The Supreme Arbitration Court has decided to leave in force the decision of an appeals court that the popular social networking web site Vkontakte is not responsible for the actions of its users.

The All-Russia State Television and Radio Company filed suit against Vkontakte in 2008 demanding 3 million rubles ($100,000) in compensation for the posting of an unlicensed copy of the film "Okhota na Piranyu," or "Piranha Hunt."

Vkontakte did not accept responsibility for the film's presence, and the court was unable to find it on the web site, so it did not order Vkontakte to cease distributing it and did not grant the state broadcaster compensation.

An appeals court decided in July 2010 that Vkontakte did not take exhaustive measures to counter the posting of unlicensed material and ruled to award the broadcaster 1 million rubles. That decision was also overturned when a higher court determined that a way should be found to identify the uploaders of illegal material, and they should be held accountable.

The state broadcaster petitioned the Supreme Court of Arbitration, saying the lower court erred in its interpretation and application of the law and its conclusions were not consistent with the facts and evidence in the case.

The deputy general director of the state broadcaster, Dmitry Mednikov, hoped that the court would differentiate between uploading user content and uploading material that allows sites to make money on the violation of others' rights. Mednikov could not be reached for comment Monday.

The highest court found no basis to rehear the case, however.

Alexander Blinov, general director of Gala Records/EMI said he was surprised by the decision. It bodes ill for the industry, he said, since recent suits by rights holders against Vkontakte and Mail.ru had been on hold awaiting that decision.

Vkontakte spokespeople declined to comment on the decision Monday.