Swarbrick v Burge

Case [2004] FCA 813

FEDERAL COURT OF AUSTRALIA

Swarbrick v Burge [2004] FCA 813

INTELLECTUAL PROPERTY – copyright – designs – applicant (a naval architect and shipwright) prepared freehand drawings of a yacht – those drawings digitised and scanned into a computer – applicant then made, by hand, a “Plug” in the shape of a yacht – Plug substantially different from freehand and digitised drawings – applicant made major changes to dimensions of Plug – applicant fashioned other changes manually and by eye – used Plug to make mould for manufacture of mouldings of fibreglass yacht by vacuum infusion – applicant’s licensee manufactured and sold 32 such yachts in Australia and overseas – respondents obtained an identical yacht from former employee of applicant’s licensee and, by reverse engineering, had prepared a flop mould of the hull and were also involved in various stages of the manufacture of a deck moulding intended for use with that hull – respondents intended to manufacture and sell the yachts – whether applicant author and owner of copyright in the Plug, hull and deck moulds made from that Plug, hull and deck mouldings made from those moulds and the first yacht built – whether applicant author and owner of copyright in certain drawings made during the course of and after construction of the Plug – whether applicant lost copyright protection through industrial application of an unregistered corresponding design – whether the applicant’s Plug, moulds or the yacht were “sculptures” and also works of artistic craftsmanship – whether a sculpture can be a work of artistic craftsmanship for copyright purposes.

Copyright Act 1968 (Cth), ss 10(1), 32, 74, 77

Wham-O Manufacturing Company v Lincoln Industries Ltd [1984] 1 NZLR 641 applied
Breville Europe plc & Ors v Thorn EMI Domestic Appliances Ltd [1995] FSR 77 referred to
Sheldon and Hammond Pty Ltd v Metrokane Inc & Ors [2004] FCA 19 referred to
George Hensher Ltd v Restawhile Upholstery (Lancs) Ltd [1976] AC 64 applied
Cuisenaire v Reed [1963] VR 719 referred to
Merlet v Mothercare plc (1984) 2 IPR 456 referred to
Commission of Taxation v Murray (1990) 21 FCR 436 referred to
Coogi Australia Pty Ltd v Hysport International Pty Ltd & Ors (1998) 86 FCR 154 applied
NABM of 2001 v Minister for Immigration and Multicultural Affairs [2002] FCA 335 referred to
Grain Elevators Board (Vic) v Dunmunkle Corp (1946) 73 CLR 70 referred to

Interlego AG v Croner Trading Pty Ltd (1992) 39 FCR 348 referred to
Shelley Films Ltd v Rex Features Ltd [1994] EMLR 134 referred to
United Pacific Industries Pty Ltd v Madison Spate Pty Ltd (1998) BC 9802268 referred to

Bonz Group Pty Ltd v Cooke [1994] 3 NZLR 216 referred to
Safe Sport Australia Pty Ltd v Puma Australia Pty Ltd (1985) 4 IPR 120 referred to
NABM of 2001 v Minister for Immigration and Multicultural Affairs [2002] FCA 335 referred to
Grain Elevators Board (Vic) v Dunmunkle Corp (1946) 73 CLR 70 referred to

JOHN HARLEY SWARBRICK v BRENT BURGE, TREVOR…

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AGLC
Swarbrick v Burge [2004] FCA 813
Case
[2004] FCA 813
Decision Date

CaseChat Overview and Summary

In the matter of Swarbrick v Burge, the applicant, Mr. Swarbrick, sought to establish liability for copyright infringement against the respondents, Burge. The dispute involved the design and manufacture of a yacht, the JS 9000, with allegations that the respondents had infringed upon the applicant's copyright by copying its design. The case was heard in the Federal Court of Australia, where the primary issue was whether the respondents had infringed the copyright held by the applicant in the design and manufacture of the JS 9000.

The court had to determine whether the Plug, a key component of the yacht's design, constituted a work of artistic craftsmanship under the Copyright Act 1968 (Cth). This distinction was crucial because if the Plug was deemed a work of artistic craftsmanship, it would be excluded from copyright protection under the Act. Additionally, the court needed to assess the credibility of the applicant's evidence regarding the design process and whether the respondents had a statutory defence under section 77 of the Act.

The court concluded that the Plug was not a work of artistic craftsmanship but rather a sculpture, which is protected under the Act. The applicant's evidence was found to be credible and truthful, despite the respondents' attempts to impugn his credibility. The court found that the applicant had constructed the Plug in a manner that included aesthetic considerations, and this was supported by his extensive background in yacht design and construction. The court also noted that the applicant's delay in mentioning the importance of visual appeal in the design process was not indicative of dishonesty but rather a response to the respondents' reliance on section 77 of the Act.

As a result, the court declared that copyright existed in the items claimed by the applicant, that the applicant was the author and owner of the copyright, and that the respondents had infringed upon this copyright. The court also addressed the respondents' claim for costs, finding that while the applicant's initial application had been hastily prepared, the subsequent affidavits had clarified the design process, and thus the respondents were not entitled to costs on an indemnity basis.

Orders

Orders of the court

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Background

Background to the litigation

On 6 November 2003 I made an order, by consent, that the question of liability be heard and determined separately from questions of relief. These reasons deal with liability. THE FACTS There were only two witnesses for the applicant, namely, the applicant himself and Mr Paul Burnham. The applicant was cross-examined vigorously and extensively. His credit was placed in issue. I am well aware of both the financial and professional interest that the applicant has in the outcome of these proceedings. I took that into account in weighing his evidence. I noted that the applicant occasionally volunteered information which he thought to be favourable to his case. I took that into account (as a negative factor) in assessing his credit. But I accept his evidence as being truthful. There was nothing in his demeanour which would point me one way or the other in that regard. I noted that, as a general rule, the applicant answered the questions which were put to him in a direct and non-evasive manner. There was nothing in his evidence which I found to be inherently unlikely. That includes the method, referred to later in these reasons, by which the applicant said he constructed the Plug. Nor was there anything in the documentary evidence which led me to doubt the applicant’s evidence. The respondents impugned the applicant’s credit on the basis that he was late in claiming that visual appeal was a critical part of the process of the design and manufacture of the JS 9000. The respondents pointed to the fact that it was not until his third affidavit that aesthetic considerations were mentioned. I do not think that there is any substance in this point. The applicant filed two affidavits (one in which confidentiality was sought) with his principal application. In that application he sought interim injunctive relief on an urgent basis. I do not think that it was exceptional that the applicant did not raise the issue of artistic craftsmanship until the respondents made it clear that they were going to rely upon s 77(2) of the Act. I formed the impression that the applicant was highly intelligent, was well-versed in the field of yacht design and construction, and that he was an honest witness. The applicant was born into a family who have built vessels in Western Australia for many years. He worked in the boatyard of the family firm, Swarbrick Brothers Yachts, as a teenager and young man where he learnt the manual skills of a shipwright. The applicant has a diploma in Naval Architecture, Marine Engineering and Yacht Design, (with Honours), from Westlawn Institute of Marine Technology, Stamford, Connecticut. After working for about six years in the family firm, the applicant was employed by a naval architect, Phillip Curran Yacht Design, in relation to various commercial vessels, for about one year. He then spent about another year (1982-1983) engaged in naval architecture on Sydney Harbour ferries and then in naval architecture and marine engineering on the America’s Cup yacht “Advance”.That was in the employment of Messrs Alan Payne & Partners.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

CARR J
This evidence strongly corroborates (had corroboration been needed) the applicant’s evidence about how he crafted the Plug. CONCLUSION For the foregoing reasons there will be declarations that copyright exists in each of the items referred to in paragraph 1 of the application, that the applicant is the author and owner of the copyright in those items and that the respondents have infringed the copyright in each of those items, other than (as yet) those which depict the deck. COSTS The respondents submitted that even if the applicant succeeded (as he has) on the question of liability they are nevertheless entitled in any event to all their costs up to the filing and service of the applicant’s fourth affidavit on or about 22 January 2004 on an indemnity basis and that the applicant should be deprived of any order for any costs. The respondents’ reasons for those claims (and I summarise their written submissions) are as follows: the Court was misled on the original ex parte interlocutory application (and all material matters were said not to have been disclosed) as to the creation of the works in which copyright was claimed. The respondents point to the misrepresentation that the Drawings preceded the creation of the Plug; at all material times thereafter the respondents would normally have been entitled to an automatic discharge of the interim injunctive relief; the applicant did not correct the evidence in his first two affidavits in his third affidavit sworn on 15 October 2003; and the respondents obtained evidence from Mr Riley and Mr Hood on the basis of the applicant’s first three affidavits. The applicant was cross-examined about these matters. I accept his evidence that the application and his supporting affidavits were put together in great haste. The haste was occasioned by the fact that there was a real risk that the respondents would export a prototype of the JS 9000 yacht which they were surreptitiously copying in their factory at Pinjarra. The applicant swore his third affidavit in support of the continuation of interlocutory relief. In my view, the contents of that affidavit clarified, to a very considerable extent, the process in which the applicant engaged, and identified the drawings which ultimately culminated in the Drawings at annexure JHS1 to his second affidavit. As senior counsel for the respondents acknowledged, (during final cross-examination of the applicant on the last day of the hearing), it had emerged from both the applicant’s third and fourth affidavits that the Drawings were produced during or after the Plug was completed. On 6 November 2003 I made an order that the questions of liability and relief in this application be heard and determined separately. I expedited the hearing of the question of liability by listing it for 3, 4 and 5 February 2004. I made directions for the remaining interlocutory steps to be taken leading up to that hearing. The intervening period included, of course, the Christmas “vacation”. It is true that it was not until the filing of the applicant’s fourth affidavit, that the picture became much clearer.

Ratio Decidendi

Legal Principle Established

Established by: CARR J

The respondents say that apart from the other defences which they raise, they have a complete statutory defence under s 77 of the Act. Section 77 of the Act is in the following terms: ‘Application of artistic works as industrial designs without registration of the designs77 (1) [Application] This section applies where: (a)copyright subsists in an artistic work (other than a building or a model of a building, or a work of artistic craftsmanship) whether made before the commencement of this section or otherwise; (b) a corresponding design is applied industrially, whether in Australia or elsewhere, by or with the licence of the owner of the copyright in the work in the place where the industrial application happens; (c)at any time on or after the commencement of this section, articles to which the corresponding design has been so applied (in this section called “articles made to the corresponding design” are sold, let for hire or offered or exposed for sale or hire, whether in Australia or elsewhere; and (d)at that time, the corresponding design is not registrable under the Designs Act 1906 or has not been registered under that Act. (2) [Not an infringement] It is not an infringement of the copyright in the artistic work to reproduce the work, on or after the day on which articles made to the corresponding design are first so sold, let for hire or offered or exposed for sale or hire, by applying that, or any other, corresponding design to an article. (3) [Exclusions] This section does not apply in relation to any articles in respect of which, at the time when they were sold, let for hire or offered or exposed for sale or hire, the corresponding design concerned was excluded from registration by regulations made under the Designs Act 1906, and, for the purposes of any proceedings under this Act, a design shall be conclusivelypresumed to have been so excluded if: (a)before the commencement of the proceedings, an application for the registration of the design under that Act in respect of those articles had been refused; (b)the reason, or one of the reasons, given for the refusal was that the design was excluded from registration under that Act by regulations made under that Act; and (c)when the proceedings were commenced, no appeal against the refusal had been allowed or was pending. (4) [Applied industrially] The regulations may specify the circumstances in which a design is, for the purposes of this section, to be taken to be applied industrially.’ Section 74 defines “corresponding design” as follows: ‘“corresponding design”, in relation to an artistic work, means a design that, when applied to an article, results in a reproduction of that work, but does not include a design consisting solely of features of two-dimensional pattern or ornament applicable to a surface of an article.’THE PLUG In my opinion, the Plug is a sculpture within the meaning of s 10(1). I would regard it as being in the same category as the wooden models of the frisbies which were the subject matter of the decision of the New Zealand Court of Appeal in Wham-O Manufacturing Company v Lincoln Industries Ltd [1984] 1 NZLR 641. Wham-O was followed in England by Falconer J in Breville Europe plc & Ors v Thorn EMI Domestic Appliances Ltd [1995] FSR 77 at 94.