Justice Gaetano Pagone said in his ruling that the processes Redbubble had in place, such as its intellectual property policy, and a team devoted to ensuring that products on sale on Redbubble were not in breach of copyright law, as well as the company's takedown process when receiving complaints from copyright owners, meant that the infringement wasn't "flagrant".



"Redbubble may have made a commercial decision concerning the risks of infringement but its conduct did not amount to a flagrant disregard of the rights," the judge said.

Following on from the decision, Redbubble has appealed to the government to legislate to prevent this sort of case happening in the future.

Legislation introduced into parliament by communications minister Mitch Fifield in December last year would extend so-called "safe harbour" extensions in copyright law to service providers, libraries and others.

It would mean that a university, for example, isn't held liable for when students or other users infringe on copyright on their network. It is an extension of the protection already offered to internet service providers such as Telstra.

The legislation was supposed to be introduced earlier in the year as part of another piece of legislation, but was pulled at the last minute amid complaints from copyright holders about it being included.

When it was re-introduced, the government dropped its most controversial aspect: an extension of safe harbour to online service providers such as Google, cloud hosts including Amazon, and online marketplaces like Redbubble. This exclusion places Australia at odds with US law around safe harbour.

Copyright holders argue that these companies should not be afforded protection at the expense of copyright owners.

But in a submission released last week, Redbubble said that due to the law, Australia was a "high risk" environment for hosting content. Redbubble pointed to the Pokémon case and said that the legal risks of not extending safe harbour were real and already being directly felt by the company.

"Despite Redbubble's practices, under the current safe harbour provisions it does not have the benefit of a statutory limitation on the remedies which are available against it," CEO Martin Hosking said.

"It is in no one's interest for proceedings to be brought against good actors in the intellectual property space such as Redbubble. A proper safe harbour for commercial online service providers would go some way to deterring such litigation in the future and to ensuring that no monetary relief could be awarded against such entities who take appropriate steps to deal with infringing content on their platforms."