The Australian court tussle between the movie studios and the iiNet Internet service provider is back on again.

The Australian Federation Against Copyright Theft, an umbrella organization for the country's film and TV industries, earlier this month failed in its landmark attempt to hold iiNet liable for illegal file-sharing.

On behalf of its 34 film company members, AFACT today (Feb. 25) appealed against the Federal Court's judgment.

AFACT executive director Neil Gane argues that the ruling wasn't reflective of Australia's copyright law, and warns that Justice Cowdroy's decision rendered the safe harbor regime ineffective.

"The court found large scale copyright infringements, that iiNet knew they were occurring, that iiNet had the contractual and technical capacity to stop them and iiNet did nothing about them," he said. "In line with [the] previous case law, this would have amounted to authorization of copyright infringement."

If this decision stands, he added, "the ISPs have all the protection without any of the responsibility."

Today's development comes as little surprise to anyone observing the case, least of all iiNet. The ISP today issued its own response, in which the telecoms firm's CEO Micheal Malone said the studios' legal action would do little to prevent online piracy.

"It is more than disappointing and frustrating that the studios have chosen this unproductive path," Malone said. "This legal case has not stopped one illegal download and further legal appeals will not stop piracy."

Malone went on to suggest the studios were partly to blame for not having developed a commercial solution. "People are crying out to access the studios materials, so much so some are prepared to steal it. A more effective approach would be for the studios to make their content more readily and cheaply available online," Malone noted.

AFACT took legal action in November 2008 after, it claimed, iiNet ignored repeated notices to act on illegal file transfers. The trade body cited 94,000 such instances, observed over a five-month-long investigation.

However, in a 200-page ruling handed down on Feb. 4, Justice Cowdroy said that the iiNet "has done no more than to provide an Internet service to its users."

The appeal is likely to be heard later this year.