After outlining, Village Roadshow has charged iiNet with providing a faulty product that allows its customers to break the law.
The claims follow comments from iiNet chief regulatory officer Steve Dalby whichfor their responsibilities in preventing piracy. However, Village Roadshow co-CEO Graham Burke has pointed the finger back at the ISP, saying it needs to take responsibility for the product it provides.
In a broad-ranging interview with CNET, Burke described Dalby's recent blog post as "lies".
"For him to be continuing to distort the picture when he clearly knows otherwise is very depressing," said Burke. "I'm dealing with it in a transparent and open and honest way and I wished we could get that from iiNet."
Central to his argument was the charge that it is iiNet's service that allows users to pirate content, and therefore the ISP needs to play a part in tackling the problem.
"iiNet are selling a car which happens to kill people on the roads, so they should be paying towards that," said Burke. "It's the car that's faulty. In this instance it's the fault of the car, not the driver.
"They're providing a service which enables people to steal other people's property, so...some of the costs should be theirs. Equally, the copyright owners -- of which we're one -- stand to gain, so the cost should be shared in some equitable way."
Burke said Village Roadshow was looking to the Federal Government to legislate for a three strikes policy on piracy in order to deter internet users from illegally downloading content. He cited similar initiatives in France and the "gold standard" of Korea, where he said the industry went from "literally facing extinction" to a 77 percent reduction in piracy and a 1,300 percent increase in legal digital downloads following the introduction of three strikes.
"What we've been saying loud and clear is that the piracy initiative has to be tripartite. One, it's about educating people...when they realise that it's theft and it's not a victimless crime, that it could put people out of work and they could lose their jobs, most people stop.
"Two, there have to be legally available, low-cost alternatives, which are being provided. And three, for the serially offenders and people that don't take any notice of the graduated response, there needs to be teeth."
Burke said the punishment for infringement was "not draconian" but a matter of slowing speeds, "which is something that iiNet themselves do if people are exceeding the plan they've paid for".
He also conceded that content creators and rights holders had a responsibility to provide content in a timely and affordable way, saying Village Roadshow got this wrong with the Australian release of "The Lego Movie".
"As the films co-producer and its distributor, we delayed [the film] for a couple of months -- we wanted to release it in the school holidays when kids and families were available.
"But there was inordinate piracy on "The Lego Movie", so for that reason, in future, we will not be delaying films. Feature films are released in America and Australia now, day and date, all virtually at the same time."
Despite Roadshow's past mistakes, Burke said ISPs should not ignore their role in providing a service for pirates.
"They don't seem to care, although they say they do, that other people's product is being stolen and they're facilitating it and they'll put them out of work," he said.
"All Mr Dalby wants is to continue to have this extraordinary smorgasbord of product that's made by creative people, with the sweat of their passion and labours, and that he can have a mechanism where he can be the conduit that provides that free and he clips the ticket. He's complicit."