While Canberra residents recovered from the reverberations of a minor earthquake this morning, the High Court set off tremors of their own in unanimously finding that internet service provider, iiNet  had not authorised the copyright infringements of their users.

iiNet and Hollywood film studios had been locked in litigation for three years, over whether failing to respond to notices sent by the Australian Federation Against Copyright Theft (AFACT) alleging copyright infringement by their users meant that iiNet implicitly "authorised"  their users' actions.

The High Court delivered an eloquent, focused decision  that concerned itself with facts that could amount to authorization of copyright infringement. The High Court found iiNet didn’t have a direct power to prevent copyright infringement by their users on BitTorrent: they weren't hosting BitTorrent, they couldn't control the content being shared on BitTorrent and couldn’t prevent their subscribers from accessing the infringing content. iiNet, the High Court found, had only an indirect power to prevent copyright infringement in their contractual/technical power to cut off a user’s access to the internet.

The judgment centred on an examination of the meaning of ‘authorise’ in ss 101(1) and 101(1A) of the Copyright Act 1968. Included in s101(1A) are three matters to be considered in determining whether copyright infringement has been ‘authorised’:

1. the extent of any power to prevent the infringement
2. the nature of the relationship between authoriser and infringer, and
3. whether reasonable steps were taken to prevent the infringement

Nic Suzor, respected IP researcher and lecturer with Queensland University of Technology, has written a great blog post going through the Court's technical discussions on the meaning of ‘authorisation’.

The High Court didn’t go into great detail as to whether termination of internet access would ever be considered a ‘reasonable step’ to take in response to copyright infringement, one of the more controversial steps being demanded of iiNet by the movie studios. They note that there’s nothing to prevent users from signing up with another ISP if their service with iiNet was terminated, but don’t extend too much into whether termination itself would be reasonable.

Access to the internet has become a bit of a hot topic in the human rights debate, and the consequences of termination for users have been an uneasy question mark hanging over ‘three strikes’ regimes and voluntary codes in other countries. The internet is so essential to the way we communicate with each other, participate in study and work, conduct business and access important information, it’s been hard to determine how termination of internet access would still enable consumers to carry out necessary, and lawful, activities online.

French CJ, Crennan and Kiefel JJs conclude their judgment with the comment that the content and principles of authorisation law are ‘not readily suited to enforcing the rights of copyright owners in respect of widespread infringements occasioned by peer-to-peer file sharing’, hinting that a ‘targeted legislative scheme’ may be more appropriate.

AFACT have already made it clear in their response to the iiNet High Court decision that they expect Government to address what they call the failure of copyright law ‘to keep pace with the online environment’. While the iiNet case has been ongoing, the Attorney-General’s Department has led closed door discussions between the ISPs and content industries in an attempt to reach a voluntary code, and have stated that they prefer mediated industry talks and a potential code over any legislative changes.

The industry discussions have so far been kept secret from the public, and whether the Government moves forward with an industry code or legislative reform, the closed door nature of the discussions may have to change. Consumers won’t take kindly to being left out in the cold in discussions that could ultimately affect how much they pay for internet access, for content, as well as any steps that could lead to their internet access being taken away. And consumers really won’t take kindly to a solution that still fails to address the fundamental issues of market supply failure in Australia – that Australian consumers pay more, and wait longer, to access content than users in other countries do.

After the High Court judgment was handed down today, iiNet CEO Michael Malone again called on content industries and the ISPs to work in partnership to reduce piracy through more available licensed digital content:

"Increasing the availability of licensed digital content is the best, most practical approach to meet consumer demand and protect copyright," Mr Malone said.

"We have consistently said we are eager to work with the studios to make their very desirable material legitimately available to a waiting customer base - and that offer remains the same today."

Here’s hoping that today’s High Court decision in iiNet is another step towards more licensed, affordable content, and not a hasty charge towards an  industry code or legislative scheme that skirts around the ongoing market supply issues for consumers.