Sharman Networks, the operator of the Kazaa P2P file sharing system, may have to fork over at least three-quarters of a billion dollars to the global recording industry as the Australian Federal Court for Sydney ruled the company violated Australian copyright law. More than violation of copyright law, the ruling goes as far as finding Sharman guilty of enticing users to become pirates by making it easy for them to do so.
Justice Murray R. Wilcox, senior associate judge of the court, found Sharman and five of nine co-defendants guilty enticing and enabling Australians to make and distribute audio files without a license. Wilcox did not classify the offense as a conspiracy to entice and enable the infringements, however, as Universal Music Australia Pty. Ltd. and 29 other applicants would have preferred.
As a result, Kazaa is to be discontinued in Australia. The order goes into effect in two months if Kazaa hasn’t taken measures to update the network so that copyrighted files are protected. Sharman was also required to broadcast a message asking P2P members to update their current version of Kazaa to include these measures.
Sharman argued that Kazaa users were often warned about copyright infringement, an assertion the judge dismissed.
“The Kazaa website contained warnings about copyright infringement,” writes Justice Wilcox. “The EULA was clear. These steps were substantially ineffective. However, that was not because users were not warned; it was because they were unwilling to allow the warnings to affect their behaviour. The fact that this unwillingness was encouraged by other material on the Kazaa website does not mean there were no warnings.”
The defendants were also critical of the music industry’s lack of effort in using technology to protect copyrighted material on discs. This argument also lacked a landing pad in court.
“I understand the argument in favour of more widespread licensing of copyright works. No doubt that course would have commercial implications for sound recording distributors. Whether or not they should take it is a matter to be determined by them. Unless and until they do decide to take that course, they are entitled to invoke such protective rights as the law affords them,” wrote the judge.
