Retsis v Network Ten Ltd [1998] FCA 223

FEDERAL COURT OF AUSTRALIA

COPYRIGHT - Infringement - Applicant had copyright in jigsaw greeting card featuring a red heart with a missing jigsaw piece - Respondent screened television promos based on a red heart jigsaw with a missing piece - Whether there was a causal connection between respondent's promos and applicant's card - Question determined as a matter of fact - Relevance in relation to costs of respondent's failure properly to address applicant's complaint of copying.

STACEY RETSIS v NETWORK TEN LIMITED

NG711 of 1996

JUDGE: WILCOX J

PLACE: SYDNEY

DATE: 19 FEBRUARY 1998

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NG711 of 1996

BETWEEN: STACEY RETSIS

Applicant

AND: NETWORK TEN LIMITED

Respondent

JUDGE: WILCOX J

DATE OF ORDER: 19 FEBRUARY 1998

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The Application be dismissed. 2. Liberty be reserved to the respondent to apply for an order regarding costs by motion supported by affidavits, if the respondent so wishes and seeks to make out a case that at some stage the applicant was informed with particularity of the respondent's explanation. 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 NG711 of 1996

BETWEEN: STACEY RETSIS

Applicant

AND: NETWORK TEN LIMITED

Respondent

JUDGE WILCOX J

DATE: 19 FEBRUARY 1998

PLACE: SYDNEY

EXTEMPORE REASONS FOR JUDGMENT WILCOX J: The critical question in this case is whether the respondent breached the copyright of the applicant. The applicant, Stacey Retsis, is a creative designer by occupation. Since April 1994 she has carried on business under the trade name "Puzzling Stuff". The major activity of that firm has apparently been the creation of novelty gift items. In about 1992 Ms Retsis conceived the idea of a jigsaw greeting card. At that time she prepared some designs, but it was some time later before she carried any design into production. In April 1994 she arranged for the printing of paper containing a particular jigsaw design. She then laminated the paper onto cardboard and cut the cardboard into jigsaw pieces. She packaged the jigsaw pieces and marketed them through retail outlets as greeting cards. The idea was that a person would send the loose jigsaw pieces to a selected recipient and the recipient would piece together the jigsaw in order to reconstruct the card. The particular card with which this case is concerned is a jigsaw card that features a red heart with one piece missing. The jigsaw is a rectangular shape with a red heart on a white background upon which are printed the words "There's a piece missing from my heart, it must be you". It was apparently intended a person would send the card to somebody in whom he or she had a romantic interest. The idea is novel and arresting. Apparently it achieved some success in the marketplace. The evidence shows the cards commenced to be promoted in about August 1994. At that time the cards were featured on a program run by Channel Ten, Melbourne called "Good Morning Australia". For that purpose, apparently, one or more cards were sent to people associated with the television station. Channel Ten, Melbourne is one of the stations operated by the present respondent, Network Ten Limited. The jigsaw puzzle was also featured in a short article in the September 1994 edition of "Woman's Day" and was the subject of an interview with the applicant published in a Greek language newspaper called "Vima" in January 1995. According to the evidence of Ms Retsis, by February 1995 the heart jigsaw was on sale at more than 110 Australian retail outlets. In that month employees of the respondent based at Channel Ten, Sydney decided to prepare some promotional advertisements ("promos") for the respondent's serial "Neighbours". That serial features stories about relationships. Josephine Carrano, the Head of Promotions at TV1, a media organisation related to the respondent, engaged Matthew Baldwin, a copywriter, on a freelance basis, to suggest ideas for the promotions. This was a routine event for Ms Carrano. Her job was to arrange for production of promos to advertise the respondent's programs. In any one week, she said, something like 126 separate promos would be made; there were about 11 per week for "Neighbours" alone. The promos sometimes duplicated footage; Ms Carrano said she meant 11 separate videos. Mr Baldwin seized on the theme of relationships and, according to his evidence, came up with two ideas. One involved the use of a daisy that would lose a petal as each different excerpt from a forthcoming episode of the program was shown: "she loves me, she loves me not". Another idea was to create a heart by jigsaw pieces coming together with each excerpt from future episodes. At the end of the process, one piece would still be missing; this would indicate to viewers the necessity for them to watch the program in order to get the full story of the relationships. Mr Baldwin gave the jigsaw idea to Ms Carrano. She liked it and gave an instruction for the production of a three dimensional heart cut into jigsaw shapes. The Channel Ten, Sydney Stage Manager, Michael Pratt, arranged for the heart to be made by a freelance prop maker, Pamela Milbourn. All these people gave evidence. All said they knew nothing about the applicant's cards, they had not seen them. The key witness for the respondent was Mr Baldwin; it is the respondent's case the jigsaw heart idea came from him. Mr Baldwin was cross-examined about the origin of the idea. He said the heart was a well known stereotype for a relationship; the object of a promo was to use stereotypes to get an idea across to viewers in a very short time. The heart conveyed the idea of a relationship; red was the colour normally associated with the heart; that is why he chose red. He said the jigsaw was conceived as a way of illustrating the interlocking nature of the events and characters in the serial and in the development of a relationship. He conceded to Mr Richard Hughes, the solicitor for the applicant, that he could have chosen different components - for example, blocks, or triangles, or something of that nature - but he chose a jigsaw because of the concept of interlocking. Mr Baldwin was asked about the decision to leave one piece missing. He said this was to convey the idea that it was necessary to watch the program, because the story was not complete. He was asked why he positioned the missing piece in the top right hand corner of the heart. He said this was to him aesthetically correct; "it looked right and balanced to my eye". Ms Carrano developed this idea somewhat. She said when the idea was explained to her, she liked the notion of the missing piece being in that position; although the heart is on the left hand side of the body, it presents to the camera as being on the right hand side; so the missing piece was in the same position on the jigsaw as the heart appears to the camera on the body. The basic question for me to determine is whether I accept this evidence. As I say, Mr Baldwin and Ms Carrano, and also the other people involved in the production of the jigsaw, flatly deny any knowledge of the applicant's card. This is not a case where somebody acknowledges having seen an applicant's copyright material but denies conscious copying; this is a case where the relevant people say they never saw it. They claim the use by them of a red heart in a jigsaw pattern, with a missing piece, was simply coincidental. Mr Hughes concedes the evidence of Mr Baldwin is not inherently incredible. However, he says the similarities between the card and the television promo are so great that I should conclude it was improbable Mr Baldwin reached this idea without having seen his client's card; I should reject the evidence of Mr Baldwin and Ms Carrano and infer copying. I understand the points put by Mr Hughes but I do not think I can accede to his submission. I agree it is a remarkable coincidence if, within a relatively short time, two people independently came up with the concept of a jigsaw heart with a missing piece. However, coincidences do happen. I do not see anything in the detail of the two jigsaw hearts that dictates an inference of copying. The differences are not so great as would lead me to hold, if there was copying, that no substantial part had been taken; nonetheless there are differences. In the applicant's heart, the major dimension of the missing piece is vertical; in the respondent's heart it is horizontal. The applicant's missing piece occupies a much greater proportion of the heart area than does the respondent's. There are more jigsaw pieces in the respondent's heart than in the applicant's. I mention these matters simply to point out this is not a case of an exact copy, compelling disbelief of a sworn denial of copying. Here there is similarity in concept rather than in detail. I do not think it is it incredible that Mr Baldwin independently conceived this concept. It is important to remember how the first promo was structured. As I have said, it was based on a three-dimensional heart jigsaw puzzle. The video tape which was shown in Court, and rerun twice so I could be certain I had it correctly, shows one piece of the heart being put in position against a scene from a forthcoming episode of "Neighbours". Then another piece is joined to it, against another excerpt from a forthcoming episode, and so on. Finally, one has the whole heart, except the missing piece. So there is an idea of relationships being built up. A jigsaw is a good way of conveying the idea of interlocking. As Mr Baldwin said, jigsaw puzzles are familiar to everybody from their childhood; we all know about them. At the end of the promo the viewer sees the total heart, save the tantalising omission that is intended to compel viewers to watch the program and find out for themselves. It seems to me the symbolism is logical. It plays on stereotypes, but that is what advertising is all about. I cannot see any reason to doubt Mr Baldwin's evidence that this was his process of thought. I rarely place major weight on demeanour. I am conscious of the fact that one can be wrong in evaluating a witness by reference to demeanour. However, I should say Mr Baldwin impressed me as a witness. I thought he was honest and open in his evidence. As he was speaking, I felt no doubt about his credibility. When I add that factor to my consideration of the substance of what he said, I conclude there is no reason for me to disbelieve his story. I add to that conclusion my reaction to Ms Carrano's evidence. I am critical of her conduct in one respect; I will come to that later. But that criticism is not relevant to her credibility. She says she had previously worked with Mr Baldwin. She was obviously impressed with his creativity. She said she liked the daisy idea and also that of the heart. She, herself, thought about the symbolism of the heart. Ms Carrano did not claim authorship of the concept, but clearly it was something she thought about and embraced. Had Mr Baldwin simply taken the heart from Ms Retsis' card, he would probably have shown Ms Carrano the card. But it was not suggested he did. Mr Baldwin denied having seen the card, so did Ms Carrano. There was nothing about Ms Carrano's evidence that causes me to disbelieve the respondent's case about the creation of the promo. The other two witnesses, Mr Pratt and Ms Milbourn were, without any disrespect to them, simply mechanics in the creation of the jigsaw puzzle. Their evidence is consistent with any view of the origin of the idea. In short, I am not persuaded there was a causal connection between the work created by Ms Retsis, in respect of which she undoubtedly has copyright, and the promos produced by the respondent. For that fundamental reason, the application must be dismissed. In reaching that conclusion, I indicate my considerable sympathy for Ms Retsis. It must be galling to her to have had a good idea and, no doubt with considerable trouble and some expense, promoted it in the marketplace only to find somebody else, with a much bigger market reach, using the same idea. Ms Retsis could be forgiven for feeling upset about that. That brings me to the point I earlier reserved. Ms Retsis saw one of the respondent's promos and had a telephone conversation about it with Ms Carrano. During that conversation, apparently, Ms Retsis gave Ms Carrano a description of her card. Ms Carrano said that, if the two designs were similar, it must be a coincidence. At some stage, something was said about any further contact being with the respondent's legal department. Accordingly, Ms Retsis took up the matter with the legal department. That department handled it in a way that was not calculated to dissipate Ms Retsis' sense of grievance. Correspondence ensued. On the respondent's side, it was handled by an in-house lawyer who wrote more than one letter that contained no denial of copying - and no admission either, I hasten to add - but which made an offer, in "full and final settlement of any dispute between Ten and Puzzling Stuff", of an advertorial segment on "Good Morning Australia". Later this was changed to an advertorial segment on another program. Nothing was done to put before Ms Retsis the facts now put before the Court and which I have found credible. If Ms Retsis had been told how it was that the idea came about, and perhaps invited to attend a meeting at which Mr Baldwin and Ms Carrano could have told her what they have told the Court, I strongly suspect she would not have embarked on this proceeding. This was not done. What was done was to make her an offer in "full and final settlement" as if there had been a copying, which she justifiably regarded as being totally inadequate if there had been a copying; indeed, it could be thought almost insulting. I think Ms Carrano bears some responsibility for the situation. Her evidence shows she was dismissive of Ms Retsis' complaint. The situation was not improved when the matter was handed over to the respondent's in-house lawyer. All this has nothing to do with the question of whether there was a breach of copyright; that must be concluded against the applicant. But it has much to do with the question whether this proceeding would have been commenced if the situation had been handled in a better way, the complaint taken more seriously and an attempt made to let Ms Retsis know the full facts. I mention the matter because it raises a question in my mind as to whether I ought to make any order for costs. The application will have to be dismissed but I would like to hear Mr Cobden on costs. [There was discussion about costs.] The appropriate course is for me to dismiss the application. At this stage, I make no order about costs. I reserve liberty to the respondent to apply for an order regarding costs by motion supported by affidavits, if the respondent so wishes and seeks to make out a case that at some stage Ms Retsis was informed with particularity of the respondent's explanation. I certify that this and the preceding six (6) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Wilcox.