Copyright walkabout
I am present IPSANZ annual copyright update for 2012:
- in Brisbane at Corrs Chambers Westgarth’s offices on 9 October; and
- in Melbourne at the RACV Club on 18 October.
Details via the links above.
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Copyright
Raising the Bar regulations
IP Australia has published the first tranche of draft regulations to implement the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (most of which comes into force on 15 April next year).
This tranche includes the draft regulations for:
- Schedule 1 – Raising the quality of granted patents,
- Schedule 4 – Assisting the operations of the IP profession, and
- Schedule 5 – Improving mechanisms for trade mark and copyright enforcement.
Comments should be submitted by 21 November 2012.
Download all the gory details, including draft EMs, here.
Lots have people have had a go at trying to explain some, or all, of the ramifications of the Act. If you don’t want to Google, or bing, or duck duck go, the EM can be found on Parliament’s site here and the Bills Digest prepared by the Parliamentary secretariat is here.
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No damage for infringing copyright in questionnaire
Besanko J has awarded Insight SRC $32,510.00 for the infringements of its copyright in the School Organisational Health Questionnaire by the Australian Council for Educational Reseaarch (ACER). The award consisted of $10 nominal damages and $32,500 by way of additional damages. There are some interesting points about ownership, assignment and damages.
The questionnaire consisted of 57 questions arranged under 12 headings or modules. ACER reproduced some 25 of these questions from 5 modules between 2006 and October 2009 as part of a project with Independent Schools Victoria.
There was no dispute that copyright subsisted in the questionnaire or that ACER had reproduced a substantial part. Rather, ACER disputed Insight SRC’s title to the copyright and whether Insight SRC had suffered any damage.
Ownership
ACER’s basic point was that, as Dr Hart made the questionnaire in the course of his employment by the Victorian Department of Education, the Department (or the Crown) and not Dr Hart was the owner of the copyright pursuant to s 35 or the Crown Copyright provisions (here and here) of the Copyright Act 1968. If Dr Hart was not the original owner of the copyright, Insight SRC had no title since its rights depended on a chain of assignments starting with Dr Hart and not involving the Department (or the Crown).
Besanko J agreed with ACER that Dr Hart had created the questionnaire while employed by the Victorian Department of Education. However, his Honour found that Dr Hart and the Department (through Dr Hart’s superior) had agreed Dr Hart would retain ownership of the copyright and so s 35(6) and s 176 were excluded by the operation of s 35(3) and s 179.
The interesting point here is that the agreement between Dr Hart and his superior was purely oral but, as Besanko J pointed out, unlike the case with assignments pursuant to s 196 or s 197, there was no requirement for an agreement which excluded the operation of s 35(6) and s 176 to be in writing.
Besanko J did also find that s 176 would not have applied as Dr Hart, although an employee of the Department, was not acting under the control or direction of anyone in the Department in creating the questionnaire.
Assignment
Insight SRC claimed to be the owner of the copyright in the questionnaire by assignment. The assignment of copyright to it was made on 1 October 2009; that is, after ACER had ceased its infringing conduct.[1]
The main point of interest is that prior to 12 May 2011, none of the assignments – to Hart Cultural Lodges or Insight SRC – included the right to sue for past infringements. Deeds assigning the right to sue for past infringements from Dr Hart to Hart Cultural Lodges and then from Hart Cultural Lodges to Insight SRC were executed only on 12 May 2011.
After a review of the case law, including Trendtex and the High Court’s ruling in Equuscorp v Haxton, Besanko J accepted that Australian law now permitted the assignment of “bare” rights to litigation provided the assignee had a pre-existing genuine commercial interest in enforcing the claims of the assignor:
…. It must now be taken to be established in Australia that the circumstances in which a bare or mere right of action may be assigned include a case where the assignee has a pre-existing genuine commercial interest in enforcing the claims of the assignor.
While Besanko J was somewhat bemused why there was an assignment to Hart Cultural Lodges, his Honour considered that the ownership of the copyright in the questionnaire was a sufficient pre-existing genuine commercial interest to validate the late assignment of the right to sue for past infringements.
Damages
ACER generated some $213,000 in revenue from its infringing use of the questionnaire. Independent Schools Victoria in turn earned some $807,000 from supplying the questionnaire to its associated schools in infringement of the copyright.
Besanko J refused to award Insight SRC general damages; his Honour awarded nominal damages of $10 only.
The basis for this refusal to award general damages was that all Insight SRC obtained through the assignment of the right to sue for past infringements was whatever rights Dr Hart had to assign. Dr Hart himself had no right to general damages because:
118 …. Dr Hart was not personally conducting a business involving the use of the [questionnaire] between the beginning of 2006 and 1 October 2009 and it has been no part of their case before me that Dr Hart personally would have exploited any commercial opportunities with ISV. Furthermore, Dr Hart did not claim that he could recover any such loss as the major shareholder of Insight SRC and that the Court could lift the corporate veil. On the other hand, what Dr Hart did have as the copyright owner was a right to nominal damages for infringement of copyright and a right to claim additional damages under subs 115(4). An award of nominal damages is appropriate to vindicate the invasion of a copyright owner’s proprietary right….
That is, as Dr Hart was not himself in the business of selling the questionnaire, he could not claim the profits lost on the sales made by an infringing “competitor” – he was not in competition with ACER.
If general damages had been available, Besanko J would have assessed them at $130,000. Rather questionably (with respect),[2] his Honour started with the revenue earned by ACER and reduced that amount by its costs to reflect the profits it made.
Besanko J would not have made any allowance for the revenues made by Independent Schools Victoria as that was not how Insight SRC put its case. The judgment does not explain why Insight SRC did not pursue such a claim. Presumably, it would not have claimed a share of Independent Schools Victoria’s revenues if it [or its exclusive licensee, rather] had secured the contract instead of ACER.
Additional damages
Besanko J found that ACER’s infringement was flagrant and awarded $32,500 by way of additional damages pursuant to s 115(4). ACER had a permissions unit to secure copyright licences where necessary and well knew of its obligations not to use copyright for commercial purposes without an appropriate licence. The fact that the officer in charge of ACER’s program did acknowledge Dr Hart’s authorship in footnotes did not save ACER either.
The amount of any additional damages is highly discretionary and notoriously difficult to predict. Given his Honour’s finding that ACER made $130,000 profit[3] and the permissibility of taking into account that profit in assessessing the amount of additional damages,[4] the award may seem surprisingly low given his Honour’s characterisation of the infringement as flagrant.
Insight SRC IP Holdings Pty Ltd v The Australian Council for Educational Research Limited [2012] FCA 779
- The situation was rather more complicated: Dr Hart had assigned, or purported to assign, his copyright in the questionnaire to Hart Cultural Lodges (Dr Hart’s family trust) by two deeds, both dated 30 June 2009 and Hart Cultural Lodges in turn assigned its interests to Insight SRC by deed dated 1 October 2009. Dr Hart was the director and major shareholder of Insight SRC. To complicate matters further, Insight SRC granted an exclusive licence to another “Insight” company of which Dr Hart was also the director and major shareholder. That other Insight company having been the operating entity between 2006 and 2009, but not having a written agreement in place to qualify it as an exclusive licensee in terms of the Act. ?
- See Aristocrat Technologies v DAP Services (Kempsey) [2007] FCAFC 40 at [3], [18]-[20]. ?
- At [190] in the face of ACER’s claim at [151] that it made no profits at all. ?
- See Aristocrat Technologies v DAP Services (Kempsey) [2007] FCAFC 40 at [48]-[54] and Facton Ltd v Rifai [2012] FCAFC9 at [40]–42] and [48]. ?
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ALRC’s Copyright and Digital Economy Issues Paper
The ALRC has published an Issues Paper for its inquiry into Copyright and the Digital Economy.
In an attempt to provide some structure to the anticipated submissions, the Issues Paper propounds some 55 questions over a range of topics including:
- should (maybe that should include “can”) Australia adopt a “fair use” exception (questions 52 – 53) – an earlier assessment by the CLRC (pdf – see p.7 for the recommendations);
- is there a need for greater freedom for “transformative uses” such as ‘sampling’, ‘remixes’, and ‘mashups’ (questions 14 – 18)
- to what extent should copying for private and domestic use be permitted more freely, including should Optus be able to provide its Optus TV Now service (questions 7 – 13);
- orphan works (questions 23 & 24);
- library and archive exceptions (questions 19 – 22);
- data and text mining (questions 25 – 27);
- educational institutions (questions 28 – 31);
- Crown use (questions 32 – 34);
- retransmission of free-to-air broadcasts (questions 35 – 39);
- do the statutory licensing schemes work efficiently in the digital environment and are new licences needed (questions 40 – 44);
- should there be any other free use exceptions and should any existing exceptions be done away with (questions 48 – 51);
- to what extent should people be able to “contract out” of copyright exceptions (questions 54-55) – see what the CLRC thought (pdf).
The Issues Paper is available on the web, as a pdf, an ePub and also in rtf components. (So far as I can see, it does not appear to be available in “dead tree” form.)
Submissions are sought by 16 November 2012. The ALRC itself is required to report by November 2013.
If you are looking for an overview of what is already in place, the Australian Copyright Council’s take is here (pdf).
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Tobacco plain packaging
Quote from the High Court:
At least a majority of the Court is of the opinion that the Act is not contrary to s 51(xxxi).
Reasons (which may explain that rather cryptic quantity) to follow later.
So, by 1 December 2012, all retail cigarette packs in Australia will look something like this. – the colour is officially described as Pantone 448C.
Tobacco Plain Packaging Act 2011
Tobacco Plain Packaging Regulations 2011
Tobacco Plain Packaging Amendment Regulations 2012 – extending regime to cigars and tobacco pouches.
On the global front, Ukraine, Honduras and Dominican Republic have brought complaints against Australia before the WTO dispute resolution process and, so far, Brazil, Canada, El Salvador, the European Union, Guatemala, Indonesia, Nicaragua, New Zealand, Norway, the Philippines, Uruguay and Zimbabwe have joined in the consultations.
So far as I can work out, the arbitration between Philip Morris and Australia under the 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments has reached the stage where the panel of 3 arbitrators has been established.
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Apotex v Sanofi: the (un)implied licence
In addition to finding Sanofi’s patent infringed, the Full Court affirmed Jagot J’s conclusion that Apotex had no implied licence to reproduce the copyright in Sanofi’s product information documents (PID).
Before a (medicinal) drug can be offered for sale in Australia, it must be registered in the Australian Register of Therapeutic Goods by the Therapeutic Goods Administration. One of the requirements for registration is the submission of a PID, describing the drug, what it can be used for and how and providing warnings about potential problems and risks.
Apotex argued that it was industry custom or usage for the suppliers of generic drugs simply to provide PID for their generic drugs in substantially the same terms as the originator’s PID. It provided evidence of many cases where this had happened, including a number of cases in which Sanofi’s generic arm had simply re-used a competitor’s original PID itself. This included:
13 drugs of which Sanofi-Aventis was the innovator and 22 generic versions of the same drug,
the top 10 drugs by value on the PBS and 62 generic versions of the same drug,
some eight drugs of which companies other than Sanofi-Aventis were the innovators and generic versions of those drugs of which Sanofi-Aventis was the issuer.
The TGA did not require PID submitted by generics to be in the same terms as the originator’s PID. If a generic’s PID was different in substance or terms, however, the TGA may require the generic to submit additional safety or efficacy data to support registration of its own formulation.
On the last day of trial, Sanofi was also allowed to introduce evidence showing that some generics did in fact prepare and register their own PIDs rather than just copy the originator’s PID.
In this state of affairs, the Full Court unanimously upheld Jagot J’s conclusion that the evidence of an implied licence was at best equivocal and so rejected the implication. (Keane CJ [80]-[81], Bennett and Nicholas JJ [98]-[208])
It is difficult to resist the impression that, if instead of being sober judges their Honours (at least Bennett and Nicholas JJ) were teenagers, the suggestion that a licence could be implied between parties who were not in any type of contractual or consensual relationship would have been met with:
rofl.
As to the public interest, Parliament was forced to intervene (at the legislative equivalent of the speed of light) and create yet another specific defence and, in due course, Jagot J found that Apotex could rely on it as a defence (for acts done after the amendment came into force).
So far, 2012 is not proving an easy year for those trying to claim they have an implied licence to protect themselves from infringement allegations.
Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) [2012] FCAFC 102
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TPM exceptions review
Following my post on the ALRC’s reference re exceptions in the digital environment, a couple of people kindly pointed out the Attorney General’s department is also conducting a review of the exceptions to technological protection measures.
A technological protection measure is … well, anyway, since the Sony v Stevens stuff up, the definition has been “fixed up” to close that gulf by adding access control technological protection measure as well.
Section 116AN provides for a number of exceptions – e.g. interoperability, encryption testing, security testing, online privacy, law enforcement and national security, libraries – and s 116AN(9) provides a regulation making power to create additional exceptions.
The existing “additional” exceptions are found in Schedule 10A of the Copyright Regulations.
The US Copyright Office is currently a large way through its 5th 3 year “ad hoc” rulemaking exercise for the counterpart arrangements under the US Act.
The review’s home page is here and the pdf of the issues paper is here.
Submissions about the exceptions should be in by 17 August 2012
Responses to those submissions should be in by 5 October 2012.
(Congratulations to the AGD for a sensible, structured approach to submissions which recognises that some people will definitely have something to say about what other people submit!)
Lid dip:
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A few exercises in parody?
Gotye and Kimbra had that smash hit “Somebody I used to know“.
via Prof. Tushnet at the 43(B)log, there comes “The Star Wars I used to Know” (99USc or $1.69 in the Oz iTunes store).
Prof. Tushnet gives extra points for the artwork. I wonder about that, does it go too far? I guess there is that dig at the artwork too …
While we’re having fun:
Walk off the Earth did this theatrical cover of Gotye/Kimbra.
Then, in the Key of Awesome really took the sledgehammer to it.
Copyright Act 1968 (Cth) s 41A.
(see: it was IP related)
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ALRC terms of reference finalised
The Government has announced the finalised terms of reference for the Australian Law Reform’s inquiry into copyright:
I refer to the ALRC for inquiry and report pursuant to subsection 20(1) of the Australian Law Reform Commission Act 1996 the matter of whether the exceptions and statutory licences in the Copyright Act 1968, are adequate and appropriate in the digital environment.
Amongst other things, the ALRC is to consider whether existing exceptions are appropriate and whether further exceptions should:
- recognise fair use of copyright material;
- allow transformative, innovative and collaborative use of copyright materials to create and deliver new products and services of public benefit; and
- allow appropriate access, use, interaction and production of copyright material online for social, private or domestic purposes.
As one might expect, the ALRC is directed not to duplicate work being undertaken by other inquiries and the like. It turns out that, amongst other things, these include
not duplicate work being undertaken on: unauthorised distribution of copyright materials using peer to peer networks; the scope of the safe harbour scheme for ISPs; a review of exceptions in relation to technological protection measures; and increased access to copyright works for persons with a print disability.
Anyone know what that work is?
The ALRC is required to deliver its report by 30 November 2013.
Terms of reference here.
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ACTA in trouble in Australia
The Age is reporting that a Parliamentary committee has “struck down” Australia’s signing of ACTA.
As it turns out, the Joint Standing Committee on Treaties has unanimously recommended that Australia should not ratify ACTA at this time. Recommendation 8 states:
That the Anti-Counterfeiting Trade Agreement not be ratified by Australia until the:
- Joint Standing Committee on Treaties has received and considered the independent and transparent assessment of the economic and social benefits and costs of the Agreement referred to in Recommendation 2;
- Australian Law Reform Commission has reported on its Inquiry into Copyright and the Digital Economy; and
- the Australian Government has issued notices of clarification in relation to the terms of the Agreement as recommended in the other recommendations of this report.
Recommendation 9 goes on to exhort any future Committee on Treaties to take into account what is happening with ACTA in other jurisdictions including the EU and the USA.
Recommendations 3 to 7 relate to more specific matters such as, for example, a need to clarify the meanings of ‘aiding and abetting’ and ‘commercial scale’.
Apart from specific matters of particular detail, the Joint Standing Committee seems to have had two main concerns about ratification:
First, the Treaty was tabled in Parliament with a National Interest Assessment (NIA). However, the NIA did not include an analysis of the economic impact that ratifying ACTA would have on Australia.
One reason why there was no economic analysis feeds into the Joint Standing Committee’s second major concern: the NIA stated that ACTA would not require any changes to existing Australian law. The benefit of ratifying ACTA (early) was that it would give Australia influence:
2.13 The NIA encourages the early ratification of ACTA, so as to enable Australia to play an influential role in the ACTA Committee, which will consider, inter alia, rules and procedures for reviewing the implementation and operations of ACTA.
In the absence of an economic assessment, however, the Joint Standing Committee noted there was an absence of reliable evidence that there is a “problem” that needs to be addressed. See [3.6] and reference to the concerns expressed, amongst others, by the US Government Accountability Office.
Secondly, the Joint Standing Committee received a number of submissions which challenged the view that no changes would be required to Australian law. For example, what does “aid and abet” or “commercial scale” mean? To what extent, if at all, are patents caught up in what is counterfeit?
How valid those concerns are may require further investigation but, as As. Prof. Weatherall pointed out, the ACTA Committee will have a role in developing more detailed enforcement mechanisms. The Joint Standing Committee also noted in several places that ACTA does not include the defences or exceptions expressed in TRIPS.
So far as I can work out (it is a long time since I studied constitutional law so let me know if you know better), the Joint Standing Committee has not in fact “struck down” ACTA or Australia ratifying it. The Committee’s recommendations do not constitute a resolution of a House of Parliament and ACTA is not a legislative instrument subject to disallowance on such a resolution.
As a treaty, ACTA would become part of our domestic law only if Parliament passed a statute to implement it. The Government could still ratify ACTA but the Joint Standing Committee’s recommendations are the unanimous recommendations of a cross-party committee so they plainly reflect a level of disquiet with ACTA within Parliament at a high level: a level of disquiet which appears to be felt even within the EU (one of the IP-exporting parts of the world one might think likely to support such a regime).
Download copies of the Committee’s report from here (pdf).
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