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A scene from, "The Hurt Locker."Anonymous/The Associated Press

In a pivotal courtroom battle over unauthorized downloading in Canada, a Federal Court has handed down a major ruling – one that has all sides claiming victory.

Canadian Internet service provider TekSavvy Solutions Inc. has been ordered to hand over a list of names and addresses of its customers suspected of illegally downloading movies, in a landmark Federal Court decision.

The ruling is sure to grab the attention of millions of Canadian who engage in what is known as "peer-to-peer" file sharing on the Internet, which allows users to share copyrighted movies or other content for free. But its ultimate impact on anyone who illegally downloads material in Canada is harder to predict.

In a decision dated Feb. 20, the Federal Court of Canada sided with Voltage Pictures LLC, producer of the Oscar-nominated film The Hurt Locker and ordered TekSavvy to produce a list of about 2,000 names and address of customers associated with Internet Protocol (IP) addresses the film company alleges illegally downloaded its movies.

Lawyer James Zibarras, who acted for Voltage, said the decision marks a shift from a 2006 ruling that went against BMG Canada Inc., which was attempting to track down illegal music downloaders.

"That was heralded by many people as a kind of green light for downloading," Mr. Zibarras said. "This is the first time that case has been reconsidered by the court."

Voltage's biggest win may come outside the courtroom, and be harder to measure. Even though the courts put several restrictions on the manner in which Voltage can use the customer information it will receive, many Canadian Internet users will undoubtedly see the news that the information has been handed over as a sign that they may be in for a lot more trouble if they download copyrighted content. Ultimately, such a reaction may result in a reduction, if not an outright end, of the unauthorized downloading of Voltage's movies – without having to take every infringing user to court.

"We're not going to seek their firstborns," Mr. Zibarras said, arguing that small movie producers have been hurt by the revenue they lose as a result of illegal downloading. "But there has to be some recourse of rights owners."

In the decision, Federal Court Prothonotary Kevin Aalto said Voltage's communications with TekSavvy users must be approved by the court, and its demand letters will "clearly state in bold type that no Court has yet made a determination that such Subscriber has infringed or is liable in any way for payment of damages." And any litigation it launches will be managed in connection with this case, the court ruled.

For its part, TekSavvy seized on these restrictions to put the court decision in what, for itself and its customers, is a more positive light.

"We are pleased with these new safeguards and are proud to have played a role in increasing the protection of consumers," said TekSavvy CEO Marc Gaudrault, who added his company will not hand over any customer information until all the court's conditions are met.

"TekSavvy will maintain a role in the court process moving forward to ensure that our customers' rights continue to be at the forefront of these proceedings."

But with both sides claiming victory, it still remains unclear just how broad the decision's impact could be.

Intervening in the case, and essentially facing off against Voltage, was University of Ottawa law professor David Fewer, executive director of the Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic. While the decision does force TekSavvy to hand over the list of addresses for Voltage to pursue copyright infringement cases, Mr. Fewer said that the ruling clarifies what legal tests a copyright holder must meet and also imposes safeguards to block the activity of so-called "copyright trolls."

Prof. Fewer had argued that allowing copyright holders to access contact information allows the creation of a "business model" that sends small-time users threatening letters demanding large payments for copyright infringement, as has been seen in the United States. Many people settle and pay instead of going through the greater expense of fighting in court. "From my view, it slams the door on the copyright-troll business model in Canada."

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