Young v Wyllie

Case [2010] FCA 283

FEDERAL COURT OF AUSTRALIA

Young v Wyllie [2010] FCA 283

Citation: Young v Wyllie [2010] FCA 283
Parties: GARY YOUNG v GREG WYLLIE, VIDEO SPORTS PTY LTD, EX DVD PTY LTD, JIM ZAVOS, PITSTOP BOOKSHOP PTY LTD, BARBARA ELIZABETH LYSTER, ATLANTIC VIDEO, CHAOS ENTERTAINMENT PTY LTD, ROBERT APPEL, STOMP PTY LTD, ANDREW JORGENSEN, SANITY MUSIC STORES PTY LTD, (NO THIRTEENTH RESPONDENT NAMED), GREG MILNE and DARREN ROBINSON TRADING AS MOVIE SEARCH DOT COM
File number: ACD 41 of 2008
Judge: MOORE J
Date of judgment: 30 March 2010
Catchwords:

PRACTICE AND PROCEDURE - summary judgment pursuant to s 31A of the Federal Court of Australia Act 1976 (Cth).

COPYRIGHT – copyright in a cinematograph film – whether evidence of infringement of those rights.

TRADE PRACTICES – whether evidence of misleading and deceptive conduct .
Legislation: Copyright Act 1968 (Cth) ss 10, 86, 101, 103
Federal Court of Australia Act 1976 (Cth) s 31A
Trade Practices Act 1974 (Cth) ss 52, 53
Cases cited: Coles Supermarkets Australia Pty Ltd v FKP Limited [2008] FCA 1915 discussed
Dandaven v Harbeth Holdings Pty Ltd [2008] FCA 955 followed
Houghton v Arms (2006) 225 CLR 553 distinguished
Kervan Trading Pty Ltd v Aktas (1987) 8 IPR 583 applied
Universal Music Australia Pty Ltd v Cooper (2005) 65 IPR 409 discussed
Universal Music Australia Pty Ltd v Sharman License Holdings Ltd (2005) 220 ALR 1 cited
Wang v Anying Group Pty Ltd [2009] FCA 1500 followed
Date of hearing: 12 February 2010
Place: Sydney
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 74
Counsel for the Applicant: The applicant appeared in person
Counsel for the First and Second Respondents: C Champion
Solicitor for the First and Second Respondents: Hazan Hollander Solicitors
Counsel for the Fifth and Sixth Respondents: P McGowan
Solicitor for the Fifth and Sixth Respondents: Conal O'Toole
Counsel for the Seventh Respondent: J McDonald
Solicitor for the Seventh Respondent: Harris Freidman Hyde Page
Counsel for the Tenth, Eleventh, Twelfth and Fourteenth Respondents: S Gorry
Solicitor for the Tenth, Eleventh, Twelfth and Fourteenth Respondents: Henry Davis York

IN THE FEDERAL COURT OF AUSTRALIA

AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY

GENERAL DIVISION

ACD 41 of 2008
BETWEEN:

GARY YOUNG
Applicant
AND:

GREG WYLLIE
First Respondent

VIDEO SPORTS PTY LTD
Second Respondent

EX DVD PTY LTD
Third Respondent

JIM ZAVOS
Fourth Respondent

PITSTOP BOOKSHOP PTY LTD
Fifth Respondent

BARBARA ELIZABETH LYSTER
Sixth Respondent

ATLANTIC VIDEO
Seventh Respondent

CHAOS ENTERTAINMENT PTY LTD
Eighth Respondent

ROBERT APPEL
Ninth Respondent

STOMP PTY LTD
Tenth Respondent

ANDREW JORGENSEN
Eleventh Respondent

SANITY MUSIC STORES PTY LTD
Twelfth Respondent

(NO THIRTEENTH RESPONDENT NAMED)
Thirteenth Respondent

GREG MILNE
Fourteenth Respondent

DARREN ROBINSON TRADING AS MOVIE SEARCH DOT COM
Fifteenth Respondent

JUDGE:

MOORE J

DATE OF ORDER:

30 MARCH 2010

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The matter be listed for further directions at 9.30am on Tuesday 18 May 2010.

2.Any respondent wishing to make further submissions on the question of costs is to do so within 14 days of the date of this…

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AGLC
Young v Wyllie [2010] FCA 283
Case
[2010] FCA 283
Decision Date

CaseChat Overview and Summary

In the case of Young v Wyllie, the applicant, Gary Young, filed an application for summary judgment against several respondents, including Wyllie and Duke Video Pty Ltd, over alleged copyright infringement and misleading conduct in relation to the sale of DVDs. The applicants sought relief under the Copyright Act 1968 (Cth) and the Trade Practices Act 1974 (Cth), claiming that the respondents infringed his copyright by selling DVDs internationally without authorisation and engaged in misleading conduct by advertising the DVDs on websites accessible worldwide.

The primary legal issues the court had to address were whether the respondents had any reasonable prospect of successfully defending the claims, whether there was an infringement of copyright, and if the conduct of the respondents amounted to misleading and deceptive conduct under the Trade Practices Act. The court also considered whether the applicant had a valid claim for damages due to the alleged infringement and misleading conduct.

The court found that the applicant's claims of copyright infringement under the Copyright Act were not substantiated as there was no evidence that the respondents sold the DVDs internationally. Regarding the misleading conduct, the court noted that the evidence presented did not clearly establish that the conduct was misleading or deceptive, as the websites primarily targeted Australian and New Zealand audiences. The court concluded that the applicant had not demonstrated that the respondents' actions were bound to fail or that the application for summary judgment was appropriate.

The court dismissed the applicant's motion for summary judgment, finding that the respondents had a reasonable prospect of defending the claims and that the applicant had not provided sufficient evidence to warrant an interlocutory judgment in their favour. The court emphasized the need for a full trial to determine the merits of the claims and the applicable legal standards.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

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Evidence

Evidence Before The Court

A further amended statement of claim was filed by the applicant on 16 April 2009. Subsequent submissions and affidavits (which are in part argumentative) filed by the applicant include: memorandum of points in support of the Notice of Motion and affidavit of Gary Young (filed 26 August 2009); an affidavit filed on 2 September 2009 (Greg Tingle), three affidavits of the applicant filed 28 October 2009, further points in support (10 February 2010 and 26 February 2010) and an affidavit of the applicant filed in court 12 February 2010. Before considering the legal issues raised in the applicant's notice of motion, it is convenient to refer to the evidence. Given that this is an interlocutory application seeking orders under s 31A, I refrain from making findings of fact. What follows should be treated as an account of some of the evidence which has been admitted for a limited purpose and is untested.The evidence - the 2005 licence agreements In an affidavit sworn on 24 March 2009 and in another filed on 28 October 2009, the applicant annexed a series of emails which reveal the events leading to the signing of the licence agreements of 26 May 2005. The first respondent, in his affidavit of 3 December 2009, agreed that these emails represent an accurate record of their communication at that time. On 14 March 2005 an email from the applicant to the first respondent asked whether he was still interested in selling Wheels on Fire and Cosy Cool. Two days later the first respondent indicated that he was still interested in both titles and would like to be able to advise the applicant about marketing. He requested information from the applicant about "the sort of deal" he would accept and the artwork or material available. By 6 April 2005, the applicant had advised that he would be interested in an advance of "$2500/3000 or so" and royalties on each DVD for a licence of 5 years. The following day, the first respondent indicated that this "would work fine for us" and that he would contact the applicant to finalise the deal. On 19 April 2005 the first respondent requested that the applicant provide "what you normally provide as paperwork" and inquired again about artwork. In an email that same day, the applicant indicated that he was under pressure from investors to finalise the deal and that:… I dont [sic] need anything too formal..I can just write a simple contract… more like an exchange of letters if you like. Again on 26 April 2005, the applicant indicated that he would like to finalise the deal and that "[w]e dont [sic] need anything fancy and just a basic deal set out in a letter form". The applicant also mentioned that he had some original photographs and artwork. Included in the email was a draft licence agreement in which the applicant required Duke in clause 4 "to produce a minimum of 5000 copies of each film on DVD…". The following day the first respondent indicated that the only problem he had was with clause 4 because "5k as a minimum would not work for us at all". There was some discussion of art work and a request for the type of format of the master copy so that the first respondent could make a submission to his distributor "for a Fathers Day Release". By Thursday 28 April 2005 the first respondent indicated that "[w]e have to do an initial run of 1,000 units and then re-runs of 500 min…" but a run of 3000 would be possible. Other emails between the parties that day concerned negotiations about royalty payments and a request by the applicant for "some free publicity right around fathers day…and the 2 weeks before…". The first respondent indicated he agreed as long as he obtained the confirmation of the Father's Day order for mass markets.

Decision

Reasons for decision

In a letter dated 26 May 2009 from the fifteenth respondent to the Court, he said that the applicant had never asked him to take down his web page and he removed it voluntarily. He denied a conspiracy in the "DVD industry". There was no submission filed by the fifteenth respondent in response to the applicant's notice of motion.The applicant's case on the summary judgment application The essential points raised by the applicant in support of his notice of motion for summary judgment are the following (this involves some repetition of an earlier description of the applicant's case):(1) The respondents have no reasonable prospect of successfully defending the claims and their defence is hopeless and bound to fail. Mere denial of the facts is insufficient to prevent the granting of summary judgment.(2) There is infringement of s 103 of the Copyright Act because the DVDs are "articles" and the copyright is owned by the applicant. The infringing act has been done in Australia without the licence of the owner of the copyright and published on the internet.(3) There is a mandatory duty of care imposed by s 103 of the Copyright Act on the resellers to have a valid licence or sublicence.(4) Section 86 of the Copyright Act grants exclusive rights to the applicant only. The first and second respondents are only licensed to offer the DVDs for sale to the public within Australia and New Zealand. The respondents are making the DVD copies available online on websites that can be seen all around the world and are in breach of s 86 because only the applicant has the right to "communicate" and make available online or electronically transmit the DVDs.(5) The respondents have not complied with the industry code of practice of not selling unlicensed copyright products from within Australia without a licence from the copyright holder.(6) The first respondent was fraudulent in signing the agreements on behalf of Duke Video Pty Ltd.(7) The respondents have infringed ss 52 and 53 of the Trade Practices Act. They all admit they are involved in "trade and commerce" and have engaged in conduct that is misleading and deceptive by advertising the DVDs for sale on their websites which can be seen world wide. The websites have currency converters, offer overseas delivery, advise on which countries can play PAL formatted DVDs and how to set up NTSC DVD players to play PAL formatted DVDs, advertised payments with and without tax payments, and advertised the DVDs for sale in US and British currency. The first and second respondents also engaged in misleading and deceptive conduct by failing to promote the DVDs as promised.(8) The applicant has suffered major loss because 700 DVDs are missing and the applicant is owed between $10,000 and $20,000. Also, because the respondents have been offering the DVDs for sale overseas on the internet, the applicant has failed to secure an agreement for international licensing with a US satellite television company worth $1.425 million. The applicant filed an affidavit on 2 September 2009 of Greg Tingle, his agent and promoter of his films through a business, Media Man. Mr Tingle said at para [14], "the satellite Television transaction fell apart when it was discovered that Australian distributors who were only licensed to sell in Australia and New Zealand were in fact selling internationally without any license to do so."(9) The applicant contends he approved the "actual MAJOR picture layout of the artwork but not the final artwork".(10) The contracts signed by the first respondent requires the first and second respondents to advise resellers of their obligations to have a licence.(11) The number of websites offering the DVDs for sale world wide indicates there was a conspiracy between the respondents.(12) In para [5B] of the applicant's affidavit of 26 August 2009, he claimed to be "SEVERELY Prejudicially affected" because he has been derided by his peers in the Australian Film Industry for having licensed the DVDs for sale in Australia and New Zealand and they are, instead, being offered for sale in every country. This has belittled him and made it difficult for him to obtain investment funds for his current projects.Consideration

Ratio Decidendi

Legal Principle Established

The essential points raised by the applicant in support of his notice of motion for summary judgment are the following (this involves some repetition of an earlier description of the applicant's case):(1) The respondents have no reasonable prospect of successfully defending the claims and their defence is hopeless and bound to fail. Mere denial of the facts is insufficient to prevent the granting of summary judgment.(2) There is infringement of s 103 of the Copyright Act because the DVDs are "articles" and the copyright is owned by the applicant. The infringing act has been done in Australia without the licence of the owner of the copyright and published on the internet.(3) There is a mandatory duty of care imposed by s 103 of the Copyright Act on the resellers to have a valid licence or sublicence.(4) Section 86 of the Copyright Act grants exclusive rights to the applicant only. The first and second respondents are only licensed to offer the DVDs for sale to the public within Australia and New Zealand. The respondents are making the DVD copies available online on websites that can be seen all around the world and are in breach of s 86 because only the applicant has the right to "communicate" and make available online or electronically transmit the DVDs.(5) The respondents have not complied with the industry code of practice of not selling unlicensed copyright products from within Australia without a licence from the copyright holder.(6) The first respondent was fraudulent in signing the agreements on behalf of Duke Video Pty Ltd.(7) The respondents have infringed ss 52 and 53 of the Trade Practices Act. They all admit they are involved in "trade and commerce" and have engaged in conduct that is misleading and deceptive by advertising the DVDs for sale on their websites which can be seen world wide. The websites have currency converters, offer overseas delivery, advise on which countries can play PAL formatted DVDs and how to set up NTSC DVD players to play PAL formatted DVDs, advertised payments with and without tax payments, and advertised the DVDs for sale in US and British currency. The first and second respondents also engaged in misleading and deceptive conduct by failing to promote the DVDs as promised.(8) The applicant has suffered major loss because 700 DVDs are missing and the applicant is owed between $10,000 and $20,000. Also, because the respondents have been offering the DVDs for sale overseas on the internet, the applicant has failed to secure an agreement for international licensing with a US satellite television company worth $1.425 million. The applicant filed an affidavit on 2 September 2009 of Greg Tingle, his agent and promoter of his films through a business, Media Man. Mr Tingle said at para [14], "the satellite Television transaction fell apart when it was discovered that Australian distributors who were only licensed to sell in Australia and New Zealand were in fact selling internationally without any license to do so."(9) The applicant contends he approved the "actual MAJOR picture layout of the artwork but not the final artwork".(10) The contracts signed by the first respondent requires the first and second respondents to advise resellers of their obligations to have a licence.(11) The number of websites offering the DVDs for sale world wide indicates there was a conspiracy between the respondents.(12) In para [5B] of the applicant's affidavit of 26 August 2009, he claimed to be "SEVERELY Prejudicially affected" because he has been derided by his peers in the Australian Film Industry for having licensed the DVDs for sale in Australia and New Zealand and they are, instead, being offered for sale in every country. This has belittled him and made it difficult for him to obtain investment funds for his current projects.Consideration