A court in Australia has announced that internet service providers cannot be held responsible for the illegal downloading of movies and TV programs by the users.

A consortium of more than 30 Hollywood and Australian film studios and TV producers lost a landmark copyright case against iiNet, an Australia internet provider, on Thursday.

The consortium argued that the firm had itself breached copyright by storing and transmitting data over its networks.

"While I find that iiNet had knowledge of infringements occurring, and did not act to stop them, such findings do not necessitate a finding of authorization", said Justice Dennis Cowdroy. "The evidence establishes that iiNet has done no more than to provide an internet service to its users", he added.

The consortium includes major international names such as Warner Bros, Disney, Paramount, Columbia and Twentieth Century Fox.

However, iiNet argued customers cannot be blamed, until proven guilty in court.

After the verdict, Michael Malone, Managing Director of iiNet, said, "we welcomed the ruling and wanted to work with entertainment companies on ways users could access their content legally".

Neil Gane, the Head of AFACT, said that the outcome was disappointing and the group will file an appeal in Australia's High Court.