Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd  FCA 362
A recent dispute between two printer cartridge resellers has demonstrated the types of human effort that must be shown in the development of any compilation for which copyright protection is sought, as well as the types of product origin claims that Courts will consider to mislead and deceive consumers in contravention of the Trade Practices Act 1974 (Cth) (now the Australian Consumer Law).
In a decision handed down on 14 April 2011, Justice Yates of the Federal Court found that Tonnex International Pty Limited had:
- infringed the copyright of its competitor Dynamic Supplies Pty Ltd ("Dynamic"), by copying a printer consumable compatibility chart published on Dynamic’s website; and
- made a number of false statements that were likely to mislead or deceive, particularly statements suggesting that its products were Australian made.
Copyright infringement of Dynamic’s printer compatibility charts
In the course of operating its printer consumable supply business, Dynamic maintained a product database called the "Navision System". The system contained extensive product information, including price, product descriptions and the compatibility of printer consumables with various models of printers. Initially, the information contained in the Navision system was used by Dynamic’s staff to manage inventory and generate price lists for customers.
In 2007 Mark Campbell, a Dynamic employee, adapted the information in the Navision System to create a consumer-friendly, searchable compatibility chart designed for use by potential customers on the Dynamic website.
Tonnex, a competitor of Dynamic, had published a similar compatibility chart on its website, and in its price lists. According to Tonnex, its table was created by compiling information from a variety of sources, including its price lists, third party websites and from customers. Tonnex specifically denied copying any information from Dynamic's website.
The key questions before Justice Yates were:
- whether Dynamic’s compatibility chart was sufficiently original to enjoy copyright protection at all; and if so
- whether Tonnex had reproduced a substantial part of the chart.
- Was the printer compatibility chart original?
While both parties accepted that Dynamic's compatibility chart was a compilation capable of protection under the Copyright Act as a ‘literary work’, Tonnex contended that Mr Campbell had not expended sufficient independent intellectual effort in the adaptation of the Navision System to make the chart an original literary work. The originality of copyright works is a precondition to any protection under the Act.
Justice Yates did not agree with Tonnex’s submissions, finding that Mr Campbell had merely used the Navision System as a starting point before:
- selecting consumer-relevant information from the Navision System;
- arranging the material in an easy to read format; and
- updating product descriptions and compatibility information in the Navision system specifically for inclusion within the online table.
According to Yates J, the extent of this independent intellectual effort imparted by Mr Campbell was sufficient to render the work an original literary work for copyright purposes.
- Had Tonnex copied the compatibility chart?
Having found that copyright subsisted in Dynamic's compatibility chart, Yates J proceeded to consider whether a number of Tonnex's online and printed compatibility charts infringed the copyright in Dynamic's original work.
Given the extensive objective similarity between the works—including the presence of idiosyncratic typographical errors and formatting conventions from Dynamic's table in Tonnex's chart—Yates J rejected Tonnex's claim that the work was independently created, and held that on the balance of probabilities, Tonnex subjectively copied Dynamic's online compatibility chart.
Yates J also found that Tonnex's charts reproduced a substantial part of Dynamic's work, as its copying went beyond a mere appropriation of publically available factual information. Tonnex's charts reproduced a large proportion of the selection and arrangement of Dynamic's work, together with the particular expression of product descriptions and compatibility information. Consequently, Yates J concluded that Tonnex infringed Dynamic's copyright in the online compatibility chart.
Misleading and deceptive Australian-made claims
Dynamic also contended that Tonnex had made a number of false statements on its website and in its brochures that were likely to mislead or deceive, in contravention of ss 52, 53 (a) and 53 (c) of the Trade Practices Act 1974 (Cth) (which was in force until 31 December 2010). In this respect, Yates J concluded that Tonnex's representations as to the genuineness and provenance of the products, and the tax benefits associated with purchasing some of Tonnex's products were indeed likely to mislead or deceive.
Country of origin representations
In particular, Tonnex made a number of "powerful" statements on its website that amounted to representations that the products sold by Tonnex were Australian made. For example, Tonnex stated on its website that "…because you are buying genuine Australian products, free from counterfeit, you are protecting Australian jobs". Yates J considered that the statements were likely to be understood "by a substantial number of the persons to whom they are directed, as meaning that the products originate in Australia, in the sense that they are made in Australia". This was not the case - At best, some of Tonnex's products were restricted for sale in "Australia only". Consequently, Yates J concluded that the representations were likely to mislead or deceive (contrary to s 52), falsely represented that the goods were of a particular standard or quality (contrary to s 53 (a)), and falsely represented that the goods originated in Australia (contrary to s 53 (eb)).
Lessons to be learned
This case demonstrates that:
- Following the decisions of the High Court and Full Federal Court in Ice TV and Telstra, respectively, copyright can still subsist in a compilation, as long as:
- Sufficient independent human effort is imparted in selecting, arranging and expressing the compilation;
- The author of the compilation can be effectively identified; that is, the person or persons who express the compilation in a material form (i.e. those responsible for the selection, arrangement and expression of the compilation);and
- The expressive work is undertaken by a human author, rather than being the result of mere computer generation (as was the case in Telstra).
- The copying of a substantial part of the particular expression of a compilation (including the selection, arrangement, format and phrasing) may constitute infringement of copyright.
- False or misleading representations as to a product's country of origin will contravene the Australian Consumer Law. It is best to seek legal advice prior to making a statement as to a product's provenance.1