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High Court of Australia Transcripts |
Last Updated: 9 February 2005
IN THE HIGH COURT OF AUSTRALIA
Office of the
Registry
Sydney No S319 of 2004
B e t w e e n -
EDDY STEVENS
Appellant
and
KABUSHIKI KAISHA SONY COMPUTER ENTERTAINMENT
First Respondent
SONY COMPUTER ENTERTAINMENT EUROPE LIMITED
Second Respondent
SONY COMPUTER ENTERTAINMENT AUSTRALIA PTY LIMITED
Third Respondent
GLEESON CJ
McHUGH J
GUMMOW J
KIRBY
J
HAYNE J
HEYDON J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON TUESDAY, 8 FEBRUARY 2005, AT 10.18 AM
Copyright in the High Court of Australia
__________________
MR J.V. NICHOLAS, SC: May it please the Court, I
appear with my learned friend, MR C. DIMITRIADIS, for
the appellant. (instructed by Gadens Lawyers)
MR D.K. CATTERNS, QC: May it please the Court, I appear with my learned friend, MR R. COBDEN, for the respondents. (instructed by Blake Dawson Waldron)
MR J. BASTEN, QC: If the Court pleases, I appear with MR G.C. McGOWAN, SC and MS L.G. de FERRARI for the Australian Digital Alliance Limited and the Australian Libraries Copyright Committee, seeking leave to be heard as amici. (instructed by Sarah Waladan)
GLEESON CJ: We have the written submissions from the parties on that application. Does anybody want to add anything orally to what they have put in writing?
MR NICHOLAS: No, your Honour.
MR CATTERNS: No, your Honour.
GLEESON CJ: Yes, you have that leave, Mr Basten. I assume the parties have agreed between themselves on a division of time and that you will go second?
MR BASTEN: Yes, that was the proposal, your Honour, that we go after the appellants and before Mr Catterns.
GLEESON CJ: Yes, thank you. Yes, Mr Nicholas.
MR NICHOLAS: Your Honours, this case raised three important questions arising under the Copyright Act. The first question concerned the proper construction of the section concerned with technology protection measures and circumvention devices.
KIRBY J: Will you in your submissions provide in very simple language some notion or a description of how the technology actually operates? I have read and reread the descriptions but I am not absolutely sure that I understand it.
MR NICHOLAS: Yes, your Honour, I proposed to come to the technology and perhaps work through it orally, notwithstanding that it is covered in some detail in the written document. To the extent it appears in the appellant’s submissions it is based upon the findings of the primary judge and, save for the three issues that we have identified and I am in the process of enunciating now, there is no relevant contest between Mr Catterns and myself as to the correctness of the findings that were made by the primary judge and his findings of fact are not challenged.
You see, your Honours, the first question concerned the meaning of section 116A, which draws on a definition of the expression “technological protection measure”, which is defined in section 10(1) of the Act. The question as fought out in the case heard by Justice Sackville, who was the primary judge, first instance, was really this, that the respondent’s protective device, and that is a device which we will refer to as the Boot-ROM and/or the access code, that is found on PlayStation CD-ROMS and PlayStation consoles, constitute a “technological protection measure” within the meaning of that definition. That is the first issue, your Honours.
The second issue was, what is the proper construction of the definition of “material form” in section 10 of the Act, and, in particular, did the playing of a PlayStation game on the respondent’s PlayStation console involve the reproduction in “material form” of the whole or a substantial part of a computer program within the meaning of the Act?
KIRBY J: That is the matter that has been the subject of amendment.
MR NICHOLAS: Yes, your Honour. With effect from 1 January of this year. Now, it has always been - - -
GUMMOW J: The definition of “material form” was not changed by the Act 110 of 2000.
MR NICHOLAS: That is correct, your Honour. The definition was changed as a consequence of the coming into effect of the Australia United States free trade agreement. That amendment, and other amendments to another definition in the Act, that concerns the third issue, which I will now come to – is also affected by that series of amendments.
KIRBY J: At some stage, perhaps you can help us on the principles that apply where Parliament, between a decision and the final determination, amends the Act. Does it mean that it is accepting the decisions below or does it mean that it is making beyond doubt clear that which might not have been clear?
MR NICHOLAS: Your Honour, so far as the amendment to “material form” is concerned, we explored that question at some length before preparing the written document, and we would accept that the amendment would have to be of a character where one could not say, one way or the other, whether what was occurring was clarification of the law or a change in the law. We do not see that approach to the amendment as really advancing the argument in one direction or another.
Your Honours, the third issue that arose in the case concerned - - -
KIRBY J: I suppose we would not be blind to the fact that the United States of America takes very seriously the protection of its intellectual property, repeatedly refers to it, constantly talks about it and that was part of the free trade agreement.
MR NICHOLAS: Your Honour, the circumstances in which the amendment came about probably makes it, in this case, even more difficult than might otherwise have been to draw inferences as to whether or not Parliament should be taken as having intended to correct a mistaken view of the provision as it originally stood.
Your Honours, the third issue in the case was whether or not, in the course of playing a PlayStation game on a PlayStation console, the user thereby makes a copy of the whole or a substantial part of a cinematograph film within the meaning of the Act. More particularly, does the evidence establish that a substantial part of such a cinematograph film is embodied in the RAM of the PlayStation console during this process? Now, I will come to the technology shortly.
GLEESON CJ: Just a minute. You succeeded on issues two and three in both the courts below, did you not?
MR NICHOLAS: Yes, your Honour, we did, by majority in the Full Court with Justice Finkelstein dissenting on both issues. We accepted before Justice Sackville at first instance and in the Full Court that if either of the second issues were decided adversely to us, we would also fail in relation to section 116A, that is to say, the first issue, not because of its interpretation, but because of its application to facts of this particular case.
GLEESON CJ: I presume you will be devoting the bulk of your argument to the first issue.
MR NICHOLAS: Yes your Honour, I will. We have addressed in the document the two other issues, but we will focus on the first issue in-chief - - -
GLEESON CJ: And the first issue turns on the meaning of the word “inhibit”.
MR NICHOLAS: Yes your Honour, that is so.
GLEESON CJ: Entirely.
MR NICHOLAS: Yes, your Honour, that is so. May I take your Honours before I go to the statement of facts and technology to the relevant provisions of the Act.
GUMMOW J: Do we not have to start – what are we construing? Are we not construing the Act 110 of 2000?
MR NICHOLAS: Your Honour, we are - - -
GUMMOW J: Which has its own objects clause, that is why. Section 3 of that Act gives some clue as to what they were trying to do. Is that not right?
MR NICHOLAS: Yes your Honour, it does in that the Act was introduced for the purpose of it addressing issues arising out of the use of digital technology. I will turn up section 3 your Honour, I do not have it at hand, of that Act, but may I take your Honours firstly to section 116A of the Copyright Act as in force at relevant times.
Your Honours, the Act provides
that:
If:
(a) a work or other subject-matter is protected by a technological protection measure; and
(b) a person . . .
(i) makes a circumvention device - - -
GUMMOW J: What does this word “protected” mean?
MR NICHOLAS: Your Honour, we submit it is directed to protections.
GUMMOW J: I mean, the books in a library are protected, I suppose, by a key of the door.
MR NICHOLAS: That is so, and there is no reason when one reads the section to say that it is necessarily limited to the very narrow types of facts with which we are concerned in this case.
GUMMOW J: Any “work”.
MR NICHOLAS: Yes, “or other subject-matter”, your Honour.
GUMMOW J: Yes.
MR NICHOLAS: The nature of the protection, your Honours, is further defined by - - -
GUMMOW J: If I can just say to you, Mr Nicholas - and it is said to all of you - a lot of the discussion in the courts below – I suppose it is understandable – is focused upon this particular factual situation.
MR NICHOLAS: Yes, your Honour.
GUMMOW J: These provisions, it seems to me, have much wider reach.
MR NICHOLAS: We accept that, your Honour. One of the difficulties in a case of this kind is that the evidence before the trial judge - - -
GUMMOW J: People easily become obsessed with computers.
MR NICHOLAS: Yes, your Honour. The evidence before the trial judge was quite limited; Mr Stevens was not represented. It is difficult to investigate many of the arguments that arise in relation to which of the two competing constructions of this section should be preferred against a background of limited evidence and a situation where one must engage in some speculation to some extent as to other situations in which the provision may apply, either existing or which may arise in the future.
Your Honour Justice Gummow, can I come back to the question of what “protection” means, because there is some content given by the expression “technological protection measure” itself when one comes to that definition.
GUMMOW J: Yes, there is.
MR
NICHOLAS: But coming back to 116A, the circumvention device, the
prohibition extends to making a circumvention device, or if I may paraphrase,
dealing in circumvention devices, is what is prohibited in subsection (1),
and if one goes to subsection (1)(c), one of the elements
that the cause of
action is, and is only this, that:
The person knew or ought reasonably to have known, that the device or service would be used to circumvent, or facilitate the circumvention of, the technological protection measure.
Unlike provisions in other
jurisdictions, this provision does not stipulate as an ingredient of the cause
of action that the person
knew, or ought reasonably to have known, that the
technological protection measure would be used to infringe copyright, and that,
we submit, is a very important consideration especially when one is considering
the operation of these provisions in the light of
provisions relied upon by my
learned friends in their submissions in the UK and in the United
States.
KIRBY J: But that distinction is against you, is it not?
MR NICHOLAS: No, it is not, with respect, your Honour, because we submit - - -
KIRBY J: It seems to be.
MR NICHOLAS: We submit that rather than that work being done here in 116A(1)(c), the legislature has instead addressed that issue in the definition of “technological protection measure”. That is to say that the focus of this section is on the use of a device and a device that is used regardless of the knowledge of the person concerned as to whether it was to be used for the purpose of infringing copyright, but the important limit is when one goes to the definition of “technological protection measure . . . prevent or inhibit the infringement of copyright” appears, and jumping ahead, we submit that a device that does not prevent or inhibit, in the sense of block, prevent or establish some hindrance on the engaging in of an act of infringement, is not within the definition of “technological protection measure” and therefore is not caught by section 116A.
Now, in relation to that matter, it is true that the case is focused quite considerably on the Sony PlayStation products, but in this important respect it demonstrates the point we wish to make quite eloquently. The Sony PlayStation games can be copied.
GUMMOW J: How are they protected? Are they works or subject matter?
MR NICHOLAS: They are works, your Honour, in the case of the computer programs embodied in the CD-ROMs and they are - - -
GUMMOW J: Literary works?
MR NICHOLAS: Yes, your Honour, which of course comes back to the observation your Honour made earlier. They also will involve subject matter other than works in the nature of cinema graph films. Of course, they could involve other species of copyright as well when one is considering the question at a very general level. The CD-ROM itself, and I will come to the access code when talking about the technology, but the access code, I should point out at the moment, it does not form part of the copyright work.
GUMMOW J: Is there a definition of access code?
MR NICHOLAS: No, your Honour, there is not. We say that the definition of “technological protection measure” when using the expression “prevent or hinder” is really addressing this question of does a device block, check or hinder an act of copyright infringement. In the case of the Sony PlayStation disks, the copyright works and the other subject matter can be copied without restriction. They have no effect at all on a person’s ability to make as many copies as they choose using conventional copying technology of the copyright works.
GUMMOW J: What do you say would be an example of an inhibition that was not a prevention that was caught?
MR NICHOLAS: Your Honour, an example may be – and this is an example given by Justice Sackville at first instance – of a device that, in effect, prevented the whole of the work from being copied.
GLEESON CJ: A part of it I thought he said. I thought Justice Sackville said an example of inhibition is preventing part of it being copied.
MR NICHOLAS: Yes, your Honour, or preventing a whole or a part of it being copied, but either way there is not a complete prevention - - -
GUMMOW J: But you can infringe by just taking a substantial part, can you not?
MR NICHOLAS: Yes, you can, your Honour, but there would be an infringement, nonetheless. The argument that I am advancing now finds some support in the permitted purposes provisions of the Act. If your Honours can return to section 116A there are exemptions which are created in relation to certain uses and they are dealt with in subsection (2) of that section and subsection (3), in particular. They refer back in subsection (3)(b)(v) to specific provisions of the Act which are there to render lawful what would otherwise be unlawful.
If one goes to
section 116A(7) one sees this provision:
For the purposes of this section, a circumvention device or a circumvention service is taken to be used for a permitted purpose only if:
(a) the device or service is used for the purpose of doing an act comprised in the copyright in a work or other subject-matter; and
(b) the doing of the act is not an infringement of the copyright in the work or other subject-matter under –
one of the relevant sections.
Your Honours, we say that that provides a strong indication that the legislature is creating a set of exceptions in relation to the making or dealing in circumvention devices which contemplates that the acts engaged in with the benefit of those devices would be infringements because it is curiously under subsection (7) not use of a circumvention device for a permitted purpose if one is using it for a purpose that is not there, in effect, or does not involve avoiding infringement. So that the subsection, we say, is a strong pointer to what, in our submission, is the correct position. That is to say that when the definition of “technological protection measure” refers to preventing or inhibiting infringement of copyright, it is doing so in the sense that the device is, in the course of its technical operation, erecting a barrier or an obstacle or some hindrance to the act of infringement. A clear example of such a device would be a device which required the use of password-protected access to a copyright work and that might occur, for example, in relation to a website on which copyright work is stored, it might occur in relation to literary works that are stored on CD-ROMS or other electronic media.
McHUGH J: Is that your argument or does your argument not really come to that, that the TPM is really directed to protecting devices that are really part of the work in its electronic form?
MR NICHOLAS: If they are part of the work in its electronic form, certainly.
McHUGH J: In other words, if it is designed to deal with CD-ROM burners that in some way might negate or destroy the effect of an access code within another CD-ROM. Your argument seems - - -
MR NICHOLAS: Yes, your Honour, and that the operation of the section can be measured in this way. If one does copy the Sony PlayStation disk and thereby reproduce onto another disk or on to a hard drive of one’s computer, a relevant work or other subject matter, this technological protection measure does nothing to interfere with one’s ability to do that.
HAYNE J: How much does that argument seek to segregate the words “prevent or inhibit” and divorce them from the specification of means? By that question, I mean to draw attention to the underlying question of whether the specified means, without more, are legislatively taken to be methods of prevention of inhibition.
MR NICHOLAS: Yes your Honour, and in passing may I say that, of course, (a) and (b) seem to define exhaustively in terms of the categories the two means by which the result may be achieved. But, your Honour, those specifications of means do not cut across the argument, because if one looks at subparagraph (a) of the definition, it is clear enough that one can protect works in the way we submit this definition is concerned with, by denying access. The first example I give beyond the facts of this case is a password protected website that denies access to material which, if that device was defeated, could be made accessible for the purposes of copying.
Your Honours, the other examples given, decryption, unscrambling or transformation, are also, we submit, matters which would need to be circumvented, or techniques or devices which would need to be circumvented, for one to obtain access to the work. Now - - -
McHUGH J: Does your argument get some support from paragraph (b) of the definition, namely, “through a copy control mechanism”?
MR NICHOLAS: Well, your Honour, it gets some support. My learned friends would say it detracts from it in one way. Clearly, there is no copy control mechanism involved in this case, we would submit.
McHUGH J: I appreciate that, but what is a copy control mechanism? Would it ordinarily be some mechanism in the work itself which prevents copying?
MR NICHOLAS: Your Honour, it could be a mechanism in the work itself, it could be a mechanism that stands outside the work, that limits the ability to make copies of the work. That is to say - - -
GUMMOW J: It is not defined, is it?
MR NICHOLAS: It is not defined, your Honour. It is a vague expression, but it - - -
GUMMOW J: It has this word “mechanism” though, which helps you, I would think.
MR NICHOLAS: Yes, again, and that is plainly a matter that influenced Justice Sackville.
HAYNE J: But how do you relate it back to the introductory words of “device, product or component incorporated into a process”? Relevantly in the instant case, is it identified as a component incorporated into a process?
MR NICHOLAS: Well, when one reads on, your Honour, it must be a result that is achieved by either or both of those means, and if - - -
McHUGH J: But in this case - - -
MR NICHOLAS: If an applicant had to characterise it as a copy control mechanism it may be that those words would govern.
McHUGH J: But the access code in the work itself in this case is a copy control mechanism, is it not?
MR NICHOLAS: Your Honour, there is no access code in the work itself in this case, and that was a vital matter that was found by the primary judge. So that the access code does not form part of the copyright work, which is why one does not – so that when the work is being reproduced without inhibition it is being reproduced, we accept, without the access code that stands on a separate part of the CD-ROM and - - -
McHUGH J: I am sorry, I must have misunderstood you on this. Is there no code on the CD-ROM itself?
MR NICHOLAS: There is, your Honour.
McHUGH J: Yes.
MR NICHOLAS: Yes, and there is a device in the console called the Boot-ROM which looks for the relevant code.
McHUGH J: I understand that, but what I was putting to you is that the code in the work itself in the CD-ROM is itself a copy control mechanism, is it not, because it cannot be copied by an ordinary CD burner.
MR NICHOLAS: Can I answer that in its two parts?
McHUGH J: Yes.
MR NICHOLAS: Firstly, the code is not part of the work. It is not part of any copyright work.
McHUGH J: I know that. It is on a track or something.
MR NICHOLAS: It is on a track that cannot be copied.
McHUGH J: Yes.
MR NICHOLAS: Your Honour, it is not a copy control mechanism because it does not interfere in any way with a making of a perfect copy of the copyright work.
McHUGH J: I see. So it does not interfere with a copy – yes, I appreciate that. It does not prevent you copying the work, but it does prevent you playing it on the console.
MR NICHOLAS: Yes, your Honour. It is the - - -
McHUGH J: Because it does not copy that track that has the code in it.
MR NICHOLAS: Yes, your Honour.
McHUGH J: Yes.
MR NICHOLAS: And it is that latter matter that gave rise to the second and third issues in the case because if the playing involved an act of infringement then the device would be preventing or inhibiting an act of infringement in the sense that we say this expression ought to be interpreted.
Your Honours, can I take the Court to the reasons of the trial judge, Justice Sackville, in the Federal Court appeal book. There are two appeal books, one prepared for this Court and with leave granted by Justice Gummow we have adopted the book used in the court below. At page 186 - - -
HEYDON J: What paragraph, Mr Nicholas?
MR NICHOLAS: It is
paragraph 114. Paragraph 115 is critical, but if I can begin at
paragraph 114 – his Honour has just identified the
elements of
the definition:
It can be seen that the focus of the definition, as the expression “technological protection measure” itself implies, is on a technological device or product that is designed to bring about a specified result (preventing or inhibiting the infringement of copyright in a work) by particular means. Each of the specified means involves a technological process or mechanism. The means identified in sub-par (a) is an access code or process that must be used to gain access to the work. The means identified in sub-par (b) is a “copy control mechanism”. While the latter expression is not defined in the Copyright Act, the legislative history to which I have referred suggests that it is intended to encompass a mechanism that restricts the extent of copying of a work that otherwise could be undertaken by someone who has lawful access to that work.
This is really the ratio of his Honour’s decision
on this point.
The definition, so it seems to me, contemplates that but for the operation of the device or product, there would be no technological or perhaps mechanical barrier to a person gaining access to the copyright work, or making copies of the work after access has been gained, thereby putting himself or herself in a position to infringe copyright in the work. The definition is intended to be confined to devices or products that utilise technological processes or mechanisms to prevent or curtail specific actions in relation to a work, which actions would otherwise infringe or facilitate infringement of copyright in that work.
And then in paragraph 116 his Honour explains how
he sees the word “inhibit” having work to do beyond that which is
done
by “prevent”, and his Honour says that:
A copy control mechanism, for example, might not prevent all copying that infringes copyright, but might limit the extent of unlawful copying that can take place, for example by reducing the quality of copies that can be made of the copyright work. Such a device could properly be said to be designed, in the ordinary course of its operation, to “inhibit” the infringement of copyright in a work, rather than to prevent such infringement. It may be that access to only part of a work is restricted by a process requiring decryption or unscrambling. In this situation, too, it might be more appropriate to say that the process is designed to inhibit, rather than prevent the infringement of copyright in the work.
One of the matters we draw attention
to in our written submission is the fact that the broad definition that was
adopted by the Full
Court does have the effect of preventing devices being used
for perfectly lawful purposes that are not covered by certain of the
permitted
purpose provisions that I have referred your Honours to, and one example is the
right to make a back-up copy of a computer
program. Now, our learned friends
say that that right extends only to - and that is still within 47C of the
present Act. Our learned
friends say that right does not extend to subject
matter rather than works. There are cinematograph films here, so therefore it
cannot help the appellant. Looking at this set of provisions against the
broader background, of course, it will not always be that
the relevant work will
also constitute subject matter other than work, and in the case of a
conventional computer program, something
other than a game of the kind we are
concerned with in this case, the argument plainly runs.
The back-up copy provision, which confers on the owner or licensee of the particular copy a right to make a back-up copy, subject to certain exceptions, absolutely, and it does so in terms that, by virtue of section 47H of the Act, prevent that right from being excluded by contract. So if for the reason I have put moments ago, leave aside the fact that here the Sony PlayStation games have cinematograph works, there may be other answers to the point the respondents take.
McHUGH J: One of the difficulties of the case may be that the explanatory memorandum seems to have very much departed from the statement of the objects of the Act in section 3 of the Digital Agenda Act. Section 3 was directed to an online environment and one might have thought you read it in the context of the online environment but the explanatory memorandum, and correct me if I am wrong, spoke about technology specific rights. It may be it goes beyond what the object of the Act is stated to be.
MR NICHOLAS: Your Honours, both sides have from time to time relied upon the legislative history, the various reports that have been prepared and other like material, but at the end of the day, and this seems to have informed somewhat Justice French’s view, notwithstanding it was adverse to us, it is not terribly helpful to the resolution of the question of construction. It is not a matter we took up in our written document, your Honour, but in those circumstances one can see why the object of the Act as expressed in the Act against the background, which on one view is quite confusing, with various inconsistent signals being sent, that statement is significant.
McHUGH J: Four of the objects of the Act specifically refer to “online”. We are not dealing with online here, are we?
MR NICHOLAS: No, we are not.
McHUGH J: Paragraph (e), the fifth one, talks about the Internet.
GUMMOW J: What they put in as Division 2A, 116A and following, does not appear to be covered by an object. That is not necessarily against you.
MR NICHOLAS: Your Honour, we would submit it is a reason for not adopting an expansive interpretation of the relevant words where there is no clear indication given either in the legislative material or in the objects to what it was intended to cover.
GUMMOW J: It may be - we do not know what happened - that some compromise was hammered out, not in public, and this is the product of it, and none of the legislators wanted to be upfront about it.
MR NICHOLAS: Yes, your Honour. There is no clear guidance to be had from either source. We do say that it is significant that the interpretation that has been adopted by the majority below is one that does circumscribe the exercise of lawful rights. It expands in ways that, as I indicated before, could not be explored in an evidentiary sense, the capacity of a copyright owner to get more from his work, and when I say get more from his work, get more than what traditionally comes with the grant of the exclusive rights under this Act.
For example, I have referred to the back-up copy argument. Justice Lindgren had an answer to that, which we submit is, with great respect to him, flawed. We have dealt with that in the written submission and I will not go to it now. In addition to the back-up copy point, we also know that one can lawfully import for non-commercial purposes games of this kind, CD-ROMs of this kind. The effect of the majority’s interpretation of this section is to preclude a person from gaining access to a device or a console which would enable copies imported, private collections, whether imported personally or by mail, to be used in this country.
GUMMOW J: How do the parallel importing provisions apply to these computer games, if they apply at all?
MR NICHOLAS: I might need to take that on notice, I am sorry, your Honour, but they - - -
GUMMOW J: And the cinematographic films, I suppose.
MR NICHOLAS: I will need to take that on notice. May I do that, your Honour?
GLEESON CJ: You can give us a written note about that.
MR NICHOLAS: We will do that. To the extent they do apply, the argument is - - -
GUMMOW J: As I understand it, one of the matters that agitated the ACCC when they were involved in this case – they no longer are – was the use of this legislation, these particular provisions here, to prop up market divisions, as it were.
MR NICHOLAS: Yes, your Honour. The position is that when one looks at the technology, one cannot go and buy a console in this country and play Sony games that one has acquired in the United States. It is unlawful for someone, on this interpretation of this legislation, to supply you with the means of doing so. So that point in relation to that specific example – and there are others that can be postulated – and the back-up copy point are what lead us to say that section 116A(7) is, against that background, providing a fairly strong indication that this section is concerned with the prevention or inhibiting of acts which would otherwise constitute an infringement, because the permitted purpose provisions simply have no scope to operate at all if they are not being used to permit an act which would otherwise constitute an infringement.
We have, in the written document, attempted to summarise – and in quite uncontroversial terms, I can say – the nature of the technology. That appears under “Narrative Statement of Facts”, part 7 and following, but if your Honours would be assisted in me working through this to some extent, I can do so quite briefly. The position is that a Sony PlayStation is not like a general computer; we refer to it as a “special purpose computer”, and that is because it has a fairly specific and dedicated use. It does not lend itself to the general uses that can be made of a desktop or laptop computer and that becomes very relevant when one comes to the second issue concerning reproduction in material form.
So far as that point is concerned – I should bring this out now – as found below, and this is not the subject of disagreement, one cannot inspect the contents of the RAM in the special purpose computer unless one wants to, in effect, develop new technology for the purpose of doing so. In effect, one cannot take the console, as supplied by the respondents, and inspect or have access to or regard to the contents of the RAM. The position in relation to a general purpose computer is quite different, usually and that is an important distinction so far as these devices are concerned because, coming to the second argument, one cannot say that the computer program, to the extent that it is at any time in the RAM of the Sony PlayStation, can be reproduced from that mechanism.
The device consists of the console itself, a central processing unit, some graphics processing units, some read-only memory devices, including what I referred to as the Boot-ROM, the Boot-ROM being the particular device that enables the console to look for the access code on the disk.
The access codes of course, as used by the respondents here, are not access codes that are used for the purpose of differentiating between an infringing copy and a non-infringing copy. There are access codes that are used for the purpose of differentiating between the particular region in which the copy was released. In paragraph 11 we have explained how it comes about that one cannot play on a PlayStation console acquired here, copies of games acquired overseas without the use of some device or without making some modification to the console.
KIRBY J: I understood what you have said about the way in which that divides the world, unlike the Popes of old, not into two but into three. But what is the overall policy objective of doing that? Is it just to make it difficult for those who seek to do what your client did, to succeed on a large scale in different parts of the world?
MR NICHOLAS: I think the correct answer is that there is no evidence at trial which throws any real light on that - - -
KIRBY J: Or is it just something like television systems, that they are different in different countries?
MR NICHOLAS: The access code, we accept, and there was a finding made by the primary judge which is not challenged - - -
McHUGH J: One could make a guess that probably one of the objects is to allow pricing differentials in various regions.
MR NICHOLAS: One of the objects, your Honour, and whether or not it is an object in this case, it is certainly an opportunity - - -
GUMMOW J: That is irrelevant. We just have to construe the section.
MR NICHOLAS: That is so. It certainly presents an opportunity and in that sense, it is quite irrelevant what the respondent here may or may not have intended to achieve with its device, although the section does of course refer to the ordinary operation of the device being one that prevents or inhibits infringement.
So, unlike the United States legislation which contains a much broader prohibition on the use of any such device which is not related in any terms at all, backed in any terms at all to the object of checking infringement, here we do have these words that do require that there be some connection between the protection of the copyright and the use of the device. But on the interpretation that has been adopted below, given that in these settings manufacturers of equipment of this kind will typically be acting for a variety of purposes, it is a very, we submit, wide opportunity being presented that would enable this section to be used for the purposes of carving up the world into regions, as has occurred here, for marketing purposes, not just for the purposes of protecting copyright. That is a reason, we submit, for being cautious and ultimately not adopting the wide construction that is being advocated in relation to the definition of “technological protection measure”.
HAYNE J: Why? Why is it a reason for caution?
MR NICHOLAS: It is a reason for caution, your Honour, because one would not lightly infer, we submit, that the legislature would be prohibiting the manufacture or supply of devices which can be used for lawful purposes. The devices can be used for lawful purposes, amongst other things, for making available in this market copies of copyright works distributed in other markets by means of a console that is acquired in this market.
GUMMOW J: How does “fair dealing” fit in with this?
MR NICHOLAS: Your Honour, we say that - - -
GUMMOW J: It is not specially dealt with, is it?
MR NICHOLAS: It is not specially dealt with at all, and, as we say in the written submission, your Honour, it is not a case where one can readily postulate examples where one might wish to make a fair dealing of what one finds on the Sony Playstation disks. I do not say that it is not possible, but, certainly, if what was on that disk was a literary work of a more conventional character – not a computer program, but perhaps literary works, artistic works, information that has been reduced so as to attract copyright protection in the first place – that is the type of material which, of course, does lend itself, and has always lent itself, to the exercise of the fair dealing rights conferred by this Act.
Again, on this interpretation, notwithstanding that the device in question was to be used for the purpose of enabling those rights to be exercised, one could not obtain access to the device that was needed for that purpose. The result would be that the fair dealing provisions and the rights conferred by them would be thwarted and denied to the people who were wishing to exercise them.
GUMMOW J: Is that not going to happen anyway?
MR NICHOLAS: Not - - -
GUMMOW J: In other words, giving the words “prevent or inhibit” the operation you want to give it, will not fair dealing be adversely affected anyway?
MR NICHOLAS: Yes, your Honour, but not so extensively.
GUMMOW J: That is what your point has to be, is it not?
MR NICHOLAS: Yes, your Honour. Not so extensively, but it would - - -
GUMMOW J: So those interests who rely strongly on traditional fair dealing in section 40 of the Act, they did not manage to get themselves into - - -
MR NICHOLAS: The permitted purpose provisions.
GUMMOW J: - - - into the permitted purpose provisions.
MR NICHOLAS: That is so, your Honour. I rely on that when I come to section 116A(7), because that section does seem to contemplate that the permitted purpose provisions are concerned with the use of devices to perform acts that would otherwise constitute infringements of copyright.
GUMMOW J: But a “fair use”, by definition, does not involve an infringement.
MR NICHOLAS: Precisely, your Honour. We would submit that in those circumstances there is an indication that the permitted purpose provisions were not directed to situations which would not involve acts of infringement.
A second question that arose in the appeal concerns the meaning of “material form”. The question arose for consideration in this case against the background, as I say, of a special purpose computer where, as was held, the computer program on RAM, encoded on the RAM at the time the console has been played, is not a work that can be reproduced from the former storage that we accept RAM is. It is true that we accept that RAM is a form of storage. What we say takes the form of storage outside of the definition of “material form” in the Act, as it stood prior to 1 January, is that it is not a form of storage from which the work, or a substantial part of the work, can be reproduced. That submission was upheld at first instance, and by majority in the Full Court. It arises on a notice of contention - - -
GLEESON CJ: Normally, we would hear an argument from the appellant on a point on which the appellant won below on reply, if we needed to.
MR NICHOLAS: Yes, your Honour. If your Honour pleases, the cinematograph film argument is of the same character. It is dealt with in the document, and, on the same basis, I will not deal with that now.
Your Honours, at the end of the day, there is not a lot more that can be said about the question of construction that arises. We have dealt with it in the written submission, and I do not propose to work through it, to say more than I have this morning.
GLEESON CJ: Yes. Thank you, Mr Nicholas.
KIRBY J: I know that you argue that we have to define the purpose by reference to the language, but if one is looking at the purpose of Parliament, as it were, in the general, it would appear to be to protect the copyright owner against invasions such as your client was endeavouring. It may be that it overreaches, that may be a misfortune, and it may be that one reads copyright laws so that it does not overreach, because of the balance of the interests involved. But, if one looks at it in social terms, the object would appear to be to prevent people like your client reducing the economic value of the product, which I see is described as “exceedingly popular”, though I have never had the pleasure myself.
MR NICHOLAS: Yes. Well, your Honour, that involves defining the object in extremely broad terms, which, of course, would - - -
KIRBY J: That is what politicians and Parliaments tend to do.
MR NICHOLAS: Well, yes, your Honour, but it is here a balancing act, and what one can derive from the second reading speech, in particular, in terms, is that the government was mindful of the need to balance the competing interests that arose here.
KIRBY J: There was a difference between the Andrews Committee and the legislation that was enacted. Is that difference helpful for this argument?
MR NICHOLAS: We submit it is not, your Honour. We had originally tried to draw some support from the legislative history, as our learned friends seek to do, and Justice Lingren found some, Justice French did not. At the end of the day, we say that it is too much a matter of speculation when one starts to investigate that material, by reason of its extensiveness and its diversity.
KIRBY J: Would you answer my question. In terms of an economic analysis of this case, here is a company with an exceedingly popular product that introduces this form of endeavour to prevent people, as it were, invading their intellectual property and Parliament provides by its enactment language which, at least on one view, can apply to it as three judges of the Federal Court have held. Why would one take a view that defeats that purpose? I realise that my view in The Panel was not a majority view and it has been criticised in the article by Kimberlee Weatherall as insufficiently attentive to the other interests that are at stake here, but if one is looking in economic terms at the facts of this case, it would seem that the Parliament’s endeavour was to do precisely what the majority in the Full Court upheld.
MR NICHOLAS: I respectfully submit that one cannot draw that inference at all. The Parliament has enacted legislation, and it is to be construed as best it can having regard to the objects and to the extent - - -
KIRBY J: The Court keeps saying it is to be construed in a purposive way.
MR NICHOLAS: Yes, your Honour, but - - -
GUMMOW J: This may be a field in which it is hard to discern purpose because of the complexity of the competing interests, very powerful interests, which are resolved in an unspecified fashion other than through the production of this statute.
MR NICHOLAS: Yes, your Honour, but in addition we would say that it is not a case where one should be looking at specific sets of facts and saying for the purpose of interpreting the legislation, we think this device should be covered and therefore we will interpret it expansively, because, while in this particular case it might, based upon some view as to whether Parliament would have this particular device curtailed, that may not be so of other devices which are caught by the same interpretation. Like everyone, the technique the respondents here have adopted for protecting their copyright work will either stand or fall, having regard to the view that this Court comes to as to the proper construction of this provision, informed by much broader considerations than whether Sony is going to be deprived of some revenue in this very specific factual scenario.
As I said earlier, one of the difficulties that arises in a case like this is that one cannot really go into evidence in relation to the types of scenarios where one might say Parliament surely would never have intended that type of activity to be curtailed, because it does involve speculation and conjecture and often interpreting legislation against a background of what are at the present time technological possibilities.
McHUGH J: But given the limited purposes for which you can make a back-up copy under 47C, if your argument is correct, would the Act cover Microsoft’s activation code on its Windows XP program?
MR NICHOLAS: Yes, your Honour, it would. Take that as an example. If I go and buy a computer program, let us say it is a Microsoft program, typically it is protected by a copy control mechanism. I put it into my computer, I cannot copy it onto my hard disk until I have entered the access code and, subject to other things, that would be covered.
McHUGH J: So it is covered under (b) is it, rather than (a).
MR NICHOLAS: Yes, (b) certainly, possibly (a) as well.
GLEESON CJ: Yes, thank you, Mr Nicholas.
MR NICHOLAS: May it please the Court.
GLEESON CJ: Yes, Mr Basten.
MR BASTEN:
Your Honours, the points we want to make in relation to the statutory
construction argument obviously flow from the terms of the Copyright Act.
The Copyright Act itself reflects a balance between the interests of
copyright owners and users. There is no need, as we would understand it, to
seek
to identify those interests separately. Everybody knows that the balance
is to be achieved and it is there in the Act. Of course,
the interests are not
separated necessarily. A researcher in a university has an interest both in
protecting copyright in his or
her own work and having reasonable access to
works produced by others, so that my own clients have in their own terms
accepted the
appropriate balance to be found in the Act, and work with
it.
The policy issue which we derive from the extrinsic material is that Parliament sought to maintain through the Digital Agenda Act the balance which had already been established, so that the overriding principle of construction that we seek to present to the Court is one which seeks to maintain the balance between the rights of owners and users.
Might I also say by way of introduction that the factual matrix in this case is quite limited in the part of the broad field of digital material in which it appears, but its significant element for present purposes is that it operates in relation to an acquired product, in other words, offline use. One of the apparent difficulties with the legislation is that the Parliament envisaged as the Court has noted in the objects of the 2000 Act that it was dealing with material online, and some of the conceptual framework that it introduced does not readily translate into offline usage in the same way that it may operate online.
The measure used by Sony in this case constitutes, in effect, the creation in the console of a system for playing Sony games which ensures that games are only played on the customised hardware or console. If the game is played on an unmodified Sony console, then the access code controls use or apprehension of the work.
Although Sony has vacillated in the course of the earlier part of these proceedings and Mr Nicholas suggested there might still be some vacillation, as we would understand it, it is only the combination of the unmodified console and the access code on the game CD-ROM which can constitute a relevant protection measure. In other words, to produce a clone of the console without the Boot-ROM or to override, as was the activity of Mr Stevens, the Boot-ROM on a Sony console as marketed, prevents the measure working. It is that activity, either form of the activity, which prevents the measure working as a protection device. As we understand it, this case was run on the basis that this is a circumvention device if a technological protection measure exists.
When one then comes to the scope of the statutory provisions,
may I just note in relation to 116A, to which your Honours were taken,
that
there is clearly work intended to be done by paragraph (1)(a). As
your Honour Justice Gummow, I think, noted:
this section [only] applies if:
(a) a work or other subject-matter is protected by a technological protection measure –
Now, in the argument that has taken us back to the definition of “technological protection measure”, may I just note that the unlawfulness of the conduct addressed in this case is not only civil, but also criminal. That, of course, has some consequences for one’s ultimate statutory construction. Section 132(5B), which appears at page 159 of Reprint 10, if that is the one your Honours are using, at the bottom of the page, reproduces in substance the operative parts of subsection 116A(1)(b), but does not reproduce paragraph (a). In other words, what happens when one gets to the criminal conduct is that one generalises the conduct so that it need not be within respect to any particular work or other subject matter. The criminality flows from the purpose of creating the device.
That has some
relevance, we submit, in relation to how one approaches the definition of
“technological protection measure”,
which, of course, constitutes an
essential element of the criminal conduct. The possibility that
your Honour Justice Hayne put to
my learned friend was that in
substance paragraphs (a) and (b) were an exemplification, perhaps an exclusive
exemplification, of
the kinds of devices or products which the section was
designed to pick up. Now, in a sense, we are happy to accept what
your Honour
puts, but with the qualification that they are in terms, and we
would say intended to be, mechanisms which limit or give effect to
perhaps the
chapeau to the provision, and that one should pay primary attention to that
terminology, which talks of:
a device or product, or a component incorporated into a process, that is designed, in the ordinary course of its operation, to prevent or inhibit the infringement of copyright in a work or other subject-matter by either or both of the following means –
In other words, it must be - - -
GUMMOW J: To what is the word “by” attached?
MR BASTEN: At the end of the second last line?
GUMMOW J: Yes, “by either or both”.
MR BASTEN: I think it attaches to (a) and (b), although (a) repeats “by”. That seems to be a grammatical error.
HAYNE J: Why do you not attach “to prevent or inhibit” to the words “to prevent or inhibit by”?
MR BASTEN: Yes. May I say one thing about the argument I am putting. I do accept that the semantic discussion can ultimately go in different directions, and I am going to come back and say something about why we favour the result achieved by Justice Sackville, but what your Honour Justice Hayne is putting to me is that that is the mechanism by which the prevention or inhibition takes place, I think. If that is so then I accept that, of course. That must be the grammatical reading of that provision, I think. Unless your Honour is putting to me that it has some greater effect than that, that is my argument.
What I come back to saying is that the product which operates in this way must be designed with a specific purpose in mind, namely, to prevent or inhibit the infringement of copyright in a work. Now, what one obviously has, and particularly in a case like this where there are controls on regional access and so on, is that a particular measure may be designed for more than one purpose and it may operate in more than one situation. That was the discussion that was had before as to whether or not there is an overreach on the part of the manufacturer in adopting a measure which does not necessarily prevent only infringement of copyright but prevents or inhibits fair dealing with copyright material.
At the end of the day I do not know that we can suggest a form of measure which would have the effect of preventing or inhibiting infringement which might not have other effects. It is difficult to envisage what the Parliament could have intended. One is left then with the question of whether the extent of the overreach in a particular situation suggests that it is designed for some other purpose than the prevention or inhibition of copyright.
GUMMOW J: There is a question as to these words in commas, “in the ordinary course of its operation”. Are they linked to “designed” or, more readily, to what follows, “to prevent or inhibit”?
MR BASTEN: I am not sure whether in a practical sense it would matter which answer I gave to your Honour’s question. I do not know whether it is strictly an alternative. The design is for a purpose but the measure which is so designed must have a particular ordinary course of operation.
GUMMOW J: Yes.
MR BASTEN: I think that there is an explanation of why those words were introduced. I think it was intended to overcome the possibility that the measure might be interfered with and then have a different course of operation. That is discussed in one of the authorities, I think. On this approach there is a danger, we would say, in isolating and seeking to identify the scope of the provision by reference to what appears to be a key word in a particular circumstance and in this case it has been said to be “inhibit”.
There is no difficulty in seeing the clause “to prevent or inhibit the infringement” as involving a greater and a lesser element of the same activity. In other words, prevention assumes effectiveness. The word “effective” at one stage was included in the definition. Inhibition suggests something which is less than totally effective but puts a hurdle or obstacle in the way of the infringement. What Justice Sackville seeks to say, I think, is that one looks to a physical or technological prevention or inhibition of the actual act of infringement rather than a psychological discouragement.
True it is that inhibition might cover something like a psychological discouragement if read on its own. Read in context, we would see it as having a more restricted and constrained connotation.
Your Honours, we say that the primary judge’s conclusion was right, for a number of reasons. Firstly, his Honour appears to have adopted a purposive construction which does focus on the protection against infringement of copyright in the chapeau, and treats paragraphs (a) and (b) as a means to that end, not as ends in themselves. That, we say, is consistent with the focus of this Act as a copyright Act. It also focuses on the avoidance, and this is the correlative to the first point, of giving a right to control access when the section is applied or the definition is applied to a copy of a work already acquired by a user, and that, we say, is the alternative situation to the control of access online to which the objects of the 2000 Act seem to be directed.
HAYNE J: Take perhaps one of the central operations of the provision. A device designed to prevent infringement by ensuring access available solely by use of access code. What is the relationship that is being drawn between the device and “designed”?
MR BASTEN: Yes. Well, the answer to that may vary for the reason I was just seeking to address, namely that whether the “ensuring”, which is itself a strong word, was intended by the drafter consistently with the objects of the Act to be dealing with access online, which is an understandable explanation, may give rise to a different answer when one is considering access offline. It is in the case where the customer already has acquired, legitimately, let us assume, a copyright work and seeks apprehension of that work, that too broad a construction to the terms of this provision will ultimately provide the copyright owner with a right to control all forms of apprehension going well beyond the control of reproduction of copyright material, as protected by the Act, and the fair dealing example is, of course, the example to which one tends to come back.
HAYNE J: But does it include the case where access to the program on the CD-ROM cannot be had until first you activate the CD-ROM by particular access code.
MR BASTEN: In a mechanical way.
HAYNE J: Yes.
MR BASTEN: In a technological way. Well, that is this case, your Honour. The answer we would say is that reading the terminology there, the answer may be yes or no. It obviously could be yes. We do not quibble with the construction of the Full Court in saying that this is a meaning, which is available on the words of the section, of the definition.
HAYNE J: And at what point of the words in the definition does the fork come where you choose yes or no?
MR BASTEN: The fork comes by giving primary operation to the chapeau and asking is that what it is designed to do, or is it designed to do something quite different, namely, simply to discourage by preventing ready use of an infringing copy after the infringement has taken place and the copy has been acquired by somebody else. In other words, you diminish the value of the infringing copy because nobody can use it unless they take another step, which is to get a mechanism which will play the copy other than the Sony authorised console.
GUMMOW J: What force are you giving to the work “protected” in the section?
MR BASTEN: In section 116A?
GUMMOW J: Yes, “protected by a technological protection”. That is what we are really construing.
MR BASTEN: Yes. We would say, your Honour, that once one identifies a work which is protected, reads that in combination with the definition of “technological protection measure”, it is clear that the protection is protection of the copyright work from infringement. That is how the chapeau to the definition would work. So that although it would be open to say in this case that mere discouragement of the use of an infringing copy may in some circumstances inhibit the original infringer, that is not the initial or primary purpose of the section, and to give it that meaning is to have the effects which go beyond the protection of copyright. There is a helpful analysis of why we say that in Professor Ginsburg’s article which we quote a passage of in the written submissions and to which I will not seek to return. Your Honours, the only other comment - - -
KIRBY J: Do we have that full article? I read the extract.
MR BASTEN: Yes, we have provided a copy of it to your Honours. Might I say that the policy issues which underlie this legislation have of course been addressed in Europe and America, amongst other places. We have provided a copy to your Honours of an article by Mr Vinje which outlines some of the European perspective, and I think we will if we have not provided a copy of an article by Professor Samuelson which sets out some of the background of the American debate.
GUMMOW J: Do we need to look to the WIPO Treaty?
MR BASTEN: We would say no, your Honour, not particularly, because the treaty does not prescribe in precise terms how it is to be given effect, and clearly the Australian Parliament has adopted a particular approach. But the treaty leaves open the mechanism by which the balance is to be maintained, and we say that Australia has sought to maintain it in a particular manner and there is nothing inconsistent with the copyright treaty in that respect.
Just in relation to your Honour Justice Gummow’s question on parallel importation, I think the answer is that it does not apply, and one finds that in section 44E of the Act. Curiously, that was introduced by the Copyright Amendment (Parallel Importation) Act No 34 of 2003, which I think commenced in May of 2003, that is, after the facts which were the subject of this case, and therefore I do not know that consideration was given to it in the construction argument.
GUMMOW J: How does section 44E work?
MR BASTEN: I think the effect is to provide that there is no offence committed by parallel importation in the circumstance of computer programs which are non-infringing copies. So if one obtained a non-infringing copy in America which could not be played in Australia and imported, there would be no offence as such.
GUMMOW J: “Non-infringing copy” is defined in section 10, is it not?
MR BASTEN: Yes.
GUMMOW J: Section 10AB?
MR BASTEN: Qualifying country is non-infringing copy, yes.
GUMMOW J: I see. You have to read 10AB, that is critical.
MR BASTEN: Yes.
GUMMOW J: The United States would be a qualifying country.
MR BASTEN: I think that is right, your Honour, yes.
GUMMOW J: Yes, thank you.
MR BASTEN: Your Honours, I was going to say something briefly about the contention points. Could I do that now, if the Court pleases.
GLEESON CJ: Certainly.
MR BASTEN: The first of the contention points relates to the reproduction of a code in the RAM, the random access memory, in the console. The primary argument on this point, as we understand it, is concerned with whether the creation in the RAM of an incidental and highly ephemeral copy of parts of a game as played constitutes an exercise of the copyholder’s right to reproduce in a material form and is thus itself a possible infringement if not authorised. The question, of course, only arises if the appellant is successful on his first argument.
If the respondents’ argument is correct, use of any digitally stored material is likely to result in copies for purely technical reasons and of a highly ephemeral kind. In technical terms that will occur whenever some form of buffer is required between mechanisms operating at different speeds. One example is where one uses an analogue television to receive a digital signal. Another is the present case because the central processing unit and the graphics processing unit in the console operate at many hundreds, possibly thousands, of times faster than code can be downloaded from a hard disk in the CD-ROM. So that the purpose of having a RAM is, as it were, a buffer between those parts of the mechanism used for playing the game and it is necessary only for the purpose of effectively playing the game.
The question for present purposes is, therefore, whether that ephemeral reproduction is in material form. That in turn depends on a number of aspects of the definition. I think that the appellant, in identifying the question, suggested that ultimately the question in this case will turn upon whether what is in the RAM can itself be reproduced. What is in the RAM is a form of object code, as we understand it, and whether it can be reproduced was a matter which was the subject of fairly limited evidence. Might I just say though in respect to the definition of “material form”, that - - -
GUMMOW J: Do you wish to criticise Galaxy, do you?
MR BASTEN: Galaxy deals, in effect, with - - -
GUMMOW J: Or is that your third - - -
MR BASTEN: It is really the third point, I think. I will come to something on the cinematograph film point which, of course, is closely related because it deals with what is downloaded to the RAM. I do not think for present purposes the argument in Galaxy extends to the point I am seeking to make now. But in relation to the definition of “material form” in section 10, there is again a danger in isolating words and when one looks at the form of storage from which the work, or a substantial part, can be reproduced, there are really two points of importance. Firstly, we would say that the concept of reproduction from storage in itself invites a purposive construction of the concept as a whole, including the concept of storage. Again, it is no doubt true to say that storage for a millisecond in a RAM may itself be in one form storage.
Whether it is storage for the purposes of considering a reproduction which is an infringement of copyright, given the circumstances and limited purpose of the storage, is an entirely different question and one which we would say is emphasised in providing the answer we seek to give by the additional words “can be reproduced”, but it may not depend upon the existence of those words in that form. I say that not to anticipate arguments which we have not yet heard, but, obviously, because this case has come before the Court at the time when the definition no longer is in the Act in its present form.
Your Honours
have, attached to our learned friend the appellant’s submissions, a copy
of the present definition of “material
form”. It seems to us that
the Court would at least need to appreciate the changes that have been made from
the definition
in issue in this case to the current one. There are two
substantial changes. One is that the current form of definition talks
about:
a work or an adaptation of a work, includes any form (whether visible or not) of storage from which the work or adaptation, or a substantial part of the work or adaptation, can be reproduced.
Now, it may be that the concept of a work being in storage would attract, at least in terms of activity, the operation of section 14, which picks up the idea that a substantial part is sufficient, but it is perhaps significant, on one view of it, that the current definition of “material form” uses the phrase “work or adaptation of a work” in the first limb and then speaks of the “work . . . or a substantial part” being reproduced. That has changed, so it is clear that in the new definition, which appears at page A2 in the appendix to the appellant’s submission – I am sorry, A10, A2 is the current one – that what is in storage is clearly intended to be both a work and possibly a substantial part of a work.
The other change which has been made is that the phrase or clause “can be reproduced” is no longer an essential element of the definition of “material form”. So that the work may be in material form if it is held in a form of storage, even if it may not be capable of being reproduced. The construction, therefore, of the section may or may not, in the Court’s view, turn on the precise wording.
We seek to limit the operation so that it does not have the expansive form the respondent proposes by reference to the purposive argument to which we adverted, which may not necessarily depend upon the precise words, because, again, it is clear, as the division in the Federal Court indicates, the two views are open and one form will expand the rights of the copyright holder to control virtually all forms of use in the circumstances such as the present case. That view, we say, should not be adopted, for the reasons which we gave before. Again, the access prevented or controlled may be for a purpose which is permitted under the Act involving fair dealing.
In relation to the third point, the cinematograph film, this depends, of course, on the combination of section 86(a), making a copy, the definition of “copy” in section 10 in relation to a film, a definition which in turn imports the concept of embodiment.
As we understand it, there is a real issue in
this case on the facts as to whether the downloading of a program into RAM in
the form
of object code results in the embodiment in the RAM of the visual
images. It may be for that reason that this argument is difficult
to reach a
conclusion on the facts as found by the primary judge. Could we just make two
points. Firstly, in the definition of
“cinematograph film” in
section 10 the reference is to “the aggregate of visual
images”, which constitutes
the film and some work must be given to be done
by that phrase, “the aggregate of the visual images embodied”.
Secondly,
and this is a point which I think underlay the reasoning of
Justice Emmett in the AVRA v Warner Case at paragraph [63]. I
will not take your Honours to it. In the second definition, namely of
“copy”:
in relation to a cinematograph film, means any article or thing in which the visual images or sounds comprising the film are embodied.
As we would understand his Honour’s reasoning, which we respectfully adopt, the concept of a film or the images of a film being embodied suggests that there is a temporal continuity. In other words, it is not sufficient that the embodiment of small parts of the aggregate takes place over a period of time, one image replacing another. There is support for that analysis in section 24 of the Act which gives some expanded operation to the concept of embodiment for the purposes of the Act.
Your Honours, the only other point I wanted to deal with, and very briefly, if I may, was that as I think your Honour Justice Gummow noted in a directions hearing, there is a decision of Justice Laddie in Sony Computer Entertainment v Ball [2004] EHWC 1738 - I do not think it is reported - which is directed to a very similar set of circumstances to the present. We simply want to make a few short points about that.
Firstly, and I will not take your Honours to it, in
paragraph [10] there was apparently a concession that the case involved
what
constituted, in our terms, a technological protection measure. Secondly,
in paragraph [17] it
appears that the defendant conceded that playing a
foreign or infringing copy involved copying a substantial part and thus
infringement
- again, a concession of something which is at the heart of
the argument before this Court on the contention.
GUMMOW J: I am sorry, you took us to paragraph [10]. That was the concession.
MR BASTEN: Paragraph [10] was the concession that was - - -
GUMMOW J: Then [17].
MR BASTEN: Paragraph [17] is a concession in relation to the contention argument, namely, that the playing of a foreign or infringing copy involves copying a substantial part. At paragraphs [32] to [33] there appears to have been evidence that the purchaser was told that the game was licensed to be played only on a Sony authorised machine. That is not a factor which is present in this case, as we would understand it. Further, the UK legislation is structurally different because it repeats in separate provisions the requirements in relation to digital material which is not a structure our Act adopts.
At the end of the day the only point that the defendant took in that place was in relation to intention and that, as we would understand it, is not an issue which arises, at least at this stage of these proceedings. Your Honours, those are the submissions.
GLEESON CJ: Thank
you Mr Basten. Yes, Mr Catterns.
MR CATTERNS: Your Honours, in
our respectful submission, each of the three questions before the Court, but
particularly dealing with the first
one first, can be dealt with as questions of
pure construction. We would respectfully disagree with our friends. We think
the most
useful reprint, if the members of the Court are using a reprint, is
Reprint 9 because that is the form of the Act as it was when
the so-called
Digital Agenda Act, Act 110 of 2000, came into force. That was the form in
which the Act was when it was argued before
his Honour Justice Sackville,
although there is some relevance, as our friends say, to the fact that some of
the provisions have
now been amended.
Your Honours, before I come to section 116A, could I just very quickly remind your Honours what acts constitute infringement, because that is what the protection device is directed to. We agree. Your Honours, so far as a literary work, which includes a computer program, is concerned, they are set out in section 31(1) and they (a) include but, of course, they are not limited to reproduction in a material form.
GUMMOW J: You really start with 36, do you not?
MR CATTERNS: Then I was going to go to 36, your Honour,
because 36 uses the phrase “act comprised in the copyright”, and I
get that
from a combination of 31 and 13. Just as quickly though, your Honours,
in (a):
(i) to reproduce the work in a material form;
. . .
(iii) to perform the work in public;
(iv) to communicate the work to the public -
and these
technological protection measures may be protecting works from infringements of
all of those kinds. Your Honours, by section
13(1), those exclusive
rights, and there are corresponding rights in relation to films in
section 86, are called “acts comprised
in the copyright”, but
then as his Honour Justice Gummow says, the definition of infringement
is 36(1), whereby the copyright
in a work, and there is a corresponding
provision in section 101 for subject matter other than works, is infringed
by a person who
without licence:
does in Australia, or authorizes the doing in Australia of, any act comprised in the copyright.
Your Honours will remember from the
recent Panel Case, that by section 14, that includes acts done in
relation to a substantial part. So, your Honours, that allows us to go to
section
116A, and we agree that the heart of the case
is - - -
GUMMOW J: Just before you do that, Mr Catterns, Division 2, starting with section 36, tells you what an infringement is and then Division 3, starting at section 40, tells you something that is not.
MR CATTERNS: Yes, your Honour.
GUMMOW J: We have been taken to 44E, which is the parallel importing provision for computer programs.
MR CATTERNS: Yes, your Honour.
GUMMOW J: Is there one for cinematograph films?
MR CATTERNS: Your Honour, no. Although the Act has been amended since Justice Sackville’s decision to bring in section 44E to allow parallel importation of computer programs authorised elsewhere, a la books and sound recordings, there is no provision which allows the parallel importation of legitimate, if I can use the shorthand, films. Your Honours, going to the - - -
GUMMOW J: Insofar as computer programs, one way or another, seem to have got caught up with cinematograph films, the absence of the one can dilute the effectiveness of 44E.
MR CATTERNS: Precisely, your Honour. If this were a case of a parallel importation case, rather than an unauthorised copy case, then 44E would not have taken away our rights. We could have sued on the film. The corresponding provisions in relation to importation, your Honour, are 102 and 103, which correspond to 37 and 38.
GUMMOW J: I just mention it because that is another illustration of all these competing interests producing a result which is not a perfect world for any of them.
MR CATTERNS: Yes, your Honour, and that is really our submission as to our learned friend’s submissions as to the balance. We agree, of course, that the legislature is attempting to strike a balance and that is the question in the case – where has the balance precisely been struck? Every time the Act is amended to deal with these modern technologies, there are corresponding impacts on other provisions, for example, on the fair dealing provisions, which, of course, are vastly more limited here than they are in the UK, where there is a broad fair use exception. Here, there are fair dealings permitted for very specified purposes – research or study, reporting news, criticism or review – as discussed in The Panel Case – and so on.
Your Honours, it is just a necessary concomitant of dealing with complicated legislation with complicated modern technologies that there can be an impact. So, for example, with respect to fair dealing, yes, it may be that this provision, however interpreted, as our friends fairly conceded, will have an impact on fair dealing, but with respect to section 49, which allows a library to do a fair dealing for the library user, that is one of the permitted purposes. If your Honours would notice section 49(1)(b), that is the library equivalent, where you can ask the library to do for you – let us assume it is in the stacks, for example, and there is no ready access – what you could do for yourself. That provision is one of the permitted purposes.
There is quite a complicated regime, which I will mention in a second, for the permitted purposes and it is fair enough to expect that libraries will be able to deal with that – certifying that it is for one of the purposes, for example – but if we allowed every single person, under the rubric of fair dealing, to be an exception to the circumvention device provisions, then it would be practically useless.
Similarly, when the photocopying provisions are in Part VB of the Act, in effect, they override fair dealing and everything beyond an “insubstantial part” – which is defined as one per cent or two pages, to put it shortly – is recorded and paid for and picked up in the sampling system that the Act allows, then the Copyright Tribunal works out whether any deduction is allowed for the now lost fair dealing in respect of that. So we would respectfully submit that it is unsurprising that there will be an impact on fair dealing, or, if it is the case, an impact on back-up copies.
All of that, with respect, your Honours, is a reason why one would look at the Act as closely as possible and not have resort to policy considerations in resolving the question. Our essential submission is that, in the end, there is no ambiguity, and the type of access control that we propound, which was clearly one of the mechanisms considered through the legislative process – that type of access control finds itself into subparagraph (a) of the definition.
McHUGH J: Can I just ask you about this question which has been troubling me. On the view of the Full Court, their construction only prevents or inhibits the infringement of copyright when it is used on the copyright owner’s machine or on your machine. Let me give you an illustration. Supposing this appellant had not only sold the circumvention device but had also sold a reverse engineered device of your console, you would have no case, would you? In other words - - -
MR CATTERNS: We would, your Honour - - -
McHUGH J: Well, you might have a case about infringement of copyright but that would not prevent the infringement of the copyright, would it?
MR CATTERNS: Well, your Honour, that might leave us an argument about whether the access code itself alone could be a technological protection measure, which is not this case, but we would submit that is precisely what this new machine is doing, your Honour’s hypothetical machine. It is just the same as one of our consoles with a circumvention chip in it, because that is what it is. It will have all of the same other devices inside it, but instead of a Boot-ROM which looks through the access code and says, “I won’t play the game if it’s not present”, it will write a rival Boot-ROM which does not do that. Your Honour, I would submit that in that case the whole new console would be a circumvention device.
McHUGH J: But it does throw up part of the problem about your construction, does it not? You have a different machine altogether and it is reverse engineered and it allows the infringing copy to be played.
MR CATTERNS: Yes, it does that, but I submit that means it is a circumvention device. It is just the same as our machine with the Boot-ROM pulled out and a new reverse engineered Boot-ROM put in which circumvents our previous one, whereas in the present case there was another little chip, the mod chip, the modification chip, put in, which connected in.
McHUGH J: No, but the point is that it does not prevent or hinder the infringement. I mean, the argument of the Full Court is in a practical sense it makes the infringement useless, therefore it prevents or hinders it, but if you can reverse engineer another console, then you can play, so it does not prevent infringing. Your device does not prevent infringing in any practical sense.
MR CATTERNS: Well, your Honour, our device - the reason we do not prevent infringement in your Honour’s example is because your Honour has circumvented it by making a rival machine.
McHUGH J: No, but you are forced to say that your device concerns anticipatory infringement, are you not?
MR CATTERNS: Well, I see your Honour’s point about temporal. Our device prevents an infringement because the subsequent access cannot be gained, therefore the prior infringement is useless.
GUMMOW J: That is what the case comes down to in a way, does it not, this sequential problem?
MR CATTERNS: Yes, your Honour, whether a temporal prevention or inhibition can be read into it as his Honour Justice Sackville did - - -
GUMMOW J: That is one element, and the other element is what do you mean “prevent”? I mean, discourage human activity of some sort - - -
MR CATTERNS: Or does it have to be physical?
GUMMOW J: - - -or are we inside the technology itself rather than the human actor upon it?
MR CATTERNS: Yes, your Honour, and we respectfully submit that - - -
HAYNE J: And that throws up the problem of putting together “device . . . designed”.
MR CATTERNS: Yes, your Honour.
HAYNE J: Where are you injecting the human into the process?
MR CATTERNS: Well, your Honour, we submit that – the “designed” is the purpose of the copyright owner who has applied the protective device or the measure, and his Honour Justice Sackville made a finding about that in our favour which our friends do not challenge in paragraphs [108] and [109]. But the infringement is by the person who makes the unauthorised copy, and our device is designed to prevent or inhibit that, because the copy would be useless, as his Honour Justice McHugh, with respect, rightly summarised the way the Full Court held.
We respectfully submit that the words of the definition do not say “prevent subsequent infringement”, nor do they say “physically prevent”. And so the word “inhibit” is apt to include deterring or discouraging, because the copies, or perhaps the communication, that type of infringement, is going to be useless.
HAYNE J: Some toehold for the temporal point might be found in the parenthetical expression “in the ordinary course of its operation”. That could be understood as a reference to the device unaffected by the circumvention device; that is, working as it ordinarily works.
MR CATTERNS: Yes, your Honour.
HAYNE J: Or is it to be read as indicating some temporal connection between the operation of the device and the consequence of prevention or inhibition?
MR CATTERNS: We would respectfully submit the former, your Honour. It would provide part of an answer to the matter his Honour Justice McHugh raised with me. The fact that the device operates in the ordinary course to prevent or operate – sorry, prevent or inhibit infringements is sufficient, even though it is the case that if you go to sufficient trouble and expense, you can get around it by building a rival reverse engineered console.
HAYNE J: Now, the temporal point must be considered also against, as I say, what I regard as one of the core operations of the provision, the reference to “access code”, where the work is available solely by use of an access code. How does that sit with interpreting the definition as embodying some temporal connection?
MR CATTERNS: Well, your Honour, we submit it sits ill with a construction that you must have a temporal connection of access first, infringement later. The words can also apply just as aptly – and, in particular, the words in the bracket, which I can expand in a second – to access later being not available, as the words say, except with the authority of the copyright owner. Your Honours, we respectfully submit that the matter his Honour Justice Hayne has raised with us is the key to the construction, using the very words here.
GUMMOW J: But how – “by ensuring . . . is available solely”?
MR CATTERNS: Yes, your Honour.
GUMMOW J: Ensuring it.
MR CATTERNS: Yes. As our friend says, that is a strong word. Your Honours, if I could just submit how we submit it works - - -
HAYNE J: Well, that tips you back into “designed . . . to prevent . . . by ensuring” access only, that is, that is the intended operation that you can get at only by putting in the relevant access code.
MR CATTERNS: Yes, your Honour, exactly. Your Honours, there is no doubt that (a) covers – and our friends would agree – it covers the case of you cannot even get at the work to copy it. So our friends would accept that it deals with prevention of access prior to the act of reproduction, but we see nothing in there that is limited to it. In particular, the words “decryption, unscrambling or other transformation” allow it to occur temporarily in the other direction.
May I just step back one second. Of course, your Honours, there is a crucial distinction between access to a work, which in a case of a computer program is a set of instructions, and access to the physical thing on which it is embodied. So, your Honours, here the work is embodied on a CD-ROM, which just looks like an ordinary compact disc, or a DVD, and anybody, as our friend Mr Nicholas fairly accepted, can get that and burn a copy in their computer and they can make a perfect copy of the work exactly in the form in which it appears on the disk, but by our device, the person who does that makes themselves what is called a Bali Silver, meaning an unauthorised copy, does not get access to the work. So what you want, the purpose of the copying, which is to get access to the work, the whole perfect copy of the work, you do not get access to it. Now, your Honours, we submit that fits within the earlier words.
McHUGH J: Why do you say you do not get access to it if you can make a perfect copy of it?
MR CATTERNS: Because, your Honour, to use our learned friend Mr Basten’s phrase, one is unable to apprehend the work, read it or play it. So you have the work physically there embodied on your unauthorised copy CD-ROM, but you cannot play it. So you do not get the access, which was the whole purpose of your copy.
McHUGH J: You cannot play it on your machine?
MR CATTERNS: That is right, your Honour.
McHUGH J: You can get access to it on a reverse engineered machine.
MR CATTERNS: Yes, your Honour. But by doing that your Honour has either circumvented my technological protection measure and thereby given me a right of acts in under 116A, or if your Honour’s machine is out of the ordinary, then, although undesigned in the ordinary course of operation to prevent the run of the mill pirate, with respect, you Honour is not in the run of the mill.
McHUGH J: We have to keep plainly in mind the question of infringement of the work, which occurred in this particular case and the question of the use of the circumvention device.
MR CATTERNS: Yes, your Honour. One can imagine a case where somebody thinks, “Oh well, great, I’ll make an unauthorised copy of my friend’s PlayStation game”, they copy it, they put it in the machine and they find they cannot get access to it, they cannot play it. That is what the access means. They are unable to apprehend it, play it, et cetera. And so in that case the device has operated as a technological protection measure.
McHUGH J: Yes. But the difficulty I have at the moment is that access ordinarily – and one would think in this definition - precedes infringement, but your argument is that you prevent or inhibit infringement prior to access.
MR CATTERNS: Your Honour, yes, a proceeding infringement, that is right, because it is a waste of time to do that infringement because you will not get the access you want. Your Honour, may I use the example of - - -
McHUGH J: It turns it on its head in a real sense, does it not? Access first, infringement later. You want to say for the purpose of this definition in its application to your case, prevention or inhibition of infringement first, access later.
MR CATTERNS: Your Honour, I can buy drugs in Bangkok and my act of buying drugs is complete there, but I am inhibited from doing so because I cannot bring them back to Australia. That is a perfectly apt use of the words - - -
McHUGH J: Why are you inhibited from doing it?
MR CATTERNS: Because it is illegal - - -
McHUGH J: You are inhibited from using them in Australia, but you are not inhibited from in any way using them.
MR CATTERNS: Your Honour, it is clear that this was one of the possible ways – we submit it is clear from the legislative material that this is one of the ways that has been thought of being as a useful tool - - -
GUMMOW J: Yes, I know, but it was not then translated into sufficiently plain words. That is what is put against you.
MR CATTERNS: Certainly, your Honour. That is why - - -
GUMMOW J: There was some sort of fudge behind closed doors, which we cannot really ponder about too much.
MR CATTERNS: If your Honour is referring to section 3 of the 2000 Act - - -
GUMMOW J: No, I am referring to this provision of “technological protection measure”.
MR CATTERNS: Well, your Honour, what happened was, as his Honour Justice Kirby pointed out, the Andrews Committee, after looking at both sides, said “We recommend that it just be a copy protection measure”.
GUMMOW J: We do not have the brief that went to parliamentary counsel. Nobody knows what that was.
MR CATTERNS: No, your Honour.
GUMMOW J: It did have a brief to draw section 3, though, I suppose.
MR CATTERNS: Yes, your Honour, but when one looks at the Digital Agenda Act, there are probably at least a dozen sections of the Digital Agenda Act that deal with digital media, such as CDs, and not just online. It is full of them, your Honour, including in relation to university copying. So although section 3 of the Act refers to online, I would accept exclusively - - -
GUMMOW J: Is there any amendment in the Senate?
MR CATTERNS: I do not think so, your Honour. I will check.
GUMMOW J: So it is the Bill as introduced that was enacted?
MR CATTERNS: I believe so, your Honour. There was a second explanatory memorandum, which I do not think takes this present question any further.
GUMMOW J: No.
MR CATTERNS: Just picking up the matter that I have been
making submissions to your Honours about, if your Honours would look
at the words in the
bracket:
(including decryption –
This is not the present case, but that, we submit, clearly answers what Justice McHugh has been putting to me because that is where access follows the act of infringement and the copyright owner can allow it or deny it.
GUMMOW J: What you have to swing on, in the end, is this phrase you introduced, “a waste of time”, “would be a waste of time”.
MR CATTERNS: Your Honour, I am saying that colloquially. I have to use the word “inhibit” and say that it includes deterring or discouraging by making impractical the act of infringement. And it is impractical when one looks at the bracket, because let us assume the work is encrypted or scrambled or in some other way transformed, you can still make a perfect copy on your CD burner. You make a perfect copy of it, but it is still in an encrypted form, and you only get access to it, subsequent to the infringement, with the owner’s consent, which will be denied. So this device, my imaginary device, which will not let you have access to it without consent, operates to prevent or inhibit infringement because you can physically do it, but what you do is of no value because it is still encoded, scrambled or otherwise transformed.
McHUGH J: But that only means in the illustration you gave the access and infringement or the prevention of infringement are concurrent. You want to go a step beyond that. You want to say the section also deals with prevention or inhibition of infringements prior to access.
MR CATTERNS: I respectfully disagree, your Honour. In my example, you have a prior act of infringement whereby you make the copy and it is subsequently that access is unavailable - could be years later - because the copy you have made is still in the encrypted unscrambled form unless you circumvent the encryption process or the encryption device.
We respectfully submit that those words in the brackets precisely incorporate or include, embrace, a case where infringement is inhibited in the sense of deterred, because you cannot get access to the work. You have physical in the sense that our learned friends use it which is the right sense; you cannot apprehend it or you cannot use it to play the game. We submit that is one of the several ways of protecting a work that the legislature had in mind.
We would respectfully disagree with what our learned friend Mr Nicholas said about Microsoft, and the legislature clearly had in mind examples like the Autodesk AutoCAD lock. You can copy that to your heart’s content prior, but it is useless without that little lock constituted by WIDGET C, which was held to be a substantial part of the program in the Autodesk Case.
Similarly, with the Microsoft example our learned friends gave, unless you use the password you cannot put it into your hard disk and use it but you can copy a disk of Microsoft Word a million times with a burner. You are able to copy them but you are prevented or inhibited from copying them because they are useless. We submit that that example is just like the AutoCAD example and from the very beginning of this process locks which prevent the use of unauthorised copies have been expressly amongst the considerations. We do not need to take your Honours to it and we would respectfully submit that his Honour Justice Lindgren’s summary is very fair and very complete. But at the very beginning, when the Copyright Law Review Committee was looking at these matters, protecting things like the AutoCAD lock, which is analogous to the Microsoft lock, and analogous to our system, it is just the same idea. It is an access code like a lock where you cannot get into the game to play it without the copyright owner’s consent.
HAYNE J: Is the expression “access to the work or other subject matter” an expression found elsewhere in the Act.
MR CATTERNS: I do not think so, your Honour.
GUMMOW J: Well, you would not expect to find it, because this notion of access is a new, what Americans would call para-copyright.
MR CATTERNS: Yes, your Honour.
GUMMOW J: It is the key in the lock to the library door.
MR CATTERNS: Yes. The reason I was pausing was, in case it was used in another concept, for example, in the importation provisions. Not in any way that gives us any help, I think, your Honour, but we will check it over lunch if we may. So, your Honours, that is really the heart of the question.
McHUGH J: But you seem to be converting the ensuring of access into a right to access, rather than as a means of protecting your copyright. Why should the Copyright Act be concerned with giving you sole rights of access as opposed to ensuring that you can use means concerned with access to protect your copyright?
MR CATTERNS: Your Honour, I respectfully submit it may be that when the Act - - -
GUMMOW J: That is the new dimension that is going on, is it not?
MR CATTERNS: Yes, your Honour. That is the debate. We have now committed ourselves under the free trade agreement to control access without any question of infringement, a la America – apparently, we have got to do that within two years – we have given your Honours the reference to that. But, your Honour, what protects us, as this is worded now, from your Honour’s idea, is the words “infringement of copyright”. So this is not giving the copyright owner a new right to control access. It is giving the owner a right to control access so as to prevent infringement.
One can imagine cases where the ordinary course of the operation might be different from this, where it was held to relate to unauthorised copies. If you created a device, for example, that was solely intended in its ordinary course to stop fair dealing copying – if one could think of such a thing – then it would not come within the definition.
Your Honour, on our construction, we do not have a pure right to control access. The control of access is a means to prevent or inhibit infringement.
GUMMOW J: Even though it prevents or inhibits activities which are not infringement.
MR CATTERNS: Yes, your Honour.
GUMMOW J: And that is the debate.
MR CATTERNS: But the answer to that is, of course it does or might, and that is why section 116A(3) provided for some exceptions to this, and again the legislative history shows that in considering the protection of works, including AutoCAD type locks, various people in the various committees and the legislature itself realise that you would have to allow some legitimate activities such as reverse engineering or access to works for the purpose of interoperability or error corrections, but not back-up copies.
GUMMOW J: And not your use of this access system to sustain your parallel importing?
MR CATTERNS: Yes, that is right your Honour. Now, it may have been - - -
HAYNE J: But the narrowing may also come in the confinement of the definition of “circumvention device”.
MR CATTERNS: Yes, your Honour, with respect. The circumvention device has to have only a limited commercially significant purpose or no such purpose - - -
HAYNE J: Other than.
MR CATTERNS: Other than. Yes, your Honour. So, the two definitions, and when they are brought up into - - -
HAYNE J: Thus the ordinary CD burner is not a circumvention device.
MR CATTERNS: That is right, with respect your Honour. It is only when somebody creates a mod chip, as here, which had this particular purpose that they are attracted by this section.
Just while we are at “technological protection measure”, we respectfully submit that the right way to read it is that the device or product covers the combination of our Boot-ROM, which itself is the silicon chip in the console with the program, and that program looks for the access code, which is stored on the CD-ROM, but we agree, as it happens, not part of the computer program. His Honour held in paragraphs [108] and [109] that it was designed in the ordinary course of its operation to prevent infringement - - -
McHUGH J: But why do not those words, “in the ordinary course of its operation”, indicate that you are dealing with a physical process and not some practical, commercial purpose?
MR CATTERNS: Your Honour, we agree that it is a physical process. It is a physical device – I am sorry, I must continue to emphasise – which operates to prevent or inhibit infringement by doing things, and it physically ensures that access is available solely by use of an access code. So there is no doubt there is a physical operation here, but the question is, does it have to physically stop the act of copying, as his Honour Justice Sackville held, or does it have to physically – forgive the split infinitive – control access? So there is no doubt there is a physical device which, in the ordinary course of its operation, controls access in terms of (a), we submit.
Your Honours, may I just raise one question. My learned friend Mr Cobden is going to follow up briefly on the cinematograph film point. We very tentatively volunteered to show the Court a demonstration if the Court thought it would be useful. We do not think we need to show it to the Court unless the Court wants to see it. We have liaised extensively with the Registry as to how it could be done - - -
KIRBY J: Was it done before the trial judge?
MR CATTERNS: Yes, your Honour and also the Full Court. We have the transcript and Mr Cobden was going to take the Court to the transcript.
GLEESON CJ: How long does it take?
MR CATTERNS: I think it takes about ten minutes, your Honour. I believe the idea is to project it onto the screen.
GLEESON CJ: Let me just test the level of demand here.
HAYNE J: Do we get to choose who we play against?
GLEESON CJ: What we will do is adjourn as usual at 12.45 and then we will resume at 2 pm and we can have it between 2 and 2.15 presumably.
MR CATTERNS: Yes, your Honour, I am sure the Court staff is ready to do it if that is what your Honour thinks appropriate.
GLEESON CJ: You are travelling well in terms of time, as I would understand it?
MR CATTERNS: Yes, your Honour.
GLEESON CJ: All right. Do you want to adjourn now?
MR CATTERNS: If that is a convenient time, your Honour, thank you.
GLEESON CJ: We will adjourn now and we will resume at 2 pm.
MR CATTERNS: May it please the Court.
AT 12.44PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.02
PM:
GLEESON CJ: Just before we go ahead, Mr
Cobden, there is on the record a summons by the Australian Competition and
Consumer Commission. As I
understand it, everybody is agreeable to that summons
being dismissed with no order as to costs. That order will be made. Yes,
Mr Cobden.
MR COBDEN: Thank you, your Honour. Before
the demonstration commences, could I just explain to your Honours what has
been connected and what
the parts are of the demonstration. I am holding in my
hand one of the exhibits, MAS4 from the trial, which is a PlayStation console.
I think this particular one was an unchipped console – it is not going to
matter for the purposes of this demonstration.
It has some outputs at the back, one of which is connected to the controller, which is a thing by which you steer vehicles or move the characters around, the other one of which is ordinarily connected to an ordinary television monitor, television set. For today’s purposes, it is connected to a projector, which will project onto the wall, but has precisely the same technical effect as a television screen.
McHUGH J: What are we going to watch? A motorbike race or something?
MR COBDEN: You are going to watch a motorbike race, yes, your Honour.
GUMMOW J: A non-violent motorbike race.
MR COBDEN: Non-violent except to the extent that I have asked Mr Chalk, who is operating the console, to crash the motorcycle a couple of times to illustrate the point that we wish to make. What happens, your Honours, is that – as your Honours have heard – this has a lid, and a CD-ROM is inserted into it. It will also take an ordinary audio CD, as the evidence indicated, and play it like an ordinary CD. A CD-ROM is inserted, the lid is shut and, as the evidence showed, some code is then loaded into RAM.
What we will do is Mr Chalk will now start the console, and it will load into it – just pausing there for one moment – will load into it an infringing game. The demonstration that took place before his Honour and before the Full Court was much longer than the demonstration we are proposing to give your Honours today. The demonstration we gave to the Full Court – there is a script for it set out in the High Court appeal book at page 20 – involved using chipped and unchipped consoles to demonstrate what it was that the chip did, how it was that the chip allowed a game that would not load onto an unchipped console to load.
What we were proposing today was to abbreviate the demonstration, simply to use a chipped console and an infringing game, and, for the purposes of the demonstration, all we needed to do was to show how much of the game remains in RAM. For our part, for the respondents’ part, we only seek to do this to demonstrate how the question of substantiality is able to be assessed by any judge with the material before them. Mr Chalk will now put into the chipped console, which was exhibit NK1 at the trial, the disk of Moto Racer World Tour, which was exhibit NK3 at the trial.
There is some preliminary loading of this material. This is in fact one of the trademark infringements found by the trial judge to have taken place.
(PlayStation game played to the Court)
With those preliminaries out of the way, there is a short introduction to the game. The names that are coming up in the bottom left-hand corner are the names of the available racing circuits on the game. One can choose to race on any one of eight circuits which are being listed there, one can choose to race with any number of, I think, one of six bikes, and you can either race one or two players.
That further introductory material being out of the way, there is a brief pause and we choose one of six languages. Mr Chalk is choosing English. Now, he presses to start Moto Racer World Tour. The evidence showed that checks for a memory card is not relevant to the present matter. There are now four options, one is Arcade and one is World Tour. Mr Nabarro, who played this game at first instance, indicated that those are two different approaches to playing the game. Then there is an option of two players and then there are some more options. Mr Chalk is going to select Arcade.
As I indicated, there were available, I think, eight different circuits. This is the circuit that was played before his Honour and before the Full Court. It is a Sachsenring – misspelt, I think, in the Full Court transcript – it was reproduced as “Saxon Ring”, but it is actually as your Honours see spelt there. Now, Mr Chalk will start racing the bike. I am sorry, just stop there for a second. What has happened, we say, is that the code has been loaded into the RAM at this point, so I will ask Mr Chalk to go back a step, open the top of the PlayStation, take out the CD and now play the game.
Now, what that means and as Mr Nabarro said in evidence is that the game has been played solely from information that has been stored in the console. It has not been drawn at all from the CD-ROM. At the bottom left-hand side there is a map of the circuit, the Sachsenring circuit. The green dot is Mr Chalk, the red dot and the blue dots are the other bikes which I feel he is never going to catch, although at the Full Court, where this demonstration was played by.....junior to all counsel present, I think he managed to win most of the races. I will ask Mr Chalk now to crash the bike to demonstrate that what happens is we do not lose the game in this instance. The bike rider is put back onto his bike at the position where he was when he or she crashed and continues to go around the circuit. In the long stretch that runs down the middle of the map of the circuit your Honours will see a small greyish blob across the straight. That is where we started from. What I will ask Mr Chalk to do is to play the green rider all the way round for the purpose of demonstrating to your Honours that we finish one complete lap.
In due course when I address your Honours on the cinematograph film point, I will take your Honours to some evidence where it was clear we could keep on doing this forever and ever as long as the power remained to the console, but your Honours will recall that the CD-ROM is out of the console, and this is all being played from information that has been stored in the console; in our submission, information that has been stored in the RAM.
It is now, I think, entering the straight and there is some audio, as your Honours can hear of crowds cheering. At that point we have completed one complete lap, and we now set off and do it again. We could do that for as many hours as we chose to unless the power was interrupted on this particular game. That was all we proposed to show your Honours by way of demonstration.
GLEESON CJ:
Thank you, Mr Cobden. Yes, Mr Catterns.
MR CATTERNS:
May it please the Court. I understand it might take a moment or two for the
lights to come fully back, your Honours. Your Honours,
in dealing
with some of the matters raised by the members of the Court arguendo, we thought
we would go to some of the factual findings
first, which we hope will deal with
the matters in running.
If I could ask your Honours to go to the Full Court appeal book or to his Honour Justice Sackville’s reasons in the reported version, if your Honours prefer – I will refer to paragraphs as well – at page 164 of the Full Court appeal book, in paragraph [43], his Honour makes a couple of findings about this regional issue. Our submission is that this is not a disguised parallel importation case. It is clearly a case dealing with unauthorised copies. The regional issue – again, it is not a question of pricing, although the ACCC - - -
GUMMOW J: No one suggested this case is of that description. The point is, in construing the Act, it could be.
MR CATTERNS: That is true, your Honour, but the reason that parallel importation is able to be stopped is because, so far, the legislature has only made a number of specific exceptions to the provisions, such as 37 and 38.
GUMMOW J: Indeed.
MR CATTERNS: If I could just refer your Honours then to the provisions, where the use of the two systems is explained by his Honour in paragraphs [43] through to [47].
So your Honours can see that it is not just a question of keeping Australia as an island in this particular case. Any PAL game, which would include Europe or some parts of Asia and the UK of course, can be imported here. Under paragraph [46] there is a useful brief description of the way that access code and the Boot-ROM work together, and the aspect of the access code being different for the PAL regions as opposed to the NTSC regions as explained in [47].
Your Honours, his Honour’s ultimate findings which go to the question of the ordinary course of operation are in paragraphs ]103] to [108], which begins at page 182 of the Full Federal Court appeal book, and in [103] his Honour notices the ACCC’s argument, and the question is whether or not the device was designed for the purpose of preventing or inhibiting infringement or regional control. His Honour in [104] rejects a submission that it was sole purpose test, and in [106] his Honour notes the second disagreement, which is the matter that we are arguing before the Court now, namely whether the definition covers devices that have the practical effect of deterring or discouraging.
Then, your Honours, returning to the first of those two
issues which is the purpose of the design as required by the definition,
his Honour makes findings about that in [107] and [108], and about halfway
through [107] his Honour says it is:
appropriate to infer that the protective device was intended . . . to deter or otherwise discourage copyright infringement by the unlawful making, importation and distribution of copies of PlayStation games.
Your Honour, they are unlawful. In context,
his Honour must be referring to unlawful copies, and then holds that it
does have that
practical effect, and that is reinforced in [108] in the
second-last sentence:
Accordingly, I find . . . that the protective device was designed in the ordinary course of its operation, to deter or discourage persons infringing the applicants’ copyright –
The question is: does it come within the definition?
Your Honours, just as to Mr Stevens’ activities and
the satisfaction of section 116A except as to this question of the
definition,
they are all set out – and I do not need to go to them in any
detail – in paragraph [58], which is at the Full Court’s
appeal
book page 168 through to paragraph [63] at page 169, and in
paragraph [63] his Honour Justice Sackville makes the finding
of
knowledge that is required for section 116A. As your Honours know of
course, the crucial matter is his Honour held against us
on the definition,
but if your Honours would go to paragraph [165] at page 205
his Honour makes a finding about the devices being
circumvention devices,
and says if we had got up on the definition point, in [167], his Honour
would have held:
that the chips installed by Mr Stevens had only a limited commercially significant use other than circumventing or facilitating the circumvention of the access code.
If it had been a TPM “the chips would have been circumvention devices”. So all elements were present apart from that, your Honours.
Just as to the question of this phrase, “in the
ordinary course of its operation”, while your Honours have
his Honour’s
reasons open, at page 175 paragraph [82]
his Honour gives the reason for the insertion of that phrase, “in the
ordinary course
of its operation”. Your Honours can see that originally
there were two concepts - I was going to show your Honours this briefly
in
Justice Lindgren’s reasoning – technological protection measure and
the word “effective”. His Honour
says in that last
sentence:
the expression “in the ordinary course of its operation” . . . was inserted to foreclose an argument that a measure could not be an effective technological protection measure because access could be gained through unlawful means.
We submit that is partly in answer to the reverse engineered console that his Honour Justice McHugh put to us.
Your Honours, just to conclude our submissions on the fair dealing type arguments, and this applies also to section 47C, back-up copies, any construction of this section, including our learned friend’s construction, and including just paragraph (b), copy control, can stop various legitimate activities. That is part of the balance. Our submission is that the way the legislature deals with that – and this is not the first time that has happened, as I submitted this morning – is, first of all, by those two qualifications in the definitions; the one in the “technological protection measure . . . in the ordinary course of its operation”, the other in “circumvention device”, limiting it to a “limited commercially significant purpose other than”.
The other strategy, your Honours, is in section 116A, where there is the permitted purposes allowed, which include some which are computer specific, namely, that the right to reproduce computer programs to make interoperable products, so if you want to write some software that would work on a Windows operating system, you are allowed to reproduce part of the Windows operating system for that purpose. Similarly, you can reproduce computer programs to correct errors under (e), and that is saved, and security testing under (f), and that is saved.
Your Honours, the purpose of 47H, which says that you cannot exclude the operation of a number of those sections, is so that Microsoft cannot buy a shrink wrap, a licence, a so-called shrink wrap licence, a licence that it imposes on you when you undo your wrapping of your Microsoft Word, a condition that gets over those sections, but so far as back-up copies go - and your Honours remember that they are not included among the permitted purposes of 116A - the copyright owner is allowed physically to prevent back-up by section 47C(4)(b), but again, your Honours, we put this forward as an answer with respect to floodgates-type arguments by our friends, and submit really that they beg the question. The question is: where has the legislature struck the balance? The answer to that is: where this section properly construed bites.
Your Honours, we submitted this morning, and we do not need to take your Honours to the Digital Agenda Act, we accept what his Honour Justice Gummow put, which is that section 3, its objects or purposes, appears to be confined exclusively to the online environment so-called, but there are many provisions in that Act which deal with other digital forms of copying. If I could just give your Honours a reference to them without taking your Honours to them. There is a definition of “manuscript” in section 10(1), which includes digital. The new section 10(2) – there are amendments to section 21, which deal with digital forms of reproduction. The library provisions, section 49, has a new subsection (5A) put in it allowing digital copies to be made, and while we are in this particular division where we find section 116A, there are further digital rights matters or electronic rights matters in section 116B and 116C.
So it does seem, with respect, that the objects or purposes section in section 3 of that Act does not really cover the full range of matters that the Act was designed to address, so we submit that section 15AA of the Acts Interpretation Act is difficult to apply in this circumstance just by the use of section 3.
GUMMOW J: What are 116B and 116C broadly dealing with?
MR CATTERNS: Your Honour, I think they deal with - - -
GUMMOW J: They are lumped together then in 116D as to remedies.
MR CATTERNS: Yes, your Honour. 116B and 116C deal with cases where I think the - I am saying this from the Tar table, but I think one of the modern ideas is that information other than the work itself gets stored on, for example, a compact disk, including the name of the copyright owner, how you can find them and so on, and that helps manage the rights in the digital age.
GUMMOW J: There is a definition of “electronic rights management information”, which would seem to bear out what you are saying.
MR CATTERNS: Yes, it is, your Honour. Thank you. And so your Honours can see that that is another non-online environment provision. I do not think I need to go over that point any further.
Then, your Honours, just picking up this question of
whether or not the definition is apt to pick up inhibiting an infringement by
denying access post the act of infringement, thereby, we say, deterring or
inhibiting the infringement by making it impractical,
his Honour
Justice Sackville, in paragraph [116] at Federal Court appeal book
page 187, made a suggestion of how the word “inhibit”
could be
given work to do other than our construction, which would include deterring or
discouraging. His Honour’s two examples
are in the middle of
paragraph [116] where:
A copy control mechanism, for example, might not prevent all copying that infringes copyright, but might limit the extent of unlawful copying that can take place, for example, by reducing the quality of copies –
With respect, what his Honour, Justice Gummow said when our learned friend paraphrased that example this morning is right. That does not inhibit infringement, because it is quite likely that you still infringe by reproducing a substantial part. On the other hand, if his Honour’s example of reducing the quality so that access is inferior or not as good, then it fits within our view, whereby it is the subsequent poor quality of the copy that deters, discourages or inhibits you from infringing, because you are just not getting a good enough copy to make the activity worthwhile.
We would respectfully submit that the last sentence fits within our definition and we have made our submissions about the, we submit, crucial significance of the words in the parentheses, “decryption, unscrambling or other transformation”.
Your Honours, we undertook not to take much
time on the legislative history, but just really identify what we submit are the
crucial
matters. His Honour, in [117], sees, with respect, rightly,
that – this is the fourth line of the paragraph:
From at least . . . 1997 . . . the emphasis has been on penalising or discouraging –
your Honour sees the word “discouraging”
–
the commercial distribution of devices for circumventing “locks” or protective devices which deny unauthorised access –
which is what our device does, which is what Microsoft
Word’s password does and what the AutoCAD lock does –
to materials stored in electronic form, including Internet sites –
we respectfully agree that is both online and electronic –
or which prevent unauthorised copying of such materials.
That is exactly how we submit the (a) and (b) of the
definition work. His Honour then refers to the European Commission
Directive,
referring to:
the circumvention of specific technological measures such as those requiring a code for a user wishing to gain access to the work.
Perhaps that begs the question, because that might be access prior to infringement, which (a) certainly includes, or, as we would also submit, access to the work post infringement.
GUMMOW J: Do you have the text of the United States provision?
MR CATTERNS: Yes,
your Honour. We have put it at the back of our submission. I am sorry we
did not number the pages. We have numbered pages
if that is convenient, but it
is fairly easy to find because of the print differences, your Honour. In
fact, I think it is first.
It follows our submission that there is a list of
provisions and then section 1201(a) says:
No person shall circumvent a technological measure that effectively controls –
and your Honours know that is a word that appears in various cases and including in the definition of our Act, even though the word got removed from the definition of “technological measure”.
And your Honours, turning to the next page under
(E)(2):
No person shall manufacture . . .
that –
(A) is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a work –
And your Honours can see that that is broad. It does not say “prevents infringement”, it says, “effectively controls access”. That breadth in this so-called Digital Millennium Copyright Act is what has led to the academic debate that our learned friends in their, with respect, scholarly submissions have given the hint about.
McHUGH J: One of the interest groups in your side wanted the American definition put in, but Parliament - - -
MR CATTERNS: Yes, your Honour, and the free trade agreement promises to do so.
McHUGH J: Yes, but in the 2000 Act Parliament refrained from accepting it.
MR CATTERNS: That is right, your Honour, but again, that begs the question of whether or not – certainly the precise definition has not been put in, and the question is whether or not on the proper construction it goes so far. We have never said, your Honour, that it goes so far as to protect access per se, which this definition, I submit, does do.
McHUGH J: Yes, 1201 throws the weight of the argument on the question of access.
MR CATTERNS: Yes, your Honour, not infringement at all.
GUMMOW J: But there is a definition of “effectively controls access”.
MR CATTERNS: Yes, your Honour, I meant to go it, that is (3)(B), just a few centimetres down.
GUMMOW J:
to gain access to the work - - -
MR CATTERNS: Yes, your Honour, full stop. And as Professor Ginsburg explains in - - -
GUMMOW J: But how does this deal with your prospective argument?
MR CATTERNS: Your Honour, because it does not depend upon infringement, it subsumes it, if that is the right word. Our device would certainly come within this, because the question of any temporal relationship between the infringement and the access go to (A). That is why there is a debate in the US about this, and your Honour referred us at the special leave application to Professor Cornish’s lecture, and he discusses that also.
But that (3)(B), Australia has undertaken to - - -
GUMMOW J: Yes, we know that.
MR CATTERNS: - - -be part of our law. Your Honours, our submission about that is, that shows that these – I would only be repeating myself.
GUMMOW J: Have they legislated in Canada yet?
MR CATTERNS: We think
not, your Honour, no. Your Honours, may I then briefly go to the Full
Court judgments in the High Court appeal book. Your
Honours, we
respectfully adopt his Honour Justice French’s reasoning at
pages 32 to 36, paragraphs 13 to 21 and your Honours
can see
– of course, I do not propose to read them – that his Honour
– we have adopted parts of his Honour’s
reasoning or
his Honour has accepted part of our reasoning. In paragraph 17, just
looking at the scope of the two words “prevent”
and
“inhibit” in the middle of the paragraph, his Honour
says:
The scope of these two verbs, in their ordinary meanings, is wide enough, in my opinion, to cover an intended result of deterring or discouraging infringement by rendering the infringing copy useless for the purpose for which it was made.
In 18 his Honour says that he sees nothing in the
definition that requires:
physical prevention or inhibition of infringement –
He quotes the two means, (a) and (b) and his Honour says,
as I submitted to his Honour Justice McHugh in answer to a question of
his
Honour:
If these means are confined to physical mechanisms –
we agree that they must be physical but that does not mean that
the section:
requires a narrow “physical” construction of “prevent or inhibit –
His Honour says, and we respectfully submit, that:
par (a) is logically entirely consistent with the notion that the practical denial of access . . . by the use of an access code may prevent or inhibit the use of copying devices which cannot reproduce that code. For infringement is to that extent prevented or inhibited according to the ordinary meaning –
Then his Honour’s reasons go on, paragraphs 19 to 21.
His Honour Justice Lindgren touched upon the question
of construction at page 57 at paragraph 85. His Honour found the
matter finely
balanced but perhaps slightly our way and in 89 says that:
I regard the word “inhibit” as . . . meaning “restrain” or “check”, in the sense of “discourage or deter, without preventing”, infringement.
Strictly, there either is or is not a “reproduction”, and so, even on Mr Stevens’ approach, the inhibition which arises from spoiling can be seen to operate by way of making reproduction difficult and unsatisfactory –
Then, your Honours, his Honour gives a very detailed summary of the legislative history. We would just like to touch on a few aspects of it, your Honours.
GUMMOW J: It is criticised by your opponent for being selective.
MR CATTERNS: Yes,
your Honour, but I do not think our learned friends point to any additional
matter that is relevant. I might be corrected on
that but I think it is
selective in that it deals with the relevant bits, your Honour. The draft
report of the Copyright Law Review
Committee in paragraph 33 under the heading
“Decompilation to defeat program ‘locks’”
referred
to some form of protection to prevent copying or, as in the
Autodesk Case, to prevent unauthorised use.
Really,
your Honours, since then this question - two ways of “protecting work
and other subject-matter” has been in the
Act. In paragraph 95
his Honour discusses the reference in that paragraph to Autodesk,
explains how the AutoCAD worked, which we submit is relevantly the same as ours,
and then about five lines from the bottom says:
There would be no point in making pirated disks if, for lack of the AutoCAD lock, the copy of the program on the pirated disk could not be run. The AutoCAD lock was therefore akin to the Boot ROM in the present case. The CLRC saw the AutoCAD device –
and we would say the Sony –
as an appropriate response –
Then your Honours see in 97 - I can skip over the next few but commend them to your Honours. It shows that there has been debate backwards and forwards, including submissions that there should not be access control. In paragraph 100 his Honour refers to the treaties. The treaties have now come into force internationally. The present position, your Honours, is that they were laid before Parliament, tabled I think on 22 June. We understand there is an intention that Australia accede to them but we have not yet.
In paragraph 103 there is the Government’s
Digital Agenda Discussion Paper and your Honours see at the end of the
quote his
Honour Justice Lindgren has emphasised “unauthorised
copying or access”. Then there is the exposure draft in
paragraph
106 and your Honours can see the various items - it was
perhaps closer to the US - there was a definition of “effective
technological
protection measure” and “technological protection
measure” itself. It was within the concept of “effective”
that we had the idea of access control. It is:
effective only if access to the work or other subject-matter . . . is available solely by use of an access code or process –
So they did not even have copy control at that time, your Honours. They had purely access control.
If I could then skip
to paragraph 117, where we are at the House of Representatives Committee.
That quotes in paragraph 4.11 the
committee saying:
technological measures to protect copyright materials are essentially of two types: access control measures and copy control measures. Access control measures allow the copyright owner to control who has access –
and if I can skip - - -
GUMMOW J: When they say that, where are they getting this expression “access” from?
MR CATTERNS: Your Honour, I believe - - -
GUMMOW J: They treat it as an already given.
MR CATTERNS: Yes, your Honour.
GUMMOW J: Why?
MR CATTERNS: I think, your Honour, it comes from the European directive, your Honour, which is quoted in 108.
GUMMOW J: Yes. Were they giving any thought whatever to the big change this will be in Australian law, or are they just playing catch-up with some European directive?
MR CATTERNS: Well, your Honour, at each stage there was an agonising process of consultation.
GUMMOW J: What you read to us does not seem like that. That is a conclusion, is it not?
MR CATTERNS: Your Honour, I am sorry. The whole House of Representatives report, for example, which was against this, I should say, goes through it in fair detail, as does the Copyright Law Review Committee.
GUMMOW J: Do you have the European Directive?
MR CATTERNS: We have a copy here. We can give the Court copies when the Court rises, if that is convenient, your Honour.
GUMMOW J: It is said to be almost incomprehensible, by some commentators.
MR CATTERNS: I think Professor Cornish says that. He calls it the “InfoSoc Directive”.
GUMMOW J: Well, he is the sort of person who would know.
MR CATTERNS: Yes.
HEYDON J: Does it not appear in paragraph [108] of Justice Lindgren’s judgment? Is that right?
MR CATTERNS:
Your Honour, the relevant part does. In particular, at the end of the
quotation from Article 6 of the directive, there is the sentence:
“Technological measures shall only be deemed ‘effective’ where the work or other subject matter is rendered accessible to the user only through application of an access code or process, including by decryption, descrambling or other transformation of the work or other subject matter, with the authority of the rights holder.”
I should have drawn attention to
the sentence earlier, which says:
“designed to prevent or inhibit the infringement” –
so it does differ from the US in that sense. But your
Honours can see that that is very, very close to the wording of our provision
as
it now appears.
HAYNE J: We have slid together notions of “effective” with other notions altogether, have we not?
MR
CATTERNS: Your Honour, that is precisely right. At the time
his Honour Justice Sackville determined the case, the definition of
“circumvention
device” had the words in it “an effective
technological protection measure”, but “effective” had no
work
to do because it had gone. That has now been amended, as his Honour
foreshadowed was going to be the case, and the definition
now unfortunately
reads:
facilitating the circumvention of an technological protection measure –
because Parliament took out
“effective” but forgot to take out “an”. I do not think
that makes any difference.
So at the end of paragraph [117] of
his Honour Justice Lindgren’s reasons, quoting 4.19 from the House of
Representatives
Committee:
“In the view of the Committee, the definition –
and it was still “effective” then,
your Honours –
in the Bill is a hybrid of access control and copy control measures . . . it may be preferable to define effective technological protection measure simply in terms of copy control measures.”
His Honour says in paragraph [119] that
that phrase “hybrid”, going on:
The HRLACA Committee clearly intended by that sentence to describe a copy control measure and to exclude an access control measure –
and notes in [120] that, importantly, that
recommendation was not adopted.
We respectfully submit that, putting it shortly, that legislative history shows an awareness of the two strategies, at various stages including the House Committee Report recommendations against access control, but that recommendation was not adopted. As his Honour Justice Gummow points out, we do not know what went on behind the scenes, but we would respectfully submit that that legislative history is at least consistent with the submission that it is possible that that type of access control that we propound was contemplated. Indeed, we submit, on a proper reading of this section, that is what it says.
Your Honours, they are our submissions on the definition question. I was going to then make some brief submissions on the question of reproduction in RAM, and then leave Mr Cobden to finish with the film argument.
GLEESON CJ: You are dealing with the second issue and Mr Cobden is dealing with the third issue.
MR CATTERNS: Yes, your Honour, if that is convenient. May I just remind your Honours that the round argument is a fallback and the reason we run it is, even if we are wrong on the definition of “technological protection measure” but we are right on RAM, then there is no doubt that the holder of an infringing or an unauthorised PlayStation game would themselves infringe, and so it is a technological protection measure on any view as long as a substantial part of the game is reproduced in a material form. His Honour Justice Sackville held that it was a substantial part with respect to the computer program and so the question is: are we beaten by the definition?
Your Honours, the definition is in section 10(1),
“material form”, and this occurred in a flurry after his Honour
Justice
Beaumont delivered the judgment at first instance in the Apple
Computer Case where his Honour decided the copyright part of the case
on the sole ground that a computer program was not a literary work because
it
did not instruct or amuse human beings in the way literary works do and, I think
anxious to be up with the modern society, the
government undertook to amend the
Act rapidly and we got the change to the definition of “literary
work” to include a
computer program and a definition of “computer
program” which has changed over the years as noticed by the Court in the
Data Access v Powerflex Case. But the definition of “material
form” also came about in 1984 and says:
in relation to a work or adaptation of a work, includes any form (whether visible or not) of storage from which the work or adaptation, or a substantial part . . . can be reproduced.
Your Honours, the effect of the judgments against us
in this case and also the judgment of his Honour Justice Emmett in the
Warner Case, is that those words, “can be reproduced”, have
been read to mean “can be reproduced as a factual matter in the
particular
machine that we are talking about”. Hence, his Honour
Justice Emmett gave an answer to a separate question put
to his Honour
that it depended on whether or not the computer happened to have a program in it
that would allow what was in RAM to
be reproduced.
We respectfully submit that it does not matter if you need - your Honours have.....something I have said before – that it does not matter if you need to build a cyclotron to get it out of RAM. The purpose of this definition - “material form” is crucial for two purposes. The first is subsistence of copyright. Copyright subsists in a work by section 32 when it is “made” in Australia. In America the concept is “fixed” and so you need to have the work in a way where you can determine what its set of statements or instructions is so you know what the work is, when it is made, by whom, for the purposes of subsistence.
Your Honours, with respect, that cannot depend on the accident as to whether or not the RAM in which you happen to embody it is in a machine which has a device to allow you to print it out or copy it electronically, or whether you need to bring along another machine or, indeed, invent another machine and bring it along. It is whether or not it is going to be in a sufficiently fixed form for the purposes of determining subsistence, and we respectfully submit also infringement and, your Honours, that is really the submission. We respectfully submit the words “can be reproduced” just mean that. They do not mean in the machine where the RAM is situated or by use of the facilities already present in the computer, say, or PlayStation console.
Your Honours, may I remind your Honours that it
appears from the explanatory memorandum that that was what was intended. In
paragraph
151 of his reasons, just as a convenient way of finding it,
his Honour Justice Lindgren quoting Justice Tamberlin, quotes the
explanatory
memorandum. It is at page 82. Your Honours, there is a
slight error in the quotation. Your Honours can see Justice Tamberlin
is
quoting the explanatory memorandum and says:
The definition of ‘material form’ is new and makes it clear that the material form includes such methods –
and it should read, “of fixation” –
as storage or reproduction on magnetic tape, read only or random access computer memory, magnetic or laser disks, bubble memories and other forms of storage which will doubtless be developed.
Justice Tamberlin says:
It is evident from this that the definition was intended to be far-reaching and to cover not only ROM and RAM but also other types of storage –
At 163, however, his Honour Justice Lindgren
says:
that it was contemplated that at least in some circumstances RAM might constitute “material form”. But I do not think the paragraph indicates that RAM would do so in all circumstances.
We respectfully submit that is a misreading of the paragraph of the explanatory memorandum, and there is no reason in principle why the device itself has to have the means.
Now, your Honours, that is a matter
of construction. Your Honours, the evidence was thin, but we respectfully
submit just sufficient.
If your Honours would go to the Federal Court
appeal book for Justice Sackville’s reasons, his Honour, I
respectfully submit,
is right to say - his Honour appears to accept
the evidence from Mr Nabarro that at the end of paragraph 51 on
page 166:
the portion of the game code stored in the RAM –
he was asked whether it could be extracted and reproduced. The
answer was:
this could not be done without developing hardware which would enable the process to be reversed.
If I could just give your Honours references to some other paragraphs. There is a little bit more of a discussion over the next two paragraphs.
Then his Honour Justice Sackville’s reasons begin at page 188, paragraphs [119] and following. His Honour holds that it is a substantial part in paragraph [125] on page 190, then his Honour discusses the Australian cases, but at [137] which is on page 195, his Honour follows the reasoning of his Honour Justice Emmett, which requires the device itself to provide the means from which the RAM can be reproduced.
Your Honours, our learned friend Mr Basten mentioned the word “storage”. That has not been the subject of any of the arguments below as far as we can see. We respectfully submit that it is clear that “storage” includes storage in RAM, and might I remind your Honours that the fact that storage is in an electronic form caused no difficulty Autodesk v Dyason [No.1], where what was held to be an infringing reproduction was stored on an EPROM, that is erasable and programmable read-only memory, so it store in the same way, namely electronically, but does not go away when you turn the machine off, and your Honours saw from the demonstration that while the machine is on, what his Honour held to be a substantial part with respect to the literary work stays on the RAM.
So, just giving your Honours references to the reasons of Justice Lindgren following and upholding Justice Sackville, that is paragraphs 167 to 170 at pages 87 to 89, and his Honour Justice Finkelstein is the judge in our favour. At paragraph 209 at page 103 he holds that mere happenstance of the nature of the device possessing something from which it can be reproduced from RAM ought not determine the question. His Honour also discusses the US cases, but we would respectfully agree on it, as his Honour says, that the US position is different. So, your Honours, for those reasons, we respectfully submit that the second argument, the first one on the notice of contention, ought to be accepted.
GLEESON CJ: Thank you, Mr Catterns. Yes,
Mr Cobden.
MR COBDEN: Thank you, your Honours. Your Honours
know that this is another argument that does not depend on the “prevent or
inhibit”
or the temporal relationship of the infringement, because in the
same way as the RAM argument, if this argument is successful, there
is a
subsequent infringement which is prevented, that is to say, on our argument, the
reproduction of the making of a copy of a film.
There are four ways in which we
are said not to be correct in that by either the appellants or
Mr Basten’s clients, or by
the majority of the Full Court or his
Honour Justice Sackville.
The first is that we are said not to have
proved that what was in the RAM was a substantial part. The second is that it
is said
that we have not established that what was in the RAM was a copy within
the meaning of the Act. The third is going back to the definition
of
“technological protection measure”, whether our device was:
designed, in the ordinary cause of its operation, to prevent or inhibit the infringement –
The third is the new point raised by Mr Basten on behalf of his clients, which is we have to establish whether Galaxy v Sega is correct, and that an aggregate of visual images of this kind, where there is some control by the user on the ultimate version that happens on each occasion is in fact the cinematograph film as defined in the Act.
On the question of “substantial part”, there are two areas in which we respectfully submit his Honour Justice Sackville erred. Your Honour will recall that the Full Court, Justice Lindgren and Justice French explicitly did not deal with “substantial part”; only Justice Finkelstein did.
The first is on what is the correct approach to determining or assessing “substantial part” in relation to Part IV subject matter and, in particular, in relation to films. The second is whether more evidence than was before his Honour was needed in order to perform that task.
For the purpose of commencing the first part of the question, what is the proper approach to assessing “substantial part”, one needs to start, with respect, with section 101, which says that one infringes by doing an act “comprised in the copyright”, and then, via section 13, one could go to section 86(a) and find that that is – an act comprised in the copyright is something that is one of the “exclusive rights” of the owner, and in this case it is to make a copy of the film. Then one goes to section 14, which says that that is also a reference to an exclusive right with respect to a substantial part of the film.
It is important to commence with that perspective, because what it is is an exclusive right of the owner of the copyright to do something with respect to a substantial part, which makes it difficult, we would submit, to see why the question of whether it is a substantial part should be determined by reference to the conduct of the infringer, that is to say, which part they have taken, and whether they have bestowed or otherwise importance on it by reason of their purpose.
We are criticised by the appellant’s submissions in places for saying that the way in which we demonstrate this infringement of the cinematograph film is contrived. But that is necessarily so, with respect, in these circumstances, because, unlike an ordinary copyright infringement case, there is no actual infringement for us to look at. What we are looking at is whether the device prevents or inhibits an infringement of copyright, and that could be any number of infringements of copyright. In relation to a film – the film in question I could refer to most easily is the Moto Racer World Tour, which we say is the total aggregate of visual images and sounds – but I will refer just to visual images – that is embodied on the CD, the whole of the CD, an infringing copy of which was put into the console.
That film, as a subject matter, may have dozens, if not hundreds, if not thousands, of substantial parts. In other words, five minutes of it might be a substantial part, or a different ten minutes, or a collection of three lots of three minutes. So it is a little contrived, in the sense that there is no actual infringement for us to point to, but we need to point to an infringement or a number of infringements that would be prevented or inhibited by the protective device.
The question of what is a substantial part of a Part IV subject matter is not one that has been looked at in detail by this Court, as we have said in our written outline. It arose at the edges of The Panel Case, but it has been remitted to the Full Court to deal with, because this Court, of course, determined what was the copyright subject matter that one started with for the purpose of measuring the substantial part, and that was the half-hour or hour long or longer broadcast. In this case, that question does not arise. The question arises of how one would measure the substantial part.
In cases of authorship, Part III works – one looks at the appropriation of the skill and labour of the author, but that is what is summed up in the word “originality”. That does not occur here. In our submission, really, the only approach that Justice Sackville took to this was to look at the purpose test. We have dealt with the purpose test in our written outline, where among the factors we looked at – frequently, we listed a number of factors, and one of them is the nature and objects of the selection made.
We sought to demonstrate in the written outline, and I will not take your Honours to it in great detail, but that is a phrase of very doubtful pedigree in relation to substantial parts, whether of copyright works or of other subject matter because it really comes, and came without acknowledgement for a very long time, in Copinger, the authoritative text from which it has been quoted on many occasions, from an American fair use case in the 1840s.
It is not surprising that the nature and objects of the selection made would be relevant in a fair use case. Indeed, in all our fair dealing cases, under our copyright law, one needs to look at that criticism or review. In other words, the purpose is determinative of whether it is a fair dealing to start with and, we submit, it is not a useful test to apply. It is one that comes from Nationwide News, particularly where his Honour was applying it and Justice Emmett had applied it in relation to published editions but, in our respectful submission, it is not a useful test because it focuses on the intentions and activities of the infringer, or the user, as it did in Nationwide News and rather than what is objectively a substantial part of the copyright subject matter.
We submit, in other words, that his Honour Justice Sackville, by directing himself to the question of purpose almost exclusively in assessing substantial part, erred in that way. Justice Finkelstein, therefore, is the only judge in any court below who, in our submission, has approached the task correctly and that is to assess whether the part that was reproduced was something other than an insubstantial part or was something more than de minimis, or was something more than something that is so trifling or insignificant that it has no impact on the work as a whole.
GUMMOW J: Something more than de minimis?
MR COBDEN: That is the test proposed by the text writers of.....for example, your Honour, in relation to generally what we would call Part IV subject matter because of the inability to fix on originality and the appropriation of skill and labour. The copyright arises, as it were, merely by – one can have copyright on a cinematograph film merely by filming a blank wall.
GUMMOW J: Indeed.
MR COBDEN: It might not be much of a copyright but it is a copyright, nevertheless. The measure, your Honour, it is really a question of assessment. One way that has been suggested of looking at it in relation to Part III works is to say could the thing stand as a work in its own right. Would it afford the same sort of copyright experience as the original work did and that has sometimes been looked at to say, could the parts stand alone, as its own piece of authorship.
What we say here and what Justice Finkelstein said and we would respectfully adopt, is that if one looks at the totality of – I will come back to how one does that - - -
GUMMOW J: You have got no authorship.
MR COBDEN: No authorship, quite so, your Honour.
GUMMOW J: So just what is this Act protecting? What are the values it is protecting in these non-works?
MR COBDEN: In this sort of case, your Honour, it is protecting the value of the making of an appreciable, viewable, playable aggregate of visual images.
GUMMOW J: It just seems to be authorising a business investment. That is what the preamble to this Digital Act says.
MR COBDEN: And, indeed, your Honour, that is what has often been said about the Part IV subject matters generally when they were introduced in England, well ahead of continental systems, of course, and criticised roundly. I think Professor Cornish summarises that in his talks that, in a sense, para-copyright - these were para-copyright in their day, Part IV subject matter - but they have been given protection and we would say this is not a case where - - -
GUMMOW J: You want to give the fair dealing provision an even weaker application to them, even though one might think it was the other way around.
MR COBDEN: I am not quite following your Honour. In what sense?
GUMMOW J: You have an author who writes a well-known book. It is infringed and he has to show that a substantial part has been taken.
MR COBDEN: Yes, your Honour.
GUMMOW J: That involves a fairly difficult operation.
MR COBDEN: Yes.
GUMMOW J: You want to say that some business people who produce the sort of thing we have been looking at one way and another this afternoon, when it comes to fair use, all they have to show is something more than de minimis.
MR COBDEN: Well, first of all, that it comes to substantiality, because, of course, if a substantial part is not taken, fair dealing will not come into effect at all. The other approach that was taken in Nationwide News was to look at what is the interest protected by this copyright. Where we submit the Full Court erred was to look at the purpose that the infringing part was put to in order to see whether it was a substantial part of the original subject matter. But if one takes the approach of looking to see what is the interest protected by this copyright – the cinematograph film copyright, in this instance – it is the making of an aggregate of images that is appreciable, viewable, and, in this case, playable. It is, at one level, a jury question. It is a question simply of assessment: is that not insubstantial? Is that the taking of a part that is - - -
GUMMOW J: You want to say it is substantial if it is more than de minimis.
MR COBDEN: That is one approach to take, yes, your Honour. Another one is to say, is it not trifling or not insubstantial? Is it not just a snippet? Is it more than that, is it of substance when compared with the whole? What we would say in this case, your Honour, is that the whole game – for example, the Moto Racer World Tour game – was what was contained on the CD-ROM. It contained the possibility of playing on eight circuits, the possibility of playing on six bikes, and, I think, six language options. The language options would appear to not make a great deal of difference.
The question is, is the taking of a whole circuit, which was what was demonstrated today – and I will take your Honours very briefly through the evidence to show why we would say that is a substantial part, if that is something that is more than a trifle or insignificant or more than a de minimis part of the whole game. Almost on whatever approach one applies to substantiality, other than a mathematical one or one that requires that one take something just short of the whole, we would submit that the taking or the loading of a whole circuit in that way could be no other than a substantial part of the cinematograph film. That would be the six or eight circuits, or the six bikes.
It is related to the question, of course, of what evidence might be required to assess the question of substantiality. His Honour felt that he would need more evidence to tell him what the value and quality of the images was stored in the RAM, when compared to the whole work. We respectfully submit that, as would be the case with any film or any book, all that is needed is to place the subject matter into evidence and to place the infringement into evidence and the Court can do it on its own – as, indeed, the Court did in the 3M Case, which is a patent case, by having to assess the question of relative insensibility of the bandaid there. What happened, if I could take your Honours very briefly through the evidence to show - - -
HEYDON J: Can I just interrupt. This de minimis question does not really matter much, does it? Is not your argument that one lap out of three was taken?
MR COBDEN: No, your Honour, one circuit out of eight. Your Honour may recall that as the demonstration began there were - - -
HEYDON
J: Yes, but I am looking at Justice Finkelstein, paragraph 220.
Maybe it is a different race perhaps, but:
If the game is played in its entirety, the race occupies three laps of the circuit . . . only one lap of the circuit is shown . . . the player can race over only one lap, he can he can do so indefinitely - - -
MR COBDEN: Yes, your Honour. We raced around the Sachsenring circuit - - -
HEYDON J: Yes, but your point is that there are seven other circuits, so what - - -
MR COBDEN: Seven other circuits which were listed at the beginning of the - - -
HEYDON J: So the question is: is one twenty-fourth substantial?
MR COBDEN: Yes, but not assessed on the mathematical basis. One twenty-fourth of a cinematograph film might be just the end credits rolling up with the names of people on them. It would be a fairly shortish film - - -
KIRBY J: It might be the burning scene in Gone With the Wind and then where would we be?
MR COBDEN: It may well be, your Honour.
HEYDON J: Judge Zobel talks about the highlights of each broadcast.
MR COBDEN: Yes, your Honour.
HEYDON J: Was that a highlight that we saw, was it?
MR COBDEN: Well, an equal light. The whole of the copyright subject matter which is in evidence is the whole of that disk. It has eight circuits on it which can be played on I think six bytes and one or two players, but in substance, one will race around within the parameters of the game, one of those eight circuits in the same way that the demonstration did today. And I will take your Honours through very briefly the evidence and the demonstrations that were shown to his Honour and to the Full Court, but we would submit that it is not a question of single images or a few seconds or a brief snippet of a film. Some of the instances in The Panel that have gone back for determination, I think, were a question of a matter of a minute, 30 seconds from broadcasts of several hours long.
KIRBY J: We will not go there again, Mr Cobden.
MR COBDEN: I am treading a very careful line myself, your Honour.
KIRBY J: What was on your case the reason for the deletion of one circuit?
MR COBDEN: I am sorry, your Honour?
KIRBY J: On your case, what was the reason for the omission of one circuit?
MR COBDEN: I am not following the question, I am sorry, your Honour, because we did not omit a circuit.
KIRBY J: There was one circuit of the seven, was it, that was not reproduced.
MR COBDEN: I am sorry, your Honour, we are at cross purposes. On that infringing CD-ROM, the totality of our CD-ROM other than the access code is reproduced, so all of our cinematograph film material from our original work, original subject matter, is reproduced. What was loaded into the RAM was just one of the eight circuits, and we accept that at one time, you cannot load more than one circuit. We could have done – I will show your Honours where in the Full Court it happened. In fact we did that circuit and then as a further demonstration we went and loaded the Barcelona circuit – did exactly the same thing, in other words, opened the lid, took out the disk and then played the whole of the Barcelona circuit. We can only load one circuit into the RAM at one time, but we would say each circuit – in fact, we would submit really considerably less than a whole circuit would be a substantial part of the cinematograph film consisting of the eight circuits, because it is a substitute in some ways. I mean, not a full substitute by any means, but it is a substitute for the copyright work or copyright subject matter. One could sit there and play that game for hours on end.
As Mr Stevens put a question to Mr Nabarro at first instance, he said, “You could do this forever and ever and ever. It would get a bit boring, wouldn’t it?” Mr Nabarro said, “Yes, it might, but it doesn’t matter that it’s boring. It does keep on going”.
HAYNE J: Keep on going, or permit the playing of successive games on that circuit?
MR COBDEN: Permit the reproduction on the screen of the visual images of that circuit time and time again, adjusted slightly depending on the way in which you control the bike.
KIRBY J: As long as you can crash the bike.
MR COBDEN: So you have a slightly different view of the scenery if you swung over to one side of the track or the other side of the track, or if you crashed and got up again, but it would be that - - -
HAYNE J: Sometimes you win, sometimes you lose.
MR COBDEN: Yes. It would be that aggregate of visual images which we submit is a substantial part of the total aggregate of visual images contained on that CD-ROM.
HAYNE J: In that sense, what is taken is, so long as power is retained, a usable game.
MR COBDEN: Yes, your Honour. Boring, perhaps, by today’s standards, in the sense that you expect to progress up through eight levels, but not boring, for example, by reference to video games of 15 years ago where you could do very much less than that for the whole game.
HAYNE J: I do not think questions of the entertainment value should be agitated terribly hard.
MR COBDEN: No, your Honour. Could I just indicate, it is also said by the appellant in this case that the results are so variable and the evidence indicates that there are other games in which one could not play a continued version of the game once the CD-ROM was lifted out, but the results cannot be relied upon to indicate that there would be a substantial part usually reproduced. The demonstrations began at page 47 of the Full Court appeal book, where Mr Nabarro inserted that very game into the system – I will just indicate rapidly, for the purposes of the transcript, what happened. He then went on to do precisely what Mr Chalk today did, that is to say, to play the game for a bit, then lift the lid of the console, take out the CD and then continue to play the game. He said at page 49 that he could demonstrate that function with MediEvil – that was another game in suit – and many other PlayStation games as well.
Then, at page 50, to
demonstrate how independent the storage in the RAM was of the presence of the
CD, he put in an audio CD of Riverdance and played that while he
continued to play the game – that is at page 50 of the Full Court
appeal book – and said in
his evidence:
That absolutely demonstrates there is no reliance whatsoever now on the game CD being inserted. This further demonstrates the fact that this level of the game is completely playable, in its entirety, because of the copying system RAM.
He was then invited by counsel for the ACCC to do it with the MediEvil game on the basis that that had a much higher megabyte level and may not do the same thing. At page 51 he put in MediEvil, another game in suit, and said it was a very large game, it took a long while to load up all the options, but played that game with the disk out, and so, we submit, demonstrated again in relation to that game – we did not do the demonstration for your Honours today, but the disk is in evidence and can be referred to by your Honours at any time – demonstrated that precisely the same thing happened with that game.
At page 53 of the Full Court appeal book, page
96 of the transcript, his Honour Justice Sackville said to
Mr Stevens:
HIS HONOUR: You want an illustration of a game that effectively runs out when the - - -
MR STEVENS: As soon as you open a lid it stops.
HIS HONOUR: Yes. Is there a game that answers that description?
Mr Stevens, who was at the Bar table at that point, said “Most of them”. Mr Nabarro said he was struggling to think of one. Mr Stevens said he could bring one in tomorrow. In fact – and I am dealing in anticipation of something that was said in reply to us – Mr Stevens did bring in two disks which did not have the effect of being able to play them continuously, as the one we saw today was, but they were demonstration disks and there was no indication at all that they were the sorts of disks that we put onto the market.
Mr Nabarro also gave some evidence, which is in the Full Court appeal book, and affidavit evidence at pages 114, 115, to say that that is what he had done before he came to the witness box. The effect of all that, we say, is that the Court is, just as it did in the 3M Case. The Court at any level is capable and indeed quite able to assess the part against the whole, and we would submit, on the evidence that is before the Court, reached in the same way that.....today, assess questions of substantiality and reach the view that that is a substantial part because it is a playable game.
The next criticism made of us is that we
have not demonstrated that it was a copy of a cinematograph film within the
meaning of the
Act. The definitions, your Honours, are all in
section 10(1), and the definition of “copy”, which we say would
be sufficient
on its own terms:
means any article or thing in which the visual images or sounds comprising the film are embodied.
There is a lot of discussion in Galaxy v Sega. There is discussion by his Honour Justice Lindgren in the present case about what the word “embodiment” means and whether it can be said that visual images were embodied in the RAM in the present case.
If one cannot get
there on the plain words of the definition of “copy”, one turns to
section 24, which has been unamended
since the enactment of the
Copyright Act, where one, we respectfully submit, is not directed by any
preconceptions about what the meaning of “embodied” is. It
is a
deeming provision and sounds or visual images are deemed to have been
embodied:
if the article or thing has been so treated in relation to those sounds . . . are capable . . . of being reproduced from the article or thing.
“Reproduction” there is not a reference to physical reproduction. It has always been taken to be a reference, we respectfully submit correctly, to being reproduced as in visually reproduced or reproduced as sounds. The treatment that is required, we would respectfully submit, has never been required to be permanent treatment, because plainly the use of a cassette tape or a video tape would be appropriate, but that could be erased and wiped clean and reused.
Justice Lindgren focused on the question of whether the RAM in the PlayStation console was an article or thing. We respectfully submit it must be an article or thing. Those are very broad words indeed. “Articles” is broad enough on its own, but to add the words “or things”, extremely broad. We have given some references. Mr Justice Laddie in a similar case in the United Kingdom said there can be no doubt that silicon chips and RAM is an article. The question - and we submit it is plain that the visual images can be reproduced from it. Your Honours have seen that today and that demonstration can be re-enacted at any time. The question is whether it has been treated. Treated by - as long as the power is being maintained to it, it continues to store the visual images, and they can be used in the way in which your Honours have seen. So we respectfully submit that whatever difficulties there might be about the word “embodied”, they are entirely overcome by having reference to the deeming provision of section 24 if we fulfil each of the circumstances as set out there, which we submit we do.
Then, there is a copy of the cinematographic film, so long as the power is maintained in the RAM of the console. It is said that in relation to the definition of “technological protection measure” that our device is not designed in the ordinary course of its operation to prevent or inhibit that variety of infringement. We respectfully submit that what it does, plainly as intended to do, is to prevent the loading of code into RAM from an unauthorised game. It does not, we would say - we do not have to demonstrate, we have identified particular varieties of copyright infringement, ie, whether they be the copying of musical works, literary works, artistic works. We simply have to demonstrate that the act that it is designed to prevent doing – that is the loading of the code – if it happened, would involve an infringement of copyright.
Our learned friend Mr Basten’s clients have suggested that we have to establish that Galaxy v Sega is correct and that this is a cinematograph film. We respectfully submit that it was not an issue ultimately before Justice Sackville at all whether this was cinematograph film, nor was it an issue in the Full Court and our learned friends for the appellant, in their submissions, agree with that. On that view we would not have to address your Honour on Galaxy v Sega at all. Galaxy v Sega looked at the question of whether an aggregate of visual images that was invariably embodied in an arcade game, because it was not definite in each one of its reproductions or iterations, could it still be a cinematograph film within the meaning of section 10(1) of the Act.
McHUGH J: That case was settled before we decided the special leave application.
MR COBDEN: That is so, your Honour, yes.
McHUGH J: I thought we granted leave. I know I looked at it. I think I was in favour of granting leave in that case.
MR COBDEN: That is rather menacing, your Honour. I had better spend just a couple of minutes on the question in that case. The definition of “cinematograph film”, your Honours, is in section 10. It means an aggregate of visual images. The key point in Justice Burchett’s decision in Galaxy v Sega, which was agreed with by Justice Lockhart, Justice Wilcox and Justice Lindgren in the Full Court in one way or another, was that there was an aggregate of visual images, even if there was some control on each particular occasion in which the aggregate was displayed to the user, by the user of the precise outcome. There is evidence in this case that there were parameters very like the Galaxy v Sega parameters.
GUMMOW J: We are construing the definition of “cinematograph film”, are we?
MR COBDEN: Yes, your Honour, and it means the aggregate of the visual images embodied in an article or thing - - -
GUMMOW J: How do you read it in the light of Galaxy?
MR COBDEN: First of all, you start with an article or thing, your Honour and, in this case, that was the CD-ROM of the whole of the game. That was the starting point in Galaxy v Sega as well, that is to say the starting point and Justice Lindgren looked at this because of - - -
GUMMOW J: Do not worry about anybody else, just worry about the text.
MR COBDEN: Yes, your Honour. First of all, an article or thing, that is the CD-ROM. That contains an aggregate of all the visual images that are capable of being shown as a moving picture. On each time you play the moving picture, the same aggregate is available, but a slightly different result is shown depending on the way in which you control - - -
GUMMOW J: Capable, by the use of the article, of being shown as a moving picture.
MR COBDEN: Yes, your Honour.
GUMMOW J: Is there a definition of “moving picture”? I have forgotten. There is not, is there?
MR COBDEN: No, your Honour, there is not.
GUMMOW J: We know what “moving picture” meant in 1968. It did not mean what we saw this afternoon.
MR COBDEN: With respect, your Honour, it meant any aggregate of visual images. It goes back as long ago as the flickering image of - - -
GUMMOW J: Indeed.
MR COBDEN: - - - cinematograph or, indeed, it may well be that one of those picture books that one flips. “Moving pictures”, with respect, does not necessarily just mean celluloid film or a defiant series of images following a plot. I would respectfully submit that, in fact, one of those books with drawings on them that change slightly, one to the next, which you can flick through, would be an aggregate of visual images embodied in a thing so as to be capable of being shown as a moving picture.
So, it has a very wide variety of meanings available to it, with respect. What we saw screened on the wall this afternoon has all the features of a moving picture that one would have seen at the cinema in 1968 or indeed even the rudimentary cinemas of 1911 - when it was probably then pronounced cinematograph productions - were projected as dramatic words or as a series of photographs. We would respectfully submit there is nothing in the definition that says that a moving picture of that variety is not to be protected just as a moving picture of any other variety would be.
HEYDON J: Mr Cobden, you started off by drawing attention to Mr Basten’s contention that you bore the onus of showing that Galaxy was wrong and you said that had never been run below.
MR COBDEN: Quite so, your Honour. Is that some factual type argument? Is that a Suttor v Gundowda type of point or merely, as it were, jeering at it as an afterthought.
MR COBDEN: Your Honour, it was not contested. We say that the point does not arise for consideration in this case by this Court at all because it was conceded by Mr Stevens that what we had on our CD-ROM was a cinematograph film. That is as surely as if he had admitted it on a pleading. There may well be an occasion for your Honours to consider the correctness of Galaxy v Sega but we would respectfully submit that this is not the occasion because there is a concession which, as Mr Stevens’ counsel adhered to in the Full Court, did not raise it again there, and reiterated in their reply submissions in this Court, that they do not dispute that there is a cinematograph film of ours on the CD-ROM. Unless, perhaps by analogy with admissions - - -
HEYDON J: And your point is a non-party should not be allowed to disturb this consensus?
MR COBDEN: That is what we would say, your Honour, and in particular because the point was not raised below, there were no submissions about it below, it has not been considered by the Full Court in relation to this case and once there is a concession or admission that there is a cinematograph film within the meaning of the Act of which we are the copyright owner - - -
HEYDON J: Is there any evidence that could have been called at trial which might have defeated the point by any possibility?
MR COBDEN: As my learned leader reminds me, in Sega there was a vast amount of evidence which really went to how these sorts of works are created and that often happens in the seminal or test case. Once the principle is accepted and then once one says, “This is a cinematograph film like in Sega” or, “This is a computer program like in Apple”, we are not going to go and demonstrate every time we prove a computer program, how that works.
If there had been a challenge to the point at trial - although we raised it very late, if there had been a denial this was a cinematograph film, we may well have sought an adjournment. We may well have led a very large amount of evidence about the way - - -
GUMMOW J: What, to different effect to the evidence before Justice Burchett at first instance in Galaxy as to how these things are created?
MR COBDEN: No, your Honour, but conceivably, if the argument against us were, for example, that there were too many different varieties of moving picture that could result from the use of the aggregate by the use of a console, we could put on evidence, for example, that would demonstrate precisely how far outside the basic moving picture one could stray. Our principal submission is that because it is conceded as a cinematograph film the matter does not arise for this Court.
McHUGH J: Did not the evidence in Galaxy indicate that you got a different set of visual images every time?
MR COBDEN: I think the evidence, your Honour, indicated that there were some very close parameters within which you had to operate. Perhaps I could develop a slightly better answer to Justice Gummow when answering your Honour’s point. If there had been a challenge to whether this was a moving picture with just some changes at the margin, we could have, for example, led evidence to show that the scenery part was unchanged the whole of the time.
Now, the scenery part, even without the bikes – again,
it might not be very interesting, but not every moving picture is very
interesting – may itself simply amount to a cinematograph film or a moving
picture without the interactive element of the bike,
because, although subtly
cartoon-like, a cartoon of a tour of the Sachsenring circuit, would, we would
respectfully submit, still
be a full cinematograph film in its own right. So
the raising of the point, we would respectfully submit, at this stage, is too
late for this case, without detracting from the ability, naturally, of this
Court to hear in
another case whether Galaxy v Sega is correct.
Unless there is anything further, those are our submissions.
GLEESON CJ: Yes, thank you, Mr Cobden. Yes, Mr Nicholas.
MR COBDEN: I am just asked by my learned leader to hand up some copies of the directive of the European Parliament in response to the question by Justice Gummow earlier.
GLEESON CJ: Thank you. Yes, Mr Nicholas.
MR NICHOLAS: Your Honour, Mr Basten wanted to say something with your Honours’ leave.
MR BASTEN: This could be infringing the terms of my leave. Could I have 90 seconds of your Honours’ time to correct or disavow a use of the term “apprehension” which Mr Catterns borrowed from our submissions?
GLEESON CJ: Yes.
MR BASTEN: In answering your Honour Justice McHugh, Mr Catterns went to the definition of TPM to argue that the use of an access code or an encryption or scrambling would not necessarily prevent access, and therefore would not prevent copying of the work, but would prevent apprehension of the work, as here. With respect, I did not use the term “apprehension” as synonymous with access, but with use, and if one has access so as to allow one to make a complete copy of the work, the access code is clearly not the sole means of ensuring that access to the work is with the authority of the copyright owner in the terms of paragraph (a). Accordingly, paragraph (a) of the definition only answers your Honour Justice McHugh’s concern about temporality by assuming the answer to the question which is attempted to be proved.
Mr Catterns’ reading of “access to the work” as apprehension of visual images can only be achieved by ignoring the chapeau, and, on any view, that approach is not permissible. What the government had in mind appears at Justice Lindgren’s judgment in the appeal book at page 63, paragraph 102, and it gives no support to my friend’s construction. The part of the EU directive set out at paragraph 108 in his Honour’s judgment seems to use similar words, but to a different effect, which he seeks to import into this legislation.
GLEESON CJ: Thank you, Mr Basten. Yes, Mr Nicholas.
MR NICHOLAS: Your Honours, if I can return to the question of section 116A and the definition of “technological protection measure”, and deal with a number of matters Mr Catterns has raised, and if I can refer to, by shorthand, this argument concerning prospective infringement. We say, your Honours, that when one looks at the definition of “technological protection measure” and, in particular, the means identified, certainly, in paragraph (a) – paragraph (b) raises a different approach – all of the means referred to in that subparagraph may not prevent or hinder all copying, but they certainly will prevent or hinder copying at some stage. If one takes, for example, the obvious one, “access to the work”, if access to the work is denied, it cannot be copied. Then decryption - - -
HAYNE J: In what sense are you using the expression “access to the work”? More relevantly, perhaps, what does the statutory definition mean by that expression?
MR NICHOLAS: If it is used broadly and it is talking about access in any terms, we still come back to the question of the meaning to be given to “prevent or inhibit infringement of copyright”. The means that are described there are all means which would stop copying, not mere use. So that, to take an example, a process that involved encryption to protect a work would need to be defeated in order for the work to be de-encrypted, which de-encryption would then constitute a reproduction of the work and an infringement. So that is to say - - -
HAYNE J: Would there not be an infringement if you could simply burn a new CD, still encrypted?
MR NICHOLAS: There may or may not be, your Honour. That is a question which would involve determining whether or not there was a reproduction of the original work when it had been transformed into its encrypted state. But certainly when the work is then decrypted there will be a reproduction because one will then, following the decryption, have a work which bears perfect resemblance to the original work.
So on this construction of the section we do see the processes that are described in subparagraph (a) as operating in order to check a subsequent infringement. The same, we would submit, occurs in relation to unscrambling; just another expression perhaps for a form of description or other transformations. So the infringement that is being checked in each of those instances is the infringement that would, we would say, inevitably occur when the work was decrypted, unscrambled or transformed once the protected device had been circumvented.
So the protected device, in all scenarios that are expressly identified here, is checking an infringement that is yet to occur. Now, my learned friend picked up the example that we raised with the Microsoft Office CD-ROMs. True it is that they can be copied in the same way the Sony PlayStation disk can be copied, but where the section has work to do in the case of the Microsoft program is that for the program to be installed, which necessarily involves reproducing the program on the hard drive of one’s computer, the access code needs to be entered – or the key number, as they would refer to it – before the reproduction can occur.
So, again, in that example we see the access code working to check what may or may not be an infringement. Then my learned friend referred to the AutoCAD lock, suggesting that it was outside the protection of this system. Well, we would respectfully submit not because AutoCAD, we know from the decisions of this Court and the Court’s description of the system, was a piece of proprietary software for installation on general purpose computers, and we may reasonably assume that when AutoCAD was run there was a reproduction in a material form occurring in RAM. Now, that leads into the second question as well, which I will come to in a moment.
We respectfully submit that even in the case of the AutoCAD lock, and there may be some room to argue about that in the absence of any evidence as to whether or not there is a reproduction in material form of any part of that program when the system is run, that all of the examples that are postulated here do fall within the definitions we would say it should be construed.
GUMMOW J: What do you say in response to the criticism of your reliance upon what Justice Sackville gave as illustrations of “inhibit”?
MR NICHOLAS: Yes, your Honour. We, with respect, say that is misconceived because what his Honour was saying is that the device in the circumstances his Honour was describing in paragraph 116 of his judgment would be in effect working to spoil the copy, prevent some part of it being copied, or to reduce the quality of the copy that was made.
GUMMOW J: Well, the latter is said - the response is so what. It is still an infringement.
MR NICHOLAS: It would still be an infringement, your Honour, but the copying - the infringement is being inhibited in that if the infringes object is to create a perfect copy, he is being stopped short of obtaining that result. So we would submit that that is also quite consistent with what his Honour said about the additional work that the word “inhibit” has to do above and beyond the word “prevention”.
HAYNE J: Does that argument owe anything to the origins we find in history of the use of the word “effective”? That is, are you injecting notions of effective inhibition or the like into the language?
MR NICHOLAS: No, your Honour. We would submit on the contrary, because we are accommodating the situation where there is an inhibition but not a prevention. That is, there is some imperfect or perhaps only partially effective check on the making of an infringing copy.
HAYNE J: And the copy either infringes or it does not. Whether it is a good copy or bad copy seems not to the point. So I do not quite know where this argument is taking us.
MR NICHOLAS: Well, your Honour, it inhibits infringement in that, true it is an infringement occurs, but not an infringement on the scale that would be possible in the absence of a device.
McHUGH J: But does not Justice Sackville’s interpretation lead to the fact that it inhibits all subsequent infringements after access? The issue here is whether or not, on its proper construction, section 116 catches anticipated infringement before you get access. Do you follow what I am putting?
MR NICHOLAS: Yes, your Honour.
McHUGH J: What I am putting to you is that, whichever of the two interpretations you accept, it catches subsequent infringements, that is infringements subsequent to access. The real issue here is whether or not it catches and - it anticipates infringement. It inhibits infringements that otherwise would have occurred.
MR NICHOLAS: Infringements that have already occurred in circumstances where it may be assumed for the argument there would be no further infringements occurring at all, the copy having been created and made ready for use and subsequently used.
McHUGH J: What I was putting to you – just correct me if you do not agree with it – I thought it was in your favour – I did not think that Justice Sackville’s interpretation only had a limited operation, but it would deal with any device where the process was access first, infringement afterwards.
MR NICHOLAS: Yes, your Honour.
GLEESON CJ: It must have been attempted infringement on that basis, because if infringement is prevented, by hypothesis, there is no infringement.
MR NICHOLAS: Yes, your Honour, I
would accept that. Justice Gummow asked, as I recall, where the expression
“access control” may have
come from in terms of the discussion, the
very extensive discussion, that led to this. At page 176 of the
Federal Court appeal book,
in Justice Sackville’s judgment at
paragraph 84, his Honour quotes from the Advisory Report on the
Copyright Amendment (Digital Agenda) Bill 1999, and he refers to this
explanation of access control measures:
“Access control measures allow the copyright owner to control who has access to the copyrighted material. Examples of access control measures include password protections, file permissions and encryption.”
That would cover what we see referred to in paragraph (a) of the
definition, and they are all measures that are capable of blocking
or preventing
or inhibiting subsequent infringements that occur as a consequence of obtaining
access. Then there is a reference
to copy control measures being:
based on the premise that a user already has some lawful access to the work - - -
GUMMOW J: Yes. There is a contrast in the third sentence, “a user already has some lawful access”.
MR NICHOLAS: Precisely.
GUMMOW J: And you rely on that.
MR NICHOLAS: Suggesting that the second limb is concerned with situations where access has already been obtained by complying with or defeating the other processes that are referred to in subparagraph (a).
HAYNE J: Well, the debate there reflected first turns upon concepts of “lawful access” to the work, exactly what is encompassed by that, and seeks to divide the world into two classes, users who have lawful access and users who do not have lawful access, when the circumstance with which we are faced is a circumstance where the disk can be burnt to a fresh copy - - -
MR NICHOLAS: Yes, your Honour.
HAYNE J: - - - and yet, the question remains, does the user of that new disk have lawful access to the work? Answer, no.
MR NICHOLAS: Your Honour, the mere possession of a disk does not, prima facie, involve any infringement of copyright.
HAYNE J: But the debate reflected proceeds from an unduly simplified understanding of the quite complex range of circumstances that can be confronted.
MR NICHOLAS: Yes, your Honour.
GUMMOW J: What does this word “access” mean? I still do not understand it.
HAYNE J: Nobody will tell us.
MR NICHOLAS: Well, your Honour, we - - -
GUMMOW J: The general attitude seems to be, “Don’t you worry about that”.
MR NICHOLAS: I am sorry, your Honour?
GUMMOW J: The general attitude seems to be, “Don’t you worry about that”, but we have to worry about it, and it is just inarticulate at the moment, in my mind.
MR NICHOLAS: Your Honour, in context, we would say the better view is - - -
GUMMOW J: It is a metaphor for something.
MR NICHOLAS: It is referring to access that would facilitate an act of infringement.
GUMMOW J: What activities do you mean by the word “access”?
MR NICHOLAS: I accept that it would include the range of acts within the copyright. Certainly, making a copy is, for present purposes, that which is most relevant. Communicating the work, involving communications to the public - - -
GUMMOW J: Just think of the whole range of works for a moment. What amounts to “access”? I do not have access to the Mona Lisa because I cannot get into the Louvre without paying and it is often shut.
MR NICHOLAS: Yes.
GUMMOW J: Now, what are we talking about? None of these reports addressed the question. They do not address it in the United States either, from what I could see in the materials. It is all assumed that everybody knows what they are talking about.
HAYNE J: In particular, an assumption seems sometimes to be made that access for the work in the context of computer programs means the capacity to run the program.
MR NICHOLAS: Yes.
HAYNE J: Why?
MR NICHOLAS: Which is something quite different.
HAYNE J: What?
MR NICHOLAS: To access to the work, whether it be access to the original work or access to a reproduction of the work.
HAYNE J: The large commercial forces, to which Justice Gummow has referred in the course of argument, are concerned primarily with who could run computer programs.
MR NICHOLAS: No doubt they were - - -
HAYNE J: Not necessarily who could copy them.
MR NICHOLAS: No doubt they were, your Honour, but that does not bear on the question of what the section means. In relation to Mr - - -
GUMMOW J: But you can have access. The assumption seems to be you can have access without the committing of any act within the monopoly, is it not?
MR NICHOLAS: Yes, your Honour.
GUMMOW J: Now, what are we talking about of acts outside the monopoly which give rise to access, apart from running the computer program?
MR NICHOLAS: Your Honour, we are talking about, in our submission, obtaining access to the work, typically online by downloading a copy of a program, perhaps through a password-protected website, or receiving a copy of a program by email attached, in circumstances that protect the program from being opened and copied onto one’s hard drive without having to provide an access code or comply with some other process.
McHUGH J: But in the context of 116A does it mean anything more than being placed in a position where but for the TPM you would be in a position to infringe the copyright.
MR NICHOLAS: Yes, your Honour. That is how we would see this section operating, and the prevention or inhibition is aimed at checking infringement either at any time from which access was obtained. In the circumstances of this particular case there is no act of infringement that occurs, subject to the second and third arguments, after that point in time and, therefore, there is no such act that has prevented or hindered.
Justice McHugh raised with our learned friend the effect of the section in circumstances where someone wanted to create their own PlayStation console and play PlayStation games on it, a not completely academic scenario. The respondents’ answer to that proposition is a very circular one, we submit, because what they say is that these games are protected because copyright infringement is prevented or hindered because the games are useless. That is the word they use. They are only useless if no one else is free to make available the hardware that will enable those games to be played. So it is very much a bootstraps argument to say that the games are useless. They are useless if they must be played, as on the Full Court’s interpretation, for all practical purposes they have to be, on a Sony PlayStation console, but not otherwise. So, with respect, we do not see your Honour’s argument as having been satisfactorily answered, and it is - - -
McHUGH J: It was not an argument, it was a question.
MR NICHOLAS: Yes. I am sorry, your Honour. I adopt it as an argument if I may.
Can I then come briefly to the second issue of copying RAM. It is true that we have never advisedly said that RAM was not, at least since the 1984 amendments, a form of storage within the meaning of that word, as used in the definition of “material form”. The reason for that is that when one does go to the explanatory memorandum, it does make it quite clear that, as we interpret it, RAM was one form of storage that may, we say may, qualify for the purposes of a material form. We say “may” because the definition of course does not refer to RAM in terms and it introduces words which are not referred to in the explanatory memorandum, being the words “can be reproduced”, and it is not insignificant that at the time the 1984 amendments were under consideration, for the most part the consideration that was given then to these issues concerned computer technology, which by today’s standards was fairly primitive. Those amendments followed the Apple decision at first instance, and I would respectfully submit - - -
McHUGH J: Was it after the Full Court decision or the - - -
MR NICHOLAS: Just after the first instance.
McHUGH J: The Full Court reversed the trial judge, and then the High Court reversed the Full Court.
MR NICHOLAS: Yes, your Honour.
HEYDON J: Paragraph 4 of the explanatory memorandum refers to the reversal of Justice Beaumont’s decision 2:1, and a further appeal has been lodged, so it must have been after the Full Court.
MR NICHOLAS: Yes. I am grateful for my learned friend. There was an announcement made that the legislation would be introduced very soon after Justice Beaumont’s decision.
GUMMOW J: Then there was an agonising time in the draftsman’s office. Then there was the Full Court decision.
MR NICHOLAS: The submission we wanted to make in relation to the 1984 amendment is that, it is fair to say that - and this followed from a reading of Apple, a reading of the explanatory memorandum and other material - that we were not at that time addressing these problems in terms of machines like the Sony PlayStation. We are concerned with general purpose computers, and the two cases that have raised facts which throw into sharp focus the important differences between a general purpose computer and what we have come to call a special purpose computer are the AVRA Case, which concerned DVD players, and this case concerning the Sony PlayStation.
The one characteristic both devices share is that they do not contain screens, printers or other apparatuses by which one can print from the RAM or inspect the RAM or have regard to it in any way whatsoever. That is what gave rise to the debate in AVRA and in this case as to whether one could treat RAM as deployed in these particular applications as satisfying the requirements of the definition. On our learned friend’s construction of “material form” prior to 1 January of this year, we would say those words “can be reproduced” are given no work to do whatsoever.
One can see compelling reasons why, when that definition was being propounded, one would want to know that the former storage in which the protected work would reside could be scrutinised. That would be important for questions of subsistence and it would be important – although I would accept perhaps not perceived to be at the time – in terms of a commonsense view of what one is doing when using a special purpose computer, running a game, some part of a computer program is stored in RAM in circumstances where no one would ordinarily suggest that the computer program was being reproduced, nor could it be said, we submit, coming back to the terms of the definition, that that computer program “can be reproduced”.
We submit that the line of country that begins with AVRA and Justice Emmett’s decision is correct for the reason that was given by his Honour in that case and the majority in the Full Court in this case and Justice Sackville. It is perhaps surprising that the point took so long to arise, but really the AVRA Case was the first time that threw up a device where the significance of those words “can be reproduced” really became apparent.
The submissions
on RAM are developed in some detail in the written submissions. May I also draw
attention to, because it is not
mentioned in the documents, the paragraph in
Justice Lindgren’s judgment which is paragraph 172 where he
– and Justice
French agreed here – refers to the evidence of
Mr Nabarro and what is said there is that:
The testimony -
and this is the evidence that my learned friend now relies on
here -
of Mr Nabarro was not that machines or devices were already available which made possible reproduction of the PlayStation games’ computer programs out of RAM. Rather, his testimony was that “if it were absolutely necessary some piece of hardware could be developed to extract it and reverse the whole process back”.
That is, aside from the question of construction, not a terribly satisfactory body of evidence upon which this question ought to be being determined. The same point arises in relation to the cinematograph film point.
The cinematograph film point, as my learned friend has indicated, arose at first instance, at a time when Mr Stevens was unrepresented, very late in the day – on the first day of the trial, in fact. There was a very large number of PlayStation games relied upon by Sony which were said to constitute cinematograph films in addition to computer programs. One of the criticisms we make of the evidence that is relied upon by Sony is that they did not sue in relation to infringement of films. What they did was they sued in relation to - - -
GUMMOW J: I was wondering that. Have we got the initiating process?
MR NICHOLAS: It will be in the first appeal book, your Honour, and I will turn it up. The case essentially was conducted on the basis of section 116A. The point we make is that it is not good enough to determine, for the purpose of section 116A – the question being whether or not a device has a particular form of operation in its ordinary course – to look at only a couple of games in a hearing, by means of demonstrations of the kind your Honours have shared in today, without any real elaboration in evidence at a technical or any other level, for that matter, for the purpose of determining whether one can say that that definition of “technological protection measure” is satisfied, if it is said that we come within the protection of that provision because the work that is being protected by this process, in the ordinary course of its operation, is a cinematograph film. So one would need some sound body of evidence to draw that conclusion because it does involve moving from the specific to the general.
There was some evidence given by Mr Stevens, which is referred to in our written submissions. It is not wholly satisfactory in that there does seem to be some debate as to whether he was using what my learned friend calls a demonstration game, issued by Sony no doubt though, or one of the catalogue of games that our learned friends relied upon, for the purpose of demonstrating that what was said to be true of these two games was not true of others.
So whether it is successful in that attempt on the evidence - that is, to positively prove the contrary – or whether you merely raised it as a live issue at the trial, we say that his Honour Justice Sackville was quite entitled not to act on what has been described in the judgment as very scant and sketchy material. Now, it is true – and it followed from the way in which the case was conducted at first instance – that we did not raise the correctness of Galaxy in the Full Court.
HEYDON J: Just before you go on. Your submissions say that the cinematograph film argument was raised for the first time by Sony by amendment of the pleadings pursuant to leave being granted by Justice Sackville on the first day; you refer to page 8 of the relevant appeal book. That pleads that the second applicant was “the owner or exclusive licensee of the copyright in a range of” films, paragraph 22. Paragraph 30 pleads a breach of section 116A, but no breach of anything else in the Copyright Act.
MR NICHOLAS: Yes that is so, your Honour. That is so.
HEYDON J: So your submissions are wrong, are they not?
MR NICHOLAS: I am sorry, your Honour?
HEYDON J: About saying that the cinematograph film argument was raised by amendment of pleadings.
MR NICHOLAS: Yes it was, your Honour, in that paragraph 22(b), is my recollection, was introduced on the first day of the hearing - page 12.
HEYDON J: This third issue, though, depends on whether the playing of the PlayStation game involves the making of a copy of the whole or a substantial part of the cinematograph film.
MR NICHOLAS: Yes, your Honour.
HEYDON J: That is a distinct breach of the Act, is it not, from section 116A?
MR NICHOLAS: Yes, your Honour, but it is not a breach of the Act that was sued on.
HEYDON J: I agree, but why, then, are you talking in paragraph 65 in the way you are? The cinematograph film argument would only arise if there were a breach of other parts of the Act than section 116A. Is that not so?
MR NICHOLAS: If your Honour looks at page 13 of the pleading – of the book, the amendment that was introduced on the first day is the amendment which is picked up in 25(ii).
HEYDON J: I see, the 116A argument cuts in, as it were, in relation to the infringement. There is no action for the infringement itself, but there is a claim that 116A – I see.
MR NICHOLAS: That is so, and, your Honour, that is why we say that it is not a case of coming to a view in relation to a particular reproduction and saying, “I am satisfied in that case that there has been an infringement”, because that is not the way the case was pleaded or conducted. It really did involve going beyond that to demonstrate in relation to the catalogue of films – and this is reflected in the pleading – that this device was designed in the ordinary course of its operation to prevent or inhibit infringement of those films.
GUMMOW J: There was no action on 101.
MR NICHOLAS: Yes, your Honour, that is correct.
GUMMOW J: There was 116A. Mr Basten – I may have misunderstood him – referred to criminal sanctions, but are there any sanctions for infringement of 116A other than 116D?
MR NICHOLAS: Criminal sanctions?
GUMMOW J: Yes.
MR NICHOLAS: Yes, your Honour, in 132(5B), I believe.
GUMMOW J: Yes, thank you.
MR NICHOLAS: What we would observe, and Mr Basten may have made the point about that provision, is that the requirement of knowledge goes to the question of whether or not there would be a circumvention of a device, not whether or not there would be an infringement of copyright so it has very broad operation, potentially.
Perhaps against that background we have not contested the correctness of Galaxy in the Full Court but Galaxy is very different to this case in a number of significant ways. It does, of course, raise the question of cinematograph film and the way it applies to video games but Galaxy was not concerned with substantiality at all because in the case of Galaxy the infringing articles were EPROMs or hard-wired chips. It did not raise any question of reproduction in RAM at all and these chips had been imported in their entirety. So no question of whether or not there had been a reproduction in substantial form arose in Galaxy.
The absence of evidence that one might have expected to see at the trial hearing in relation to the principal point decided in Galaxy complicates the issue of substantiality, but we submit that that is a problem for our learned friends, rather than us, because the Court is in a position where it is not able to look at the evidence for the purposes of determining whether or not there has been a substantial taking of what was alleged to be a cinematograph film, and determine, well, what are the particular images? What is that part of the film which is in RAM at a given moment in time, and is it substantial, or is it insubstantial?
The reason I say that is that we know that the images that constitute the data that is in RAM at some stage is manipulated by the program. So one cannot know, absent some expert evidence, without perhaps engaging in some measure of guesswork, what is an image that formed part of the original film that has been embodied in RAM, and what is the creation of the computer program? And, beyond that, what is the creation of interaction between the computer program and the user?
The whole question of substantiality is left to be decided in the light of what we say is this quite contrived and unsatisfactory situation, where all that is done is a game is played, a disk is removed from the console, and the Court is invited to draw inferences about what part of the cinematograph film is in RAM at a particular time, and whether or not that forms a substantial part of the whole.
We submit that it is not surprising that there has been no finding made up until this point of a substantial taking of the cinematograph film against the background of that evidence.
KIRBY J: Why do you say that? Where else does the image come from? By magic? Is it in the air? I mean, really, you have to use your commonsense here and draw inferences as judges do all the time.
MR NICHOLAS: Yes, your Honour, but we know that - - -
KIRBY J: We saw the disk in. We saw it taken out. We saw the image projected and it was a full playable game.
MR NICHOLAS: No, with respect, your Honour, it was not a full playable game that your Honours saw.
KIRBY J: W did not see the full game but we were told that it was one full game.
MR NICHOLAS: At no stage did your Honours see a full game loaded in RAM. Your Honours were watching a part of a game, but the point we make is that that game as was projected on the wall today is the outcome of a complicated technical process that involves taking some existing images, projecting those and then manipulating those as well and then deploying those again and at another level it involves interaction with the user. So that if one could sit down and look at a catalogue of the total images that were in the film, that were in the work to begin with and say, “All right, we can now see where it begins and ends. We can see what relationship the images that are in RAM at any particular moment bear to the whole”, some meaningful conclusions could be drawn but, in our respectful submission, not on the basis of these demonstrations.
We do say that the games have obviously been selected to make points for the purposes of the section 116A case. They have been deployed in the course of these demonstrations in particular ways and this is not said critically - - -
KIRBY J: That is what cases are all about; what courts are all about. The party has one case to try to advance its cause and you have entitlements to reply.
MR NICHOLAS: Your Honour, it goes to the question of the representativeness of what one sees given that such a small selection of work is presented for the purpose of justifying a proposition that this device is intended to prevent or inhibit infringement across the whole catalogue of films. Mr Stevens, on one view succeeded, our learned friends disagree but on one view he did, in demonstrating that there are some games where what was attempted today cannot happen because you take the disk out of the console and the game stops and that, in our submission, is an important matter.
Your Honours, in relation to the question of substantiality, we do say, because originality is not a relevant touchstone when we are dealing with a cinematograph film, that the purpose for which the reproduction is occurring, and we say purpose at an objective and technical level, is a relevant consideration. It is not, of course, Mr Stevens or Mr Nabarro’s purpose, but one asks why is that part of the work being reproduced in RAM and the answer to that on the evidence is at a technical level it has been there because RAM is being used as a buffer, as a storage place, not for the purposes of copying in any conventional sense or for the purposes of exploiting the work commercially. It is simply being used in the same way a book is being read.
GUMMOW J: I am not sure how substantiality really gets into a 116B case, or a 116A plus B case. You are not talking about infringement of particular works or subject matters, are you?
MR NICHOLAS: Yes. Well, I am - - -
GUMMOW J: What you have been saying is rather tending that way. For all we know, Sony makes thousands of these games.
MR NICHOLAS: That is so, and what they needed to show was, on our interpretation of the section, that it prevents or inhibits infringement in the ordinary course of its operation. The infringement they rely upon is the infringement of their cinematograph films, and the case came down to an argument about substantiality in relation to one or two films. But even if that is resolved in their favour, that does not get them there, because one cannot, on that material, extrapolate as one would need to do.
Your Honours, we have dealt with the question of embodiment in
our written submissions and section 24. We submit, for the reasons
that
were given by Justice Lindgren, that there is not an embodiment of the
images in RAM in the necessary sense. The RAM, acting as a buffer or a
transit station, if you like, is not something that has been
treated in relation
to the visual images so that the images are capable of being
reproduced.
KIRBY J: Is this not all in your written submissions at 18?
MR NICHOLAS: Yes, your Honour, it is. Unless there is anything further, your Honour, they are our submissions in reply.
GLEESON CJ: Thank you, Mr Nicholas. Is there anything
arising out of that?
MR CATTERNS: No, your Honour. I just
wondered if the Court would be assisted by a brief written submission on the
meaning of the word “access”
as raised by his Honour
Justice Gummow and I think Justice Hayne.
GLEESON CJ: Any party who wants to put anything in writing on that can do so within seven days.
MR CATTERNS: May it please the Court.
GLEESON CJ: We will reserve our decision in this matter and we will
adjourn until 10.15 tomorrow morning.
AT 4.27 PM THE MATTER
WAS ADJOURNED
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