 25000 defendants for infringing copyright in an earlier film, the Hurt Locker.

The initial win in court unraveled for Voltage Pictures when the Federal Court rejected draft letters to account holders, submitted by Voltage Pictures for approval by the Court.

In the draft letters submitted to the Court for approval, Voltage Pictures proposed to ask account holders for four types of payments as settlement for infringing copyright by downloading Dallas Buyers Club:

  • the purchase price of a single legitimate copy of the film; plus
  • another fee for sharing the film to other BitTorrent users (an extremely large amount that would be a multiple of the total number of people to whom the subscriber may have transmitted small parts of the film); plus
  • punishment for any other infringement of the copyright in any other, unrelated, content that subscribers admit to have illicitly downloaded; plus
  • an amount that would cover the cost of tracking down users associated with infringing downloads.

The Court accepted that Voltage Pictures could ask for the costs of a single copy of the film and an appropriately proportioned fee to recover its legal costs so far but rejected the other two requests for payment as potential abuse of the legal system by presenting account holders with the possibility of a larger fine to coerce a much higher settlement.

What does this mean for consumers who are downloading movies?

If you are illegally downloading movies and content you could still be liable for damages. If you are one of the 4700 account holders being sought after by Voltage however, you won’t have a letter coming anytime soon. Voltage Pictures cannot send any letters as they have not been approved by the Court.

Voltage can send letters in the future buy only if it promises to limit the damages it is seeking to a reasonable amount and any re-drafts will also require Court approval.

There are changes afoot that will require consumers to curb their desire to download content without proper licences or subscriptions.

The Copyright Amendment (Online Infringement) Bill 2015 was passed in the Senate this year and is designed to prevent Australians accessing some overseas websites like BitTorrent.

When the Bill becomes law it will not actually stop people who insist on downloading illegal content from overseas websites. The law will, however, allow owners of intellectual property such as movie companies to bring an action in the Federal Court to force an Internet Service Provider to take reasonable steps to block access to an overseas website like BitTorrent that allows illegal downloading of their movie or content.

The Dallas Buyers Club case sets an important precedent for the future.

This decision means Australian courts will be careful to scrutinise future claims made by copyright owners seeking to identify internet users associated with infringing downloads.

It also means consumers are protected from extortionate demands made by copyright owners.

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