Australasian Performing Right Association Limited v Illusion Bar & Nightclub Pty Ltd

[2017] FCCA 883

FEDERAL CIRCUIT COURT OF AUSTRALIA

AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED v ILLUSION BAR & NIGHTCLUB PTY LTD & ANOR [2017] FCCA 883

Catchwords:
COPYRIGHT – Copyright Act 1968 (Cth) – default judgment for non-appearance – breach of copyright in musical works by corporate respondent and sole director of corporate respondent engaged in nightclub business – damages under s.115 – applicant entitled to declaratory and injunctive relief.

Legislation:

Copyright Act 1968, ss.31, 36, 115, 126

Federal Circuit Court Rules 2001 (Cth)

Cases cited:

International Writing Institute v Rimila Pty Ltd (1995) 57 FCR 135

Sutherland Publishing v Caxton Publishing [1936] Ch 323

Applicant: AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

First Respondent: ILLUSION BAR & NIGHTCLUB PTY LTD

Second Respondent: PETER ARHONTOGIORGIS

File Number: SYG 3114 of 2016

Judgment of: Judge Dowdy

Hearing date: 7 April 2017

Last tender of evidence: 10 April 2017

Delivered at: Sydney

Delivered on: 5 May 2017

REPRESENTATION

Counsel for the Applicant: Mr A Doctor

Solicitors for the Applicant: Banki Haddock Fiora

No appearance for or by the Respondents.

THE COURT DECLARES AND ORDERS AS FOLLOWS:

1. Declare that in the events and circumstances which have happened the Respondents and each of them have infringed the Applicant’s copyright in the following musical and literary works (collectively Works):

   (a)Hideaway music;

   (b)Hideaway lyrics;

   (c)Jack music;

   (d)Jack lyrics;

   (e)Got a Feeling music;

   (f)Got a Feeling lyrics;

   (g)Free music;

   (h)Free lyrics;

   (i)Shake That music; and

   (j)Shake That lyrics.

2. Order that the First Respondent by itself, its servants and agents be restrained from performing or authorising the performance of any of the Works in public;

3. Order that the Second Respondent by himself, his servants and agents be restrained from performing or authorising the performance of any of the Works in public;

4. Damages against the Respondents and each of them pursuant to s.115(2) of the Copyright Act 1968 (Cth) in the amount of $30,572.28.

5. Damages against the Respondents and each of them pursuant to s.115(4) of the Copyright Act 1968 (Cth) in the amount of $75,000.

6. The Respondents and each of them are to pay the Applicant’s costs of the proceeding in the sum of $8,541.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 3114 of 2016

AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED

Applicant

And

ILLUSION BAR & NIGHTCLUB PTY LTD

First Respondent

PETER ARHONTOGIORGIS

Second Respondent

REASONS FOR JUDGMENT

Introduction

1. By Application and Statement of Claim filed on 11 November 2016 the Applicant, which is a collection society and the owner, or representative of the owner, of the copyright in the musical and literary works (Works) identified in the Application, seeks certain declaratory and injunctive relief together with damages under s.115 of the Copyright Act 1968 (Cth) (Act).

2. At the hearing in this Court on 7 April 2017 there was an oral application for default judgment under rule 13.03B(2)(c) of the Federal Circuit Court Rules 2001 (Cth). I dispense with any need for the filing of an Application in a Case for default judgment.

3. I note that I am satisfied by the affidavit evidence that both the First and Second Respondents have been appropriately served with the Application and Statement of Claim and given notice of the intention of the Applicant to move the Court for default judgment.

4. Despite service and appropriate notice of the application for default judgment, neither of the Respondents has ever appeared in this proceeding. Their disregard of the proceeding is entirely of a piece with their disregard of the valuable property rights of the Applicant which are referred to below.

5. The First Respondent was at all material times the proprietor of the business known as “Illusion Bar & Nightclub” situated at 229 Queensberry Street, Carlton in the State of Victoria (premises). The Second Respondent was at all material times the sole director and shareholder and the controlling mind and will of the First Respondent and was personally directing its day-to-day management.

6. Further, I am satisfied and find that at all material times the Applicant was the copyright owner or the representative of the copyright owner in the Works and that the Respondents, by publicly performing the Works by way of recorded music for dance use at the premises substantially from 1 September 2013 to 31 December 2016, have infringed that copyright without the licence of the Applicant.

7. The evidence establishes that the Applicant sent a stream of correspondence to the Respondents which invited them to regularise their position by entering into an arrangement with the Applicant to license the use of the Works and to comply with the Respondents’ legal obligations regarding the public performance of the Works at the premises.

8. However, the evidence also establishes that the Respondents entirely ignored the eminently reasonable attempts of the Applicant to regularise the position of the parties according to law. Instead of entering into an appropriate arrangement with the Applicant, both Respondents have acted with contumelious disregard for the Applicant’s rights.

Relevant Statutory Provisions

1. Section 126 of the Act provides that where an action is brought, copyright shall be presumed to subsist in the relevant works if the defendant does not put in issue whether copyright subsists in the works, and the relevant plaintiff shall be presumed to be the owner of the copyright if he or she claims to be the owner of the copyright and the defendant does not put in issue the plaintiff’s ownership.

2. By virtue of the Respondents’ non-appearance, the Applicant’s copyright in the Works is therefore established pursuant to s.126 because it is not put in issue. Furthermore, I am entitled to regard the facts as pleaded in the Statement of Claim as admitted, since the Respondents have neither appeared in the proceeding nor filed any Defences to the Statement of Claim.

3. By force of s.31(1)(a)(iii) of the Act, copyright is the exclusive right to perform a musical work in public.

4. By force of s.36(1) of the Act, it is an infringement of the copyright in a work to do or authorise the doing of any act comprised in the copyright.

5. It is provided by s.36(1A) that in determining for the purposes of s.36(1) whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the owner of the copyright, that the matters that must be taken into account include the extent of the person’s power to prevent the doing of the act concerned, the nature of any relationship between the person and the person who did the act concerned and whether the person took any reasonable steps to prevent or avoid the doing of the relevant breach of copyright.

6. As stated at [5] above, the evidence establishes that the Second Respondent was the directing mind and will and the alter ego of the First Respondent. I find that he authorised the relevant breaches of copyright.

7. In my view, in these circumstances both Respondents are equally liable for an award of damages or an account of profits under s.115 of the Act. I note at this point that the Applicant has elected to seek damages rather than an account of profits.

8. The measure of damages under s.115(2) is the diminution in value of the copyright as a chose in action: see Sutherland Publishing v Caxton Publishing [1936] Ca323, approved and applied by the Federal Court in International Writing Institute v Rimila Pty Ltd (1995) 57 FCR 135.

9. I am of the view that in the present case, the appropriate measure of damages under s.115(2) is the licence fee which would have been charged by the Applicant if the Respondents had accepted the offer of the available licence for the Works to be performed at the premises.

10. I am satisfied by the evidence that the amount of licence fees payable by the Respondent in respect of performances during the relevant period at the premises is the sum of $26,633.05 for the period of 1 September 2013 to 31 December 2016. I will give judgment against each of the Respondents for that amount.

11. The Applicant seeks additional damages pursuant to s.115(4). Section 115(4) provides:

    s.115     Actions for infringement

    (1)     …

    (2)     …

    (3)     …

    (4)     Where, in an action under this section:

    (a)     an infringement of copyright is established; and

    (b)the court is satisfied that it is proper to do so, having regard to:

    (i)     the flagrancy of the infringement; and

    (ia)    the need to deter similar infringements of copyright; and

    (ib)    the conduct of the defendant after the act constituting the infringement or, if relevant, after the defendant was informed that the defendant had allegedly infringed the plaintiff's copyright; and

    (ii)     whether the infringement involved the conversion of a work or other subject-matter from hardcopy or analog form into a digital or other electronic machine-readable form; and

    (iii)   any benefit shown to have accrued to the defendant by reason of the infringement; and

    (iv)    all other relevant matters;

    the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances.

12. In my view the present case constitutes a serious breach of copyright by the Respondents. As stated at [8] above, they have both ignored the very reasonable overtures from the Applicant and entirely disregarded the present proceeding. Taking into account the matters disclosed in the evidence, and the Applicant’s Written Submissions, which will be placed with the papers and should be considered to have been adopted by me for the purposes of these reasons, I am of the view that, having regard to the Respondents’ complete and deliberate disregard of the Applicant’s rights, together with both the need to effect deterrence against similar infringements of copyright and the benefits which the Respondents have obtained in using the Works in their business, a reasonable figure for damages pursuant to s.115(4) is the sum of $75,000.

13. Finally, I am further of the view that the Applicant is entitled to interest in the sum of $3,937.52 up to the date of this judgment on the damages awarded under s.115(2).

14. There should also be appropriate declaratory and injunctive relief.

Dispositive Orders

1. In the circumstances the orders of the Court will be as follows:

   1)Declare that in the events and circumstances which have happened the Respondents and each of them have infringed the Applicant’s copyright in the following musical and literary works:

   a.Hideaway music;

   b.Hideaway lyrics;

   c.Jack music;

   d.Jack lyrics;

   e.Got a Feeling music;

   f.Got a Feeling lyrics;

   g.Free music;

   h.Free lyrics;

   i.Shake That music; and

   j.Shake That lyrics.

   2)Order that the First Respondent by itself, its servants and agents be restrained from performing or authorising the performance of any of the Works in public;

   3)Order that the Second Respondent by himself, his servants and agents be restrained from performing or authorising the performance of any of the Works in public;

   4)Damages against the Respondents and each of them pursuant to s.115(2) of the Copyright Act 1968 (Cth) in the amount of $30,572.28.

   5)Damages against the Respondents and each of them pursuant to s.115(4) of the Copyright Act 1968 (Cth) in the amount of $75,000.

   6)The Respondents and each of them are to pay the Applicant’s costs of the proceeding in the sum of $8,541.

I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of Judge Dowdy

Date:         5 May 2017