Europe's highest court has ruled that Internet service providers do not have to disclose identities of users accused in civil lawsuits of illegally file sharing.

The court said ISPs (PDF) should provide police with names and addresses for criminal investigations, but said they don't have to give the information to private investigators or industry groups. The court, in Luxembourg, also said Tuesday that E.U. member states can establish their own rules for disclosure of information related to illegal file sharing.

Like their counterparts in the United States, music industry groups in Europe have conducted their own investigations when they suspect Internet users of illegally downloading music.

A Spanish music industry group, Promusicae, filed a complaint against telecommunications company Telefonica, stating that ISPs should identify people suspected of illegal file sharing. The industry group sought the release of names and addresses of subscribers it accused of using Telefonica to access KaZaA and illegally share copyrighted music. The request was based on IP addresses Telefonic had obtained.

The court stated that E.U. member states can create their own rules, but added that they are not obligated to either withhold or release information for civil lawsuits over copyright infringement. The court stated that the rules should protect personal data as well as copyrighted material. It cited a need to reconcile measures protecting the rights of copyright holders and those protecting individual privacy.

The ruling is a setback for the music industry, as well as film companies, which have fought copyright violations primarily through civil lawsuits.