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Spoiler alert: ‘Dallas’ case won’t stop illegal downloads

Apr 21, 2015
A scene from Dallas Buyers Club

A scene from Dallas Buyers Club

Much has been made of the recent judgment by Justice Nye Perram in Sydney in what has come to be known as the Dallas Buyers Club (DBC) decision. One commentator rather unkindly described the movie company‘s victory as “pyrrhic”.

So what is the court decision’s wider significance? Will it end illegal downloading of movies in Australia? Probably not.

The success of copyright owners in suing individuals overseas is driven entirely by the US system of statutory damages. Copyright holders can obtain large damages awards for small infringements. That is not, and is never likely to be, part of the Australian legal landscape.

The bedrock of our common law system is that damages are assessed so as to put the aggrieved plaintiff in the same position as if the copyright infringer had not caused them the loss or damage – often a “lost profits” approach.

What would that be here? The profit from the sale of a legitimate download via iTunes (current price A$11.99) is not much. Will copyright owner DBC LLC really sue for such a small amount? Unlikely.

So why did this case really come about? To assess that we need to look at its effect.

First-time infringers – who are typically purchasers, or hirers, of DVDs – and hard-line recidivist infringers – who never pay for legal downloads – are unlikely to be affected by the decision.

The action really targets the vast middle ground of “casual” infringers, who might be frightened enough to reconsider the risks of illegal downloading. It may also push them towards streaming services (such as Stan, Presto or Netflix Australia) instead.

There is a lot of hard yakka ahead for copyright owners before they might see a significant culture shift from illegal downloads towards legitimacy. Putting higher walls in the way of copyright infringers means that infringers just get taller ladders.

The Federal Government also runs hot with measures to stop downloading and infringement. Recently introduced into Parliament was the online copyright infringement Bill. If this passes, courts may order carriage service providers (including the ISPs) to take reasonable steps to disable access by users in Australia to online locations overseas whose “primary purpose” is copyright infringement if they in fact facilitate infringement of copyright material here or overseas.

The DBC case has a number of interesting features. DBC’s box office take has been 11 times its $5 million production costs. It won three Academy Awards, including in best male actor and male supporting actor categories, the first time this has happened since 2003.

The ISPs targeted by the plaintiffs were big enough to matter, but not too big to attack. Telstra, Optus and TPG were noticeably absent. Telstra and Optus have since said that they will resist having to providing names and addresses of customers accused of illegal downloading.

So what happens if I get a letter from the DBC lawyers? Let’s say I throw it in the bin. Later (much later) I get sued. There is no presumption that I was involved in any infringement just because the IP address allocated to a browsing session engaged in by a user of my internet service appears to correspond to that used by someone who downloaded (or more accurately, uploaded) a copy of DBC.

Sure, certain inferences arise, but ultimately if I sit tight and say nothing, can DBC really establish, on the balance of probabilities, that I am the infringer? There are many credible alternative explanations: I have an unsecured wi-fi connection and was the object of a “war driver”; it was my 17-year-old son, or the exchange student I’m hosting etc.

Importantly, the judgment provides no easy administrative or streamlined process to pursue  sophisticated or serial downloaders. Court processes must still be followed. There is a lot of hard yakka ahead for copyright owners before they might see a significant culture shift from illegal downloads towards legitimacy. Putting higher walls in the way of copyright infringers means that infringers just get taller ladders.

The Netflix user interface on an iPad.

The Netflix experience shows that masking technologies are commonly used.

The experience in Australia of US streaming service Netflix shows that masking technologies such as VPNs are no longer only for the technologically savvy. These can also be deployed to mask the true location of infringers, making it much more difficult for rights holders to seek their identities via IP addresses.

The decision is a nice result for rights owners like DBC, but raises more questions than it resolves. While the fear factor may provide some shortterm gain, recent mass downloads of leaked Game of Thrones episodes show that the effect is, at best, transient.

The case also emphasises certain uncomfortable facts.

Why did DBC open in US box offices more than three months earlier than in Australian cinemas?

Why do Australians get a more restricted library of Netflix films?

Why do we still pay more for content, as a recent Senate enquiry found?

In an era of digital delivery, can all this still be justified? Does this not encourage pirated downloads in Australia?

Spoiler alert – yes, it certainly does.

John MacPhail is a director of Adelaide law firm NDA Law.

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