[edit: for more analysis, see EFA Chair Nic Suzor's blog post: iiNet did not ‘authorise’; providing internet access is not providing the ‘means’ of infringement’; safe harbours are effective.]
And with one tweet, iiNet CEO Michael Malone announces the result that we've all been waiting for:
IiNet did not authorize the infringements #iitrial
More analysis will follow when the full written judgment is handed down, but it is apparent that the Judge was convinced that iiNet has no control over bittorrent and is not responsible for the acitons of its users in the circumstances alleged by AFACT. From the preliminary information available, this sounds like a decision that is absolutely consistent with the theory of secondary copyright liability developed in the US case of Sony v Universal: the lack of control over the system means that iiNet has no legal responsibility over its users, despite knowledge that some users are obviously infringing copyright. In terms of the decision in Moorhouse, iiNet could not be seen as 'approving, sanctioning, or countenancing' the infringing acts of its users. This decision seems to fill the gap with the Kazaa and Cooper decisions in Australia, which both found that the intermediary in question facilitated and encouraged the infringements that occurred.
This provides important certainty for ISPs in Australia: "the mere provision of access to internet is not the means to infringement". It also seems that more generally, this has important ramifications for innovation in Australia; in contrast with Kazaa, if you provide facilities that assist in infringement, but do not have control and do not act in bad faith, you will not be liable for secondary copyright infringement.
AFACT has been ordered to pay iiNet's costs. Expect an appeal, but this first instance decision seems quite strong in favour of iiNet.
Stay tuned for further analysis.