Concept Television Productions Pty Ltd v Australian Broadcasting Corporation

Re: CONCEPT TELEVISION PRODUCTIONS PTY. LTD. and CARTOON CONCEPTS PTY. LTD.
And: AUSTRALIAN BROADCASTING CORPORATION
No. G1114 of 1988
Injunction - Equity - Contract - Trade Practices

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Gummow J.(1)

CATCHWORDS

Injunction - interlocutory injunction - no serious question to be tried.

Equity - breach of confidence - applicant developing idea for television game show - disclosure to respondent of idea - decision by respondent not to proceed with applicant's idea and to adopt allegedly different concept - necessity for applicant to identify clearly coincidence between information supplied and material allegedly in breach.

Equity - damages - Lord Cairns' Act provisions no basis for damages for disclosure of confidential information - Talbot v General Television Corporation Pty. Ltd. (1980) VR 224 disapproved.

Contract - negotiations for production of game show - whether, if contract existed, negative stipulation could be implied - no claim for restitution - programme in any event not bearing sufficient resemblance to proposed programme to breach term if implied.

Trade Practices - statements as to future conduct allegedly made in negotiations - necessity to assess statements in context - knowledge of falsity or recklessness not shown.

Talbot v General Television Corporation Pty. Ltd. (1980) VR 224

O'Brien v Komesaroff (1981) 150 CLR 310

Moorgate Tobacco Co. Ltd. v Philip Morris Ltd. (No. 2) (1984) 156 CLR 414

Sabemo Pty. Ltd. v North Sydney Municipal Council (1977) 2 NSWLR 880

British Steel Corp. v Cleveland Bridge & Engineering Co. Ltd. (1984) 1 All ER 504

Fraser v Thames Television (1984) QB 44

Codelfa Construction Pty. Ltd. v State Rail Authority of NSW (1982) 149 CLR 337

Castlemaine Tooheys Ltd. v Carlton & United Breweries Ltd. (1987) 10 NSWLR 468

Pappas v Soulac (1983) 50 ALR 231

Bill Acceptance Corporation Ltd. v GWA Ltd. (1983) 50 ALR 242

Global Sportsman Ltd. v Mirror Newspapers Ltd. (1984) 2 FCR 82

McLean v Burns Philp Trustee Co. Ltd. (1985) 2 NSWLR 623

Hawthorn Football Club v Harding (1988) VR 49

Commonwealth v John Fairfax & Sons Ltd. (1980) 147 CLR 39

Attorney-General v Guardian Newspapers Ltd. (1987) 3 All ER 316

Tito v Waddell (No. 2) (1977) Ch 106 at 238

Catt v Marac Australia Ltd. (1986) 9 NSWLR 639

re Dawson (dec'd) (1966) 2 NSWR 211

Bartlett v Barclays Bank Trust Co. (No. 2) (1980) Ch 515

United States Surgical Corporation v Hospital Products International (1982) 2 NSWLR 766

HEARING

SYDNEY

#DATE 25:7:1988

Counsel and Solicitors for Applicants: J. Garnsey instructed by Garland Seaborne

Counsel and Solicitor for Respondent: J. Simpkins instructed by Judith K. Walker

ORDER

That the application for interlocutory injunctive relief be dismissed.

That costs be reserved.

Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules.

JUDGE1

The respondent, which I shall call the ABC, is a party with two other companies, which together trade as Taffner Ramsay Productions, to an agreement dated 12 July 1988. The agreement (which is Exhibit AA) deals with the production of a first series containing 65 episodes, each of about 28 minutes, of a television quiz show entitled "The Oz Game".

It is proposed that the programme be shown nationally on five consecutive nights each week and that the first episode be shown tonight, Monday 25 July 1988. The agreement provides for both parties to contribute assigned elements to the production and for the ABC to pay to Taffner Ramsay Productions what is called a co-producer's fee. The ABC has options for a second and third series, the first option being exercisable no later than the broadcast date of the 35th episode of the first series.
I have viewed as a typical example the second episode in the first series. This was recorded on 10 July 1988. I accept as accurate the description of the format of the programme contained in para. 33 of the affidavit of Mr. Scowcroft sworn in these proceedings on 22 July 1988; I shall not set out that paragraph. Mr. Scowcroft has at all material times been the head of television features at the ABC.
The format bears a close but by no means identical relationship to the format described in exhibit H to para. 32 of Mr. Scowcroft's affidavit. Para. 32 states that:

On or about 11 May 1988, Taffner Ramsay Productions' managing Director, Lorraine Collins, provided me with the developed game by consultant Mark Maxwell Smith of Los Angeles, USA, from which the OZ GAME has now been produced. The distinctive elements provided by Taffner Ramsay Productions substantially altered my view of the game show that we were seeking and created an entirely new format different even to that which I had proposed.

A copy of the original format devised by Taffner Ramsay Productions is exhibit H to Mr. Scowcroft's affidavit.

On and after 7 June 1988, various newspaper reports appeared concerning the coming programmes of "The Oz Game". These newspaper reports, shortly after their appearance, came to the attention of the applicants. For example, on p. 71 of the issue of the Australian Financial Review for 14 June 1988, there appeared a report, portion of which reads as follows:

After viewing more than 50 overseas game shows, the ABC decided to design its own, with a distinctly Australian theme.

. . .

Taffner Ramsay is the product of a marriage between the Australian Paul Ramsay Company and the Los Angeles-based L.F. Taffner group which produces situation comedies and game programmes for Home Box Office and the Disney Channel stations in the US.

However, now the show has been "formated"

(sic) and its first pilot produced last week, The Oz Game will be produced every night out of the ABC Sydney TV studios using ABC staff.

The contestants will all be family groups, with a high school student aged between 13 and 16 teaming with another member of his/her family older than 21. This can be a parent, an older sister or brother, or even an uncle or aunt.

But the game is not just a simple question of the compere firing questions at the teams. Mr. Scowcroft said the teams would interact with each other, with tactics and strategic elements also affecting the final outcome.

Prizes are an integral part of any game show - and as such presented the non-commercial ABC with a bit of a problem.

However, it was decided that no "free" prize offers would be accepted from any companies. Instead the prizes, which would all involve travel around Australia, would either be donated by the Australian Bicentennial Authority or be paid for by the ABC.

Mr. Scowcroft is confident the programme will have a wider audience appeal than EastEnders because he believes viewers at 6.30 pm want a show they can watch while doing other things, and which is not "too engaging".

Other publicity emphasised the selection of Mr. John Derum as "host" of the programme.

In these proceedings, commenced by application filed 22 July 1988, the applicants seek to restrain the broadcasting of the series "The Oz Game". On that day, that is to say last Friday, I heard an application for interlocutory injunctive relief. The case for interlocutory relief was put on three bases: contract, breach of confidence and contravention of s. 52 of the Trade Practices Act 1974 ("the Trade Practices Act"). The first two claims lie in the accrued jurisdiction of the Court.
The first applicant, Concept Television Productions Pty. Ltd., was formerly known as M & N Enterprises Pty. Ltd.. It carries on the business of developing, promoting and assessing quiz and game shows for television. For some years, Mr. Wayne Cameron, a director, and Mr. Michael Boughen have known of a box-board game entitled "Oz Quiz" which was developed by a Mr. Brett Clements and Mr. Phillip Turner of the second applicant, Cartoon Concepts Pty. Ltd.. Mr. Cameron and Mr. Boughen have had an association with Messrs. Clements and Turner for some time.
Prior to July 1987, Mr. Cameron and Mr. Boughen wrote and developed an adaptation of the Oz Quiz game as a television game show and quiz. This was contained in the document entitled "Oz Quiz written as a television format". On 22 July 1987, Messrs. Cameron and Boughen attended the premises of the ABC at Gore Hill and met Mr. Scowcroft. They handed him a copy of that format which is now Exhibit A to Mr. Cameron's affidavit sworn 22 July 1988. The documents contained some 8 pages and dealt with such topics as comedy performance, contestant/guest participation, prizes, staging and questions. The proposed contestants were to be juveniles.
There followed, after 22 July 1987, a series of meetings or communications between Messrs. Cameron and Boughen with Mr. Scowcroft and other officers of the ABC. These dealings ended with a meeting on 4 May 1988, at which Mr. Scowcroft told the other two gentlemen that: "Oz Quiz is cancelled". The principal meetings which followed that of 22 July 1987 were all at the ABC premises and were held on 14 October, 13, 25 and 26 November and 10 December 1987. On 16 December 1987, a "commissioning meeting" was held at the ABC, the minutes of which show the following, under the heading of item 3, "Oz 88":

CTVProgs was not prepared to commit to a series for an unseen product and an untried format. It was agreed that HdFeats be asked to develop a proposal for a simplistic pilot. However the business relationship for the pilot and for any eventual series had to be developed and signed. (It was also noted that all resources investigations had been on a pilot rather than a series basis and big problems could have been anticipated had series approval been forthcoming.)

It is important to note, in evaluating what transpired at these meetings, that the evidence in its present form - and no cross-examination has taken place in the limited time available - indicates that:

? (a) before the meeting on 22 July, Mr. Scowcroft had

concluded that a travel quiz about Australia would be appropriate for the ABC in 1988 using a large map of Australia with contestants winning kilometres instead of points, and applying the kilometres to a trip around Australia;

(b) as early as the meeting on 22 July, Mr. Scowcroft expressed reservation as to the adaptability of the board game for TV;

(c) on 16 September, Mr. Harvey Shore, another officer of the ABC, had presented to Mr. Scowcroft a format for an Oz 88 programme which used the idea of progress across a map of Australia, but with adult and children contestants, rather than simply children;

(d) Mr. Shore's format was given by Mr. Scowcroft to Messrs. Cameron and Boughen on 14 October;

(e) this led to a revision of the applicant's proposal, which is exhibit C to Mr. Cameron's affidavit, but Mr. Scowcroft swears that he does not recollect ever having seen that revision;

(f) on 14 October, and later on 13 November, Mr. Scowcroft says in his affidavit that he canvassed with Messrs. Cameron and Boughen a combination of the proposals - that is to say, their proposal and Mr. Shore's proposal;

(g) on 14 October, although the versions of what transpired vary, it is agreed that in substance Mr. Cameron said to Mr. Scowcroft: "We wish to present the television format for Oz Quiz to Channel 7", and he was told by Mr. Scowcroft to go ahead with it if he so wished;

(h) there was, over this period, much discussion and some preparation for the making of a pilot but there was never any agreement as to "lock down" dates, as they were called, for a pilot before 8 February 1988. Mr. Scowcroft then told Mr. Boughen that the pilot had been postponed until June.

(i) at no time did Mr. Scowcroft provide any material supplied to the ABC by Concept Television to Taffner Ramsay Productions either in written or verbal (sic) form, nor did he copy any of the material supplied by Concept Television into the script which he provided to Taffner Ramsay Productions (para 31 of Mr. Scowcroft's affidavit).

Mr. Garnsey, who appears for the applicant, points to what he says are significant characteristics shared by the format proposed by his client, at least in its amended form after the meeting of 14 October, and episode 2 of the Oz Game which has been viewed as part of the evidence. In particular, Mr. Garnsey points to:

(a) the use of three family groups, each of two members;

(b) a segment dealing with personal questions and personal matters concerning the contestants;

(c) the use of a large screen to display material used in the course of the programme, including a stylised map of Australia;

(d) the use of what one might call double-barrelled questions in the course of the programme;

(e) the nature of the prizes and, in particular, the identity of Mr. John Derum as a compere.

It has to be borne in mind that para. 20 of Mr. Cameron's affidavit is equivocal as to who first suggested the use of Mr. Derum as the host. Furthermore, the identity of Mr. Derum has been widely publicised since the promotion commenced, as I indicated, in the course of last month. Further, the other features that are referred to by Mr. Garnsey are by no means fairly described as unique to the particular formulation that was propounded by his client, nor would they appear to be particularly striking in this field of endeavour.
My impression is that, as a matter of degree and significance, the format of the programme as disclosed in episode two is far closer to the format proposed in annexure H (to Mr. Scowcroft's affidavit) by Taffner Ramsay Productions than to the formats earlier put forward both by the applicants and by Mr. Harvey Shore. Further, Mr. Scowcroft has sworn, as I have stated, in para. 31 of his affidavit, as to the lack of communication of information to Taffner Ramsay Productions.
I should also re-emphasise that the Financial Review account which I have quoted, together with other publicity referred to in para. 26 of Mr. Cameron's affidavit, contains fairly detailed accounts of the format of the programme. I should also point out that the publication of this material is not complained of in the statement of claim filed on 22 July as having been a breach of confidence.
My conclusion at this stage on the material before me is that the applicants have not shown, on the confidential information branch of their case, that there is a serious question to be tried. I say this because even if on 22 July 1987 an obligation of confidence did arise as alleged in the statement of claim, there was insufficient coincidence between that information as claimed and the format eventually used for the Oz Game. This is true also of the revised formulation of 14 October 1987.
I should also add that whilst the authorities collected by Mr. Gurry in his work "Breach of Confidence", pp. 125-126, including as they do the Victorian decision in Talbot v General Television Corporation Pty. Ltd. (1980) VR 224 (applied in Fraser v Thames Television (1984) QB 44), show that there may be an obligation of confidence arising in such situations, nevertheless it is essential for an applicant clearly to identify that which is said to constitute the subject matter of the confidence so that it may then be measured against the alleged breach of threatened breach. See O'Brien v Komesaroff (1981) 150 CLR 310 at 326-328, per Mason J. and Moorgate Tobacco Co. Ltd. v Philip Morris Ltd. (No. 2) (1984) 156 CLR 414 at 438, per Deane J. When that is done in the present case, then, on the present evidence, the result is as I have indicated.
I turn now to the contract issue. In paras. 8 and 9 of the statement of claim, the applicants plead a contract or contracts made on 17, 25 and 26 November 1987. It claims the injunctive relief it presently seeks in aid of an implied negative covenant stated by counsel to the Court to be that the ABC is not to produce a TV programme with the same format as that proposed by the applicant, this negative obligation to last for 5 years or such other period being the reasonable commercial life of the programme.
There is a number of answers to this branch of the case. First, I believe there is barely a serious question to be tried as to the existence of a contract such as that pleaded in paras. 8 and 9. The situation remained, as it seems to me, in a fluid state of negotiation even as to the making of a pilot and it was therefore quite understandable that on 2 December 1987, Mr. Cameron was asking the ABC about the provision of a contract. That is not to say that the efforts of the applicants up to 4 May 1988 were performed gratuitously and without any obligation of restitution imposed by law on the ABC; see the authorities collected and discussed by Sheppard J. in Sabemo Pty. Ltd. v North Sydney Municipal Council (1977) 2 NSWLR 880, by Robert Goff J. in British Steel Corp. v Cleveland Bridge & Engineering Co. Ltd. (1984) 1 All ER 504, and by Messrs. Lindgren, Carter and Harland in "Contract Law in Australia", para. 2314. But that is not how the present proceedings seem to be framed; even if they were, this would not found a claim to interlocutory injunctive relief as sought at present.
Secondly, even if there were a contract or contracts containing the express terms as pleaded, the applicants have not satisfied (to the standard stated in the well known authorities in this Court as that required for interlocutory relief) the tests for the implication of a term of the width propounded by the applicant. I appreciate what was said on this subject in Fraser v Thames Television (1984) QB 44 at 56, but the learned judge did not have the advantage of Sir Anthony Mason's judgment in Codelfa Construction Pty. Ltd. v State Rail Authority of New South Wales (1982) 149 CLR 337 at 345, 346; or that of Hope J. in the New South Wales Court of Appeal in Castlemaine Tooheys Ltd. v Carlton & United Breweries Ltd. (1987) 10 NSWLR 468 at 486-490.
Thirdly, the programme that has been produced does not bear such a relationship to the format proffered by the applicants in the manner I have described as to infringe the implied term on which it seeks to rely.
Finally, for this application, reliance is placed on s. 52 of the Trade Practices Act. Reliance is placed on various misrepresentations, many of which are, in the alternative, said to have been contractual in character.
Much of what I have said as to confidential information and contract applies here to the question of breach of s. 52. Further, statements made in the course of complex negotiations must be assessed in their overall context: Pappas v Soulac (1983) 50 ALR 231 at 234, and see Terry, "Misleading or Deceptive Conduct in Commercial Negotiations" (1988) 16 Australian Business Law Review p. 189 at pp. 195-196. Here, the overall context is one of little certainty and much fluidity. Again, the alleged representations, as I read them, are directed to the type of future conduct dealt with in Bill Acceptance Corporation Ltd. v GWA Ltd. (1983) 50 ALR 242; and to statements of opinion as dealt with by the Full Court in Global Sportsman Ltd. v Mirror Newspapers Ltd. (1984) 2 FCR 82.

No case has yet been made out to any degree at all that these representations even if they were made as pleaded were made recklessly or with knowledge of falsity or without foundation within the meaning of these authorities. Accordingly, I find no serious question has been raised within the meaning of the authorities so far as concerns contravention of s. 52 of the Trade Practices Act.
That is sufficient to dispose of the application for interlocutory relief. But I should add the following as to the balance of convenience.
First, the expenditure of the ABC directed to a launch of the series tonight, and to the transmission of the 64 programmes to follow over 13 weeks, and the contractual arrangements in exhibit AA, are a factor in favour of denying interlocutory relief as sought. The position of an innocent third party also is a relevant consideration in such a situation; see McLean v Burns Philp Trustee Co. Ltd. (1985) 2 NSWLR 623 at 642; Hawthorn Football Club v Harding (1988) VR 49 at 60. I have referred to the state of the evidence as to the position of Taffner Ramsay Productions.
Secondly, I should add that, contrary to what appeared to be submitted by the applicant, the consideration that the ABC is funded from public moneys does not to my mind put the ABC in some inferior position as regards its reputation with the public which provides those moneys, or as regards the stultifying of the use to which it puts those funds.
Thirdly, the applicants complain that if the televising of the series goes to air, the applicant's format will be valueless, as the concept of such a programme will lose any value to any other TV proprietor; see para. 27 of Mr. Cameron's affidavit. But the cat was out of the bag last June as is apparent from the press reports annexed to para. 25 of Mr. Cameron's affidavit. Since that time, and in the circumstances of this case, there is much to be said for the view that the appropriate remedy, if any, is pecuniary, not injunctive, because the grant of an injunction now would not avoid the detriment the applicants apprehend; see The Commonwealth v John Fairfax & Sons Ltd. (1980) 147 CLR 39 at 54; and compare Attorney-General v Guardian Newspapers Ltd. (1987) 3 All ER 316.
By referring to pecuniary remedies, I refer to the three remedies, the measure of which may differ each from the others. These are: damages for breach of contract; damages under s. 82 of the Trade Practices Act and equitable compensation for breach of confidence analogously with the like remedy for breach of fiduciary duty: Tito v Waddell (No. 2) (1977) Ch 106 at 238, 249; Catt v Marac Australia Ltd. (1986) 9 NSWLR 639 at 660. I would not, even at this interlocutory level, accept what was said in Talbot v General Television Corporation Ltd. (1980) VR 224 as to the source of this jurisdiction lying in Lord Cairns' Act and its Australian representatives. What was said in the Victorian decision seems quite to have overlooked the inherent jurisdiction of equity and the fundamental principles that are explained in re Dawson (dec'd) (1966) 2 NSWR 211; Bartlett v Barclays Bank Trust Co. (No. 2) (1980) Ch 515 at 543 and United States Surgical Corporation v Hospital Products International (1982) 2 NSWLR 766 at 816.
For all these reasons, my conclusion is that the application for interlocutory injunctive relief should be dismissed. That leaves the question firstly, of costs of that application and secondly, giving of directions for the further preparation of the matter for final hearing.

(Counsel addressed)

[1988] FCA 419

25 JULY 1988