Archive for the ‘Copyright’ Category

Online copyright infringement – back to drawing board

Thursday, September 11th, 2014

The way the press is reporting it, the Minister for Communications – one of the two Ministers who released the Online Copyright Infringement discussion paper in July – recognises it’s back to the drawing board in light of the (apparently) unanimous disapproval.

SMH

News

You can find the submissions received here (apparently they are being uploaded over time).

Will the ISPs voluntarily sit down and negotiate a warning system with the copyright owners? Do we really want the copyright owners and the ISPs coming up with their own scheme without “our” input?

$150,001 damages for infringing compatibility chart

Thursday, September 4th, 2014

Tonnex was found to have infringed Dynamic’s copyright in its printer cartridge compatibility chart. That finding was upheld on appeal. Now, Yates J has ordered Tonnex to pay Dynamic $150,001.00 in damages. The damages are comprised of compensatory damages under s115(2) of $1.00 and $150,000 by way of additional damages under s115(4).

The $1.00 nominal damages was agreed by the parties before the hearing. Interestingly, Yates J did not comment on this.[1]

Dynamic had argued for an award of additional damages of $400,000; Tonnex, while denying any award should be made, argued for an amount in the “tens of thousands”. Yates J arrived at $150,000 in the exercise of his Honour’s evaluative judgment.

Yates J’s reasons contain a useful summary of the applicable principles for the court to decide whether it is appropriate to award additional damages at [37] – [53].

Recognising that flagrancy is not required before an award of additional damages can be made, his Honour nonetheless found that the infringement was deliberate and studied. Although Tonnex’ directors denied knowledge of the copying and gave evidence that they had specifically instructed there was to be no copying,[2] the knowledge and acts of the employees involved – who included the National Marketing Manager – were at [101] relevantly the acts and knowledge of Tonnex. Further, Tonnex’ position throughout had not just been reliance on legal advice that copyright could not subsist in such a compilation. It had hi-handedly denied any copying at all.

Yates J also noted that, even if the directors were innocent of infringing knowledge, the situation should have changed after detailed particulars of infringement had been served (albeit late in the picture). Those particulars appear to have identified mistakes and other typographical peculiarities in the Tonnex catalogue which were really consistent only with copying from Dynamic. In other words, the directors were put on inquiry.

Instead, Tonnex sent out 38,000 emails with links to its infringing catalogue after Dynamic notified its infringement claims to it; only stopping just before the liability trial:

…. The cessation of Tonnex’s conduct was taken at a time of its own choosing, without regard to Dynamic’s rights. Regardless of Mr Solomon’s and Mr Kozman’s state of knowledge in that period, by reason of Mr Rendell’s knowledge, Tonnex must be taken to have known the true position regarding its copying of Dynamic’s Compatibility Chart. With that knowledge, it undoubtedly took commercial advantage of its wrongful conduct.

Tonnex did introduce an approvals process to vet material before it was published in future. Yates J was not particularly satisfied by this. His Honour was also concerned that Tonnex’ witnesses did not really exhibit appropriate contrition, but rather saw the litigation as a tactic by Dynamic rather than vindication of its rights.

The need to mark the court’s disapproval of Tonnex’ conduct and signal to the community that it was not alright to copy others’ property with impunity (i.e. deterrence) also played roles.

Dynamic Supplies Pty Limited v Tonnex International Pty Limited (No 3) [2014] FCA 909


  1. Contrast the apparent questioning of the practice raided by French and Kiefel JJ in [Venus Adult Films v Fraseride][venus] at [94].  ?
  2. it is fair to say his Honour expressed a degree of scepticism towards this evidence at esp. [102] and [103].  ?

Copyright, ISPs and authorisation 2

Friday, August 8th, 2014

I should note for the record, that the Government did officially release its Online Copyright Infringement discussion paper (pdf) on 30 July 2014.

Responses are required by 1 September 2014.

There are 3 main proposals:

  • extend the definition of ‘authorisation’ by amending ss 36(1A) and 101(1A)
  • introduce power for rights owners to obtain orders against ISPs to block access to infringing websites (like s 97A in the UK)
  • give some real scope to the “safe harbours” by extending their availability from “carriage service providers” to “service providers”.

The discussion paper does say in relation to ‘extended authorisation':

The Copyright Act would be amended to clarify the application of authorisation liability under sections 36 and 101 to ISPs.

It’s not clear how this will be done. While the discussion paper does specifically identify amendments to ss 36(1A) and 101(1A), the proposed changes apply generally to everyone and not specifically to ISPs. It is also not immediately clear how the proposed changes in fact cause ISPs to become liable for authorisation.

It does seem to be a policy still in development.

The Minister for Communications linked the reforms to some positive action about the very high prices Australians are charged for online access to copyright materials such as recorded music, movies, software etc. compared to the prices charged overseas. [1]

He and the Attorney-General may also have different ideas about who should bear the costs of the scheme.


  1. A transcript of my talk to the Copyright Society on the House of Rep’s committee report “At What Cost: The IT Pricing Inquiry and Copyright” can be found in Vol 31(2) Copyright Reporter 1 (attributed to Nick Smith).  ?

Copyright authorisation and the end of iiNet?

Monday, July 28th, 2014

Crikey.com.au has a link to what it says is the Commonwealth Government’s Online Copyright Infringement Discussion Paper July 2014.

So far as I am aware this document has not been published on the AGD’s website?

US Supreme Court downs Aereo

Thursday, June 26th, 2014

The US Supreme Court has held (6:3) that Aereo infringes copyright by publicly performing the protected material.

You may recall that Aereo has warehouses full of recording devices which an individual subscriber could rent and record over the air television broadcasts on, then play back to their tv, computer, tablet or smart phone.

In dissent, Scalia J (joined by Thomas and Alito JJ) was highly critical of the “purposive” approach to statutory interpretation adopted by the majority:

The Court’s conclusion that Aereo performs boils down to the following syllogism: (1) Congress amended the Act to overrule our decisions holding that cable systems do not perform when they retransmit over-the-air broadcasts; (2) Aereo looks a lot like a cable system; therefore (3) Aereo performs.  …. That reasoning suffers from a trio of defects ….

So Aereo joins Optus TV Now on the defunct list.

American Broadcasting Cos Inc v Aereo Inc

Lid dip: Marty and Patently-O

 

Is there a case for fair use? Lessons from the US – Seminar

Thursday, June 19th, 2014

Monash is holding a seminar on fair use: ‘Is there a case for fair use? Lessons from the US’, with the lead presenter being Prof. Geoffrey Scott from Penn State’s School of Law.

Date: 2 July 25 June at 5:15pm. (Lid dip: Gerard Dalton)

Venue: Monash University Law Chambers, Melbourne.

Details and registration via here.

Graduated response coming Down Under?

Wednesday, June 11th, 2014

According to iiNet, it is.

It would appear from documents obtained by ZDnet and, perhaps, the Fairfax press, that it is certainly one of the “options” being developed by the Attorney-General’s Department.

The Attorney-General did say back in February that he was looking at a number of ways to combat online piracy in light of the High Court’s decision in the iiNet case. Presumably, the development of the various options has progressed somewhat by now although, so far as I am aware, it is not something that has been thrown open to public comment.

The ZDnet article refers to the positive experience apparently experienced with the scheme in the USA. The Fairfax article notes Rebecca Giblins’ research indicating the costs of such schemes appear to be all out of proportion to their impact.

It would be a pity if the development of all these options means that we are not going to get the “through and exhaustive exercise in law reform” so that the Copyright Act will be shorter, simpler and easier to use and understand that the Attorney did foreshadow in February.

Meanwhile, in the UK, a Minister assisting with IP matters has raised the prospect of search engines being required to exclude from search results, or at least the first page of the results, web-sites against which blocking orders have been obtained.

2 years gaol for contempt

Monday, May 26th, 2014

The Full Federal Court has reduced Mr Vaysman’s punishment for contempt from 3 years to 2 years imprisonment for repeatedly breaching injunctions not to infringe trade mark and copyright.

In 2003, Deckers Outdoor Corporation (the owner of the UGG Australia trade mark) sued Mr Vaysman, members of his extended family and various companies they operated through for infringing its trade mark and copyright. Those proceedings were settled by consent. Injunctions against trade mark infringement and copyright infringement had been ordered.

In 2004, Deckers Outdoor Corporation again sued Mr Vaysman, members of his family and the companies through which they operated for breach of the terms of settlement reached in 2003. Those proceedings were also settled by consent.

In 2007, Deckers Outdoor Corporation sued Mr Vaysman, members of his family, their companies and a number of others for the third time: for infringement of its trade marks and copyright and breaches of the prior terms of settlement.

Essentially, notwithstanding the two sets of earlier proceedings, the undertakings not to infringe and the injunctions against infringement, Mr Vaysman et al. had continued with their infringing activity making counterfeit UGG boots unabated at all. The proceedings involved two main aspects: the civil claims for infringement of trade mark and copyright and contempt charges for breaches of court orders made in both the earlier proceedings and also the 2007 proceedings (e.g. continuing the infringing activity in defiance of an interlocutory injunction).

Before the contempt charges were heard and the punishments handed down, there had been judgment against the Vaysman parties on the civil claims for infringement including an order for the corporate vehicle and Mr Vaysman jointly and severally to pay $3 million in compensatory damages and for the corporate vehicle to pay $3.5 million in additional damages pursuant to s 115(4) of the Copyright Act. (The corporate vehicle was by this stage being wound up.)

In relation to the most serious contempt, charge 18, the trial judge had found:

Charge 18 – Between December 2005 and (at least) November 2007 Mr Vaysman caused and encouraged the use of a factory in Roper Street Moorabbin for manufacturing and selling counterfeit footwear.  He did so contrary to consent orders to which he was a party which were made by the Court on 12 March 2004.  During this period, as I found in Deckers Outdoor Corporation Inc. Farley (No 5) [2009] FCA 1298 (“Deckers (No 5)”) at [84]-[92], over 30,000 pairs of counterfeit boots were sold with the profit on those sales amounting to over $3 million.

As Mr Vaysman was found to be in overall control of the whole operation, the trial judge sentenced him to 3 years’ imprisonment for this contempt. (Other charges of contempt were also established, but received much lighter punishments to be served concurrently with the punishment on charge 18.

By the time the contempt charges came to be heard in 2010, Mr Vaysman was no longer in Australia.

After the punishments for contempt were imposed, Mr Vaysman’s father, a 74 year old in ill-health and found by the Court to be of previously unblemished character, successfully appealed a sentence of a term of 18 months’ imprisonment. Gray and Bromberg JJ, considering imprisonment very much a last resort, imposed a fine of  $50,000, but ordered that the roughly 2 months or so he had already served in prison stand in lieu of the fine. Besanko J agreed that the sentence needed to be reduced, but would have reduced the sentence to a term of 12 months.

Mr Vaysman returned to Australia in June 2013. He was imprisoned pursuant to the contempt order. He sought leave to appeal (a long time out of time).

Besanko J, with whom Siopis J agreed, granted leave and considering the 3 year sentence manifestly excessive having regard to other sentences for contempt, ordered the sentence be reduced to two years. Besanko J did not consider that Federal Court sentencing practices needed to be adjusted for consistency with State court sentences. Nor did his Honour think any discount should be made having regard to the award of additional damages.

Dowsett J took a different approach.

His Honour considered that, to the extent that Federal Court sentences for contempt, were more lenient than comparable State courts, the Federal Court standard should be lifted. Focusing on the punitive nature of awards of additional damages, however, his Honour considered there an element of double counting or double jeopardy in not taking into account the additional damages award when fixing the contempt penalty. Dowsett J would have reduced the prison sentence from 3 years to 2 years and 3 months.

Vaysman v Deckers Outdoor Corporation Inc [2014] FCAFC 60

Copyright in bikini designs

Wednesday, April 23rd, 2014

Seafolly is in the news again: this time as the winner. In her last decision before retiring, Dodds-Streeton J has ordered that City Beach[1] pay Seafolly $250,333.06 by way of damages for infringing copyright in 3 Seafolly designs: the English Rose artwork, the Covent Garden artwork and the Senorita artwork.

The English Rose artwork and the Covent Garden artwork were both patterns or ornamentation printed on the fabric. The Senorita artwork, however, was in effect stitched on to the garment using shirring and smocking. Dodds-Streeton J, however, rejected City Beach’s defence based on sections 74 and 77 of the Copyright Act. Apart from all the other issues, her Honour’s application of the Full Court’s decision in the Polo/Lauren case struck me as particularly important.

Seafolly’s Senorita artwork:

321.12
321.11

City Beach’s Richelle embroidery:

321.13

The subsistence point

As you can see, the Senorita design is pretty simple in appearance. City Beach’s argument was that this simple design was the more or less inevitable outcome of using the type of industrial sewing machine used to produce it. According to the evidence, however, it involved significant trial and error to produce because smocking fabric was very difficult to work with, smocking did not always involve using triangles or diagonals and City Beach’s expert conceded “there was a huge array of different ‘cams’ which could produce an almost indefinite variety of patterns.” Her Honour rejected City Beach’s attack, therefore:

416 …. the Senorita embroidery was not the inevitable outcome of the operation of an industrial sewing machine. Nor was the work so rudimentary and simple as to be unprotectable because, in essence, there was no meaningful distinction between the subject matter and the form of expression.

The use of the sewing machines, therefore, appears to involve use of the machine to implement the human idea more in the vein of Coogi or a wordprocessor to record the text than as an automatically generated entity like the phone books in PDC. The second point made by her Honour seems to pick up the High Court’s point that the ordering of title and time of television program in chronological order did not involve sufficient creativity (or intellectual effort) to qualify as original.[2]

The copyright/design overlap

City Beach’s defence based on the copyright/design overlap provisions failed also, because the Senorita design when sewn on to the bikinis was not a corresponding design.

When the Designs (Consequential Amendments) Act 2003 introduced the current form of s 74 and s 77, it was hoped that the old problems about whether something constituted a “design” and whether it had been “applied to” an article had been sidestepped. All that was necessary, was to identify an artistic work which had been embodied in the features of shape or configuration of the product.[3] Rares J, at first instance in the Polo case adopted that too simplistic (as we now know) approach to find that the 700 or so stitches used to embroider the Polo logo on to a shirt qualified. This was set right by the Full Court on appeal.

Dodds-Streeton J acknowledged that the Full Court’s observations were obiter. Her Honour also acknowledged that the Full Court’s reasoning “is not consistently explicit, but must be inferred”. Her Honour considered that the Full Court’s reasons:

470 …. in substance indicate that it is the features of shape or configuration of an artwork (not a label on which the artwork is reproduced) that must be relevantly embodied in a product, which will occur when the product (in the present case, a garment) is made in the shape or configuration of the artwork.

Thus, the diamond pattern was not a corresponding design because, when stitched on to Seafolly’s bikinis, it did not define the shape or configuration of the bikini as a garment.

In reaching this conclusion, Dodds-Streeton J had to interpret the Full Court’s declaration at [58] that a design must be conceptually distinct from the product in which it was embodied to qualify as ‘embodied’ for the purposes of s 74. That created a problem in the present case as Dodds-Streeton J considered the stitching, or smocking, could not have existed independently of the garment:

473 It is true that, in contrast to the logo in Polo/Lauren itself, the reproduction of the Senorita artwork sewn on to the relevant garment may not retain a separate existence, as probably, it could not survive removal and is not conceptually distinct from the garment. Accordingly, if the Full Court’s observations in [58] represent the correct and comprehensive test, the Senorita artwork could be embodied within the meaning of s 74(1). As stated above, however, the comment at [58] does not comprehensively reflect the reasoning of the Full Court’s judgment.

I am not sure, with respect, why the Senorita design was any the less capable of independent existence than the Polo logo. I think the design could not have an independent existence because it was created by attaching the stitching to the shirring framestrings and there was presumably no drawing.

Dodds-Streeton J identified a further problem. It seems difficult, with respect, to reconcile the Full Court’s interpretation of s 74 with the clear legislative intent to capture woven tapestries, bas relief and “textured” carpets within the concept of corresponding design by the inclusion in s 74(2) of:

“embodied in , ” in relation to a product, includes woven into, impressed on or worked into the product.

According to Dodds-Streeton J:

480 Following the insertion of the words “woven into”, “impressed on” or “worked into” in s 74(2), it seems clear that features of shape or configuration of an artwork can be embodied in an article which is itself a piece of embroidery, a carpet, bas?relief or similar, by being woven or worked in. This was the qualification to the maintenance of the tradition [sic] position to which the Full Court referred at [48]. The amendment to s 74(2) did not, however, apply to the circumstances of Polo/Lauren itself as the relevant product was a garment rather than a carpet, bas?relief or embroidery (although the design was applied or attached by means of embroidery or “weaving in”).

Instead:

481 In the light of the Full Court’s emphasis that the position was otherwise unchanged, it would seem that it rejected Rares J’s analysis not simply or principally because the logo remained conceptually distinct from the garment, but because the garment was not made in the shape or configuration of the artistic work, irrespective of whether it was three dimensional.

It’s not clear why garments should be treated any differently to tapestries, carpets etc. I suppose a carpet could for example be woven in the shape of a (stylised) polo player or teddy bear or some other novelty shape thought to be appealing to someone out there in the wide world, but a tapesty? One might have thought (if one didn’t have the Full Court’s obiter dicta hanging over one) the legislature intended to catch all such woven, stitched or otherwise ‘applied’ artistic works from its intention to ensure that carpets, tapestries and the like be “clearly” brought in.

This is not to say that the alternative, literal approach to interpreting s 74 is not without its challenges. Dodds-Streeton J went on in dicta to consider that the Full Court really also disagreed with Rares J’s view that the embroidered stitching was sufficiently three-dimensional to qualify as features of shape or configuration.In any event:

486 … the surface of the garment onto which the smocking is sewn is not flat because the fabric is shirred. Any protrusion of the smocking from the surface is minimal and probably significantly less than that in Polo/Lauren itself, which on a fair reading of its judgment, the Full Court nevertheless thought insufficient.

So, there may well be questions of degree in how much three dimensional appearance is required before something qualifies as shape or configuration.[4] That is, however, a problem which long challenged designs law.

Seafolly Pty Ltd v Feswtone Pty Ltd [2014] FCA 321

 

Update:

Tim Golder points out:

  1. At paragraph 13, her Honour noted that the Señorita work subsisted in final drawings – so my attempt to rationalise her Honour’s perceived distinction to the Polo logo fails dismally.
  2. City Beach has already lodged its appeal: VID224/2014 for mention before Gordon J on 2 May.

  1. City Beach Australia is the trading name of Fewstone Pty Ltd.  ?
  2. IceTV Pty Ltd v Nine Network Pty Ltd (2009) 239 CLR 458 at [54] and [170].  ?
  3. Putting to one side, of course, all the fun and games of what may be a work of artistic craftsmanship for the purposes of s 77(1)(a) or the difference between “shape or configuration” and “pattern or ornamentation”.  ?
  4. This would also be an issue to some extent under the UK’s test of “surface decoration”: see Lambretta Clothing v Teddy Smith [2004] EWCA Civ 886.  ?

Attorney-General on copyright reform DownUnder

Friday, February 14th, 2014

Yesterday, the Commonwealth Attorney-General, who has portfolio responsibility for copyright in Australia, gave an important speech at the opening of the Australian Digital Alliance forum.

Some things that caught my eye:

The Copyright Act is overly long, unnecessarily complex, often comically outdated and all too often, in its administration, pointlessly bureaucratic.

Can’t argue with that: s 195AZGF or s 135ZZZZA, anyone? So, we are going to embark on a process to reform copyright. Bearing in mind that the ALRC has just had its report tabled:

I remain to be persuaded that [adopting 'fair use'] is the best direction for Australian law, but nevertheless I will bring an open and inquiring mind to the debate.

and

First, when this process is finished, and it will be a through and exhaustive exercise in law reform, the Copyright Act, will be shorter, simpler and easier to use and understand.

Secondly, the Act will be technology neutral – no more amusing references to videotapes as we find in current section 110AA.

Thirdly, we will pay careful regard to the broader international legal and economic context ….

In carrying out this work:

The challenge for us today is how to balance the benefits for creators against a range of other public interests including the interests of users, educators and other important public goods.

….

Nonetheless, the fundamental purpose of copyright remains unchanged – to ensure that those who take on the risks of creation are appropriately rewarded for their abilities and efforts.

On the subject of online piracy:

the High Court’s decision of 2012 in the iiNet casechanged the position. The Government will be considering possible mechanisms to provide a ‘legal incentive’ for an internet service provider to cooperate with copyright owners in preventing infringement on their systems and networks.

Options the Attorney identified for fixing this include ‘graduated response’, third party injunctions against ISPs or maybe just facilitating self-regulation.

Read the Attorney General’s speech in full.

Lid dip: Peter Clarke