Issue 50 December 2003
TECHLAW BRIEFLY
In this issue:
INTRODUCTION ON JULIE CATT
Norman Waterhouse welcomes Julie back to our sunny shores after a 3 month sojourn overseas.
Julie will be working with our commercial partners Greg Tye and Celine McInerney in our litigation team and in the commercial services areas.
This edition has been prepared by Julie who can be contacted
by telephone on 8210 1277 or by email jcatt@normans.com.au.
CYBERSQUATTING – NOT SO SWEET
In CSR Limited v Resource Capital Australia Pty Ltd (RCA)
(2003) FCA 279, the Federal Court held that registration of a domain
name solely for the purpose of selling that domain name to
a company with a similar name constitutes misleading and deceptive
conduct under the Trade Practices Act 1974.
Despite the applicant’s widespread reputation in the
sugar industry and various trade mark registrations over the
word “CSR”,
the respondent (RCA) decided to register the domain names “csrsugar.com”, “csrsugar.com.au” and “constructionmaterials.com.au”.
RCA then wrote to CSR stating that it was a corporate advisory
and investment company specializing in IP protection and offered
to sell the domain name “constructionmaterials.com.au” at
a special introductory price of between $25 000 and $30,000.
A later letter threatened that the domain name would be offered
to others if an agreement was not reached.
Not surprisingly,
CSR refused the offer and initiated legal action against RCA
and its sole director, Marcus Boland, for passing
off and breaches of the Trade Practices Act 1974 and Trade Marks
Act 1995. In response, RCA argued that its sole purpose for registering
the domain names was to protect CSR, its shareholders and its
IP by ensuring that the names were proactively managed.
Hill
J found that the registration of the domain names by RCA was
for the sole purpose of making money by selling them to CSR,
or otherwise making CSR pay for RCA’s ‘intellectual
property services’. The registration of the domain names
by RCA incorrectly suggested that the domain name belonged to
the applicant, or alternatively that the respondent was in some
way associated with the applicant. Thus the conduct was misleading
or deceptive, or likely to mislead or deceive, within the meaning
of s52 of the Trade Practices Act 1974.
Hill J did not consider
that there was any trade mark infringement under s120(1) of the
Trade Marks Act 1995. This finding was based
on the fact that RCA was not using the domain names ‘as
a trade mark’ in the sense that RCA was not using the domain
names as a badge of origin in relation to goods or services for
which CSR has trade mark registrations. The court did state,
however, that there could be threatened trade mark infringement
if RCA had intended to engage in the sugar trade.
For more information contact Julie Catt by telephone on 8210 1277 or by email jcatt@normans.com.au.
COPYRIGHT INFRINGEMENT –“SECOND GENERATION NAPSTERS”
MGM v Grokster Ltd & StreamCast
A recent District Court decision in the United States has held
that the supply of software enabling users to exchange digital
files via decentralized ‘peer to peer’ transfer networks
does not amount to contributory or vicarious copyright infringement
under US law.
The defendants are the providers of ‘peer to peer’ software
which users can download free of charge. Once installed, a user
may elect to “share” certain files located on the
user’s computer. When launched on the user’s computer,
the software automatically connects to a peer to peer network
and makes any shared files available for transfer to any other
user currently connected to the same peer to peer network.
The plaintiff argued that the defendant’s conduct rendered
them liable for copyright infringement committed by the users
of the software. The defendants argued, however, that they merely
provide software to users over whom they have no control, and
thus they are not liable for copyright infringement.
Whilst the defendants’ software is analogous to the Napster
software, the Court highlighted three important differences;
namely:
- Napster required the user to enter a user name and password.
Thus Napster could terminate the accounts of individual users
found to be infringing copyright.
- Napster operated through a central directory, thus Napster
had the power to prevent a file from being downloaded if it knew
it was infringing copyright.
- Napster could prevent all further use of its system to infringe
copyright by simply shutting down.
Since the defendants were
powerless to do anything about the infringing titles after they
received notice of them, the Court
held that they were not liable for contributory infringement.
Any material contribution by the defendants to copyright infringement
occurred at a time when they distributed the software, and they
did not have the requisite knowledge at this stage. It was not
enough that the defendants knew their software could be used
for infringing purposes because it could also be used for non-infringing purposes. In this respect, the Court likened the defendants to
the suppliers of photo-copying machines.
The Court also rejected
the plaintiffs’ allegation of vicarious
liability because the defendants did not have the right and ability
to control the infringing conduct. Unlike Napster, neither defendant
had the ability to terminate users or to monitor and control
the network because of its ‘decentralised’ set-up.
It remains to be seen whether this outcome is in line with Australian
copyright law, particularly in light of the decision in University
of NSW v Moorhouse. It was held in this case that the university
was liable for authorising copyright infringement because it
failed to take adequate measures to prevent people using its
photocopiers to infringe copyright laws. The warning notices
and supervision facilities were held to be insufficient.
For more information contact Julie Catt by telephone on 8210 1277 or by email jcatt@normans.com.au.
AN AUSTRALIAN FIRST - TORTIOUS MISBEHAVIOUR!
Grosse v Purvis [2003] QDC 151
According to a recent District Court decision in Queensland,
Australians can now sue for invasions of privacy and recover
significant civil damages. Prior to this decision, there has
been no case in Australia that has expressly given recognition
to a cause of action for invasion of privacy that is additional
to, and independent of, the protection afforded under the Australian
Privacy statutes.
Ms Grosse took action for invasion of privacy against Mr Purvis,
a work colleague, after a persistent course of loitering, spying,
unwelcome physical contact, offensive phone calls and insulting
behaviour by Mr Purvis. It was held by Senior Judge Skoien
that this conduct had serious emotional and psychological effects
on the plaintiff and she was awarded $178 000 in damages.
Whilst His Honour considered a civil action for invasion of
privacy to be a bold step to take, His Honour stated that
it is both
logical and desirable. He held that the cause of action requires:
- A willed act by the defendant
- Which intrudes upon the privacy or seclusion of the plaintiff
- In a manner which would be considered highly offensive to a reasonable person of ordinary sensibilities
- And which causes the plaintiff detriment in the form of psychological or emotional harm or distress or which
prevents
or hinders
the plaintiff from doing an act which she is lawfully entitled
to
do.
Unfortunately, His Honour did not specify whether the cause
of action will catch negligent acts, as well as willed
acts, by
the defendant. His Honour also avoided specifying what
defences will be available to a defendant, although the
public interest
defence was said to be available.
Until these issues are conclusively determined by the High
Court, the decision remains persuasive authority for
the South Australian
Courts.
For more information contact Julie Catt by telephone on 8210 1277 or by email jcatt@normans.com.au.
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Norman Waterhouse
Lawyers
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