Perth ISP Westnet may have breached the Telecommunications Act by passing notices of alleged copyright infringement on to its customers, iiNet chief Michael Malone alleged in the Federal Court today.
Under cross-examination by the film industry's barrister Tony Bannon, Malone said that restrictions on the use of customer data under the Telco Act was "one of several reasons" not to pass on the notices.
"You don't suggest, do you, that Westnet did anything to the contrary of the Telco Act in passing on the notices?" Bannon said.
"Yes I do," Malone stated.
"I think this was a very grey area and they [Westnet] were ill-advised to do that over a long period of time."
"Are you seriously suggesting a difficulty with the activity of Westnet that breached the Act?" Bannon asked.
"I believe it was a very grey area and iiNet's policy was to stop [passing on the notices]," Malone said.
"iiNet's policy was reached after lots of consideration. I'm reluctant to reach into any area where we might be breaching privilege in terms of how we reached that policy."
Westnet's policy of passing on notifications of alleged copyright infringements to customers was overturned after the ISP was acquired by iiNet.
Malone alleged that as a telcommunications company, iiNet was a "pipe" and was "not permitted to match up [customer] data" from its systems to data of alleged copyright infringements.
This was because the infringement data and requests for action came from a party outside the internet services contract - which was an agreement between iiNet and a customer, not any other party.
It was alleged that the provisions of the Telecommunications Act that enabled iiNet to use customer data for purposes such as billing did not extend to parties outside of the specific agreement.
A court order - as was granted to the film industry with regard to a sample of 20 iiNet customers earlier this year - was required in instances that involved a third party, it was alleged.
Bannon quizzed Malone further on whether the same restrictions applied to iiNet forwarding alleged infringement notifications from the film industry on to Western Australian Police for further investigation.
"You do not believe based on your understanding of the Telecommunications Act that there existed any difficulty in passing on allegations from AFACT?" Bannon said.
"No," Malone replied.
"But you understood if it was otherwise prohibited, that information provided by AFACT was not information you'd precluded from passing on to third parties?" Bannon pressed.
"As far as we knew it wasn't customer information [in the notices]," Malone stated.
"There was no matching required. There was no use of customer data."
The range of inferences possible from the suggestion caused Bannon to clarify before the court that he wouldn't "suggest there is any difficulty as far as the Telco Act is concerned in passing on that information [the film industry's notices] to a third party."
"Passing [the notices] onto the Australian Federal Police or police - we thought was appropriate," Malone stated.