The Dallas Buyers Club Court Decision Is Good News For Pirates – Here’s Why

The Dallas Buyers Club Court Decision Is Good News For Pirates – Here’s Why
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The makers of the Matthew McConaughey-starring movie Dallas Buyers Club have been dealt a blow in their attempt to extract payment from people alleged to have downloaded illegal copies in Australia. So what happens now?

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Voltage Pictures, which owns Dallas Buyers Club, has been trying to identify over 4700 iiNet subscribers who it alleges downloaded illicit copies of the movie. Earlier this year, the Federal Court agreed that iiNet should hand over subscriber details, but warned that any letter sent to account holders must first be approved by the court to protect consumers from abuse of the legal system.

In a win for consumer protection, the Federal Court has now rejected Voltage’s draft letters, criticising Voltage’s attempts to avoid explaining what fee it would demand.

Voltage had told the Court it would ask account holders for a settlement figure that included:

  • 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
  • a 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 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 Justice Nye Perram rejected Voltage’s attempts to multiply these fees, potentially thousands of times, for every other user in the BitTorrent swarm. His Honour also rejected Voltage’s attempt to claim money for other infringements consumers may have admitted to.

Ultimately, Justice Perram refused to allow Voltage to send the letters in their current form. Voltage will still be allowed to send letters in the future, but only if it promises to limit the damages it is seeking to a more reasonable amount. It will have to back this promise up with a $600,000 bond payment to the court.

Consumers who have illicitly downloaded Dallas Buyers Club could still be liable for damages, but the figures requested are more likely to be closer to a hundred dollars than a few thousand. The exact amounts Voltage are prepared to settle for remain confidential for now.

The court fights back against ‘speculative invoicing’

The judge was keen to protect consumers from so-called “speculative invoicing”, where copyright owners send offers to settle claims for grossly disproportionate amounts. These demands can be extortionate: the letters typically threaten consumers with an expensive lawsuit if they don’t pay up.

Voltage Pictures has already been heavily criticised internationally for its speculative invoicing practices. It has filed massive copyright infringement suits in the US — including one naming nearly 25,000 defendants for infringing copyright in its previous film, The Hurt Locker.

The goal of these lawsuits is not necessarily to actually prove infringement in court, but to convince defendants to settle out of court, usually for sums of more than $2000.

The United States’ system is open to this kind of copyright trolling, because under US law, copyright owners do not have to prove that they have actually suffered any loss from the infringement. They can ask the court to award any amount from $750 up to $150,000.

In Australia, unlike in the US, copyright owners are only entitled to an amount that is proportionate to the fee a consumer should have paid. Only in cases of flagrant copyright infringement are courts allowed to award higher damages to either punish consumers or deter others from infringing.

Speculative invoicing pressures consumers to settle for amounts that can be wildly disproportionate to the harm they have caused. It’s an unfair practice that abuses the legal system.

It also causes real problems for consumers who are wrongly accused and face the difficult choice between an expensive legal battle or simply paying up to make the problem go away.

People, not criminals

For years now, we have seen some copyright owners demand exorbitant sums of money for downloads of music or movie files that would have cost $30 or less to legitimately purchase or hire.

In this case, Justice Perram refused to allow copyright owners to demand substantial sums of money based on completely imaginary scenarios where users would negotiate a licence to share the movie over BitTorrent. His Honour called this “so surreal as to not be taken seriously”, and said any claims for payment must be firmly grounded in reality.

In this decision, we see internet users being treated as actual people instead of assumed criminals. This is important. So long as users are painted as faceless pirates, it is easy to justify the excessive fees demanded by copyright plaintiffs. A more realistic vision of users as ordinary consumers means that copyright payments must be more realistic too.

Looking ahead to reform

This case sets an important precedent for the future. Australian ISPs are close to agreeing to a new Industry Code that will make it easier for copyright owners to track down alleged copyright infringers.

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

Hopefully, the decision will help copyright owners focus on finding ways to offer Australians with quick, convenient, and reasonably priced ways to pay for content, rather than seeking to make money through litigation.

Even Voltage admit that copyright infringement is less about consumers and more about outdated distribution models. In an interview on Triple J earlier this year, Michael Wickstrom, Vice President of royalties and music administration at Voltage Pictures, said:

[…] the problem starts with the US distributors, because they purchase it for the US and everything else is driven around the US release date. I feel that if all the distributors were granted a day and date release, this would not be happening.

When we can have realistic release dates, I don’t think that the piracy numbers will be as much.

Time and again, Australians have shown they are willing to pay for reasonably priced and accessible content. Copyright owners who try to extort money from downloaders are going about this the wrong way.

See also: Why The Dallas Buyers Club Piracy Letter Won’t Matter | Is Downloading Really Stealing? | Why I Stopped Pirating And Started Paying For Media

Nicolas Suzor is Senior Lecturer, Faculty of Law at Queensland University of Technology; Kylie Pappalardo is Associate Lecturer in the School of Law at Queensland University of Technology, and Suzannah Wood is Research Fellow, Intellectual Property and Innovation Law Research Program at Queensland University of Technology

This article was originally published on The Conversation.


    • As plainly acknowledged at the bottom: “This article was originally published on The Conversation.”

      • Since when is the Conversation part of gizmodo, which is the exact article that appears right her in lifehacker

          • I think you guys need to stop pretending that people don’t read both LH and Giz (even if you don’t it definitely comes across like that), there needs to be more coordination between the sites. Giz and LH overlap a lot and dare i say would be better as essentially a filter on the one source of articles so instead of a duplicate of the same article appearing on both sites its the same article made available to one or both at the same time, and even better if those of us that view both sites could look at one site instead of going through two and dealing with duplicate articles.

          • Thanks for your feedback, Tim. While it’s true that some readers follow Lifehacker and Gizmodo equally, the vast majority primarily stick to one or the other. If an article is relevant to both audiences, we will often cross post it so that nobody misses out.

            Sometimes the headline and lead image are tweaked for style reasons but we always acknowledge where the story was sourced from. In the case of this article, we both republished the story from The Conversation independently of one another.

            In any event, it’s usually pretty obvious when a story has been cross-posted – even if the headline and image have changed, the author’s name and opening paragraph are plainly visible before you click.

          • I know you have access to the stats, but i find it hard to believe that there is not a large amount of people that read both giz and lh (i can see that more giz readers would ready lh than lh would read giz).

            Still it having it link to the other site instead of having it masquerading as a new article (people that read both sites look at 20+articles a day on allure sites alone, + god knows how many on other sites, its hard to keep track of where we read what (or it is for me anyway), having it link to the other (and some css :visited decoration or something to show we’ve seen it on already would be great) the side benefit is you have people that don’t read the other site starting to consider doing so.

            I know i read LH on and off for a year before reading it every day, and then years later again before i looked at giz beyond the occasional article because i didn’t see enough value. Cross promotion > Cross posting. I dont profess to be close to an expert on journalism or marketing or what most people want, but i do think there is a better way that those that are paid to think about that stuff can spend more then the few minutes i have on it and devise a hugely beneficial idea.

          • I’m still not 100% sure what the problem is here?

            The worst-case scenario is that a handful of readers accidentally click on something they’ve already read — even though the author name and opening paragraph should have alerted them.

            Meanwhile, thousands of other readers only see the story on one site or the other — why should they miss out on useful information?

          • Most people must only stick to one. Have you tried clicking on one of the interesting articles at the bottom of the page?

            Locked into one site by the stupid perpetual scrolling bs…

          • If you don’t want to fix up the annoyances and have a harmonious synergy between two very similar sites that’s fine, its just becoming quite tedious to read both sites that have the same story often different headlines and often seemingly at different times, its ahrd to tell if there is new content or if its cross posting, even a bit on the byline saying – originally posted on , of course then there is still the issue of comments, you have 2 streams of comments on what is essentially the same article.

  • They tried to get a little ol’ speculative invoicing in but the court saw through it. I would have been disappointed if they hadn’t tried.

    I would like to know what this really means, though. OK, they can send letters asking for compensation of the film and the costs associated with tracking down the alleged pirate. What is to stop someone saying “it wasn’t me, I happen to share a house with 4 other users. Go after them” or “I’m a noob/indifferent to security, I don’t secure my wifi. Maybe my neighbours downloaded it.”

    Is it just whoever’s name is on the bill that will cop it?

    • The draft basically accused the account owner and said that if they deny downloading it they have to give the name, address and other details of the person who did download it. Making up their own rules and requirements, glad these clowns were denied by the courts.

      • And if you don’t know who downloaded it? If you are young, share your residence with 2 other people, and constantly have people coming and going are you expected to write down a list of all of their details, provided you know them all, and offer them up?

        Alternatively, you live alone and say you didn’t realise or care that your wifi was insecure. As far as I know there is no law that says your wifi has to be secured and password protected.

        I just don’t see how anyone can be plausibly held responsible considering the long list of defenses that would well and truly exceed reasonable doubt.

  • If anyone receives a letter from these guys, with an amount to pay. send them back an offer of the cost of the DVD + say 15% extra for legal costs.
    send that back to them notarised and certified. and they will accept it. also state on it . it isnt an admission of guilt.
    They will take it.
    Dont fall into the trap of accepting the amount they say. treat it as a negotiation pure and simple

  • Judge – “Now, I’m aware that you guys have been involved in speculative invoicing overseas. This is of great concern to me, so while I find that ISPs will be required to release the details that you seek, you will need to submit your correspondence to the court to be approved before you starting contacting the people in question.”
    *Voltage knocks up slightly toned-down version of previous speculative-invoicing, previous used form letter*
    Judge – GTFO

    I feel that a bigger penalty should’ve been levied against Voltage – they’ve clearly just submitted this form letter in an attempt to sneak it through, in clear (I’ll avoid the word contempt) violation of the judge’s wishes. Funnily enough, judges feel that they deserve respect, and tend to react to parties that do not show it.

  • Just curious, if you have a Telstra Air enabled router. Is there a 2nd WAN IP for the Telstra Air clients? I wonder how they would deal with something like this?

  • Movie was shit, they’re just trying to recoup lost income from poor ratings. Glad I didn’t pay for it.

  • it would be more costly if your name was made public that you actually downloaded the poor movie, that would be enough of a scare tactic to cough up some coin to keep that out of the public eye

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