Federal Court of Australia

Roadshow Films Pty Ltd v Telstra Corporation Limited [2022] FCA 1413

ORDERS

THE COURT NOTES:

In these orders, the following terms have the following meanings:

(a)    Domain Name means a name formed by the rules and procedures of the Domain Name System (DNS) and includes subdomains.

(b)    DNS Blocking means a system by which any user of a Respondent’s service who attempts to use a DNS resolver that is operated by or on behalf of that Respondent to access a Target Online Location is prevented from receiving a DNS response other than a redirection as referred to in Order 6.

(c)    IP Address means an Internet Protocol address.

(d)    Optus means the second to twelfth Respondents.

(e)    Target Online Location means the online location as referred to in Schedule A and that is or was accessible:

(f)    New Target Online Location means the locations referred to in Order 13.

(g)    New Target Online Location Orders refers to orders sought or made under Orders 13 or 15 hereof.

(h)    Telstra means the first Respondent.

(i)    TPG means the thirty-first to the forty-eighth Respondents.

(j)    URL means a Uniform Resource Locator.

(k)    Vocus means the thirteenth to thirtieth Respondents.

(l)    Vodafone means the forty-ninth to fifty-first Respondents.

THE COURT ORDERS THAT:

1.    Each Respondent must, within 15 business days of service of these Orders (and thereafter within 15 business days of an obligation to disable access to a Domain Name, IP Address or URL arising under Order 12), take reasonable steps to disable access to the Target Online Location.

2.    Order 1 is taken to have been complied with by a Respondent if that Respondent implements any one or more of the following steps:

(a)    DNS Blocking in respect of the Target Domain Names;

(b)    IP Address blocking or re-routing in respect of the Target IP Addresses;

(c)    URL blocking in respect of the Target URLs and the Target Domain Names; or

(d)    any alternative technical means for disabling access to the Target Online Location as agreed in writing between the Applicants and a Respondent.

3.    If a Respondent in complying with Order 1 does not implement one of the steps referred to in Order 2, that Respondent must, within 15 business days of service of these Orders, notify the Applicants of the step or steps it has implemented.

4.    Each Respondent must use reasonable efforts to redirect any communication by a user of its service seeking access to the Target Online Location which has been disabled pursuant to Order 1 to a webpage established, maintained and hosted by either:

(a)    the Applicants, or their nominee, pursuant to Order 5; or

(b)    that Respondent or its nominee.

The Applicants’ obligations pursuant to Orders 5 and 6 only arise if a Respondent notifies the Applicants that the Respondent will redirect a communication pursuant to Order 4(a) and for so long as at least one Respondent redirects communications to that webpage.

5.    The Applicants, or their nominee, must establish, maintain and host a webpage which informs users of a Respondent’s service who have been redirected to the webpage pursuant to Order 4 that access to the website has been disabled because this Court has determined that it infringes or facilitates the infringement of copyright.

6.    Within 5 business days of these Orders, the Applicants will notify each of the Respondents in writing of the URL of the webpage established, maintained and hosted under Order 4 and, if the webpage ceases to operate for any reason, will notify each of the Respondents in writing of a different URL that complies with Order 5.

7.    If, in complying with Order 4, a Respondent redirects any communication by a user of its service to a webpage established, maintained and hosted by it, that Respondent or its nominee must use reasonable efforts to ensure that the webpage informs the user of that Respondent’s service that access to that website has been disabled because this Court has determined that it infringes or facilitates the infringement of copyright.

8.    In the event that any of the Applicants has a good faith belief that:

(a)    any Target URL, Target IP Address or Target Domain Name which is subject to these Orders has permanently ceased to enable or facilitate access to the Target Online Location; or

(b)    any Target URL, Target IP Address or Target Domain Name has permanently ceased to have the primary purpose of infringing or facilitating the infringement of copyright,

a representative of the Applicants must, within 15 business days of any of the Applicants forming such a good faith belief, notify each Respondent of that fact in writing, in which case the Respondents shall no longer be required to take steps pursuant to Order 1 to disable access to the relevant Target URL, Target IP Address or Target Domain Name that is the subject of the notice.

9.    A Respondent will not be in breach of Order 1 if it temporarily declines or temporarily ceases to take the steps ordered in Order 1 (either in whole or in part) upon forming the view, on reasonable grounds, that suspension is necessary to:

(a)    maintain the integrity of its network or systems or functioning of its blocking system;

(b)    upgrade, troubleshoot or maintain its blocking system;

(c)    avert or respond to an imminent security threat to its networks or systems; or

(d)    ensure the reliable operation of its ability to block access to online locations associated with criminal content if it reasonably considers that such operation is likely to be impaired, or otherwise to comply with its statutory obligations including under section 313(3) of the Telecommunications Act 1997 (Cth),

provided that:

(e)    unless precluded by law, it notifies the Applicants or their legal representative(s) of such suspension, including the reasons and the expected duration of such suspension, by 5.00 pm on the next business day; and

(f)    such suspension lasts no longer than is reasonably necessary and, in any case, no longer than 3 business days or such period as the Applicants may agree in writing or the Court may allow.

10.    The owner or operator of the Target Online Location and the owner or operator of any website who claims to be affected by these Orders may apply on 3 days’ written notice, including notice to all parties, to vary or discharge these Orders, with any such application to:

(a)    set out the orders sought by the owner or operator of the Target Online Location or affected website; and

(b)    be supported by evidence as to:

(i)    the status of the owner or operator of the Target Online Location or affected website; and

(ii)    the basis upon which the variation or discharge is sought.

11.    The parties have liberty to apply on 3 days’ written notice, including, without limitation, for the purpose of any application:

(a)    for further orders to give effect to the terms of these Orders;

(b)    for further orders in the event of any material change of circumstances including, without limitation, in respect of the consequences for the parties and effectiveness of the technical methods under Order 2; and/or

(c)    for orders relating to other means of accessing any Target Online Location not already covered by these Orders.

12.    If a website the subject of the Target Online Location is at any time during the operation of these Orders provided from a different Domain Name, IP Address or URL outside Australia, the Applicants may, by their solicitor:

(a)    provide a notice in writing to the Respondents and the Court that:

(i)    identifies the different Domain Name, IP Address or URL; and

(ii)    certifies that, in the good faith belief of the Applicants and their solicitor, the website operated from the different Domain Name, IP Address or URL is a new location for the Target Online Location the subject of these Orders and brief reasons therefore;

(b)    within 7 business days of the notice given pursuant to Order 12(a), the Respondents must notify the Applicants and the Court in writing if they object to taking steps pursuant to Order 1 to disable access to the Domain Name, IP Address or URL notified in accordance with Order 12(a);

(c)    if any Respondent objects to disabling a Domain Name, IP Address or URL notified in accordance with Order 12(a), or the Court otherwise considers it appropriate to do so, the proceeding will be relisted for further directions; and

(d)    if, within the time period specified in Order 12(b) no Respondent objects to disabling access to any Domain Name, IP Address or URL notified in accordance with Order 12(a) and the Court does not otherwise require the proceeding to be relisted, then upon receipt of a notification from the Applicants that the Court does not require the matter to be relisted, the Respondents must take steps pursuant to Order 1 to disable access to the Domain Name, IP Address or URL notified in accordance with Order 12(a).

13.    The Applicants have leave to file and serve an amended originating application seeking further orders (New Target Online Location Orders) in respect of any additional target online location (New Target Online Location) that appears to the Applicants’ solicitors to be associated with the Target Online Location (based on its name, branding or the identity of its operator) and making available online the same or substantially the same content that the Target Online Location is or was previously making available online.

14.    Subject to any further order or direction, the leave granted under Order 13 continues to apply for the duration of these Orders.

15.    Subject to any further order or direction, if the Applicants file any amended originating application pursuant to Order 13, then the following shall apply:

(a)    The Applicants must serve on the Respondents a copy of the amended originating application together with any supporting affidavit evidence to be relied on in support of the application for the New Target Online Location Orders within 7 days of filing the amended originating application.

(b)    The Applicants must give notice of their application for the New Target Online Location Orders in accordance with the requirements of s 115A(4) of the Copyright Act 1968 (Cth).

(c)    Any Respondent who wishes to be heard in relation to the New Target Online Location Orders must notify the Applicants and the Court within 7 business days after being served in accordance with Order 15(a) above.

(d)    If no notice is given by any Respondent in accordance with Order 15(c) above, then the Applicants may approach the Court for the purpose of seeking the New Target Online Location Orders and the Court may in its discretion, consider and determine the application for the New Target Online Location Orders on the papers without further notice and without any oral hearing.

16.    These Orders are to operate for a period of 3 years from the date of these Orders.

17.    No less than two months prior to the expiry of these Orders:

(a)    the Applicants may file and serve:

(i)    an affidavit which states that, in the good faith belief of the deponent, the Target Online Location continues to have the primary purpose of infringing or facilitating the infringement of copyright; and

(ii)    short minutes of order extending the operation of these Orders for a further 3-year period; and

(b)    the process contained in Order 19 shall apply.

18.    The affidavit referred to in Order 17 is to be made by a deponent duly authorised to give evidence on behalf of the Applicants and may be given by their solicitor.

19.    If an affidavit and short minutes of order are filed and served in accordance with Order 17:

(a)    within 7 business days, the Respondents must notify the Applicants and the Court if they object to the Orders being made in accordance with the short minutes of order served by the Applicants;

(b)    if any Respondents give notice of any objection, or the Court otherwise thinks fit, the proceeding will be relisted for further directions;

(c)    if no Respondent gives notice of any objection and the Court does not otherwise require the proceeding to be relisted, then the Court may make orders in terms of the short minutes of order served by the Applicants without any further hearing; and

(d)    the Applicants must serve on the Respondents any such orders made.

20.    The Applicants pay Telstra’s, Optus’, Vocus’, TPG’s and Vodafone’s compliance costs calculated at the rate of $50 per Domain Name the subject of DNS Blocking undertaken for the purposes of complying with Order 1.

21.    There be no order as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

NICHOLAS J:

Introduction

1    Before the Court is an application for orders under s 115A of the Copyright Act 1968 (Cth) (“the Act”) for site blocking orders. The orders are sought by the applicants in respect of the online location known as Mixdrop. According to the evidence, Mixdrop is what is referred to as a cyberlocker.

2    There are 48 respondents, each of which is a carriage service provider. The first and thirty-first to fifty-first respondents have not sought to be heard in the proceeding and submitting notices have been filed on their behalf. The second to thirtieth respondents did not appear.

3    The applicants are well-known producers and distributors of cinemograph films comprising commercially released movies and television programs. Those films, in which one or more of the applicants own copyright, include The Lego Movie (Roadshow/Village Roadshow), Cinderella (Disney), Transformers: Age of Extinction (Paramount), The Shallows (Columbia) and Jurassic World (Universal). The evidence relied on by the applicants establishes that these films are made available online at Mixdrop without the licence of the copyright owners.

4    No person claiming to be an operator of Mixdrop sought to be joined as a respondent in this proceeding or to be heard in relation to relief sought by the applicants. Similarly, none of the respondents to the proceeding opposed the orders sought by the applicants or sought to be heard in relation to them.

Technical Background

5    The term cyberlocker is used to describe an online storage and distribution facility where copyright material (typically movies and television programs) are uploaded and downloaded in breach of copyright. The main point of distinction between many conventional cloud storage services (e.g. Microsoft OneDrive, Dropbox) and cyberlockers is that the latter deliberately set out to promote and encourage copyright infringement on a wide scale. They may promote online sharing of copyright material by users of the service by providing financial incentives aimed at encouraging users to upload and share as much content as possible and by creating an environment in which users can upload and download copyright material anonymously and with impunity with no steps, or at least no genuine steps, taken by the operator to discourage or curtail copyright infringement.

6    The evidence relied on by the applicants includes an expert report from a computer scientist, Mr Michael Walsh. He has a degree in computer science and psychology and has extensive experience providing technical advice and assistance to clients in relation to internet piracy. He presently acts as an independent consultant. Prior to that he worked for Kerna Communications Limited, a specialist internet consultancy based in Dublin, Ireland, which he founded in 1995. At Kerna Mr Walsh acted as a consultant to law firms, health insurers, hospitals, airlines and airport operators in relation to internet technologies and information security. His report is concerned with the activities of cyberlockers and, in particular, the Mixdrop cyberlocker. The technical discussion which follows is largely drawn from his report.

7    Cloud storage providers endeavour to integrate their facilities into the different devices that they support to ensure that users can store and access content in a manner that mirrors, as far as possible, the use of local device storage. They usually provide software for PCs, smartphones and tablets to integrate the cloud storage with the local file system so that it can be used by applications on those devices as an extension of local storage.

8    Cyberlockers do not tend to provide integration with the user’s device or synchronisation between devices. Some cyberlockers do provide desktop applications for uploading and managing shared files similar to those provided by business orientated cloud storage services. However, as cyberlockers are not intended for storing personal data, they do not typically provide tools for synchronising files across different devices. Nor do they typically provide software to integrate the cyberlocker files with local applications on a PC, smartphone or tablet. Cyberlockers generally provide larger free storage limits than commercial cloud storage providers. This is intended to encourage uploaders to upload and share as much content as possible.

9    Cloud storage service users expect the service to retain their files until such time as the user chooses to delete them, or until their account is closed. This applies equally to free and paid users of the services. Cloud storage services do not arbitrarily delete a user’s stored content. However, many cyberlockers delete files that have not been downloaded for a specified period of time, often without reference to the account holder. Users are encouraged actively to share links to their uploaded content in order to ensure that it is retained on the site. These are not services that would be used by anyone who wished to store personal data securely for later use.

10    Cloud storage services usually allow users unrestricted access to their own uploaded files. Users also have control over which other parties are authorised to access files once uploaded. Different access permissions can be set and changed for different users. Cloud storage providers also offer services intended for businesses and corporations with specific features to address business needs, such as granular control of file access permissions, security of the cloud data and integration with other business applications and service providers. Access-control may be enforced, for example, by reference to the user’s email address or their registered account on the cloud storage service, if they have one. Access permissions can generally be revoked or modified even after a file link has been shared with other parties.

11    Uploaders to cyberlockers have more limited control over who may access their files once they have been uploaded. While some cyberlockers allow files to be marked as “public” or “private”, these terms can be misleading as there is often no ability to limit access to specific service users. Typically, once a link is shared, access to it may not be revoked by the user other than by deleting the file.

12    Cloud storage services do not use their services to deliver third party advertising to their users as a means of generating revenue from user activity. By contrast, cyberlockers typically use their services to drive third party advertising. Intrusive advertising tends to be enforced on all downloads, including advertising directed at a user accessing his or her own files. For some cyberlockers, advertising is their main or only revenue source.

13    Cloud storage services do not typically offer incentives to promote any particular sort of activity on their site. Many cyberlockers on the other hand, operate affiliate schemes that reward or pay users for download activity, i.e. when third parties access the files that they have uploaded. This is intended to promote the upload, dissemination and sharing of content, drawing more downloaders to the cyberlocker and generating more advertising or subscription revenue for the site as a result.

14    Cyberlockers attempt to evade identification and avoid accountability for their activities. The sites rarely have any usable contact information and the ‘whois’ details regarding the domain name registrations are often hidden behind privacy shields. Privacy services and services such as Cloudflare are also frequently used to mask the identity of the operator of the site and its hosting location.

Mixdrop

15    Mixdrop is accessible at identifying uniform resource locators (“URLs”), domain names and internet protocol addresses identified in the applicants’ proposed orders. The evidence indicates that it hosts over 1 million files, the majority of which are commercially related movies and television programs. Most of the internet traffic to Mixdrop comes from other websites that promote and make available online copyright material – again mostly commercially related movies and television programs. These sites provide links to the copyright material made available on Mixdrop.

16    Mixdrop is accessed at the domain name mixdrop.co. The site is also accessible at the domain names mixdrop.bz, mixdrop.to, mixdrop.ch and mixdrop.sx. The domain by which the site is principally known is mixdrop.co. Each domain name resolves to the same IP address and presents identical web pages. The backend storage servers are common to all the sites and file links for streaming or download work across all of the sites.

17    Mixdrop is primarily focused on audio visual content. Mr Walsh’s analysis of the site contents concluded that 98% of the files on the site were video files. The site home page invites users to “Share your videos, files and audio” and “Embed video and audio”. It provides a facility by which users can upload video files to the site and provides download URL links for inclusion on referring sites. Mixdrop also provides URL links by which the uploaded audio-visual content may be streamed directly from the Mixdrop site without a requirement to download it first. This allows a user to watch a movie or television episode streamed directly from the Mixdrop site rather than wait for it to be downloaded. Other sites may use this feature to “embed” links in their own site in order to stream a video from Mixdrop directly in their web pages.

18    No prior registration is required to upload content, such as video files, to Mixdrop. Users can upload content anonymously. When a file is uploaded using the “Upload” button on the home page, the user is provided with a download link for future retrieval or streaming of the file. Mixdrop provides an option for registration on the site. Registration is not necessary in order to upload, download or stream audio-visual content.

19    Mixdrop also operates an affiliate scheme that shares some of the advertising revenue with uploaders of content that is the subject of high levels of download activity. Registration does provide additional means to upload files, to manage files and to register as an “affiliate” to receive part payment from the advertising revenue generated by users downloading or streaming one’s content.

20    Mixdrop does not provide integration software or synchronisation tools typically provided by cloud storage services. It does not appear to charge a fee for any of its services and instead relies on advertising revenue. Once a file is uploaded, it may be accessed by any other user of the service until such time as it is deleted. Mixdrop automatically deletes files after 60 days of inactivity.

21    Mr Walsh conducted an analysis of 2000 sample files accessible at Mixdrop. Of the 2000 files in his sample, a total of around 73% were classified as television or film. Approximately 25% of the sample were videos in the nature of “adult content” much of which, as Mr Walsh observed, is also likely to be protected by copyright.

Section 115A

22    Sections 115A(1), (2A) and (2B) of the Act relevantly provides:

115A    Injunctions relating to online locations outside Australia

Application for an injunction

(1)    The owner of a copyright may apply to the Federal Court of Australia to grant an injunction that requires a carriage service provider to take such steps as the Court considers reasonable to disable access to an online location outside Australia that:

(a)    infringes, or facilitates an infringement, of the copyright; and

(b)    has the primary purpose or the primary effect of infringing, or facilitating an infringement, of copyright (whether or not in Australia).

…

Granting the injunction

(2A)    The Court may grant the injunction in the terms, and subject to the conditions, that the Court considers appropriate.

Note 1:    For the matters that the Court may take into account when determining whether to grant the injunction, see subsection (5).

Note 2:    The terms and conditions of the injunction that apply to a carriage service provider under subsection (1) may be different from those that apply to an online search engine provider under subsection (2).

(2B)    Without limiting subsection (2A), the injunction may:

(a)    require the carriage service provider to take reasonable steps to do either or both of the following:

(i)    block domain names, URLs and IP addresses that provide access to the online location and that are specified in the injunction;

(ii)    block domain names, URLs and IP addresses that the carriage service provider and the owner of the copyright agree, in writing, have started to provide access to the online location after the injunction is made;

…

23    Section 115A(4) permits the Court to make an order dispensing with service on the operator of the online location on such terms as it thinks it fit if the Court is satisfied that the owner of copyright is unable, despite reasonable efforts, to determine the identity or address of the person who operates the online location or to send notices to that person. Section 115A(5) specifies matters which the Court may take into account in deciding whether or not to grant an injunction. Section 115A(5A) provides that an online location is presumed to be outside Australia, unless the contrary is established. The applicants rely on the presumption in this case.

CONSIDERATION

24    I am satisfied that the applicants have taken reasonable steps to determine the identity and address of the person who operates Mixdrop and has been unable to do so. The applicants have also taken reasonable steps to notify the operator of Mixdrop of this proceeding and the orders sought. To the extent the operator is not aware of the existence of the proceeding or the orders sought by the applicants I infer it is because the operator has chosen to either ignore the applicants’ solicitors’ communications or to make effective communication with it impossible.

25    I find that the requirements of s 115A(1) are satisfied and, in particular, that Mixdrop infringes, and facilitates the infringement, of copyright in the applicants’ cinemograph films, and has a primary purpose, and the primary effect, of infringing, and facilitating the infringement, of copyright.

26    Mixdrop does not provide an index or directory of material available for download at the site. However, it is clear from the evidence that the operator of the site is facilitating infringement on a large scale and that it does so with a complete disregard for copyright owners’ rights. The facilitation of copyright infringement by the operator may be characterised as flagrant.

27    The matters referred to in s 115A(5) include whether disabling access to the online location is a proportionate response in the circumstances, and the impact on any person, or class of person, likely to be affected by the grant of the injunction. I mention these particular matters because it is conceivable that Mixdrop is being used by at least some individuals for the purpose of storing non-infringing material. However, having regard to Mixdrop’s business model, including its terms of service, and the results of Mr Walsh’s analysis, this seems altogether unlikely. I think the class of persons who use Mixdrop to store or share non-infringing material is likely to be exceedingly small if not non-existent.

28    In the circumstances, an order disabling access to Mixdrop is proportionate and, is in my opinion, unlikely to impact any person not directly involved in the use of Mixdrop to infringe, or facilitate the infringement of, the applicants’ copyright and the copyright of other owners. I note that site blocking orders targeting Mixdrop have also been made in the United Kingdom and India.

29    Having considered the matters referred to in s 115A(5), I am satisfied that this is an appropriate case in which to make an order requiring the respondents to take reasonable steps to block the Mixdrop domain names, URLs and IP addresses as provided for in the applicants’ proposed minutes of order.

30    Orders accordingly.

Associate:

Dated:    25 November 2022

SCHEDULE OF PARTIES