A new anti-piracy group has surfaced and is looking to take individuals to court over copyright infringement of downloaded film content

A new anti-film piracy group has hit the headlines over its intention to take legal action against individual alleged copyright infringers in Australia on behalf of film studios. But some observers have questioned the efficacy of this tactic in deterring piracy and whether this is just a ploy for studios – and their lawyers - to make an easy buck.

Exetel chief, John Linton, first flagged the existence of the Movie Rights Group on his personal blog.

He claimed a new group, representing US film studio, Lightning Entertainment, contacted his company’s lawyers requesting the information on Exetel subscribers believed to have illegally downloaded movies belonging to the studio.

The Movie Rights Group, based in Queensland, offers an all-round service to content owners from identifying illegal downloaders and issuing infringement notices to taking legal action and handling pre-Court settlements.

According to Linton’s blog, the group noted it had 9000 Australian IP addresses, 150 belonging to Exetel, which were involved with alleged illegal downloading of content from Lightening Entertainment.

For those threatened with legal action, the Movie Rights Group strongly advises them to settle the matter out of Court. In fact, it has an entire section on its website dedicated to extolling the benefits of settling the case to “avoid costly and time-consuming Court appearances”.

But this is the kind of thing that concerns critics such as Queensland University of Technology (QUT) School of Law lecturer and former Electronic Frontiers Australia (EFA) chair, Nic Suzor.

“We’ve seen these lawsuits in the US and it is a worrying process in which people are heavily pushed into settling allegations of copyright infringement rather than going to Court for assessment of damages,” he said.

Suzor estimates about 200,000 suits of this sort have been filed in US though it has not been done in Australia before.

Locally, a swathe of film studios, through the Australian Federation Against Copyright Theft (AFACT), tried to make ISPs accountable for the piracy of their subscribers by filing a Court case against iiNet.

The case was dismissed in the Federal Court in February 2010. It was later dismissed again in an appeal to the Full Federal Court a year later. Now the case will go to the High Court in Canberra in December.

Certainly if all the lawsuits went through the Courts, the journey might not be very worthwhile – monetarily – for content owners.

“It would probably cost more to take individuals through the courts than what copyright holders are going to get out of it,” University of Technology (UTS) Faculty of Law professor, Natalie Stoianoff, said. “It is not a likely scenario for [copyright holders] to take individuals to Court unless they have been engaged in the commercial distribution of content.”

People convicted of copyright infringement in Court are often asked to pay damages to the copyright holder though this process differs between the US and Australia.

“In the US we have what is called statutory damages, which essentially means at a copyright trial, the copyright owner doesn’t have to prove actual damages; they can get statutory award of a specific amount per infringement,” Suzor said. “In Australia we don’t have that.”

According to the QUT lecturer, assessment of damages is left up to the Court which has some discretion to award not only actual harm of profits but also additional damages for punitive reasons.

He saw this as the best approach but is worried people will be coerced to settle the case outside of Court in fear of having to foot a behemoth legal bill.

The average cost to settle a case is around $3000, according to Suzor.

“Rather than facing the possibility of paying legal costs, which in many cases would be more than the damages awarded, people would be likely to settle,” he said. “It’s dangerous because it [removes] control of remedies and punishments for copyright from the Courts and that’s dangerous for the legitimacy of our copyright system.”

Pirate Party member and former president, David Crafti, saw it as profiteering.

“With regards to Movie Rights Group, I see this move to set up shop here in order to sue people as just another cynical move by the copyright industry to make money from the knowledge that a portion of people will be too scared to fight claims of infringement, even when innocent, and will instead choose to settle,” he told ARN in an email. “… If [the group] sues each person for $3000 and on average spend just a few dollars per person in processing costs, then the group knows they’ll get a rate of settlements, say 10 per cent, which gives them around a 10,000 per cent rate of return.”

Crafti claims this model is now ineffective in the US due to changes in the process which destroys the high rate of return.

“That’s why they come to Australia.”

Suzor agreed this method appears to be more about making money than stopping content pirates.

“It seems to be more a revenue generating model than a serious deterrent model,” he said. “…“We have seen certain enterprising lawyers pick up on these sorts of techniques in order to make a profit and I think that is the key distinction.”

Many sizable copyright holders, such as big movie studios, have already shifted their focus from litigation to educating users on piracy as well as providing legitimate ways to access content, according to Suzor.

The legal path, he said, is now view as an unpopular route.

ARN was unable to reach the Movie Rights Group for comment at the time of publication.