Burden v ESR Group (NZ) Limited - [2022] NZHC 1818

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2014-404-002456

[2022] NZHC 1818

UNDER the Copyright Act 1994

IN THE MATTER OF

infringement of copyright

BETWEEN

IAN JAMES BURDEN
First Plaintiff

PGT RECLAIMED (INTERNATIONAL) LIMITED
Second Plaintiff

PLANTATION GROWN TIMBERS (VIETNAM) LIMITED

Third Plaintiff

AND

ESR GROUP (NZ) LIMITED

Defendant

Hearing: 27 – 28 June 2022

Counsel:

A H Brown QC, J R Wach and J Oliver-Hood for Plaintiffs A J Pietras and V J Powell for Defendant

Judgment:

29 July 2022

JUDGMENT OF DOWNS J

This judgment was delivered by me on Friday, 29 July 2022 at 10 am pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:
James & Wells Solicitors, Auckland. A J Pietras & Co Ltd, Lower Hutt. A H Brown QC, Auckland.
J Oliver-Hood, Auckland.

BURDEN v ESR GROUP (NZ) LTD [2022] NZHC 1818 [29 July 2022]

The case

[1] The owner of a copyright has the exclusive right, in New Zealand, to issue copies of that work to the public.1 Section 9(1) of the Copyright Act 19942 defines issuing copies to the public as “putting into circulation copies not previously put into circulation”.3 I call this concept first circulation and the associated right, the right of first circulation. These are convenient labels, not more.

[2] This case involves dealings in furniture in breach of copyright, and an alleged contravention of the plaintiffs’ right of first circulation. It turns on the precise effect of s 9(1). The furniture was made in Vietnam before being imported and sold in New Zealand. It was earlier available for purchase, by others, in Vietnam.

[3] The plaintiffs contend “putting into circulation copies not previously put into circulation” means circulation in New Zealand, by or with the consent of the copyright owner. The defendant contends circulation means anywhere in the world, irrespective of whether the copyright owner consented. Existing case law is not decisive, or at least not obviously so.

[4] Other aspects of the case have been before the courts since 2014. Associated history approaches the Byzantine. With this in mind, I narrate only core background and strip everything else away. To do otherwise risks obscuring the analysis. For those interested, a chronology (of fact and litigation) comprises schedule 1 to this judgment.

Core background

[5] Ian Burden designs, makes and exports furniture. Mr Burden owns the remaining plaintiffs, PGT Reclaimed (International) Ltd and Plantation Grown Timbers (Vietnam) Ltd. The defendant, ESR Group (NZ) Ltd,4 sells furniture in New Zealand under the name, Early Settler.

1      Copyright Act 1994, s 16(1)(b).
2      The Act or our Act.
3      Emphasis added.
4      ESR.

[6] From March 2013, ESR imported from Vietnam and sold furniture here that infringed the plaintiffs’ copyright. I call this the furniture.

[7] The furniture was copied from the plaintiffs’ Irish Coast collection by a former colleague of Mr Burden. The furniture was made in Vietnam by companies in which that colleague had a…

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: [2022] NZHC 1818
Decision Date: 29 July 2022

CaseChat Overview and Summary

This case concerns a dispute over the sale of furniture in breach of copyright. The plaintiffs, Ian James Burden, PGT Reclaimed (International) Limited and Plantation Grown Timbers (Vietnam) Limited, sought to enforce their copyright over the "Irish Coast" collection of furniture designs. They claimed the defendant, ESR Group (NZ) Limited, breached their copyright by importing and selling furniture that copied their designs. The case turns on whether the defendant's actions constituted a breach of the plaintiffs' right of first circulation under the Copyright Act 1994. The plaintiffs argued that first circulation only occurs when copies are put into circulation in New Zealand by or with the consent of the copyright owner. The defendant contended that first circulation can occur anywhere in the world, irrespective of consent. Downs J held that the plaintiffs' interpretation was correct. The Court found that the right of first circulation is a territorial right, exercisable only in New Zealand. The Court also found that the defendant's actions did constitute a breach of the plaintiffs' right of first circulation, as the furniture was put into circulation in New Zealand without the plaintiffs' consent. The Court ordered the defendant to pay the plaintiffs $221,134.50 in damages, representing the defendant's net profit from the infringing sales. The plaintiffs were also awarded costs.

Orders