A crushing blow for Web pirates

Copyright ruling could cost torrent site isoHunt over $150 million in damages.

For someone who enjoys media attention, Gary Fung, founder of the Vancouver-based Internet torrent site isoHunt, is lying low these days. He didn’t return calls or e-mails for this story, and Fung’s Twitter feed (where he once wrote of his contempt for the justice system from a Canadian court room) hasn’t seen much action lately.

Apparently, facing possible copyright infringement damages of more than US$150 million has left Fung at a loss for words.

On Christmas Eve, United States District Court Judge Stephen Wilson presented his written ruling in the four-year legal battle between the Motion Picture Association of America and isoHunt, a peer-to-peer site based in Canada that links users to free movies, music and software. The decision was hardly the Christmas present Fung was hoping for. In his ruling, the judge called isoHunt’s technology “nothing more than old wine in a new bottle,” adding “generally, [the] defendants’ rest their case on legal arguments and meritless evidentiary objections.”

It was a giant blow for Fung, an outspoken opponent of copyright laws, who created isoHunt as a school project in 2003 when he was at the University of British Columbia. The site grew rapidly, and now more than 100 million visitors use it for their free entertainment fix, generating millions in advertising revenue for isoHunt. As the site expanded, it also captured the attention of the entertainment industry, putting it squarely in the legal crosshairs of the MPAA, which has been waging war against similar sites, winning a US$111-million decision against TorrentSpy two years ago.

Fung’s lawyers argued the site is nothing more than an entertainment-focused version of Google. Judge Wilson ultimately disagreed, saying it was no different than other now-defunct peer-to-peerservices.

Fung’s legal team has asked for a jury to set damages rather than the judge, a process that could drag on until the end of the year. The question is how large those damages will be. A payout could be up to US$150,000 per movie if “willful infringement” is established. The final tally could be well beyond the TorrentSpy damages, according to a source at the MPAA, and the organization’s lawyer, Steven Fabrizio has stated his organization won’t have any problem collecting from Fung, despite his Canadian citizenship.

As for Fung, he’s quoting Martin Luther King on Twitter. “One has a moral responsibility to disobey unjust laws,” he wrote in January, adding there was news to come on isoHunt’s “recent fiasco at the U.S. court.”

Chris Castle, a Los Angeles — based music lawyer who represented the original Napster in its battles with the music business, says Fung will likely find himself in similar circumstances to the founders of TorrentSpy – broke and bankrupted, with an injunction shutting down his site.

“The problem with torrent sites is they were never really intended to be entertainment sites,” Castle explains. “They are just an unfortunate example of people using a technology agenda when really they are just parasitical.”