JUDGMENT No. smn tty 2 jecorteonsees enevesesesce IN_THE FEDERAL COURT OF AUSTRALIA ) ) N OUTH WALES DISTRICT REGISTRY ) No. G466 of 1991 ) ) GENERAL DIVISION BETWEEN: INTERNATIONAL WRITING INSTITUTE INC Applicant AND: RIMILA PTY LIMITED First Respondent RODNEY BANFIELD TUBBS Second Respondent COURT: LOCKHART J. PLACE: SYDNEY DATE: 25 NOVEMBER 1994 CORRIGENDUM Amendment to the reasons for judgment of Justice Lockhart. 1. Page 7, line 4, replace "IWI" with "Rimila"; 2. Page 7, line 7, replace "Rimila" with "IWI". Ky, AA Pedi Associate to Justice Lockhart Date: 12 December 1994 RECEIVED 13 DEC 1994 FEDERAL COURT OF AUSTRALIA PRINCIPAL REGISTRY JUDGMENT No. snl bonl srcd Tie CATCHWORDS DAMAGES - breach of copyright in writing skills courses and materials - calculation of damages for infringement under s 155(2) and for conversion under s 116(1) Copyright Act - calculation of overlap - additional damages for flagrancy of infringement - award of interest. Copyright Act 1968: ss 10, 37, 38, 115, 116 Federal Court of Australia Act 1976: s SIA INT TING INSTITUTE INC v LA PTY ED and RODNEY BANFIELD TUBBS NG466 of 1991 LOCKHART J. SYDNEY 25 NOVEMBER 1994 RECEIVED ~2 DEC 1994 FEDERAL COURT OF AUSTRALIA PRINCIPAL REGISTRY IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) No. G466 of 1991 ) ) GENERAL DIVISION BETWEEN: INTERNATIONAL WRITING INSTITUTE INC Applicant AND: RIMILA Y LIMITED First Respondent DNEY_ BANF D_ TUB Second Respondent JUDGE MAKING ORDER: LOCKHART J. WHERE ORDER MADE: SYDNEY DATE ORDER MADE: 25 NOVEMBER 1994 UTE OR THE COURT ORDERS THAT: 1. The matter be stood over to a date to be fixed. NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN _ THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. G466 of 1991 wee ww GENERAL DIVISION BETWEEN: INTERNATIONAL W INSTITUTE INC Applicant AND: RIMILA PTY LIMITED First Respondent RODNEY BANFIELD TUBBS Second Respondent 25 November 1994 REASONS FOR JUDGMENT LOCKHART J. On 10 November 1993 I gave judgment on the issues relating to the liability of Rimila and Mr Tubbs' to International Writing Institute Inc. (IWI) concerning the claim by IWI that Rimila had infringed IWI's copyright in IWI's writing skills course entitled "Put It In Writing", which included a Participant's Manual, a Conference Leader's Guide, audio visual materials and video cassettes (the PIIW Works). My findings included the following:- . That Rimila had reproduced in a material form a substantial part of the literary work in the Participant's Manual PIIW published in 1968, 1972, 1977, 1986 and 1989 save for the illustration at p 86 of exhibit AJ8. This reproduction was admitted by the respondents. Reproduction by Rimila in a material form of a substantial part of the Participant's Manual PIIW UK edition 1983 UK (exhibit AJ5) and Participant's Manual PIIW published 1989 US edition (exhibit AJ8), the reproduction being in the Rimila publication Participant's Manual BWS (exhibit 4). This reproduction was admitted by the respondents. IWI was entitled to claim damages for infringement and conversion of the PIIW Participant's Manual. Reproduction by Rimila in photocopy form in its BWS Overhead Transparencies (exhibit 19) which were taken from the Participant's Manual PIIW and Conference Leader's Guide PIIW, which constituted an infringement by reproduction. IWI did not press its claim for infringement of the PIIW Conference Set (videos) or the BWS Guidelines' for Instructors BWS (exhibit 20). IWI established its case for infringement by reproduction in a material form of the 1986 edition of the PIIW Conference Leader's Guide and the 1989 edition of the PIIW Participant's Manual (exhibit AJ7 and AJ8). This infringement was established as against Rimila and Mr Tubbs pursuant to s. 30(1)(i)(a)(i) and s. 36 of the Copyright Act 1968 (the Act). . The BWS overhead transparencies of Rimila constituted an adaptation of both the Participant's Manual PIIW and the Conference Leader's Guide PIIW. The case of IWI was established against Rimila and Mr Tubbs. . IWI established its case that Rimila authorized its franchisees to publish and reproduce its BWS course which contained a substantial part of the PIIW course. My earlier reasons for judgment must be read in full in order to understand the present aspect of the case dealing with the assessment of damages. My earlier judgment is reported at (1993) 27 IPR 546. On 1 December 1993 I made orders in the following terms: "1, The respondents and each of them, whether by themselves and in the case of the first respondent, its directors, officers, servants or agents, or otherwise howsoever, be restrained from infringing the applicant's copyright in the applicant's manual and course materials known as the Put [It In Writing ("PIIW") writing skills course including the Participant's Manual PIIW ("the literary and artistic works") and, in particular, from printing, publishing or offering for sale, exposing for sale or selling or by making an adaptation or by reproducing or by authorising others to reproduce any of the literary and artistic works therein contained or any substantial part of the literary and artistic works therein contained. The respondents and each of them Shall within 21 days of the date of this order deliver up on oath to the applicant at the address of the applicant's solicitors, Anisimoff Davenport, 170 Pacific Highway, North Sydney all infringing copies of the said literary and artistic works and all proofs, plates, bromides, matrices and other reproduction materials used or intended to be used for making such infringing copies which have been at any time or which are at this date comprised in the respondents' 1990 edition Business Writing Skills ("BWS") course whether they be in the possession power or control of either of the respondents or in the possession power or control of any of the officers of directors of the first respondent. The respondents and each of them pay to the applicant damages for infringement of the applicant's copyright in the Participant's Manual PIIW and the Conference Leader's Guide PIIW pursuant to s115(2) Copyright Act 1968. The respondents and each of them pay to the applicant damages for conversion of all infringing copies and other reproduction materials and, in particular, the Participant's Manual BWS and the Audio Visual Materlals BWS, each of which comprises or relates to the respondents' 1990 edition BWS course, pursuant to sll6(1) Copyright Act 1968. Liberty to apply on 2 days' notice is reserved to any party as to costs of these proceedings to this date. The proceedings stand over to a date to be fixed for further hearing to determine, firstly, the amount of 10. il. damages payable pursuant to both S115(2) and s116(1) Copyright Act 1968, and secondly, to determine whether, and if so, in what amount, additional damages ought be ordered to be paid by each of the respondents to the applicant pursuant to s115(4) Copyright Act 1968. The applicant file and serve any additional affidavits and expert's reports to be relied upon on the issue of quantification of the damages so ordered and on the issue of whether or not additional damages ought be ordered and if so what amount by 5.00pm on Friday 14 January 1994. Each of the respondents file and serve any additional affidavits and expert's reports to be relied upon on the issue of quantification of the damages so ordered and on the issue of whether or not additional damages ought be ordered and if so _ what amount by 5.00pm on _ Friday, 18 February 1994. The applicant file and serve any affidavits in reply and expert's reports to be relied upon on the issue of quantification of the damages so ordered and on the issue of whether or not additional damages ought be ordered and if so what amount by 5.00pm on "Friday, 25 February 1994. The proceedings stand over for further directions, with a view to fixing a date for hearing on the issue of quantification of damages, until 9.30am on Thursday 3 March 1994 before Lockhart J. Direct that either party make any subpoenas which they may be so advised to issue seeking production of documents relating to either the issue of quantification of damages or to the issue of payment of additional damages returnable at 9.30am on Wednesday, 23 February 1994 before the Registrar." I gave directions for the purpose of preparing the case for hearing with respect to the issue of damages. The trial of that issue commenced on 17 August 1994. It is apparent from reading my earlier reasons for judgment that the facts of this case are complex. It is necessary to keep in mind some of those facts which have a distinct bearing on the assessment of damages. The business of IWI is not a large one. IwIl received approximately $US10,000 per year for the four years in which Rimila used the PIIW course. The IWI course which Rimila conducted in Australia during the years 1985 - 1989 was at the end of its useful commercial life; or, to use the words of Mr Albert Joseph, it was becoming a "dodo". Even the US course as updated resulted in small business. I accept the contention of counsel for the respondents that the total infringement found against Rimila involved the printing of 3,222 books, each of 80 pages, and 15 sets of 70 overhead transparencies. There 1s some evidence which might lead to a slight variation of these figures, but on balance I am satisfied that they are correct. Hence the assessment of damages is not to be approached on the basis of some large scale deprivation by Rimila of moneys to which IWI would otherwise be entitled. Also, the scale of the infringement and of the relevant conduct of Rimila was small. What I have just said 1s significant, because the approaches adopted by the two principal witnesses on the question of damages, the two experts, were fundamentally opposed. IWI called as its expert witness, Mr W L Lonergan, a chartered accountant and a partner of Coopers & Lybrand in its Corporate Services Division, specializing in the provision of financial advice to clients. Rimila called Mr Pittorino, a chartered accountant in the employ of Deloitte Touche Tohmatsu and a manager for its corporate advisory division. I shall not pause here to discuss the approaches adopted by these expert witnesses; I shall deal with them later. IWI prepared various schedules, in the alternative, relating to the assessment of its claim and they vary considerably from each other. Rimila's case is that the damages suffered by IWI total $35,506. The large difference between the figures is accounted for primarily by the differences in approach between the two experts. Many things fall into place once I have resolved the question of which of the two experts I prefer in whole or in part, if either of them. I should say at once that the approach adopted by Mr Lonergan is in my opinion the correct approach. IWI is entitled to damages from Rimila for infringement pursuant to s. 115(2) of the Act. It is also entitled for conversion damages pursuant to s. 116(1), but not to the extent that there is an overlap between the two. I accept the submission of counsel for Rimila that the primary infringement and focus for damages by IWI must be the making by Rimila for a commercial purpose of 3,222 copies of the Participant's Manual BWS and 15 sets of 70 overhead transparencies. I accept also the submission that IWI suffers no additional loss as a result of the adaptation or publication infringements once it has been fully compensated for the reproduction. As to infringement damages, the best measure is the depreciation in value of the copyright as a chose in action: Sutherland Publishing Co Ltd v Caxton Publishing Co Ltd [1936] Ch 323 at 336. The application of this test requires that the asset be valued as a chose in action and an assessment made of the extent to which it has been damaged. As to conversion damages which arise under s. 116(1) of the Act, it is important to note that s. 116(1) provides "Subject to this Act, the owner of the copyright in a work or other subject-~- matter is entitled in respect of any infringing copy, or of any plate used or intended to be used for making infringing copies, to the rights and remedies, by way of an action for conversion or detention, to which he would be entitled if he were the owner of the copy or plate and had been the owner of the copy or plate since the time when it was made." The interpretation section (s. 10) defines an "infringing copy" as: "(a) in relation to a work - a reproduction of the work, or of an adaptation of the work, not being a copy of a cinematograph film of the work or adaptation; (b) in relation to a sound recording - a copy of the sound recording not being a sound-track associated with visual images forming part of a cinematograph f1lm; (c) in relation to a cinematograph film - a copy of the film; (dq) in relation to a television broadcast or a sound broadcast - a copy of a cinematograph film of the broadcast or a record embodying a _ sound recording of the broadcast; and (e) in relation to a published edition of a@ work - a = reproduction of the edition; being an article the making of which constituted an infringement of the copyright in the work, recording, film, broadcast or edition or, in the case of an article imported without the licence of the owner of the copyright, would have constituted an infringement of that copyright if the article had been made in Australia by the importer." The relevant measure of damages for copyright conversion is the same measure as common law conversion, that is, "by reference to the value of the goods converted": Infabrics Ltd v Jaytex Ltd [1982] AC 1 at 26 and W H Brine & Co v Whitton (1981) 37 ALR 190 at 196-198. -10- The act of conversion 1s the act of dealing with the article in a way that is "inconsistent with the rights of the (deemed) owner" or "unequivocally as their own": Caxton Publishing Co v Sutherland Publishing Co [1939] AC 178 at 189. The value of the goods converted 1s the figure that someone is prepared to pay: Caxton at 203-204. Here there is evidence which assists in determining the value, namely, what was in fact paid by the franchisees. There is clear authority for the proposition that where infringement damages under s. 115(2) and conversion damages under s. 116(1) overlap, the total award of damages must be reduced by the extent of the overlap: Caxton; Lewis Trusts v Bambers Stores Ltd [1983] FSR 453. Overlap occurs when' the infringement measure is "essentially an award of damages in respect of the same sales": Lewis Trusts per Ditton L.J. at 469-470. Overlap occurs, on the facts of the present case, if conversion damages are awarded in respect of the same sales. Claims were also made by IWI for additional damages under s. 115(4) of the Act which provides as follows: "Where, in an action under this section: (a) an infringement of copyright is established; and (b) the court is satisfied that it is proper to do so, having regard to: (i) the flagrancy of the infringement; (ii) any benefit shown to have accrued to the defendant by reason of the infringement; and (111) all other relevant matters, the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances." The term "flagrancy" has been variously defined in the reported cases. It was described in Prior v Lansdowne Press Pty Ltd (1975) 29 FLR 59 at 65 as "calculated disregard of the plaintiff's rights, or cynical pursuit of benefit". In Ravenscroft v Herbert & New English Library Ltd [1980] RPC 193 it was described at 208 as "the existence of scandalous conduct, deceit and such like; it includes deliberate and calculated copyright infringement." Plainly, flagrancy is not established by proof of mere knowledge of copying. If it were, then every instance of infringement under s. 37 and s. 38 would attract additional damages because knowledge of copying or of infringement is an essential element of any act of secondary infringement under those sections. The term "benefit" in s. 115(4)(b)(i1) 1s not easy to define. It 18 possible, as counsel for Rimila submitted, that this expression is intended to encompass the case of innocent infringers who benefit from the infringement and who should therefore account for their profits, but are not amenable to damages at all. Whatever be the answer to this, I am not satisfied on the facts of this case that any discretion of the Court which 1s given by s. 115(4) should be exercised in favour of an award for additional damages. This is not a case where there have been other instances of infringement by Rimila, but not either precisely identified or quantifiable in terms of damages. The conduct of Rimila and of Mr Tubbs was not clandestine. The evidence makes clear that ali acts of infringement have been ascertained and can be compensated for in an award of damages. In my opinion no award of additional damages under s. 115(4) is appropriate in all the circumstances. Facts There was some degree of conflict of evidence between the witnesses called for the parties on the hearing of the assessment of damages. I prefer the evidence of Mr Tubbs on this issue. I am satisfied that from about November 1985 to December 1989 Rimila purchased PIIW course materials from IWI and sold them to Rimila's franchisees. Rimila also granted to those franchisees the right to conduct PIIW's courses in defined territories in Australia and received a royalty from franchisees for courses conducted. Those courses were taught under the name "Business Writing Skills". The only payments made by Rimila to IWI in order to offer the PIIW courses in Australia was for the purchase of material. The total - 13- purchases of Participant's Manuals made by Rimila from IWI in the period from November 1985 to December 1989 were 1,500 Participant's Manuals. I accept Mr Tubbs's evidence that the following table accurately sets out the number of courses taught, the number of participants and the royalties realized by Rimila in the teaching of PIIW courses for the period 1986 to 1989. I accept his evidence that no revenue was realized in 1985 because any courses taught during November and December 1985 were free promotional courses. . 1986 1987 1988 1989 ota Courses taught 34 45 28 34 141 Number of participants 473 598 292 406 1,769 Royalty (SA) 14,168 17,654.40 9,804.40 13,268" The number of participants (1,769) exceeds the number of workbooks purchased from IWI because Participant's Manuals were also used from the teaching sets purchased in late 1985 from Gower TFI. Rimila received two forms of income from the teaching of these courses: workbooks purchased by Rimila from IWI were onsold to franchisees at approximately the landed cost price; and franchisees paid a royalty to Rimila of 20% of gross fees from teaching PIIW courses. The selling price by Rimila of the PIIW participant's manuals varied somewhat as the landed cost of those goods to Rimila varied, but averaged approximately A$36.00. That price was made up of the price paid to IWI (about US$21.00, which with exchange rate fluctuations was usually about A$30.00), plus costs incurred in shipping the books to Australia. Rimila's franchisees received from PIIW courses which they taught, 80% of the gross fee less the cost of purchasing one workbook per participant, less certain expenses and overheads of conducting a course. I accept that in 1986 there were effectively 15 franchisees of Rimila and that by 1990 the figure had increased to 26 and stayed at approximately 26 continuously Since then. The facts most relevant to the assessment by Mr Lonergan of IWI's claim for damages are as follows: (a) Rimila was appointed on or about 26 September 1985 as IWI's exclusive Australian distributor of PIIW courses; (b) At that time there were other Australian distributors of PIIW courses whose sales were very small; (c) (d) (e) (f) (9) (h) The total sales by IWI to Rimila were small; In 1989 Rimila decided to give up the PIIW courses and produce its own writing course which it adopted from March 1990 until early November 1992; On or about 8 March 1990 Rimila commenced selling its own course entitled "Business Writing Skills" (BWS) throughout its franchise network; The Participant's Manual and Overhead Projector Transparencies (OHPs) used in the BWS course sold by Rimila were in breach of IWI's copyright in the PIIW course materials; In late October 1992 Rimila introduced a revised BWS course which was no longer in breach of copyright in the PIIW course materials; and Although well known in the United States, IWI is a small company which measures its gross revenue in hundreds of thousands, not millions, of dollars. Mr Lonergan expressed the opinion that Mr Pittorino's report contained a number of major errors in methodology. He summarized them as follows:- (a) (b) (c) (d) (f) (g) - 16 - various examples of double counting in the assessment of alleged loss; the failure to distinguish between Rimila's sale of PIIW courses and its other business activities; likewise with respect to Rimila's franchisees; the failure to allow for the actual costs incurred by Rimila (or its franchisees) in assessing its alleged profitability; the use of an inadequate discount rate and inadequate allowance for risk to assess the present value of the alleged loss of future PIIW sales; the failure to take account of the impact of changed market conditions and the impact of intervening economic events on the alleged growth potential of PIIW sales; the failure to take into account the natural limits of the market and reaction of competitors when assessing the alleged growth potential of PIIW sales; the treatment of the alleged loss during the relatively short period of time when the infringement occurred, as if it was a loss in perpetuity; (h) (4) (i) (k) (1) the failure to take into account the fact that IWI could re-enter the allegedly large market for PIIW type training courses either directly or via another agent from, at least, late October, 1992; the use of an incorrect volume and incorrect sales price per unit sold to assess IWI's entitlement to conversion damages; the failure to take into account the likely actions of other potential or actual competitors of PIIW type products; the failure to perform any reasonability check on the damages allegedly incurred by IwI; the failure to allow for the price elasticity of demand (eg. that higher sales prices of IWI manuals ($27) would have reduced consumer demand compared to the price of Rimila's manuals of $7.50 to $12.50) in calculating the alleged potential sales revenue and profitability of Rimila; the failure to allow for all costs incurred by IWI; the failure to distinguish between ratio of other course material sales of Power (major proportion) and those of Rimila (negligible); (0) the failure to take into account that the growth of Rimila''s sales was partly as a result of the corresponding decline in sales by Power; (p) the failure to take into account changes in the exchange rate between the Australian and U.S. dollars; (q) the failure to take into account the statement by the president of IWI that total sales lost by IWI were only USS$55,437; (vr) the failure to take into account the statement by the president of the plaintiff that no sales by IWI were lost beyond early 1993; and (s) the failure to distinguish between turnover and profits/cash flow in measuring the value of royalties. In my opinion each of these criticisms by Mr Lonergan of Mr Pittorino's report is warranted. Mr Lonergan then proceeded to give his opinion with respect to the damages and loss sustained by IWI. He divided the claims into a claim for infringement damages and a claim for conversion damages. He assumed that the measure of - 19 - infringement damages is the depreciation caused by the infringement to the value of the copyright as a chose in action. He assumed that the measure of conversion damages 15 the market value of the copies at the date of conversion less any post-conversion expenses. Mr Lonergan adopted as the measure of the value of the copyright as a chose in action the net present value of future cashflows. There is evidence that this is the standard accounting procedure; in my opinion it is a sensible and practical one. When dealing with infringement damages Mr Lonergan said that the first relevant factor he took into account was the historical revenue earned by IWI during the period prior to infringement, based on the number of attendees at Rimila's franchise business writing skills courses. He then took the number of participants requiring manuals in PIIW courses taught by the franchisees of Rimila in each of the years 1986 to 1989. He expressed certain qualifications about this (which it is not necessary for me to state) and concluded that the total gross income generated by IWI from its sales to Rimila were on average about $12,100 per annun. Using assumptions favourable to IWI (that is no decline in sales and an exchange rate of $US0.7 and a profit of 84.5%) he said one reaches a maximum gross profit of $10,225 per annum. The infringement continued for two years and ten ~months. Therefore by multiplying 10,225 by 2 years and 10 months one reaches $28,971. This is therefore the starting point as to - 20 - the correct, and indeed upper, limit of IWI's claim for infringement damages under s. 115(2) of the Act. This figure, however, needs to be reduced because it is based on the assumption that the entire value of the copyright in the relevant works is destroyed by reason of the infringement. The evidence establishes to my satisfaction that for reasons which are quite unrelated to the infringement, sales of the PIIW courses were declining and disappearing and that IWI's profit could not have been as high as 84.5%. Mr Joseph, the president of IWI, accepted this in cross examination. Also IWI did not take steps to mitigate its losses. This appears clearly from Mr Joseph's evidence in cross examination. It did not seek another distributor here or look into the market potential; these factors must be taken into account. It is impossible to make any precise quantification of the percentage or amount by which the upper limit of $28,971 should be reduced; I am persuaded from the evidence and the submissions that a reduction of 30% for these factors is fair and reasonable. This therefore produces a figure for a s. 115(2) damages of $20,280 (that is $28,971 x 70%). As to infringement damages, Mr Lonergan said that the first relevant factor taken into account was the historical revenue earned by IWI during the period prior to the infringement, based on the number of attendees at Rimila Franchise Business Writing Skills courses. He then took the number of participants requiring manuals in PIIW courses - 21 - taught by the franchisees of Rimila in each of the years 1986 to 1989. He expressed certain qualifications to this (which it is not necessary for me to state) and concluded that the total gross income generated by IWI from its sales to Rimila were on average about $12,100 per annum. As to conversion damages, Mr Lonergan assumed that the law focuses on the specific works found to be an infringement, in this case the Participant's Manual and OHP, and then awards the copyright owners the market value of those goods at the time of their conversion. He then set out his calculations to determine the correct measure of conversion damages to which IWI is entitled as follows: The market value of manuals $28,419.00 by Rimila based on the number of manuals at actual sales price Plus: The value of Overhead Projector Transparencies supplied by Rimila (1) $ 1,050.00 Less: Post-conversion expenses (2) $_3,200.00 $26,269.00 Notes: (1) He did not review documents concerning supply of OHPs, and assumed the calculation of the value of OHPs supplied set out in the affidavit of Mr Tubbs to be accurate. (2) He assumed the calculation of these expenses in the affidavit of Mr Tubbs to be accurate. (It is unnecessary to recite them.) - 22 - In my opinion Mr Lonergan's approach to the assessment of conversion damages is correct. He then proceeded to take into account overlap between s. 115(2) and s. 116(1) damages. He approached the matter as follows. Mr Lonergan assumed that infringement damages are awarded on the basis of profit which the copyright owner would have made but for the infringement. He said that the owner cannot also recover conversion damages for those same sales because the infringement damages already put the plaintiff in the position that it would have been in had it made those sales itself. Mr Lonergan's calculation of infringement damages assumed, in order to establish a maximum value for the copyright, that, but for the infringement, sales would have continued for two years and ten months at their historical average rate. He concluded that the overlap is therefore the conversion value of 1,252 manuals, on the basis of IWI having sold 1,252 manuals during the period of two years and ten months, 442 being the average number of participants in PIIW courses taught by Rimila's franchisees in that historical period. He calculated the average value of the manuals converted by Rimila to have been $8.82 (the total price realized $28,419 divided by the number sold 3,222). Therefore the value of the overlap between conversion and infringement damages is, he said, 1,252 x 8.82, namely $11,043. If awarded both infringement and conversion damages, as calculated by Mr Lonergan, he says IWI would be credited with having made the - 23 - 1,252 sales of manuals twice. In my view Mr Lonergan's approach to this question is correct. It follows that the sum of $26,269 for conversion damages must be reduced by the sum of $11,043 as representing what Mr Lonergan describes as "double counting with infringement damages" or expressed in other words as the value of the overlap between conversion and infringement damages. IWI is therefore entitled to recover damages from Rimila in the sum of $20,280 for s. 115(2) damages and $15,226 as s. 116(1) damages, a total of $35,506. Interest Interest under s. 51A of the Federal Court of Australia Act 1976 is applied for by IWI. No good cause has been shown to the contrary (see s. 51A(1)). Interest should therefore be included in the sum for which judgment is given in accordance with that section. It should be awarded at the relevant Court rate applicable from time to time during the currency of the period from the accrual of the cause of action to the date of judgment. Conclusion Counsel for all parties have asked me to enter no formal award for damages at this stage, but to allow them to peruse my reasons in case any further brief submissions need to be made. When the matter is relisted I shall make a formal award of damages and deal with the question of costs. In the result, I am satisfied that IWI is entitled to an award of damages in the sum of $35,506 together with interest. I shall make no orders today but stand the matter over to a date to be fixed for the purpose of hearing brief submissions on any outstanding questions with respect to damages and on costs, including the question whether the award should be against Rimila and Mr Tubbs equally or in different proportions. I certify that this and the preceding twenty-three (23) pages are a true copy of the reasons for judgment herein of the Honourable Mr. Justice Lockhart. Associate Leh [ex Cu Dated: 25 November 1994 Counsel for Applicant : Mr C J Bevan Solicitors for Applicant : Anisimoff Davenport Counsel for Respondent : Mr R Cobden Solicitors for Respondent: Baker and McKenzie Dates of Hearing : 17, 18 August, 12, 13 September 1994 Date of Judgment 3 25 November 1994