Russia in the firing line

Recently I wrote about the issue of cross-border jurisdiction in relation to a case brought in London in what the High Court of Justice labelled “bitterly contested litigation”.

That action was initiated as a result of allegations that OJSC Russian Aluminium RUSAL, a Russian aluminium firm being the third largest aluminium provider in the world, and TadAZ, a Tajikistan company, stole the business of a British company, Ansol, and its UK advisors, Ashton, by assisting Tajikistan in producing aluminium.

Recently it has become apparent that the popular music website Allofmp3.com is next in the firing line to be sued by the record label behemoths. The case was brought in New York against an organisation running the website from Moscow, which claims that its website is not breaching Russian law. Like the previous case involving RUSAL, the case requires analysis of cross-border jurisdiction issues and other complex issues of international law. And here is the big question – can a court in New York have any standing against a firm in Russia? The plaintiffs claim the “Defendant’s entire business amounts to nothing more than a massive infringement of plaintiffs’ exclusive rights under the Copyright Act and New York law,” according to the law suit that was filed.

The Russian company being sued is known as “Mediaservices” and is no stranger to the litigation process being kick-started in relation to its controversial Allofmp3.com website. In fact, Mediaservices is reportedly already being sued in the UK. This has led credit card companies including Visa and Mastercard to suspend the processing of any payments resulting from transactions occurring on the website.

The crux of the case is that royalties are allegedly not being paid to the copyright owners of the various music that is distributed via the website. Allegedly, the website is unfairly reaping profits while the copyright owners suffer. Normally, online music retailers provide royalties to the copyright owners via the relevant rights societies and other collecting institutions. The Russians’ case is that they are following Russian copyright law, paying royalties to the Russian collecting society, the Russian Multimedia and Internet Society (ROMS), and therefore not in breach.

It is interesting to consider how this case would pan out if heard in Australia. Here, the Federal Parliament has passed the Foreign Judgments Act 1991 to make overseas judgments enforceable in Australia by registration of the foreign judgment in Australia. Generally, the Act provides that any plaintiff who obtains a judgment of a superior court in a foreign country referred to in the Act within six years, may file and register the judgment in the Supreme Court of a state or territory of Australia. Applications may also be made in the Federal Courts to register the judgments. The effect of registration of the judgment is that once registered, for the purposes of enforcement, it will have the same force and effect and proceedings may be taken thereon and control exercised over the judgment, as if the judgment had been originally given by the court in which it is registered.

Oleg Nezus from ROMS reportedly issued a statement that: “The opinion of foreign copyright owners is just that – their opinion.”

The case will determine just how important the opinion of foreign copyright owners is. The case is especially relevant given the recent debate regarding copyright law that has been taking place in the Australian legal and political arenas.

Disclaimer: This column is for general informational purposes only. It is not legal advice nor is it a substitute for legal advice. Readers should seek legal advice on their own particular circumstances.
Alan Arnott is a technology and telecom-munications lawyer with qualifications in computer science and law with Arnotts Lawyers in Sydney. For more information, please visit: www.technologylaw.com.au or www.arnotts.net.au.

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