A ruling handed down yesterday by Germany's highest court represents a blow to rightsholders in their quest to clamp down on illicit file-sharing. The court ruled that the parents of a teenager who had made available more than 1,100 songs on file-sharing networks can not be held responsible for their son's infringements, nor be required to monitor or hinder his online activities.

When it comes to punishing file-sharers en masse, Germany is almost certainly the toughest jurisdiction in the world. While hundreds of thousands of individuals have been sued in the United States, legislation in Germany means that internet account holders are almost always held liable for activities taking place on their connections.

However, a ruling handed down yesterday by Germany’s highest court appears to be an exception to the rule, and one that could prove a considerable hindrance to regular rightsholders trying to protect their copyrights and trolls aiming to generate cash from settlements.

The story dates back to January 2007 when rights holders noticed 1,147 audio tracks being shared on file-sharing networks from a single IP address. Evidence in hand the record companies who monitored the infringements made a complaint to the prosecutor who traced the IP address back to a married couple.

A search of the couple’s residence was subsequently authorized and in August 2007 the computer connected to the infringements was seized and found to contain two pieces of file-sharing software, Bearshare and Morpheus. Importantly, the couple were not the owners of the computer, it belonged to their 13-year-old son.

Despite the evidence the parents of the teenager refused to pay damages to the rightsholders and the case ended up in court.

The plaintiffs insisted that the couple had fallen short in their parental supervision responsibilities. The district court agreed and ordered the couple to pay 200 euros damages per track on a sample of 15 tracks to a total of 3,000 euros. Other costs of 2,380 euros pushed the grand total to 5,380 euros.

Refusing to accept the decision the couple launched an appeal but that failed on the basis that they had failed to take technical measures to stop their son installing file-sharing software and had not adequately monitored his online activities.

Yesterday, the Federal Court – Germany’s highest court – overturned the decision of the Court of Appeal and dismissed the case.

The Court ruled that the parents had met their parental obligations when they informed their child of “basic do’s and don’ts” including that file-sharing copyrighted content online is illegal.

Furthermore, the Court ruled that the parents were not required to monitor their child’s online activities nor install special software to restrict his online behavior. This would only be required should the parents have “reasonable grounds” to presume that their child would engage in infringing activities online.

It will be interesting to see how this latest ruling affects demands for cash settlements from Internet account holders. Will a defense of “my child did it but I told him that it was illegal” prove enough to defuse a case? Time will tell.