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Focus: IceTV's legacy lives on in 'dynamic' copyright case

5 May 2011

In brief: Although recently tested in the High Court, the issue of whether copyright exists in a compilation remains difficult to define and ultimately involves a consideration of intellectual input. Partner Tim Golder (view CV) and Law Graduate Courtney McLennan look at a case where the Federal Court displayed a certain latitude in finding the existence of originality.

How does it affect you?

  • This case – Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd [2011] FCA 362 – offers a very helpful analysis of the circumstances in which a compilation of material drawn from another source will itself be protected as a literary work.


Background

The influence of the High Court decision in IceTV Pty Ltd v Nine Network Australia Pty Ltd1 on the analysis of the subsistence of copyright in compilations continues to grow.  In Dynamic Supplies, Justice Yates considered carefully the reasoning of IceTV, albeit reaching essentially a different conclusion on the facts.

The facts of Dynamic Supplies involved a compatibility chart (the March 2008 CSV file) designed for use by Dynamic's customers, which featured a compilation of printer and computer details derived from a database maintained by Dynamic's employees (the Navision database).  The arrangement of the information into columns provided easy access for searching by customers and was the result of Dynamic's employee Mark Campbell's considerable labour, as well as that of other employees who were deemed to possess minor (non-authorial) roles.2  In this case, Dynamic contended that a portion of its March 2008 CSV file had been replicated by a competitor in Tonnex's 2008, 2009 and 2010 price lists and compatibility charts.

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The legal arguments of the case

Originality

There was no contention over whether the compatibility chart was a literary work as defined under the Copyright Act 1968 (Cth) (the CA).  Instead, the crux of the argument was whether that literary work was original (section 32 of the CA).

Tonnex attempted to assert that originality had to be found in the form in which the material was laid out, and that the intellectual effort inherent in creating the March 2008 CSV file was 'minimal'.  In particular, Tonnex argued that the material for the compatibility chart was 'obvious' and no originality was required in the general layout of the chart's columns.

Infringement

Dynamic asserted Tonnex had reproduced a substantial part of its March 2008 CSV file by creating its own price lists for 2008, 2009 and 2010, which included separate compatibility charts that were the subject of the infringement dispute.  Tonnex claimed that it gathered its sources for its compatibility charts and price lists from both vendors and consumers, and also online.  It also claimed the information within Dynamic's compatibility chart was widely available and that it did not copy the information and layout, as the Tonnex 2008 price list and compatibility chart was 'created independently'.  Conversely, Dynamic sought to show that five out of nine information columns and 60 per cent of the March 2008 CSV file's product line entries had been replicated.

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The decision: a compilation worthy of protection

General principles

Justice Yates outlined three requirements for a compilation to attract copyright as a literary work:

  • First, the original work must stem from an author.
  • Secondly, the work must be 'the product of human intellectual endeavour', otherwise expressed as requiring 'some independent intellectual effort or the exercise of sufficient effort of a literary nature for its creation'.
    • However, no tests of novelty or inventiveness are required (citing IceTV).
    • Indeed, his Honour applied an assessment of originality that had 'regard to the whole of the identified work, rather than to a particular aspect...viewed in isolation'.  This drew parallels with Elwood Clothing Pty Ltd v Cotton On Clothing Pty Ltd where 'the greater part of the effort, skill and time' was expended in designing the overall layout of the T-shirts rather than the 'choice of words and numerals', and thus (while considering artistic rather than literary works), the 'whole' of the work required consideration.3
  • Thirdly, it must not be a compilation of 'mere facts, ideas or information', as copyright protects the compilation's form (mirroring IceTV, where Chief Justice French and Justices Crennan and Kiefel stated that '[c]opyright does not protect facts or information').
Originality

While the March 2008 CSV file was essentially derived from one source (the Navision database), Justice Yates held that the existence of intellectual effort and the compilation's 'particular[ly] convenient arrangement' ensured originality for the purposes of the CA was satisfied.

In finding originality, Justice Yates provided three reasons:

  • First, that the selection of material for the compatibility chart was 'informed by Mr Campbell's personal assessment of what information might be valuable to a customer searching a website';
  • Secondly, the selection of information and its expression in a certain form reflected an understanding of the 'greatest utility' of the chart to consumers; and
    • It was Mr Campbell's 'intellectual effort' that made the information in its expressed form useful to consumers and this intellectual labour contributed towards originality.
    • Justice Yates warned against dismissing the compatibility chart as 'obvious or prosaic', instead underscoring the fact that '[s]implicity itself may be a virtue' which need not negate originality, so long as simplicity does not mask an 'absence of skill or effort'.  His Honour pointed out that, unlike here, in IceTV the time and title of television programs could only be expressed in one form, as fact and expression were inextricable.  As stated in IceTV, program titles and time slots do not constitute 'a form of expression which requires particular mental effort or exertion' and thus 'expression was essentially dictated by' the material.4
  • Thirdly, the arrangement of the information in the compatibility chart into columns was a result of intellectual effort.
    • This was buttressed by evidence that while other compatibility charts at the time presented similar information, the form in which Dynamic's compatibility chart presented the information was unusual.

Justice Yates stated that a finding of originality in copyright law 'is a matter of degree depending on the amount of skill, judgment or labour that has been involved in making the compilation'.  His Honour also held that 'the skill and labour employed by Mr Campbell in creating the compatibility chart in the form of the March 2008 CSV file was more than negligible and that that work was...an original literary work for copyright purposes'.

Infringement

Unfortunately for Tonnex, infringement was quite clear once the hurdle of originality had been surpassed.  In particular, the existence of 'idiosyncratic expressions' and 'the sheer number of instances of precisely the same expression used within and across columns' rendered it 'inconceivable...that the same idiosyncrasies, in the same number and combination, and in relation to the same products, found their way into Tonnex 2008 by chance'.  Justice Yates held that the 'overall and compelling picture' was that Tonnex had transposed substantial portions of the earlier published March 2008 CSV file.  Substantial part was also easily assured, as 'qualitatively important elements' were duplicated (for example, product descriptions, particular coding etc).  As this was what afforded the March 2008 CSV file its 'essential character as a meaningful compatibility chart', infringement was strengthened.  Thus, as Tonnex 2008 'obviously duplicated' Dynamic's compatibility chart, infringement was proven.

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Independent intellectual effort: resonance with IceTV

The notion of intellectual effort as described by Justice Yates has resonance within the reasoning of IceTV, where it was stated that an author's application of skill and labour assists in ascertaining the originality of the expression of the work.  In that case, their Honours stated that originality as per the CA requires only that 'some independent intellectual effort' was expended by the author or joint authors.

This focus on independent intellectual effort as the key to originality in regards to compilations was also evident in Primary Health Care Ltd v Federal Commissioner of Taxation5 where Justice Stone stated that for copyright to exist in an original literary work, it must be shown that there was 'independent intellectual effort...directed to the expression of the idea'.  Thus, Justice Stone stated that '[a] compilation may be an original literary work but only if it has been created through the exercise of skill and judgment' (citing IceTV as authority).

Similarly, in Telstra Corporation Ltd v Phone Directories Company Pty Ltd6, a lack of intellectual effort on behalf of human authors was the insurmountable stumbling block to copyright's subsistence in the White and Yellow Pages.

Thus, Dynamic Supplies is the most recent case to underscore the increasing importance of independent intellectual effort as an essential ingredient to originality in compilations.

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Conclusion

Dynamic Supplies follows closely in the wake of IceTV where Chief Justice French and Justices Crennan and Kiefel stated that copyright could subsist in a compilation via 'the words, figures and symbols in which the pieces of information are expressed, and the selection and arrangement of that information'.  However, in doing so, Justice Yates' reasoning serves to strengthen further the link between originality of compilations and intellectual effort espoused in IceTV.

In Dynamic Supplies, the crucial question of originality drew heavily on the notion of independent intellectual effort to establish the existence of copyright.  While the phrase is certainly not new, it appears to be gaining increasing prevalence and will continue to prove a challenge for claimants seeking protection in literary works, such as compilations, which lack the requisite intellectual spark.  Nevertheless, in Dynamic Supplies, the court was willing to show generosity in finding the existence of intellectual effort, even when merely directed at the composition of the compatibility chart.

Footnotes
  1. (2009) 239 CLR 458.
  2. Justice Yates held that Dynamic's employee, Mr Campbell, was the sole author of the March 2008 CSV file (and thus Dynamic was the owner as Mr Campbell's employer per section 35(6) of the CA).
  3. [2009] FCA 633.
  4. IceTV 477.
  5. (2010) 186 FCR 301.
  6. [2010] FCA 44.

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