Vietnam International Video D and D Inc v Huynh, Tho Vinh t/as Thang Loi Video Co

[1997] FCA 1305

FEDERAL COURT OF AUSTRALIA

COSTS - application by applicants and respondents for costs - where respondents consented to injunctions sought by applicants at hearing for infringement of applicants’ copyright in Vietnamese script of a film - where respondents’ video tapes were seized under the execution of an Anton Piller order - discovery by applicants prior to hearing that tapes seized contained two versions of the film, only one version of which infringed the applicants’ copyright - whether applicants acted properly in obtaining and executing the Anton Piller order - whether applicants restricted respondents’ access to the tapes seized.

Columbia Picture Industries Inc v Robinson [1987] Ch 38, cited

VIETNAM INTERNATIONAL VIDEO D & D INC & VN INTERNATIONAL VIDEO PTY LTD  - v - THO VINH HUYNH t/a THANG LOI VIDEO COMPANY & ORS
NG 940 OF 1996

TAMBERLIN J
SYDNEY
27 NOVEMBER 1997

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 940 of 1996

BETWEEN:

VIETNAM INTERNATIONAL VIDEO
D & D INC
FIRST APPLICANT

VN INTERNATIONAL VIDEO PTY LIMITED
ACN 051 017 317
SECOND APPLICANT

AND:

THO VINH HUYNH T/A THANG LOI VIDEO COMPANY
FIRST RESPONDENT

QUANG VINH VIDEO PTY LIMITED
ACN 074 125 232
SECOND RESPONDENT

CHINATOWN ENTERPRISES
(AUSTRALIA) PTY LIMITED
ACN 064 588 834
THIRD RESPONDENT

JUDGE:	TAMBERLIN J
DATE:	27 NOVEMBER 1997
PLACE:	SYDNEY

REASONS FOR JUDGMENT

Introduction

When this matter came on for hearing the only issue between the parties was costs. The respondents conceded that they did have copies of the applicants’ soundtrack in their possession and they consented to the injunctions sought by the applicants in relation to those tapes.  However, both parties claimed to be entitled to an order for costs in their favour.

Background

The first applicant, Vietnam International Video D & D Inc (“VIV”), is the owner of copyright in the script for a Vietnamese soundtrack of the film “Love in the Dust”, the Vietnamese title of which is “Bui Hong Tran”. The film is a serial of 24 episodes. It was made in Taiwan with a Mandarin soundtrack by Taiwan Television Enterprise Limited (“TTV”). Taiwan is not a party to any of the international copyright conventions and therefore there is no copyright in the film or the Mandarin script enforceable outside Taiwan.

VIV was granted a licence by TTV, which gave it the rights to distribute, sell, hire, reproduce and exhibit the film for private home showing in the Commonwealth of Australia and its territories. Pursuant to this license the first applicant obtained a master tape of the film. In the United States VIV commissioned a Vietnamese script for the dubbing of the film with a Vietnamese soundtrack. This work was carried out in May and June 1996, thereby creating a new copyright work. VIV is the owner of copyright in the Vietnamese script as a literary work.

The second applicant (“VN”) is the exclusive licensee in Australia of the first applicant’s copyright in the applicants’ script for the film “Bui Hong Tran”. VN received master tapes of the film with VIV’s soundtrack on 15 August 1996. The second applicant then reproduced them onto video tapes and distributed and supplied copies of the film for hire to the public.

The third respondent, Chinatown Enterprises (Australia) Pty Ltd (“CEA”), imported into Australia copies of a film, distributed under the title “Tinh Ai Hong Bui”. “Tinh Ai Hong Bui” is a Vietnamese language version of the film “Love in the Dust”. CEA made, and supplied to each of the first and second respondents, Tho Vinh Huynh and Quang Vinh Video Pty Ltd, copies of episodes of the film. The first and second respondents made further copies of the film and supplied these video tapes to the public for hire.

In September 1996 the applicants became aware that the first and second respondents were supplying for hire video tapes of the film “Tinh Ai Hong Bui”. The applicants arranged for two trap rentals to be conducted. Two tapes were seized from each of the first and second respondents (“the trap rental tapes”). These tapes were examined by Minh Chanh Tran, the Managing Director of the second applicant. In an affidavit sworn 21 November 1996, he stated that the tapes rented from the first and second respondents were unauthorised copies of the applicants’ soundtrack in the film.    

On 2 December 1996 the applicants sought and Davies J granted an Anton Piller order against the first and second respondents. The order was executed on 3 December 1996. The first and second respondents were served separately, each with copies of the orders and affidavits in support of those orders. Two hundred and seventy four video tapes were seized, one hundred and seventy four from the first respondent and one hundred from the second respondent. In addition nine other tapes of the film, marked with the word “Master”, were seized from the first respondent. 

When the matter returned for directions on 6 December 1996 the respondents, without making any admissions, consented to interlocutory injunctions. The tapes remained in the custody of the applicants’ solicitors.

On 16 December 1996 the respondents’ solicitors forwarded to the applicants’ solicitors a copy of an affidavit sworn by Wing Cheung, a director of CEA, on 13 December 1997 which stated that the film, “Tinh Ai Hong Bui”, was obtained by CEA from Fafilms in Hoi Chi Minh City, South Vietnam, in 1996.

At the directions hearing on 17 December 1996 it was agreed by the parties that the matter should stand over to February 1997 to enable the respondents to view and compare the applicants’ tapes (“the VN tapes”) with the trap rental tapes, so to ascertain whether the soundtracks were the same. In accordance with this the applicants, on 19 December 1996, sent copies of the trap rental tapes together with copies of the VN tapes to the respondents.

On 5 February 1997 the solicitors for the applicants wrote to the respondents’ solicitors in the following terms:

“Your clients have had ample time opportunity to examine the tapes. Please advise us as soon as possible whether your clients agree that the dialogue on the soundtracks of their tapes is the same as the dialogue on the applicants’ tapes, or alternatively, which parts of the tapes they agree contains the same dialogue.

If we do not receive any response from you, by 12.00pm Friday 7 February 1997, we have instructions to draft a Statement of  Claim. We will also seek a timetable for pleadings next Tuesday.

If it is subsequently determined that the applicants’ evidence is correct, we are instructed that our clients will seek indemnity costs for steps taken after the next directions hearing as well as the costs of the next directions hearing.”

On 21 February the applicants filed a Statement of Claim.

On 4 March 1997 a conference between the parties was held. A Vietnamese interpreter, Ms Huong Vo, was present during the conference. Parts of the trap rental tapes and corresponding parts of the VN tapes were viewed and compared. Ms Huong expressed the view that, in relation to what was shown, the respondents’ tapes were the same as the applicants’ tapes, in particular the dialogue and voices were the same. The conference was terminated after Mr Cheung indicated that he did not wish to view any further tapes.

The respondents filed a defence on 13 March 1997. The respondents admitted that copies of the “Tinh Ai Hong Bui” had been imported, distributed and offered for hire. However, they asserted that this had been done pursuant to a valid license agreement with the distributor. The respondents denied that the soundtrack of the dialogue in the trap rental tapes was identical or substantially identical to the soundtrack of the dialogue in “Bui Hong Tran”, but admitted that certain limited parts sounded similar.

On the 23 May 1997 the respondents’ solicitors sent the applicants a copy of an affidavit of Tran Thuy Nga, sworn in Vietnam on 16 April 1997, in which he says that he translated the script and dialogue for the film “Tinh Ai Hong Bui” in Vietnam.

In an affidavit sworn 22 July 1997, Minh Chanh Tran stated that the tapes seized from the respondents on 3 December 1996 contained two different versions of the film, a US version and a Vietnamese version.

On 20 June 1997 Mr Tran examined all the video tapes seized from the first and second respondents on 3 December 1997 (“the Anton Piller tapes”). Mr Tran, who has over 12 years experience in Vietnamese language films, viewed each of the tapes and identified whether the origin of the tape was the US or Vietnam by forming an opinion as to whether the dialogue was spoken by actors from South Vietnam or middle Vietnam. VIV, which dubs films at its studio in US, uses actors from South Vietnam. Businesses which dub films in Vietnam, according to Mr Tran, use actors from the middle of Vietnam and the accent of those persons is different from the accent of persons from South Vietnam. Of the 283 tapes seized, approximately 190 were the US version.

On 28 June 1997 Mr Tran compared a sample of the Anton Piller tapes, which included US and Vietnamese versions of particular episodes, with a corresponding sample of the VN tapes. According to Mr Tran the Anton Piller tapes containing the US version were the same as the VN tapes, whilst the other tapes contained a different Vietnamese version.

On 25 July 1997 the applicants sent to the respondents copies of 19 tapes examined by Tran and referred to in his second affidavit. These tapes included both versions of the film for particular episodes.

In a third affidavit, sworn 30 July 1997, Mr Tran stated that a sample of Master tapes obtained from the respondents pursuant to the Anton Piller order and discovered by the respondents contained the US version of the film, and were the same as the VN tapes. In this affidavit Mr Tran also stated that one of the trap rental tapes contained both a US and a Vietnamese version of the film. Initially the applicants thought that the trap rental tapes contained only their version of the film, the US version.

Submissions on Costs

The starting point is that the applicants have been successful and that costs usually follow the event.

The respondents submit that they had made it clear, from an early stage in the proceedings, that there was a Vietnamese translation of the film. They further submit that the applicants, if they had acted properly in obtaining and executing the Anton Piller order, would have discovered that there were two versions of the film and that some of the tapes seized were of the Vietnamese version.  In support of this submission the respondents argue that the applicants have failed to comply with the conditions set down by Scott J in Columbia Picture Industries Inc v Robinson [1987] Ch 38 at 76-77, namely:

·Anton Piller orders should be drawn to extend no further than the minimum extent necessary, namely the preservation of material which might otherwise be destroyed. Once copies have been taken the material should be returned.

·A detailed record should be made by the solicitors who execute the order before the material is removed.

·No material ought to be taken unless it is clearly covered by the terms of the order.

·It is inappropriate that material seized, the ownership of which is in dispute, should be retained by the plaintiff’s solicitors pending trial.

·Affidavits in support of applications for Anton Piller orders ought to err on the side of excessive disclosure, ie. full and complete disclosure.

The respondents further submit that the applicants’ solicitors have retained possession of the tapes seized, contrary to the principles in Columbia Pictures, and only allowed the respondents limited access, thereby depriving them of the opportunity to discover that there were two versions. The respondents also say that the applicants only provided the respondents with copies of those tapes which supported their case.

In response, the applicants point out that the Anton Piller orders provided that the seized goods were to be retained by the applicants’ solicitors. The respondents, after obtaining legal advice, did not object to the Anton Piller orders and consented to an extension of the injunction when the matter returned. No request has been made by the respondents, in correspondence between the parties, for return of the videos, nor was any application made to the Court. The applicants say that they made the tapes available to the respondents for inspection. They point out that copies of the trap rental tapes, together with the VN tapes, were sent to the respondents in December 1996 and that copies of the tapes showing the two versions of the film were sent to the respondents soon after the applicants discovered the existence of the two versions. If there had been a problem with access to the tapes or if the respondents wished for the return of the tapes it was open to make an application to the Court. No application was ever made.  In my opinion this is an important consideration in deciding the question of costs.

The respondents also submit that the applicants failed to carry out a detailed examination of the material seized. It is said that if the applicants had carried out such an examination they would have discovered the existence of the Vietnamese soundtrack. The result of this failure was that the applicants seized tapes to which they had no claim. The respondents also point out that the affidavit in relation to the execution of the order was not sworn until 10 July 1997.

The record kept by the applicants simply listed the number of tapes of “Tinh Ai Hong Bui” seized. The record, which was made at the time of the execution of the order, was in each case signed by the independent solicitor present and by the manager of the first respondent in one case and the second respondent in the other.

The respondents further submit that, if the applicants had made full inquiries prior to seeking the order they would have discovered that there was the second version. They argue that the onus was on the applicants to establish their case. This required them to make inquiries to establish whether another translation of the film could have existed. The result was that the applicants seized material to which they had no claim. The respondents point to a number of factors that indicated that there were two versions. First, the respondents tapes had a different title to the applicants.  Second, an examination of the tapes at the conference between the parties in March 1997 showed that the applicants’ tapes had a logo on them indicating that they came from America. In contrast the respondents’ tapes had no logo or the TTV logo, indicating that they came from Taiwan or Vietnam.

In relation to this, the position is that although the respondents’ tapes had a different title, the majority of those tapes included the applicants’ soundtrack.  Further, tapes with the respondents’ logo, including the trap rental tapes, contained the applicants’ soundtrack.  The existence of a different title and different logo did not necessarily mean that a different translation existed.

The respondents assert that they made it clear that a Vietnamese translation existed. In December they provided the applicants with the affidavit of Mr Cheung in which he stated that the tapes had been obtained from Vietnam. In May 1997 the affidavit of Tran Thuy Nga, who claimed to have translated the film in Vietnam, was sent to the applicants. The applicants, by affidavit sworn 22 July 1997, conceded that the Vietnamese translation existed, and that therefore there were two Vietnamese language versions.

The applicants, however, say that the respondents’ position was that they held a licence for the copies of the film that they had in their possession, and its position was not that there were two versions of the film. The fact that two versions existed was only discovered by the applicants in June 1997 after examining and comparing all the tapes.

It is important to note that although two versions of the film existed, the respondents had in their possession a significant number of tapes with the applicants’ soundtrack.  In fact, approximately 190 such tapes were seized. Further, master tapes, including those obtained from the third respondent, also contained the applicants’ soundtrack.

A question was raised during argument as to which party had the onus of establishing that the two versions existed. The applicants submitted that where a similarity is shown between the applicants’ and the respondents’ work, and where the respondents have had an opportunity to copy the applicants’ work directly or indirectly, a prima facie case is established which the respondent has to answer: see Copinger and Skone James on Copyright, (1991) 13th edn, par 8-13.

The respondents also submit that the applicants failed to warn them that an Anton Piller order would be executed. However, as the applicants point out no warning is required prior to the execution of an Anton Piller order. A warning would defeat its very purpose. As Denning MR (with whom Ormond and Shaw LJJ agreed) said in Anton Piller KG v Manufacturing Processes Ltd [1976] 1 Ch 55 at 61:

“It seems to me that such an order can be made by a judge ex parte, but it should only be made where it is essential that the plaintiff should have inspection so that justice can be done between the parties: and when, if the defendant were forewarned, there is a grave danger that vital evidence will be destroyed and ... the ends of justice ... defeated” (Emphasis added)

In any event the respondents had been given an indication of potential proceedings in October 1996 when they were contacted by the Australasian Intellectual Property Office Pty Ltd. A letter was given to the respondents explaining the infringement provisions of the Copyright Act 1968 (Cth), and a representative had visited the respondents to discuss the matter with them.

A final submission made by the respondents was that the undertaking as to damages, given by the applicants, should extend to covering the respondents costs incurred in defending a claim that was resolved by examination of the material seized.  I do not accept this proposition.  The fact is that the applicants have succeeded in the case and no sound reason has been advanced to warrant any other order.

The applicants in support of their application for costs, although they do not seek indemnity costs, referred to a Caulderbank letter and an Offer of Compromise. The Caulderbank Letter, dated 9 April 1997, offered to settle the matter if the respondents would provide an appropriate undertaking, and pay costs and damages of $5,000.  An Offer of Compromise, dated 21 April 1997, offered to settle the matter for similar terms. Because no damages are now sought I do not give any weight to this consideration.

Conclusion

For the above reasons the respondents should pay the applicants’ costs in this proceeding. The applicants should bring in Short Minutes setting out the precise form of relief sought within seven days from the date of this judgment.

I certify that this and the preceding nine (9) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin

Associate:

Dated:            27 November 1997

Counsel for the Applicants:	Ms J Baird
Solicitor for the Applicants:	Simpsons
Counsel for the Respondents:	Ms R Winfield
Solicitor for the Respondents:	W Chan & Co
Date of Hearing:	5 August 1997
Date of Judgment:	27 November 1997