IPC Global Pty Ltd v Pavetest Pty Ltd (No 2)

Case [2016] FCA 1332


FEDERAL COURT OF AUSTRALIA

IPC Global Pty Ltd v Pavetest Pty Ltd (No 2) [2016] FCA 1332

File number: NSD 1203 of 2015
Judge: MOSHINSKY J
Date of judgment: 8 November 2016
Catchwords: COPYRIGHT – infringement – literary work – computer program – firmware for materials testing equipment – respondents admitted liability for copyright infringement – form of declarations and injunctions – whether to order delivery up (or destruction or erasing) of respondents’ firmware
Legislation:

Copyright Act 1968 (Cth)

Federal Court Rules 1979, Order 18, r 4

Federal Court Rules 2011, r 22.07

Uniform Civil Procedure Rules 2005 (NSW), r 17.7

Cases cited:

IPC Global Pty Ltd v Pavetest Pty Ltd [2016] FCA 500

Playgro Pty Ltd v Playgo Art & Craft Manufactory Limited (No 2) [2016] FCA 478

Streetworx Pty Ltd v Artcraft Urban Group Pty Ltd (No 2) (2015) 110 IPR 544

Date of hearing: 14, 17, 19, 20 October and 7, 8 November 2016
Registry: New South Wales
Division: General Division
National Practice Area: Intellectual Property
Sub-area: Copyright and Industrial Designs
Category: Catchwords
Number of paragraphs: 31
Counsel for the Applicant: Mr R Cobden SC with Ms E Bathurst
Solicitor for the Applicant: Bird & Bird
Counsel for the Respondents: Mr CP Thompson
Solicitor for the Respondents: Stephens Lawyers & Consultants

ORDERS

NSD 1203 of 2015
BETWEEN:

IPC GLOBAL PTY LTD (ACN 168 265 156)

Applicant

AND:

PAVETEST PTY LTD (ACN 160 146 083)

First Respondent

CON SINADINOS

Second Respondent

ALAN JOHN FEELEY (and another named in the Schedule)

Third Respondent

JUDGE:

MOSHINSKY J

DATE OF ORDER:

8 NOVEMBER 2016

THE COURT DECLARES THAT:

1.The first respondent, by the creation, development, reproduction and distribution of its controller known as the Control and Data Acquisition System (CDAS), has infringed the copyright subsisting in version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware (as defined in paragraph 32A of the Second Further Amended Statement of Claim) (IMACS Firmware).

2.The second and third respondents, and each of them, have authorised the infringement by the first respondent of the copyright subsisting in version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware.

THE COURT ORDERS THAT:

3.The first respondent, whether by itself, its directors, servants, agents or otherwise howsoever, be permanently restrained from, without the licence of the applicant, infringing the copyright subsisting in version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware by the reproduction, communication, importation, supply, sale or offer for sale or supply of the firmware for the CDAS the subject of the proceeding, and including versions 18, 19 and 20 of that firmware (CDAS Firmware), whether by the supply, sale, or offer for supply or sale of a CDAS containing the CDAS Firmware or otherwise.

4.The second and third respondents be permanently restrained from, without the licence of the applicant, authorising the infringement, by the reproduction, communication, importation, supply, sale or offer for sale or supply of the…

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AGLC
IPC Global Pty Ltd v Pavetest Pty Ltd (No 2) [2016] FCA 1332
Case
[2016] FCA 1332
Decision Date

CaseChat Overview and Summary

In IPC Global Pty Ltd v Pavetest Pty Ltd (No 2), the primary dispute involved the alleged copyright infringement by Pavetest Pty Ltd of computer program firmware created by IPC Global Pty Ltd. The case was heard in the Federal Court of Australia. The main issue the court had to decide was whether an order should be made for the delivery up, destruction, or erasing of the infringing firmware, known as the CDAS Firmware, from Pavetest's possession. The respondents had admitted liability for copyright infringement, but the form and scope of the declaratory and injunctive relief sought by IPC Global, along with the appropriate remedy for the infringing firmware, were contested.

The court considered the procedural history of the case, noting that IPC Global had amended its pleadings to include allegations of copyright infringement and breach of confidence in relation to the firmware. The respondents had admitted to not contesting specific infringement allegations concerning the IMACS Firmware, particularly its reproduction in the Pavetest CDAS Program. Given these admissions, the court was tasked with determining the appropriate form of relief and remedy.

In its reasoning, the court examined the Federal Court Rules to understand the scope of its powers to make orders in relation to the relief sought. The court concluded that it had the authority to make the orders sought, even if other questions in the proceeding had not been determined. The court then considered the form of the declarations and injunctions proposed by both parties. IPC Global sought broad declarations and injunctions relating to the IMACS Firmware generally, while Pavetest proposed more specific wording relating to particular versions of the firmware. After discussions with the parties, the court decided to adopt the wording proposed by Pavetest for the declarations and injunctions, with the inclusion of the terms "reproduction" and "communication" in the injunctions as agreed by IPC Global.

The court ultimately made orders for permanent injunctions against Pavetest and its directors, restraining them from infringing IPC Global's copyright without a licence. The orders also required Pavetest to deliver up or destroy the infringing firmware within 14 days, except for a reference copy and firmware installed on equipment under pre-existing supply contracts. Costs were reserved for further determination.

Orders

Orders of the court

3. The first respondent, whether by itself, its directors, servants, agents or otherwise howsoever, be permanently restrained from, without the licence of the applicant, infringing the copyright subsisting in version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware by the reproduction, communication, importation, supply, sale or offer for sale or supply of the firmware for the CDAS the subject of the proceeding, and including versions 18, 19 and 20 of that firmware (CDAS Firmware), whether by the supply, sale, or offer for supply or sale of a CDAS containing the CDAS Firmware or otherwise.

4. The second and third respondents be permanently restrained from, without the licence of the applicant, authorising the infringement, by the reproduction, communication, importation, supply, sale or offer for sale or supply of the CDAS Firmware, whether by the supply, sale, or offer for supply or sale of a CDAS containing the CDAS Firmware or otherwise, of the copyright subsisting in version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware.

5. Within 14 days of the date of these orders, the respondents:

(a) deliver up on oath to the applicant’s solicitors all copies of the CDAS Firmware, including as comprised in any CDAS, in their possession, custody or control (other than the reference copy and any copy the subject of a supply contract as referred to below); or

(b) alternatively, file and serve an affidavit attesting to the fact that all copies of the CDAS Firmware, including as comprised in any CDAS, in their possession, custody or control (other than the reference copy and any copy the subject of a supply contract as referred to below) have been destroyed or erased, and the steps undertaken to give effect to such destruction or erasing.

Subject to further order, this order does not apply to one copy of the CDAS Firmware which may be retained as a reference copy, and any copy of the CDAS Firmware installed or to be installed on equipment in respect of which a contract of supply of the equipment has been entered into before 8 November 2016.

6. Costs be reserved.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The main issue of dispute in relation to the orders concerned whether an order should be made for delivery up (or destruction or erasing) of the CDAS Firmware. The issues are described later in these reasons. For the reasons expressed later in these reasons, I will make an order for delivery up (or destruction or erasing) substantially in the following terms:5. Within 14 days of the date of these orders, the respondents:(a)deliver up on oath to the applicant’s solicitors all copies of the CDAS Firmware, including as comprised in any CDAS, in their possession, custody or control (other than the reference copy and any copy the subject of a supply contract as referred to below); or(b)alternatively, file and serve an affidavit attesting to the fact that all copies of the CDAS Firmware, including as comprised in any CDAS, in their possession, custody or control (other than the reference copy and any copy the subject of a supply contract as referred to below) have been destroyed or erased, and the steps undertaken to give effect to such destruction or erasing.Subject to further order, this order does not apply to one copy of the CDAS Firmware which may be retained as a reference copy, and any copy of the CDAS Firmware installed or to be installed on equipment in respect of which a contract of supply of the equipment has been entered into before 8 November 2016.Procedural background I will now briefly describe the procedural background to the issues discussed in these reasons. As originally commenced, the proceeding brought by IPC Global concerned copyright infringement and breach of confidence in relation to software only. On 11 May 2016, I gave leave to IPC Global to amend its pleading and the amended originating application to incorporate allegations of copyright infringement and breach of confidence in relation to firmware as well: IPC Global Pty Ltd v Pavetest Pty Ltd [2016] FCA 500. IPC Global’s pleadings in relation to firmware were principally contained in paragraphs 32A to 32K of the further amended statement of claim. (The pleading has since been amended but those amendments are not relevant for present purposes.) In paragraph 32A of the further amended statement of claim, IPC Global alleged that in or around January 2001, Mr Feeley and Mr David Poon created the first version of an original computer program within the meaning of the Copyright Act 1968 (Cth) which comprised the firmware for the IMACS. This was defined as the “IMACS Firmware” in the pleading. In paragraph 32C, IPC Global alleged that the IMACS Firmware had been updated and modified from time to time by Mr Feeley, Mr Poon and Mr Bhathiya (Bart) Fernando. In paragraphs 32H and 32J reference was made to a modified version of the IMACS CPU module known as the IMACS CPU module version 1.50 and a modified version of the IMACS IO (which stands for “In Out”) module known as the IMACS IO module version 1.51. By a letter from the respondents’ solicitors to IPC Global’s solicitors dated 6 October 2016 and by the respondents’ opening submissions filed before trial, the respondents indicated that they did not contest various matters. In relation to the firmware part of the case, the opening submissions record that the respondents did not contest that:(a)“the Pavetest CDAS Program reproduces a substantial part of the particular pleaded versions of the IMACS Programs that have been the subject of infringement evidence, namely the IMACS CPU module version 1.50 … and the IMACS IO module version 1.51 …”; and(b)“if and to the extent that the primary liability of Pavetest for copyright infringement is established, authorisation liability of Mr Sinadinos and Mr Feeley will also be established”.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Although the current rule in the Federal Court Rules omits the wording of the former subrule (2), I do not think this was intended to effect a substantive change in the rule. Generally, the aim of the current version of the Federal Court Rules, as introduced in 2011, was not to substantially alter existing practice and procedure but rather to explain it in a way that could be more easily followed and applied: see the explanatory statement to the Federal Court Rules 2011, p 5. The wording of the current rule refers to “any” judgment or order. I think that this supports the view that rule 22.07 embraces the power to pronounce any judgment or make any order notwithstanding that other questions in the proceeding have not been determined. For completeness I note that there would, of course, be power to make an order for the determination of a separate question and then give judgment on that question. But I do not think it is necessary to invoke this power.Declarations The declarations proposed by IPC Global referred to the IMACS Firmware without specifying particular versions. In contrast, the respondents’ proposed declarations frame the orders in terms of version 1.1D (IO Module) and version 1.20 (CPU Module) of the IMACS Firmware. These are the versions that existed before July 2003. The respondents’ proposed wording is consistent with the scope of their admission, as discussed above. In the course of discussion, senior counsel for IPC Global indicated that IPC Global was content with this wording provided an order was made for delivery up (or destruction or erasing). As I have indicated, I propose to make such an order. I will therefore make declarations substantially in the terms proposed by the respondents.Injunctions As with the declarations, a difference between IPC Global and the respondents in relation to the injunctions was whether the orders should refer to the IMACS Firmware generally or particular versions. Again, in the course of discussion, senior counsel for IPC Global indicated that IPC Global was content with the particular versions of the modules being referred to, provided an order for delivery up (or destruction or erasing) was made. Another issue concerning the form of the injunctions was that the respondents proposed omitting the words “reproduction” and “communication” from the form of injunctions proposed by IPC Global. The respondents’ counsel explained that the respondents were concerned that the injunction might be taken to apply to reproduction or communication of a part of the CDAS Firmware which may not reproduce any part of the IMACS Firmware. However, the respondents’ counsel indicated that, if it was clear that the injunction related to reproduction or communication of the whole of the CDAS Firmware, the respondents did not have a difficulty with the words “reproduction” and “communication” being included. In my view, the injunctions proposed by IPC Global relate to the whole of the CDAS Firmware. Senior Counsel for IPC Global agreed with this. On this basis, I will include the words “reproduction” and “communication” in the injunctions.