Peer-to-peer site isoHunt, one of the largest on the Internet, has lost the second round in its legal battle to be declared legal in Canada.

The service, run by Richmond, B.C.-based Gary Fung, had sought to have a British Columbia court rule that it was not violating copyrights. In March a court ruled that isoHunt would have to move forward with a full court hearing in order to attempt to prove its case. Fung appealed the ruling and was turned down this morning. The case was opposed by the Canadian Recording Industry Association, which said isoHunt tried a "legal sleight of hand and it failed," according to CRIA president Graham Henderson. isoHunt had sought to have its services ruled "non-infringing" against copyrights.

"The issues involved in this case are fundamental to the rights of creators to earn a living from their work," says Henderson. "A matter of this importance should be considered by a court with access to all the facts and not, as isoHunt had argued, to only one party's version of the facts. A lower court agreed with us and now so has the court of appeal.

"Isohunt started this fight, and now the court has told them, there will be no shortcuts," Henderson concludes.

The company's lawyer has indicated to Billboard that Fung intends to move forward with a trial.