That was because the designs were not available for purchase within the official Pokemon universe and would not have yielded royalties, the judge said. "Many of the items sold through the Redbubble website involved a 'mash up' of images, such as the combination of Pikachu and Homer Simpson," Justice Pagone said in his judgment. "The evidence thus did not support a confident finding of damages in the amount claimed." Justice Pagone said Redbubble's business model of allowing artists to upload and sell any design made copyright infringements "inevitable". The store reviewed artist's accounts regularly for intellectual property breaches but only after they had been made available for purchase.

"The business established by Redbubble carried the inherent risk of infringement of copyright," the judge said. "There may have been a sound commercial basis for Redbubble to manage the risks of infringement as it did, but in doing so it authorised the infringements which occurred." But he noted its conduct did not amount to flagrant disregard of Pokemon's rights. Redbubble was ordered to make declarations of copyright infringement and will face a hearing on legal costs at a later date. In an announcement to the Australian Stock Exchange, Melbourne-based Redbubble chief executive Martin Hosking said it had “always respected the rights of content owners and continue to work with them in the fight against infringement and piracy across the internet”.

“We remain focused on creating the leading marketplace for independent artists.

We are pleased that the judgment recognises the reasonable steps that Redbubble takes to prevent infringements occurring on the platform,” he said. The site, founded in 2006, describes itself as having 400,000 artists and designers globally who upload their designs to the site. Redbubble then handles the printing on more than 60 different items, including tote bags, clothes, phone and laptop cases, stickers and wall decals. Mr Hosking previously said the company was defending all claims. The Redbubble prospectus filed when it prepared to list on the ASX in May 2016 indicated there had been three lawsuits filed against the company since it started. One of these involved the Hells Angels Motorcycle Corporation, which alleged copyright infringement, trade mark infringement and contravention of Australian Consumer Law.

It also mentioned the Pokémon case, saying it was “possible” Redbubble would be unsuccessful in fighting the claims from either company and they could have “a material adverse impact” on the company. Pokémon alleged Rebubble had used sponsored advertisements on Google to promote Pokémon-branded products sold by the company, but argued the products were counterfeit. "A search of Google for 'Pikachu shirt' conducted on 3 February 2016 resulted in the identification of eight sponsored links. Six of those sponsored links were to products sold by Redbubble," Pokémon alleged. The company, known for its character Pikachu, alleged searching the character's name resulted in 11,564 products from Redbubble, and 43,528 when searching the Pokémon name. It described the conduct as "misleading or deceptive".

A search of Pikachu on the site on December 19 found 5320 results, and 35,802 for Pokemon. Searching "Pikachu shirt" on Google did not show a sponsored advertisement from Redbubble, though did show its results on the search giant's first page. A page on Redbubble's website about copyright recommends artists "speak to an attorney" before uploading to the site if they have specific questions or concerns about their artwork. It notes using characters from video games or text from a book could infringe someone else's copyright. with AAP