Dallas Buyers Club LLC will be forced to submit to the Federal Court the methodology it intends to use to determine how much alleged movie pirates will have to pay to fend off a potential copyright suit.
DBC LLC, which represents the rights holders of the movie Dallas Buyers Club has since late last year been involved in a court clash with iiNet and other ISPs.
DBC LLC has sought the personal details of ISP account holders linked to illicit downloads of Dallas Buyers Club in order to contact them and seek an out-of-court settlement for copyright infringement.
The judge presiding over the case, Justice Perram, in April granted DBC LLC's application for preliminary discovery. However, since then the two sides have clashed on a number of other issues.
Those include the form of the letter and phone script that will be used to contact ISP account holders. What should and shouldn't be in those documents occupied a significant portion of today's hearing.
Appearing for DBC LLC, Ian Pike SC said that his client did not want to put a dollar figure in the letter.
The amount that DBC LLC would be seeking from alleged pirates would vary depending on their personal circumstances and the severity of the infringement.
For example, DBC LLC might seek a lesser sum from someone who downloaded the movie once then deleted it after watching and who has a low income, and a greater sum from someone who downloaded the movie the day after it was released and continued to make it available online.
"There is no one figure that we are seeking," Pike said.
The general method that DBC LLC will use to determine the amount they are seeking overall will be based on a licence fee for the movie, the cost of the current legal proceedings, the cost of obtaining ISP subscriber details, an estimate of how many alleged downloaders will "engage" with the company, and then, potentially, additional damages.
The method that the company will use to determine how much it will seek from an individual subscriber is likely to remain secret, however.
At Justice Perram's request, DBC LLC will submit the methodology to him and to the ISPs' lawyers, but the judge granted a request to suppress the details of it.
If details of the methodology were revealed, it could affect the negotiating position of DBC LLC, Pike argued.
However Justice Perram declined a request from DBC LLC to keep secret the draft letter and telephone script. Computerworld Australia has submitted a request to the court to obtain copies of both documents.
Appearing for the ISPs, Richard Lancaster SC said the proposed telephone script realised many of the concerns that the ISPs held about DBC LLC's approach to the issue. He said that the script was framed as "you and your address have been identified as infringers."
There is a large gap between the court ordering preliminary discovery and a finding of copyright infringement, he said.
The script "clearly comes on too strong ... in terms of damages," the lawyer said. He cited as an example a question in the script that requested details of the account holder's annual income.
The script also asks questions about other uploads and downloads that the account holder may have engaged in using BitTorrent.
The telephone script shouldn't be a "royal commission" into account holder's use of the Internet and as it stands it runs the risk of pre-empting the discovery process of a potential court case.
"We are entitled to assert in reasonably firm terms... why we contend there has been a copyright infringement," Pike argued on behalf of DBC LLC.
The parties also disagreed over a bond to ensure that DBC LLC abides by their undertaking with regards to contacting ISP customers.
DBC LLC believe it should be set at $20,000. In contrast, the ISPs have requested it be set at $33 million.
Lancaster argued that $20,000 is "manifestly, disproportionately low" and that the security should be high enough to discourage DBC LLC from ignoring the court and seeking significantly higher amounts of money from downloaders through speculative invoicing.
Justice Perram will issue a final ruling on the outstanding issues in mid-July.