FEDERAL COURT OF AUSTRALIA Audio-Visual Copyright Society Limited v Foxtel Management Pty Ltd (No 1) [2003] ACopyT 2 COPYRIGHT – Copyright Tribunal – evidence – survey evidence – application by respondents in advance of final hearing for direction by President of Tribunal that applicants not be permitted to tender proposed survey evidence on final hearing – whether power to give such direction – whether, as a matter of discretion, direction should be given. EVIDENCE – Copyright Tribunal – survey evidence – application by respondents in advance of final hearing for direction by President of Tribunal that applicants not be permitted to tender proposed survey evidence on final hearing – whether power to give such direction – whether, as a matter of discretion, direction should be given. Copyright Act 1968 (Cth) Pt VC (ss 135ZZI–135ZZZE), 153M, 164 Copyright Tribunal (Procedure) Regulations 1969 (Cth)reg 36A Arnotts Ltd v Trade Practices Commission (1990) 24 FCR 313 referred to Centurion Roller Shutters Pty Ltd v Automatic Technology (Australia) Pty Ltd (1999) 47 IPR 126 discussed AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED v FOXTEL MANAGEMENT PTY LIMITED & Ors CT 3 of 2002 LINDGREN P 2 DECEMBER 2003 SYDNEY IN THE COPYRIGHT TRIBUNAL CT 3 OF 2002 BETWEEN: AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED APPLICANT AND: FOXTEL MANAGEMENT PTY LIMITED FIRST RESPONDENT OPTUS VISION MEDIA PTY LIMITED SECOND RESPONDENT AUSTAR ENTERTAINMENT PTY LIMITED THIRD RESPONDENT TRIBUNAL: LINDGREN P DATE OF ORDER: 1 DECEMBER 2003 WHERE MADE: SYDNEY THE TRIBUNAL ORDERS THAT: 1. The direction sought by the respondents be refused. IN THE COPYRIGHT TRIBUNAL CT 3 OF 2002 BETWEEN: AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED APPLICANT AND: FOXTEL MANAGEMENT PTY LIMITED FIRST RESPONDENT OPTUS VISION MEDIA PTY LIMITED SECOND RESPONDENT AUSTAR ENTERTAINMENT PTY LIMITED THIRD RESPONDENT TRIBUNAL: LINDGREN P DATE: 2 DECEMBER 2003 PLACE: SYDNEY REASONS FOR DECISION (No 1) (Survey evidence) 1 These reasons relate to an issue which was debated on a directions hearing on 24 November 2003. The issue was whether I could, and if so, whether I should, as requested by the three respondents ('the Retransmitters'), direct that certain proposed survey evidence not be admitted on the final hearing. I refused to make that direction. The following paragraphs express my reasons for that refusal. 2 Part VC (ss 135ZZI-135ZZZE) was introduced into the Copyright Act 1968 (Cth) ("the Act") by the Copyright Amendment (Digital Agenda) Act 2000 (Cth) (No 110, 2000) with effect on and from 4 March 2001. Part VC is headed "Retransmission of free-to-air broadcasts". 3 The applicant collecting society, which is often known as "Screenrights" and to which I will refer by that name, was apparently declared by the Attorney-General by notice in the Gazette (No 37 of 19 September 2001), to be the collecting society for all relevant owners of copyright in the works, sound recordings and cinematograph films in free-to-air broadcasts retransmitted under Part VC of the Act. 4 The Retransmitters supply television services by cable to subscribers to those services. In the course of providing those services, they "retransmit" free-to-air broadcasts. 5 The notion of "retransmission" is defined in s 10 of the Act as follows: 'retransmission', in relation to a broadcast, means a retransmission of the broadcast, where: (a) the content of the broadcast is unaltered (even if the technique used to achieve retransmission is different to the technique used to achieve the original transmission); and (b) either: (i) in any case – the retransmission is simultaneous with the original transmission; or (ii) if the retransmission is in an area that has, wholly or partly, different local time to the area of the original transmission – the retransmission is delayed until no later than the equivalent local time.' 6 Screenrights received from the Retransmitters remuneration notices under s 135ZZZ of the Act. By its substantive application which commenced this proceeding, Screenrights asserts that it has been unable to reach agreement with the Retransmitters as to the amount of equitable remuneration payable in respect of the retransmissions, and asks the Tribunal to determine that amount: see ss 135ZZM(1) and 153M of the Act. 7 In support of its application, Screenrights wishes to conduct a survey by asking questions of 1,500 cable television subscribers. The purpose of the proposed survey is to measure consumer demand in terms of the willingness of subscribers to pay for the retransmission of the free-to-air television (at present, subscribers do not pay separately for that retransmission). Screenrights' objective is to lead evidence of the results of the survey on the final hearing of its substantive application, as evidence of a factor relevant to the determination of the amount of equitable remuneration payable by the Retransmitters. 8 The Retransmitters ask me to rule that the results will be inadmissible. The Retransmitters make a strong submission that the results of the proposed survey will not be relevant to the Tribunal's task of determining the amount of the equitable remuneration payable to the owners of the copyright in the works, sound recordings and cinematograph films in the free-to-air broadcasts which are retransmitted, because: · the proposed survey fails to distinguish between that subject matter and the free-to-air broadcasts themselves; · the proposed survey is wrongly directed to the value of the elimination of the necessity of a second remote television control device and an improvement in the quality of reception; · the results of the proposed survey will not be relevant to the result of a notional bargain between a willing but not anxious licensor and licensee; and · the notion of the consumer's willingness to pay is at odds with the statutory concept of "equitable remuneration". In addition to the objection on grounds of relevance, the Retransmitters also attack the methodology of the particular survey proposed. 9 The parties have asked that the substantive proceeding be heard by a full Tribunal. Subs 146(3) of the Act provides that where a party to an application makes such a request, the Tribunal must be constituted by not less than two members, of whom one must be the President or a Deputy President of the Tribunal. The parties have asked that three weeks be set aside for the hearing in October or November 2004. 10 The procedure of the Tribunal is governed by the Act and by the Copyright Tribunal (Procedure) Regulations 1969 (Cth) ("the Regulations"). Nothing in the Act or the Regulations resembles Federal Court Practice Note No 11, which addresses survey evidence. 11 Subsection 153M(2) provides that on an application to the Tribunal under subs 135ZZM(1), the Tribunal must consider the application, and, "after giving the parties an opportunity to present their cases", make an order determining the amount that it considers to be equitable remuneration for the making of retransmissions of free-to-air broadcasts. 12 Within Division 4 ("Procedure and evidence") of Pt VI of the Act, s 164 provides that in proceedings before the Tribunal: · the procedure of the Tribunal is, subject to the Act and the Regulations, within the discretion of the Tribunal: · the Tribunal is not bound by the rules of evidence; and · the proceedings are to be conducted with as little formality, and with as much expedition, as the requirements of the Act and a proper consideration of the matters before the Tribunal permit. 13 Subregulation 36A(1) of the Regulations provides that for the purposes of s 164 of the Act, if the Tribunal has not commenced hearing a matter, the President may: 'give directions ... as to the procedure to be followed in connection with the hearing of the matter before the Tribunal.' 14 Sensibly and commendably, Screenrights has in fact followed the procedure relating to proposed survey evidence set out in Federal Court Practice Note No 11. The parties are in disagreement concerning the survey. Therefore, in accordance with par 4 of the Practice Note, "[t]he matter of the survey [has been] raised with the [Tribunal] at [a] directions hearing …". 15 Notwithstanding the continuing disagreement between the parties concerning Screenrights' proposal, its observance of Federal Court Practice Note No 11 has already been beneficial. Screenrights has already modified its proposed survey in the light of some of the criticisms made of the original version by the Retransmitters. As well, it has, through its senior counsel on the present directions hearing, indicated that it will take into account the further criticisms which have been made in written submissions, and orally on the directions hearing, on behalf of the Retransmitters. 16 Of course, it is common ground that Screenrights is at liberty to carry out any survey if chooses. What the Retransmitters seek is a direction that it not be at liberty to tender the proposed survey evidence on the final hearing. 17 In my view there is a real question whether the President may direct, in advance of a final hearing that a party not be at liberty, on grounds of relevance, to tender on that hearing particular evidence or evidence of a particular kind. Even in a proceeding in which it is intended that the final hearing take place before the President, it is arguable that such a direction would be inconsistent with the obligation of the Tribunal under subs 153M(2) of "giving the parties an opportunity to present their cases", and would not be, within subreg 36A(1), a direction "as to the procedure to be followed in connection with the hearing of the matter before the Tribunal". It may be that a case could be imagined in which it would be proper for the President, over the objection of the party intending to tender the survey evidence to direct that it not do so, but, as presently advised, I think the President would have to be satisfied that the evidence would unarguably be held on the final hearing to be irrelevant, and, further, that the tendering of it then would for some reason amount to an abuse of process. I find it difficult to conceive of circumstances which would satisfy those tests. (In Arnotts Ltd v Trade Practices Commission (1990) 24 FCR 313 there is a suggestion (at 364) that "the form of relevant questions" might, where the parties are in disagreement, be "settled by the Court", but this goes to survey methodology, not relevance.) 18 In Centurion Roller Shutters Pty Ltd v Automatic Technology (Australia) Pty Ltd (1999) 47 IPR 126 ("Centurion"), an applicant moved, in advance of trial, for leave to adduce survey evidence at trial arising out of a survey questionnaire annexed to an affidavit. After setting out Practice Note No 11, French J stated as follows: '[4] It will readily be seen that the Practice Note sets out a procedure designed to throw up at an early stage objections which may be taken to the form and methodology and other aspects of a proposed survey. It does not however establish conditions for the admissibility of survey evidence. Admissibility may involve factual questions which can only be resolved by testing survey evidence at trial and, as the Practice Note makes clear, that is a matter for the trial judge to determine. Issues of implementation and departures from the planned methodology cannot be anticipated by the Court in dealing with a proposed questionnaire and process. The Centurion motion seeks leave to adduce evidence gathered from the proposed survey. In so far as it seeks a prospective ruling on admissibility, it cannot succeed. The purpose of the Practice Note on survey evidence is to minimise the risk at trial of time wasting challenges as to form and method which could have been raised upon their prior disclosure. That is the objective of the present exercise. [5] An attempt by a party at trial to raise an objection to survey evidence which could have been raised under the procedure for which the Practice Note provides is likely, at the least, to be visited by an adverse ruling as to costs thrown away possibly extending to the costs of the survey itself according to the circumstances of the case. Alternatively, there may be a question in such a case whether the objection will be permitted to be maintained at trial.' (my emphasis) 19 The Retransmitters submit that Centurion is distinguishable on the basis that the ruling sought was one that a proposed survey would be admissible, whereas the Retransmitters seek a ruling that Screenrights' proposed survey will not be admissible. 20 French J's references to "testing survey evidence at trial" and to "[i]ssues of implementation and departures from the planned methodology" show that his Honour had in contemplation the rendering of the proposed survey evidence inadmissible by circumstances which occurred after the hearing of the motion, and which could be adequately taken into account only at trial. In the present case, on the other hand, the Retransmitters are willing for present purposes, to have me assume in favour of Screenrights, that no later circumstances will occur to render its survey evidence inadmissible. To express the position differently, the Retransmitters submit that Screenrights can be in no stronger position on the issue of the admissibility than they are in at present: subsequent developments can only tell against admissibility. 21 In my view, however, Screenrights could be in a stronger position on the final position than now, on the issue of the correct approach to the determination of equitable remuneration, and therefore the issue of the relevance of its proposed survey evidence. The appropriate basis of the determination of the amount of equitable remuneration is best decided in the context of, or following, the giving of all the evidence on the final hearing. Accordingly, for reasons generally similar, though not identical, to those which found favour with French J in Centurion, the present question should be left for determination at the final hearing. 22 I decline to give the ruling sought by the Retransmitters for the following reasons: 1. The chief basis on which the Retransmitters submit that the proposed survey evidence will not be admissible is that it will not be relevant to the determination of the amount of "equitable remuneration" payable. However, as explained above, whether this is so is an issue which is integral to the substantive determination for which Screenrights have applied. That issue should be resolved on the final hearing in the light of all relevant evidence then before the Tribunal. 2. It is preferable, if not necessary, that the full Tribunal which will be constituted to hear and determine the substantive application, rather than the President alone, determine all questions of admissibility. 3. If I were to give the ruling sought by the Retransmitters, it would remain open to Screenrights to propose a different survey, and there could be a further application by the Retransmitters like the present one for a ruling. It is better that, with the benefit of the objections notified by the Retransmitters, Screenrights proceed at its risk with a survey now, rather than that the possibility of a succession of proposals and applications for rulings be opened up. I certify that the preceding twenty-two (22) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Copyright Tribunal constituted by Lindgren P. Associate to the President: Dated: 2 December 2003 Counsel for the Applicant: Mr DK Catterns QC and Mr C Dimitriadis Solicitor for the Applicant: Banki Haddock Fiora Counsel for the Respondents: Mr R Cobden Solicitor for the Respondent: Minter Ellison Date of Hearing: 24 November 2003 Date of Judgment: 1 December 2003