Internet service provider iiNet has lauded a Federal Court decision which has put on hold an attempt by the rights holders of Dallas Buyers Club to contact alleged illicit downloaders of the 2013 movie in order to attempt to reach a financial settlement with them.
iiNet was one of the ISPs from which the rights holders sought to obtain customer details.
Earlier this year Justice Perram granted an application for preliminary discovery by Dallas Buyers Club LLC.
However the judge this morning declined to lift a stay on the order, indicating he was not convinced that DBC would refrain from so-called 'speculative invoicing' of alleged illicit downloaders.
The judge rejected two of the four elements of a formula that DBC indicated it would use to determine potential out-of-court settlements with downloaders.
Perram accepted using the cost of a obtaining a copy of the movie and the cost of the legal action to obtain ISP subscribers' details to determine a settlement.
However he rejected DBC's proposal to also incorporate into the sum the company would settle for the cost of a legal distribution licence for uploaders as well as the number of other movies illicitly downloaded by an ISP account holder.
He ruled that DBC would be required to lodge a $600,000 security in order proceed with its attempt to contact alleged downloaders via letter.
"We're extremely pleased with the decision handed down by Justice Perram today," iiNet CEO David Buckingham said.
"From the outset, we've never supported online copyright infringement but we couldn’t sit by and have our customers bullied by way of speculative invoicing.
"Today's decision is a major blow to the speculative invoicing model and sets a precedent that future preliminary discovery applications will not follow this path."
"We believe the issue of copyright infringement is best addressed by studios making their content available in a more affordable and timely manner," the CEO said.
"The rise of video steaming and its popularity in Australia to date supports this and we will continue to do what we can to ensure our customers can enjoy the content they love."