14 August brought the latest development in the LLC v iiNet Limited saga. The case relates to the owner of the film Dallas Buyers Club (DBC) seeking to recover damages in relation to illegal downloading of the movie by various persons.
In an earlier decisions, the Court decided that relevant Internet Service Providers (ISPs) were obliged to provide to the applicant Account Holder details by way of discovery and put arrangements in place to ensure that DBC’s dealing with relevant downloaders was not what was referred to as “speculative invoicing”.
In this August decision, the Court considered the format letters proposed by DBC to obtain information from the alleged illegal downloaders.
The Court noted that in English and Canadian cases the Courts had similarly considered superintending correspondence to be issued by organisations in a similar position to DBC as if the Court were some consumer protection authority but the Federal Court of Australia rejected that reasoning and interpreted the manner totally by reference to the relevant Court rules relating to discovery and the Court’s discretion.
The Court received submissions from DBC about what it was going to demand from illegal downloaders. A confidentiality order is in place in respect of the submission because some of its content has potential seriously to damage DBC is negotiating position.
Counsel for the ISPs asserted that the submission from DBC amounted to “speculative invoicing”.
The Court saw the military claims of DBC as relating to 4 heads: –
A. purchase cost for a copy of the film, being a cost more than a rental cost,
B. claim relating to the uploading activities of the alleged infringers and DBC alleged in respect of some of the infringers that there was large-scale uploading involving large amounts of money;
C. a claim for punitive damages reflective of how much downloading and uploading had occurred by each infringer; and
D. a claim for an amount of money from the costs incurred to date in pursuing the matter.
The Court determined that claims A and D are plausible, though left open the exact amount for another time whether akin to the rental fee in respect of A and noted in respect of D that, in absolute terms, whilst large amounts of costs have been incurred to date, when spread across the number of infringers, the amount per infringer is likely to be significantly less.
The Court rejected the other two grounds.
A claim under B will depend on exact detail of the legal downloading, where the whole films or “slivers” and the like, and sharing activities of a particular infringer, so being question of fact with particular situation rather than a blanket remedy.
A claim for C, punitive damages, failed due to the wording of section 115 of the Copyright Act 1968. That Court held that the section only allows damages by reference to the Copyright breach (downloading, uploading, sharing) the subject of the proceedings and not, more broadly, by reference to the totality of the unlawful copyright activities, uploading downloading and sharing, of the particular individual.
There will, no doubt, be a further sequel to this series of Court cases which will hopefully further illuminate the topic of what damages can be obtained by a copyright owner from a copyright infringer.
Unfortunately, the reality is that the case illustrates that, so far as calculating damages for breach of copyright, the devil is in the detail.