Microsoft Corporation v Marks, R.D - [1992] FCA 130

Re: MICROSOFT CORPORATION AND ORS
And: RODNEY DAVID MARKS AND ANOR
No. N G430 of 1991
FED No. 130
Contempt of Court

COURT

IN THE FEDERAL COURT OF AUSTRALIA

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

CATCHWORDS

Contempt of Court - injunction against reproduction of computer programs - act of contempt admitted - dispute as to form of penalty - respondent and family wholly dependent on income from computer business - no attitude of conscious disregard of obligations by respondent - assessment of costs of applicants.

Australasian Meat Industry Employees' Union v Mudginberri Station Proprietary Limited (1986) 161 CLR 98.

Australian Design Council v Peter Berrello (1989) 17 IPR 389.

HEARING

SYDNEY

#DATE: 4:2:1992

Counsel and solicitors Mr J.T. Svehla instructed by
for the applicants: Mallesons Stephen Jacques.

Counsel and solicitors Miss L. McCallum instructed by
for the respondents: Lander, Rogers, Melbourne.

ORDER

(1) The respondent be fined the sum of $2,000 to be paid to the Registrar of the Court within 14 days of today.

(2) The respondent pay the costs of the applicants which are assessed at $16,000 in the manner described in Order 3.

(3) The costs fixed in Order 2 be paid a to one-third on or before 60 days hereafter, one-third on or before 120 days hereafter, and one-third on or before 180 days from today.

(4) If the costs are so paid as provided in Order 3, then any interest upon the costs from time to time unpaid, which would otherwise be attracted, will not be payable.
NOTE: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules.

JUDGE1

On 5 August 1991, the present applicants commenced a proceeding in this Court alleging copyright infringement against Mr and Mrs Marks. Mr Marks is the respondent to the present contempt application.

On 11 October 1991, the Court, by consent, made various orders. At the time, the orders were explained and their significance emphasised to Mr Marks by his legal advisers. The orders as taken out and entered 28 October 1991 bore a statement:

"Take note that you will be liable to

imprisonment or sequestration of property if you

disobey the within orders."

The orders were later personally served upon Mr Marks.

Paragraph 1 of the orders contains various injunctions concerned with the reproduction or authorisation of the reproduction of the whole or a substantial part of various computer programs identified as the Microsoft programs, the Autodesk programs, the WordPerfect programs, the Lotus programs and the Ashton-Tate programs. The injunctions in each case also enjoined Mr and Mrs Marks from selling, offering for sale, supplying, offering to supply or distributing any unauthorised copy of the program in question.
Before the Court this afternoon is a notice of motion seeking punishment for contempt. It was filed in Court on 20 December 1991. Paragraphs 1, 2, 3 and 4 of the statement of charge read as follows, alleging that Mr Marks was guilty of:

"1. Reproducing the whole of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1992] FCA 130
Decision Date: 04 FEBRUARY 1992

CaseChat Overview and Summary

Microsoft Corporation sought an injunction against Marks, R.D, for the unauthorised reproduction of their computer programs. The matter was heard in the Federal Court of Australia. The principal issue was the determination of an appropriate penalty for the contempt of court committed by Marks, given his financial circumstances and the absence of conscious disregard for his obligations.

The court examined the nature of the contempt committed by Marks, which was admitted, and his financial situation, which showed that he and his family were entirely dependent on the income generated from his computer business. The court considered whether the penalty should reflect the respondent's inability to pay a substantial fine immediately and the absence of a wilful or contemptuous attitude on his part. The applicants argued for a fine and costs, while the respondent contended that the financial burden would irreparably harm his family's livelihood.

The court acknowledged the severity of the contempt but took into account the respondent's financial dependency and lack of conscious disregard. It ordered a fine of $2,000 and assessed the costs at $16,000, to be paid in three instalments over 180 days. The court ruled that if the payments were made as stipulated, no interest would accrue on the unpaid costs. The court balanced the need to uphold the integrity of the court's injunction with the respondent's financial constraints and lack of deliberate contempt.

Orders

Orders of the court

(1) The respondent be fined the sum of $2,000 to be paid to the Registrar of the Court within 14 days of today.

(2) The respondent pay the costs of the applicants which are assessed at $16,000 in the manner described in Order 3.

(3) The costs fixed in Order 2 be paid a to one-third on or before 60 days hereafter, one-third on or before 120 days hereafter, and one-third on or before 180 days from today.

(4) If the costs are so paid as provided in Order 3, then any interest upon the costs from time to time unpaid, which would otherwise be attracted, will not be payable.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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