July 2, 2004 7:43 AM PDT

Kazaa copyright trial set for November

Sharman Networks, the parent company of controversial file-sharing service Kazaa, could face the music by the end of the year following an Australian federal court ruling.

On Thursday, Justice Murray Wilcox set a tentative trial date of Nov. 29 and said that directed discovery and affidavit proceedings should be completed by October. Wilcox also dismissed a range of procedural matters that had been raised by Sharman Networks regarding access to evidence seized from its offices and from affiliated parties earlier this year.

On Feb. 6, the music industry's copyright enforcement arm, Music Industry Piracy Investigations (MIPI), raided the Australian offices of Sharman Networks and Brilliant Digital Entertainment, along with the homes of key executives and several Internet service providers. MIPI was seeking documents and electronic evidence to support its case against the peer-to-peer companies.


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In doing so, MIPI had obtained an Anton Piller order, which allows a copyright holder to enter private premises to search for and seize material that breaches copyright--without alerting the target beforehand.

The evidence is currently in the care of an independent solicitor.

At the daylong hearing Thursday, Sharman attorney Robert Ellicott raised a new motion about the legitimacy of the evidence obtained from the Sharman premises. He also protested a timetable offered by Wilcox, who called for the discovery process to be completed by Aug. 13, with applicants' affidavits filed by mid-August and responses by Sharman filed by early October.

Specifically, Ellicott claimed that the raids executed on the Sharman premises may be in breach of Australia's Telecommunications Act.

The argument refers to section 7 of the act, which states that a person shall not "intercept...a communication passing over a telecommunications system."

Ellicott said that in carrying out the Anton Piller orders, the act was breached by the "recording of communications from the routers of the raided premises before they had been received by the companies' computers."

He also argued that the action was undertaken without the knowledge of the person making the communication, which is also stipulated as a breach of the act.

However, the music industry--represented by Universal Music--contended that what was recorded may not even fit within the statutory definition of "communication."

Universal said that if Sharman was concerned that a breach of the act had occurred, the company should have taken steps to access the evidence, as any such breach would be recorded.

"Why weren't steps taken earlier if criminal conduct was being considered in regards to the the Anton Piller orders?" asked Tony Bannon, Universal's legal representative.

According to Wilcox, the operation was not carried out "behind the backs" of the operators of various raided premises, and in further response, he told Ellicott that "with all due respect, you haven?t produced any evidence from anybody."

Wilcox added: "Frankly, I think the whole thing is a distraction from the case."

Ellicott's submission was rejected because of lack of evidence, and Wilcox ruled that Sharman should cover the cost of that section of the proceedings, as the motion was unnecessary.

The music industry, Sharman and associated parties were originally issued a timetable for the discovery process at a hearing in May. Wilcox ordered those parties to submit applications to specify which evidence they needed to access for the case before June 25.

However, the process has been slowed significantly amid claims and counterclaims over access to evidence.

Universal's lawyers accused Sharman and its associates of trying to stall the case by not complying with orders made at the last hearing. "It's all there; why can't we look it?" Bannon said.

However, Ellicott said the process of making copies of the materials had been delayed, forcing the schedule back and leaving insufficient time to go through the files.

"This is one of the most important copyright cases that has occurred," said Ellicott, adding that there were around half a million electronic files to sift through to respond to Universal's case. Ellicott said doing that would take the Sharman parties "at least" a month. Wilcox advised the Universal lawyers to "trim" down their case load.

The parties also disagreed on how the process of discovery and filing affidavits should continue, as Sharman introduced several new motions regarding Universal's statement of claim.

Both parties are expected back in court on July 16 to present the outcome of talks on the procedural issues confronting them.

Abby Dinham of ZDNet Australia reported from Sydney.

 

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