CATCHWOR ; JUDGMENT No. Ll 2 dank IG. INTELLECTUAL PROPERTY - copyright - nature and subject matter of copyright - compilation of weight loss programs - whether "original" literary work - whether "literary work" - whether substantiality of copying. Copyright Act 1968 (Cth), s.10(1), s.31(1), s.310)(a@, 3.32, s.184(1), 3.249 Copyright (International Protection) Regulations 1968 (Cth), Reg. 4(1) Autodesk Inc and Anor v. Dyason and Ors (1992) 173 CLR 330 Autodesk Inc v. Dyason [No 2] (1992) 176 CLR 300 Collier Constructions Pty Ltd v Foskett Pty Lid (1991) 20 IPR 666 Coral Index Lid v Regent Index Ltd [1970] RPC 147 Cox v Land and Water Journal Co (1869) LR 9 Eq 324 Elanco Products Ltd vy Mandops (Agrochemical Specialists) Ltd [1980] RPC 213 Francis Day Hunter Lid v Bron [1963] 1 CH 587 Hollinrake v Truswell [1894] 3 Ch 420 Harman Pictures NV v Osborne [1967] 2 All ER 324 (Chd) Independent Television Publications Limited v Time Out Limited and Elliott [1984] FSR Jarrold v Houlston (1857) 69 ER 1294; (1857) 3 K & J 708 Kalamazoo (Aust) Pty Ltd vy Compact Business Systems Pty Lid and Ors (1985) 5 IPR 213 Kelly v Morris (1866) LR 1 EQ 697 Kelly v Cinema Houses Ltd [1928-35] MacG Cop Cas 362 Ladbroke (Football) Ltd v. William (Football) Lid [1964] 1 WLR 273 Lotus Development Corporation v Paperback Software International (1990) 18 IPR 1 Moffatt and Paige Limited v George Gill and Sons Ltd and Francis Marshall (1902) 86 LT 465 Ravenscroft v Herbert and New English Library Ltd [1980] RPC 193 (Chd) Scott v Stanford (1867) LR [3] Eq 718 Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479 SKYBASE NOMINEES PTY LTD AS TRUSTEE FOR THE BARCZA FAMILY TRUST and SANDRA BARCZA v. FORTUITY PTY LTD WAG 130 of 1995 FRENCH, HILL and R.D. NICHOLSON JJ PERTH A 30 OCTOBER 1996 on RECEIVED 13 JAN 1997 FEDERAL COURT OF AUSTRALIA PRINCIPAL REGISTRY IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION BETWEEN: No. WAG 130 of 1995 ON APPEAL FROM A JUDGE OF THE SUPREME COURT OF WESTERN AUSTRALIA SKYBASE NOMINEES PTY LTD AS TRUSTEE FOR THE BARCZA FAMILY TRUST First Appellant and SANDRA BARCZA Second Appellant and FORTUITY PTY LTD Respondent MINUTE OF ORDERS JUDGES MAKING ORDERS: FRENCH, HILL and R.D. NICHOLSON JJ DATE OF ORDERS: WHERE MADE: THE COURT ORDERS THAT: 30 OCTOBER 1996 PERTH 1, The appeal is dismissed. 2. The Appellants pay the Respondent's costs of the appeal. NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION No. WAG 130 of 1995 ON APPEAL FROM A JUDGE OF THE SUPREME COURT OF WESTERN AUSTRALIA BETWEEN: SKYBASE NOMINEES PTY LTD AS TRUSTEE FOR THE BARCZA FAMILY TRUST First Appellant and SANDRA BARCZA Second Appellant and FORTUITY PTY LTD Respondent CORAM: FRENCH, HILL and R.D. NICHOLSON JJ. PLACE: PERTH DATE: 30 OCTOBER 1996 REASONS FOR JUDGMENT FRENCH J: For the reasons expressed by Hill and Nicholson JJ, I agree that the appeal should be dismissed. I certify that this is a true copy of the Reasons for Judgment of His Honour Justice French. Associate: 2. + Date: IN THE FEDERAL COURT OF AUSTRALIA ) , ) WESTERN AUSTRALIA DISTRICT REGISTRY ) No WAG 130 of 1995 ) ) GENERAL DIVISION BETWEEN: SKYBASE NOMINEES PTY LTD AS TRUSTEE FOR THE BARCZA FAMILY TRUST First Applicant SANDRA BARCZA Second Applicant AND: FORTUITY PTY LTD Respondent CORAM: . FRENCH, HILL AND R D NICHOLSON JJ PLACE: PERTH DATED: 30 OCTOBER 1996 REASONS FOR JUDGMENT HILL J: I have had the opportunity of reading in draft the reasons of RD Nicholson J which analyse in detail the facts of the present appeal. For this I am indeed grateful. I adopt his Honour's discussion of the facts and respectfully agree with his Honour's conclusion that the appeal should be dismissed. There is a tension in policy between the monopoly rights which are conferred upon the owner of copyright in a literary, dramatic, musical or artistic work on the one hand, and the freedom to express ideas or discuss facts on the other. While there will be an infringement of the copyright of an owner in a literary, dramatic, musical or artistic work where there is a reproduction of that work or a substantial part of it, the fact that another work deals with the same ideas or discusses matters of fact also raised in the work in respect of which copyright is said to subsist will not, of itself, constitute an infringement. Were it otherwise the copyright laws would be an impediment to free speech, rather than an encouragement of original expression. It is tempting to draw a line between the free expression of ideas not the subject of copyright and the form in which those ideas are expressed. Copinger, 12th ed, at para 456 adopts such a distinction. The learned authors say: "What is protected is not original thought or information, but the original expression of thought or information in some concrete form." ' The distinction between content and form will often be a useful one, cf Autodesk Inc v Dyason (1992) 173 CLR 330 at 344-5, but the cases indicate that the boundary between that which is and that which is not a reproduction is not so simply drawn, see Ricketson: The Law of Intellectual Property 1984 at para 9.33 and the detailed discussion in Lotus Development Corporation v Paperback Software International (1990) 18 IPR 1 at 19 ff. For there to be an infringing reproduction two elements are required, although they are not unconnected. First, there must be a "sufficient degree" of similarity between the two works: Francis Day & Hunter Ltd v Bron [1963] 1 Ch 587 (CA). Second, there must be a "causal connexion" between the two works. Such a causal connexion arises, not to put too fine a point upon it, where the one work has been copied from the other. Therein lies the essential ingredient of Copyright. As Francis Day suggests, the degree of objective similarity between two works will lead to an inference that, prima facie, there has been the necessary causal connexion. But that inference may be rebutted in a particular case where the alleged infringer may show that the work alleged to be an infringement was an independent work of his or her own. It is trite law to say that there need not be a one hundred percent similarity between the two works to constitute an infringement. Exact reproduction need not be shown. Something less will suffice. The making of changes to an original work, otherwise copied in full so as to disguise the copying, may not avail the copier. This is particularly the case where the changes are but a colourable variation of the original and the effect of the copying is that the copier avails him or herself of the labour of the copyright owner: Jarrold v Houlston (1857) 69 ER 1294. The] learned authors of Copinger suggest that the courts have; never allowed a defendant to evade the provisions of the; copyright laws by "merely altering the form of the words in |the original work". As Sir W Page Wood VC said in Scott v Stanford (1867) LR [3] Eq 718 at 724: "No man is entitled to avail himself of the previous labours of another for the purpose of conveying to the public the same information, although he may append additional information to that already published." The view expressed above may be thought to be contrary to the suggestion of Maugham J in Kelly v Cinema Houses Ltd [1928-35] MacG Cop Cas 362 at 367 that: ",.. dit has been long known that all the valuable portions of an intellectual work can be 'lifted' by a stranger and published to the world, provided that he is willing to take the trouble to put the matter in his own words." To the extent that the views are inconsistent, I think it is the view of Maugham J which must give way: cf Ravenscroft v Herbert and New English Library Ltd [1980] RPC 193 (Chd) and Harman Pictures NV v Osborne [1967] 2 All ER 324 (ChD). While the degree of similarity between the two works may lead to an inference of causal connexion, both substantial reproduction and causal connexion are separate and necessary ingredients of infringement. Mere causal connexion will not be enough. A defendant may rework the work of a plaintiff, capturing the ideas used or facts referred to, but in his own language in such a way as not to constitute an infringement but rather to create his own new original work. Whether he has done so will involve a question of fact and degree. There is no principle of law, so far as I am aware, that the mere fact that it is shown that a defendant commences with the work of the plaintiff and then by his own skill and labours constructs a totally different work requires the conclusion that the new work is a reproduction of the original. The extent of similarity which is required to exist before an infringement is found will vary depending upon the nature of the work alleged to have been reproduced and the degree of originality in it. It must, however, be said in general terms that it is "the quality of what is taken rather than the quantity" which will be important: Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300. For example, where the work said to be copied is a musical work the fact that the infringing work captures the essence of the melody will suffice, even although in another key or but a few bars: Francis Day & Hunter Ltd ante. On the other end of the spectrum a more exact reproduction of words used may be necessary to constitute infringement of a poem where the essence of the poem lies in the use of language to express ideas. The case of an alleged infringement of a compilation where the originality of the material copied might lie in the arrangement of the material, rather than in the words used, presents yet another class of case: cf Football League Ltd v Littlewoods Pools Ltd [1959] 2 All ER 546 (ChD); Ladbroke (Football) Ltd v William Hill (Footbali) Ltd [1964] 1 All ER 465 (HL); Blackie & Sons Ltd v Lothian Book Publishing Co Pty Ltd (1921) 29 CLR 396; John Fairfax and Sons Pty Ltd v Australian Consolidated Press Ltd (1959) 60 SR (NSW) 413. [In such a case, it may be said, as it was in Jarrold v Houlston at 1298: "I take the illegitimate use, as opposed to the legitimate use, of another man's work on subject-matters of this description to be this: If, knowing that a person whose work is protected by copyright has, with considerable labour, compiled from various sources a work in itself not original, but which he has digested and arranged, you, being minded to compile a work of a like. description, instead of taking the pains of searching into all the common sources, and obtaining your subject-matter from them, avail yourself of the labour of your predecessor, adopt his arrangements, adopt moreover the very questions he has asked, or. adopt them with but a slight degree of colorable variation, and thus save yourself pains and labour by availing yourself of the pains and labour which he has employed, that I take .to be an illegitimate use." The words "slight degree of colorable variation" appear to give considerable latitude to the putative copier. Less latitude is to be found in the decision of Buckley LJ (albeit in the context of interlocutory relief) in Elanco Products Ltd v Mandops (Agrochemical Specialists) Ltd [1980] RPC 213, where Buckley LK dealing with an allegation of infringement in trade literature where two allegedly infringing versions, although derived from the plaintiff's work differed in form and expression, said at 231: "As I understand the law in this case, the defendants were fully entitled to make use of any information, of a technical or any other kind, which was available to them in the public domain, for the purpose of compiling their label and their trade literature, but they were not entitled to copy the plaintiffs' label or trade literature thereby making use of the Plaintiff's skill and judgment and saving themselves the trouble, and very possibly the cost, of assembling their own information, either from their own researches or from sources available in documents in the public domain, and thereby making their own selection of material to put into that literature and producing their own label and trade literature." Elanco has not survived without criticism: cf Independent Television Publications Limited v Time Out Limited and Flliott [1984] FSR 64 at 69. I suspect it is not profitable to approach the issue in the present case, or for that matter like cases by reference to philosophical notions such as that there is no copyright in ideas, or even notions of fair or unfair competition, such as are raised by Lahore at 7183-4 in the learned author's discussion of Elanco. Rather, it is necessary, where the causal connexion between the two works has been shown, to ask, what in essence is a jury question, namely whether the work of the defendant reproduces in a substantial way the work of the plaintiff. The answer to that question will not depend upon identicality of words or expressions, although if such identicality is there the answer may be self evident. Rather, it will involve a common sense appraisal of whether the second work in all the circumstances can fairly be said to be so sufficiently similar that the one is but a reproduction of the other. When one turns to the facts of the present case it may be observed that a recipe for an everyday dish will, howsoever that recipe may be expressed, "always contain the same ingredients and necessitate the same methods of preparation and cooking. But the original work in the present case is not a mere recipe, or for that matter a mere compilation of recipes. It is recipes and instructions combined as a programme to be adopted by those desiring to lose weight. As the analysis of R D Nicholson J makes clear, it is readily apparent that the appellants commenced with the results of the respondent's labours and set out to reproduce them changing words and expressions and in some cases order in an endeavour to differentiate the copy from the original. But the overall impression with which one is left is that the resulting product contains sufficient similarities of expression, order and format, despite the attempted changes to constitute a reproduction of a substantial part of the respondent's programme. Even if I were of a different view, the case is one where the nature of the issue is such, involving as it does matters of impression, that particular respect and weight should be given to the decision of the trial judge unless some error in the judgment has been demonstrated; cf S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 at 478 per Gibbs CJ, with whom Mason J agreed, and the cases discussed in the judgment of Hill J, with whom Tamberlin J agreed, in Federal Commissioner of Taxation v Chubb Australia Ltd (1995) 95 ATC 4186. I would accordingly dismiss the appeal with costs. I certify that this and the preceding eight (8) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Hill. Date: 30 October 1996 IN THE FEDERAL COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) GENERAL DIVISION ) NO. WAG 130 OF 1995 On appeal from a judge of the Supreme Court of Western Australia BETWEEN: SKYBASE NOMINEES PTY LTD AS TRUSTEE FOR THE BARCZA FAMILY TRUST First Appellant and SANDRA BARCZA Second Appellant and FORTUITY PTY LTD Respondent CORAM: FRENCH, HILL and R D NICHOLSON JJ DATE: 30 October 1996 PLACE: PERTH REASONS FOR JUDGMENT R D NICHOLSON J: This is an appeal from a decision by Heenan J in the Supreme Court of Western Australia. The matter commenced in the Federal Court of Australia and cross-vested to the Supreme Court to be heard together with other claims by the respondent against the appellants begun in that court. This appeal involves only claims for infringement of copyright pursuant to the Copyright Act 1968 (Cth) ("the Act"). At the date of hearing of the appeal damages were still in the process of assessment in the Supreme Court on the other claims. The relevant facts as found by the trial judge can be briefly stated as follows. The respondent conducts and markets weight loss programs (known as "Weight Watchers programs") in Australia as exclusive licensee of an United States company which has -2- rights in the US Quick success Program ("USQSP") and the Fast and Flexible Program ("FFP"). These programs go under the names of the Australian Quick Success Program ("AQSP") and Australian Quick Success Plus Program ("AQSPP"), which will be collectively described as "the respondent's programs". The second appellant is a former lecturer for the respondent. After her employment as a lecturer, she began conducting and marketing weight loss programs (known as "Trim for Life programs") by herself and then later as an employee of the first appellant. The first such program was called "Trim for Life 1" ("TFL1") which was developed in 1992 whilst the second appellant was in the employ of the respondent. After 4 November 1993 the second respondent developed "Trim for Life 2" ("TFL2") as a result of proceedings issued by the respondent alleging the second appellant was infringing its copyright. In September 1994 the second appellant prepared a further dietary program in consultation with a Mrs Stacey. This resulted in the printing in January 1995 of booklets for the first five weeks of an eight week dietary plan, known as Trim for Life 3 ("TFL3"). TFL2 booklets were used for weeks 6-8 until May 1995 when new booklets were printed for those weeks, known as Trim for Life 3A ("TFL3A"). The first appellant was registered on 22 December 1994 and in January 1995 became the trustee for the family trust representing the interests of the second appellant, her husband and their children. On 30 January 1995 the first appellant purchased the goodwill of the Trim for Life business from the second appellant, who then commenced work as an employee of the first appellant. At trial the second appellant consented to judgment against her for infringement of the respondent's programs by TFL1. However, she contended TFL2 had been subsequently developed independently from TFL1. It was also contended that TFL3 and TFL3A were further independent developments. "Originality" of respondent's programs At the hearing of the appeal leave was granted to the appellants to amend their notice of appeal to include a contention that the respondent's programs are not "original" literary works for the purposes of s32(2) of the Act. -3- In Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273, Lord Reid said at 277: "There is no dispute about the meaning of the term "original". "The word 'original' does not in this connection mean that the work must be the expression of original or inventive thought. Copyright Acts are not concerned with the originality of ideas, but with the expression of thought, and, in the case of 'literary work' with the expression of thought in print or writing. The originality which is required relates to the expression of the thought. But the Act does not require that the expression must be in an original or novel form, but that the work must not be copied from another work - that it should originate from the author." Per Peterson J in University of London Press Ltd v University Tutorial Press Lid [1916] 2 Ch 601, 608-9. And it is not disputed that, as regards compilation, originality is a matter of degree depending on the amount of skill, judgment or labour that has been involved in making the compilation." In Ladbroke (supra) at 289 Lord Devlin said "the requirement of originality means that the product must originate from the author in the sense that it is the result of a substantial degree of skill, industry or experience employed by him": cf Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479 at 511 per Dixon J. In Kalamazoo (Aust) Pty Ltd v Compact Business Systems Pty Ltd and Ors (1985) 5 IPR 213 at 233 Thomas J said: "There are conflicting and quite irreconcilable judicial statements as to the degree of originality required. The one point upon which there seems to be agreement is that a question of degree is involved from case to case. 'The amount of labour, skill, judgment or ingenuity is a question of fact and degree in every case' (per Upjohn J in Football League Ltd v Littlewoods Pools Ltd [1959] 2 All ER 546; 1 Ch 637 at 651)..." The learned trial did not admit into evidence a Technical Development Report which had been lead on behalf of the respondent at trial to detail the skill and effort which had gone into the production of the Weight Watchers programs. However, evidence was lead for the respondent from its officers on this issue. The jearned trial judge found that the compilation of the AQSPP "was the product of a great deal of skill, labour, judgment and expense". He found nutritionists and experts from various disciplines had been involved in the production of the USQSP which had been extensively field tested by the respondent's parent company and modified as a result of the feedback from those tests. The program had also been subject to some -4- modification by the respondent to "Australianise" the program. An Australian nutritionist had been employed by the respondent in order to assist in this process. This "Australianisation" process had developed a "value added" product. The trial judge therefore concluded the respondent's programs had: "a 'quality of character not possessed by the raw material' and ... [were] an arrangement 'done om by the author for the first time'. The case for the appellants contends that the evidentiary foundation upon which the trial judge reached these conclusions was inadequate in that it did not include direct evidence of the authors or persons involved in the development and compilation. Rather, it is said, he dealt with issues globally in a "rolled up way". The respondent's witnesses were Mr Penn, managing director of the respondent, and Mrs Juster, general manager of Weight Watchers, North Sydney. Their evidence was heard without objection. The only objection was to the admissibility of the Technical Report, which was upheld by the trial judge. Penn was not cross-examined about the amount of expert input nor about the value of the field test work. The Australian nutritionist was not called. In addition, the trial judge had before him evidence that the AQSPP was derived from the USQSP which enjoyed copyright registration in the USA. Furthermore, and importantly, it was open to the trial judge to infer from examination of the nature and content of the respondent's program that it possessed originality as a literary work. In my opinion, there was sufficient evidence from which the trial judge could conclude that the respondent's programs involved a sufficient degree of labour, skill and judgment to make them "original". Respondent's programs as "literary works" Section 10(1) of the Act relevantly provides that a "literary work" includes a table or compilation expressed in words, figures or symbols. In this case the respondent's programs consisted of a number of daily menus which the user followed. The programs were designed so that at the end of the course the user would lose weight. On behalf of the respondent it was claimed its program was "a compilation" of menus and other devices and would therefore be subject to copyright as a literary compilation under the Act. The case for the appellants contends the materia! said to be taken from the respondent is not properly the subject of copyright law because the respondent's program is in fact a system open to protection only by patent law. On behalf of the appellants attention is drawn to specific elements it is said the trial judge had found were copied, namely, the intake check, concept and format. It is submitted the trial judge's reasons do not show that the expression of an idea had been copied. The evidence before the trial judge was that the second appellant had taken the presentation, some menus and serving size and intake check from TFL1 into TFL2. In preparing TFL3 it was admitted that the same "concept" and "format" had been taken from TFL2. TFL3 was also subject to input from a Mrs Stacey, a nutritionist, who provided some menus and recipes. The trial judge excluded Mrs Stacey's input from the finding of copying in relation to TFL3. In support the appellants rely on the traditional dichotomy in copyright law between the idea and the expression of that idea. It is a well settled principle of copyright law that the expression of an idea is copyright, but the idea itself cannot be copyright: Autodesk inc and Anor v Dyason and Ors (1992) 173 CLR 330 per Dawson J at 344-5; cf Hollinrake v Truswell [1894] 3 Ch 420 at 427. However, where copyright is claimed in a compilation work the principles apply in a modified way. It was said by Lord Reid in Ladbroke at 277: -6- "A wrong result can easily be reached if one begins by dissecting the plaintiff's work and asking could section A be the subject of copyright if it stood by itself, could section B be protected if it stood by itself, and so on. To my mind. it does not follow that, because the fragments taken separately would not be copyright. therefore the whole cannot be. Indeed, it has often been recognised that if sufficient skill and judgment have been exercised in devising the arrangements of the whole work, that can be an important or even decisive element in deciding whether the work as a whole is protected by copyright." In this case it is clear the trial judge considered the elements together - the arrangement of the whole work including the menu plans, the coding systems, the overall system, the expanding set of food choices, the use of words and the serving sizes in deciding that skill and judgment had been used in compiling and arranging the whole work. Most of the information contained in the respondent's programs could be found in the public domain. However, it was open to the trial judge to find that this information has been compiled in such a way that it attained the protection of copyright when considered as a whole. The respondent's programs having been properly found to be original literary works, it is accepted for the appellants that the appeal is then to be approached on the basis copyright in them subsisted in the respondent. Substantiality of Copying Then it is contended for the appellants that the trial judge erred in finding the appellants had copied a "substantial" part of the respondent's program. Section 31(1)(a)(i) of the Act relevantly provides that copyright includes the exclusive right to reproduce a work in a material form. Section 36 provides that copyright is infringed where a person other than the owner (or someone authorised by the owner), does or authorizes the doing of any act comprised in the copyright. The notion of "substantiality" is addressed in $14 which provides, subject to contrary intention, a reference to the doing of an act in relation to a work shall be read as including a reference to the doing of that act in relation to a substantial part of the work. The same section provides that a reference to a reproduction, adaptation or copy of a work, shall be read as including a reference to those matters in relation to a substantial part of the work. -7- The decided cases make it clear there will not be a relevant "reproduction" unless there has been some copying of it by the alleged intringer. In Francis Dav & Hunter Ltd v Bron [1963] Ch 587 Upjohn LJ said: ".,.such a reproduction...must be causally connected with the work of the original author, If it is an independent work, then, though identical in every way, there is no infringement." At 618 Upjohn LJ said there were two questions: "The first question is whether in fact the alleged infringing work..is similar to the work of the original author....The next stage is the subjective stage...the question...is: has the defendant copied the plaintiffs work, or is it an independent work of his own?" In a passage at 623 Diplock LJ described these two features as follows: "It is well established that to constitute infringement of copyright in any literary, dramatic or musical work, there must be present two elements: first, there must be sufficient objective similarity between the infringing work and the copyright work, or a substantial part thereof, for the former to be properly described, not necessarily as identical with, but as a reproduction or adaptation of the latter; secondly, the copyright work must be the source from which the infringing work is derived. The necessity for the second element was expressly laid down by the Court of Appeal in Purefoy Engineering Co Lid v Sykes Boxall & Co Ltd, and is, indeed, implicit in all the compilation cases including the recent case in this court of William Hill (Football) Lid v Ladbrokes (Football) Ltd, where tables of betting odds were unanimously held not to infringe the copyright in substantially identical tables because the authors of the later tables, although very familiar with the earlier tables, had, in fact, worked out the odds for themselves." For the respondent it is contended the stronger the causal link between the original work and the copying, the greater the relevance of that to establishing substantiality of reproduction: Moffatt and Paige Limited v George Gill and Sons Lid and Francis Marshall (1902) 86 LT 465. Lord Reid in Ladbroke (supra) said at 276: "Broadly, reproduction means copying, and does not include cases where the author or compiler produces a substantially similar result by independent work without copying. And, if he does copy, the question whether he has copied a substantial part depends much more on the quality than on the quantity of what he has taken." Lord Pearce at 293 stated: "Whether a part is substantial must be decided by its quality rather than its quantity...For that which would not attract copyright except by reason of its collocation will, when robbed of that collocation, not be a substantial part of the copyright and therefore the courts will not hold its reproduction to be an infringement." In Collier Constructions Pty Ltd v Foskett Pty Ltd (1991) 20 IPR 666 at 669, Lockhart, French and Hill JJ said: "In determining whether what is taken is a substantial part of the copyright work various circumstances are relevant. The importance which the alleged substantial part bears in relation to the work as a whole is a significant matter. If it is a material part, even though it may be only a small part of it in quantity, it may nevertheless be substantial: Blackie & Sons Lid v Lothian Book Publishing Co Pty Ltd (1921) 29 CLR 396. It is well established that the phrase "substantial part" refers essentially to the quality, rather than the quantity, of what is taken by the infringer: .... It is always a question of judgment in each case whether the part taken from the work in which copyright subsists is a substantial part of the work. ... It is plain that the question of what is a substantial part of a work may involve fine questions of fact and degree." In Autodesk Inc v Dyason [No 2] (1992) 176 CLR 300, Mason CJ at 305 relied upon the statement by Lord Pearce in Ladbroke (supra) for the proposition that "it is clear that the phrase "substantial part" refers to the quality of what is taken rather than the quantity." He added that in determining whether the quality of what is taken makes it a "substantial part" of the copyright work, it is important to inquire into the importance which the taken portion bears in relation to the work as a whole: is it an "essential" or "material" part of the work?" In Lahore, Copyright Law in Australia (1992) p7183, par 4.11.150 it is stated that "proof of copying of a compilation may be difficult to establish for the reason that the plaintiff and defendant, both working on common material, may inevitably produce a substantially similar result without any copying". The author adds "it also must be established that what is reproduced by the defendant is the compilation and not the facts or other information so compiled". In Elanco Products Ltd v Mandops (Agrochemical Specialists) Ltd [1980] RPC 213 it was held that even though the form of instructions for the use of chemicals had been changed, -9. the content had stayed much the same so that there was an arguable case, for the purposes of the grant of an interlocutory injunction, that the plaintiff's copyright had been infringed. There the defendants had produced three versions of the material, the first being virtually identical to the plaintiffs' literacure and being withdrawn on complaint. The second and third contained virtually the same data but the format and language were quite different. Lahore at 7184 asks how the Court could have granted an interlocutory injunction given that the second and third versions only contained the same information but were different in form and expression. He concludes that the court was strongly influenced by the fact the first version was copied from the plaintiffs' work and the defendants were making unfair use of the plaintiffs' skill and judgment. On this basis copyright would become "a form of protection against unfair competition rather than copying of any form of expression as such": Lahore at 7184. For the appellants on this present appeal, that opinion is relied upon to distinguish Elanco from this case. See also the caveat on the reasoning in Elanco in Independent Television Publications Limited v Time Out Limited and Elliott [1984] FSR 64 at 69. The learned trial judge found: "My own comparison of the various programs has left me with the clear impression that the Trim for Life programs are much less sophisticated and less well presented than the Weight Watchers program. Nevertheless, Trim for Life 1 bears a remarkable similarity to the dietary plans contained in the latter. The size is almost the same. the format the same and it contains the same sort of information. It is significant that at the beginning of the trial Mrs Bareza consented to the making of orders in the second action which, among other things, restrain her from publication or use of the Trim for Life 1 and require her to pay to the plaintiff the profits which she has derived from its use. I am satisfied that Trim for Life | was copied directly from the Weight Watchers. program." . The learned trial judge then went on to find the later Trim for Life programs were reproduced substantially from the respondent's programs and that the appellant did not do her own work, relying on the skill, labour, judgment and expense of the respondent. That is, the trial judge found the elements taken from the respondent's program amounted to a substantial copying of the arrangement that was subject to copyright. The critical question on this appeal is whether he was correct in that conclusion. -10- In this case the trial judge considered the appellants had taken the labour of the respondent. The learned trial judge had found that significant labour, skill and effort had gone into the production of the respondent's programs. He found that TFL1 was a direct copy of the respondent's programs. He also found that TFL2, TFL3 and TFL3A were held to be mere revisions of TFL1 and thus did not involve any independent labour, skill and effort by the appellants. As a result, it was held the appeilants had reproduced a substantial part of the respondent's programs. In considering on appeal whether the trial judge was correct in his conclusion concerning substantiality of copying, consideration must be given to the effect of the use by the appellants of the work of Mrs Stacey (exhibit 'W'). In his order the trial judge excepted exhibit 'W', being the work of Mrs Stacey on TFL3 and TFL3A. It is argued that the trial judge erred in not finding sufficient labour, skill and effort had been used by the second respondent in conjunction with a nutritionist engaged by her to give rise to independent copyright in TFL3 and TFL3A. The case for the appellants has provided the Court with copies of those programs with the contents of exhibit 'W' excised from them. The features which the trial judge found the second appellant had taken from the Weight Watchers program included many menus and meal plans, coding, overall system, expanding set of food choices, use of the words "optional extras" and the serving of protein and fish in 30 gram sizes. It is not in dispute that expanding sets of food choices are not parts of TFL3 or TFL3A. On the issues of 30gm sizes of protein and fish, there was evidence of Mrs Stacey that she had used this idea in a book written by her many years ago. However, the trial judge recounted that in cross-examination the second appellant had admitted the serving size was taken from TFL1 and that she had copied through from TFL3 "the same concept" she had been using in TFL2. There was evidence of Mrs Wailes and Ms Burt that the Trim for Life Programs substantially reproduced the Weight Watchers Program. The significance of that evidence « -il1- is challenged for the appellants on the ground the witnesses were lead by inappropriate questions to that conclusion. In the end the appeal court is in the position where it can test the conclusions of the trial judge by comparing the documents in question. With that in mind the parties were given leave to file submissions subsequent to the hearing of the appeal directing attention to relevant points of comparison between TFL3 and TFL3A and the Weight Watchers Program. The respondent's case was supported by three volumes of comparison between the respondent's program and the TFL Programs filed after argument on the appeal and supported by written argument, to which reply has been filed on behalf of the appellants in which the point ts made that the volumes were not available at trial. I am satisfied that the volumes may only be used as aids to understanding the documents which were available at trial and that no reliance can be placed upon them as descriptive material, for example statements that a particular portion of the respondent's program was "copied" by the appellants should be discounted. Before turning to those submissions, the case for the appellants asks that the Court have in mind that the documents are but part of a package in which the lecturer is an important part. Before the trial judge the onus of establishing infringement lay, of course, upon the respondent. In determining the issue of substantial copying the Court must assess whether the copied elements from the respondent's compilation in the appellants' compilation remain so intact and are sufficiently material that the reproduction of the respondent's work in the appellants' work is substantial. Consistently with what has been stated earlier, the reproduction has to be more than the mere taking of an idea: the question is was the work copied and copied substantially? Leaving aside any aspect of system, the case for the respondent in respect of TFL3 and TFL3A points to the listing of daily intake choices, daily intake checks and use of 30gm weigh-outs as elements so fundamental to the respondent's program that substantial copying was properly found to exist by the trial judge. It is submitted this is even more so the case when regard is had to the respondent's program as a whole. - 12 - Examination of the TFL3 and TFL3A programs against the AQSPP shows, in my opinion, that there is direct copying of the latter in the former. However, the examples of such copying are not in my view sufficient to enable it to be concluded that such direct copying is substantial. There are, however, defined limits to the use which can be made of an earlier compilation by the author of a later compilation. Reference to Copinger and Skone James, Copyright (Sweet & Maxwell, 1991) supports this. There (at 168, par 8-12) it is accepted that similar language, order of describing a scheme and format of documents has been held to indicate copying of business literature: Coral Index Ltd v Regent Index Ltd [1970] RPC 147; Ladbroke (supra). At 173, par8-23 the authors express the opinion that "where the alleged infringement resembles either the whole or a substantial part of the plaintiff's work to a greater or lesser degree, and assuming that the defendant's work has in fact been taken from the plaintiff's, the Court has never allowed a defendant to evade the provisions of the Copyright Act by merely altering the form of the original work," although they add the relevant statute does not contain any direct statement that an imitation is to be treated as a reproduction. The learned authors suggest (at 173, par8.23) the test is, "whether the court is satisfied that a defendant has, in producing the alleged infringement, made a substantial use of those features of the plaintiff's work in which copyright subsists..." In the specific case of compilations it is said (at 176, par8-28) a bare assertion the plaintiff's work was not copied, without any explanation by the defendant as to how or when he worked or how long it took him, will not be enough to rebut the inference of copying. It is also stated by the authors and recognized in authorities that there are limits to the usage which may be made of a prior work by the compiler of a later work. The prior work may be resorted to in the same way any member of the public may use it and to check results of the second author's labours: Scott v Stanford (1867) LR 3 Eq 718; Kelly v Morris (1866) LR 1 Eq 697 and see other authorities in Copinger and Skone James, op cit, 178, fn54 and 56. At 179, par8-38 the authors view the principle as being "that if one person has, with considerable labour, compiled a work from various sources which he has digested and arranged, then a defendant who instead of taking the pains of -13- researching the common sources and obtaining this subject-matter from them, simply makes use of the other's labour and adopts his arrangement, perhaps with only slight variations, thus saving himself the pains and labour which the other used, this will be an illegitimate use," citing Jarrold v Houlston (1857) 3 K & 3 708. The authors also state in addressing compilations that whereas, with a strictly original work, any identity of phrase is sufficient evidence of copying, with many compilations it is only from external evidence, or from a minute examination of textual errors, that an infringement can be established. A number of authorities are cited in support of this qualification. In Kelly v Morris identity in certain mistakes was relied on, but the principle recognized was that the work of the defendant had not been compiled by the legitimate application of independent personal labour. In Cox v Land and Water Journal Co (1869) L R 9 Eq 324 the list of hounds was information which the defendants must be shown to have got "as the result of their own labour, and they are not to be entitled to the results of the labours undergone by others." The underlying principle is that the defendant should not have made unfair use of the work of the plaintiff, the existence of such unfairness being evidenced by the absence of independent labour on the part of the defendant in the making of the defendant's compilation. Here there is external evidence of the derivation of the compilation and evidence of actual copying. A comparison of the TFL3 and TFL3A programs with the AQSPP Program leaves me with the very strong impression the former are but mere adaptations of the latter and are not the product of the independent labour of the appellants other than with respect to the adaptations. The clear inference is raised by that reading that the appellants have put their labour into rearranging and adjusting the work of the respondent rather than doing their own work. That inference is not rebutted (excluding of course the work of Mrs Stacey). It is supported by the evidence of the causal link which was before the trial judge. There is a similarity of language, order of description and format of the appellants' work with the respondent's work characterised by deliberate and careful altering of words. For example, "yoghurt, fruit, low fat" in the respondent's work becomes "Yoghurt Low fat Fruit" in the appellants' work. There is a very substantial use of the features of the respondent's work in this way. Removing Mrs Stacey's work from -14- consideration, what remains exhibits a qualitative and substantial copying by adaptation of the work which is the product of the work, skill and labour of the respondent. The usage exceeds the bounds of fairness. The combination of direct copying and the use made of the respondent's work results in a substantiality of copying of qualitative aspects of the respondent's work so that the appellants' works are a reproduction of the respondent's work. To so hold is not to rely upon any notions of protection against unfair competition but only on the character of the copying which has taken place. In my opinion the learned trial judge properly concluded that the appellants' programs substantially copied and so reproduced the respondent's program and therefore infringed its copyright. Accordingly, I consider leave to appeal should be granted but the appeal should be dismissed. I certify that this and the preceding 13 pages are a true copy of the Reasons for Judgment of his Honour Justice R D Nicholson. Associate: iL fife Date: 30 October 1996 APPEARANCES Counsel for the First and Second Appellant: Mr R MacCormack Solicitors for the Applicant: Durack & Zilko Counsel for the Respondent: Mr P Nisbett QC Solicitors for the Respondent: Fiocco Hopkins Rattigan Date of Hearing: 19 March 1996 Date of Judgment: 30 October 1996