Acohs Pty Ltd v R A Bashford Consulting Pty Ltd & Ors [1997] FCA 352 - FCA 1997 case summary — Zoe

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Acohs Pty Ltd v R A Bashford Consulting Pty Ltd & Ors [1997] FCA 352

[1997] FCA 352

Federal Court of Australia|1997-07-01|Before: Merkel J

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At a glance

Source facts

Court

Federal Court of Australia

Decision date

1997-07-01

Before

Merkel J

Source

Original judgment source is linked above.

Judgment (50 paragraphs)

[1]

The applicant ("Acohs") provides computerised chemical information management services using a database management system known as "Infosafe". Infosafe utilises software developed from the applicant's chemical database of some 50,000 product information sheets. Infosafe software enables ready access to current MSDSs via the computer database as an alternative to paper or microfiche copies of the MSDSs. That process enables instant access to the most up to date format of an MSDS for a chemical at any workplace where the chemical is used. Although Acohs has the facilities to prepare MSDSs, the original MSDSs transcribed by it into its database have, for the most part, been provided to it by importers, manufacturers or suppliers of the chemicals. Acohs transcribes and therefore reproduces or adapts the MSDSs provided to it into its computer database. By that method users of the software can retrieve electronically the reproduced or adapted MSDSs from the Infosafe system. Retrieval may be by means of a printer, DOS disk, facsimile or to a computer screen. The third respondent ("Bialkower") conducts business under the name "Chemwatch". Bialkower is a major competitor of Acohs in providing computerised chemical information management services to private and public sector chemical users in Australia and overseas. In addition to the computerised services, a significant aspect of Bialkower's business has been the preparation of MSDSs in accordance with current Australian standards for importers and manufacturers proposing to supply hazardous substances or other chemicals for industrial use. Bialkower claims to be the owner of the copyright subsisting in MSDSs emanating from Chemwatch on the ground that either he or his employees were authors of the MSDSs. Forty three Chemwatch MSDSs have been transcribed into, and form part of, Acohs' Infosafe database. Bialkower claims that the copying, reproduction and adaptation by Acohs of the 43 Chemwatch MSDSs infringed his copyright in the MSDSs. Acohs disputes Bialkower's claims of copyright ownership and infringement. The copyright dispute arose in a curious way. The first and second respondents own and conduct a business known as "Risk Management Solutions" ("RMS"). RMS acted as an agent for Chemwatch in certain parts of New South Wales. The second respondent ("RMC") conducted a software division as an adjunct to the business of RMS. In that capacity RMC published a monthly "Infax" newsletter to actual and potential customers of RMS and RMC. It did not appear to be disputed that both RMS and RMC were responsible and therefore liable for the publication of the newsletter which was published for and in the interests of both RMS and RMC: see Lisciandro v. Official Trustee in Bankruptcy 1995 ATPR 41-436 at 40,903-4, and on appeal (1996) 139 ALR 689. In the Infax newsletter for November 1993, which was sent to 39 customers on 2 December 1993, an item entitled "CHEMWATCH WINS COPYRIGHT CASE" ("the Chemwatch news item") appeared. The item claimed that there had been successful Court challenges for infringement of copyright by Chemwatch in relation to the use of Chemwatch MSDSs in the Infosafe system. In fact there had not been any court case in relation to Chemwatch's MSDSs and there had not been a successful court challenge to Infosafe's, or any other company's, use of MSDSs of Chemwatch. RMS and RMC claim that the Chemwatch news item was based entirely on information provided by Bialkower, who denies providing it. The newsletter was sent to 39 customers before its falsity was drawn to RMC's attention. RMC sent a retraction to each of the recipients of the newsletter on 14 December 1993. Meanwhile, on 9 December 1993 Acohs issued proceedings claiming relief under s.52 of the Trade Practices Act 1974 (Cth) ("TPA") against RMS, RMC and Bialkower in respect of the Chemwatch news item. RMS and RMC disputed Acohs' entitlement to the relief sought by it but claimed contribution against Bialkower in respect of any damages and costs awarded against them. Bialkower denied any involvement in RMS's or RMC's conduct in relation to the Chemwatch news item. As part of his defence and also by way of cross-claim, Bialkower claimed that although the Chemwatch news item was incorrect as a statement of fact, his claim that the use by Acohs of Chemwatch MSDSs constituted an infringement of his copyright was correct. Accordingly, although the proceeding was instituted as a consequence of Acohs' s.52 claim, the primary dispute related to Bialkower's claim for protection of copyright in Chemwatch's MSDSs. Before turning to the issues arising for determination it is necessary to outline the role of MSDSs. 2.0 Material Safety Data Sheets A large number of hazardous substances are used each day in workplaces throughout Australia. In order to prevent occupational deaths, injuries and disease from the use of such substances the National Occupational Health and Safety Commission developed national standards and codes of practice, inter alia, for the control of hazardous substances in the workplace. The standards were developed in consultation with industry and, in general, are accepted and applied as industry practice. The standards are administered by Worksafe Australia which is the administrative arm of the Commission. The standards were declared under s.38(1) of the National Occupational Health and Safety Commission Act 1985 (Cth). They are prepared: • for the purpose of advising employers and employees of acceptable preventative action for averting occupational deaths, injuries and diseases arising from workplace hazards; and

[4]

• whether RMS and RMC contravened s.52 by publishing the Chemwatch news item; • whether Bialkower was a person involved in the contravention of s.52 by RMS and RMC; • whether Acohs suffered any loss or damage by reason of the contravention of s.52; and • whether declaratory or injunctive relief should be granted to Acohs in relation to any contravention of s.52. Bialkower has claimed a declaration in respect of his copyright in the 43 MSDSs and Acohs' infringement of that copyright, orders for the delivery up of all infringing copies and injunctive relief restraining any further infringement. Bialkower also claimed damages and interest but, ultimately, did not pursue those claims. The main copyright issues arising for determination in the proceeding are: • whether Bialkower is the owner of copyright in the 43 Chemwatch MSDSs transcribed by Acohs into the Infosafe database; • whether Acohs infringed Bialkower's copyright in the 43 MSDSs and, in particular, whether Acohs' use of the 43 MSDSs was in accordance with an implied licence of Bialkower; • whether the relief sought by Bialkower is discretionary and, if so, whether the Court should refuse the relief sought on discretionary grounds, including the public interest. 4.0 Section 52 4.1 The facts Prior to November 1993 Bialkower had claimed that use of Chemwatch MSDSs by Acohs infringed his copyright. Bialkower, directly or through his solicitor, had corresponded with J. Blackwood & Sons Pty Ltd ("Blackwood"), a substantial wholesaler of chemicals, and the Australian Navy, a substantial user of chemicals. He claimed that any transcription of Chemwatch MSDSs into the Infosafe database infringed Bialkower's copyright. It appears that by about October 1993 Bialkower had become confident that his copyright claims were being taken seriously, at least by the Navy. Philip McCann ("McCann"), an employee of RMC, was responsible for the Infax newsletter. He and Bialkower gave conflicting versions as to the origin of the Chemwatch news item. On the balance of probabilities I have concluded that the following events are likely to have led to the publication of the Chemwatch news item. In late October or early November 1993 Bialkower telephoned McCann and told him that he had been successful in upholding his copyright claims for Chemwatch MSDSs in relation to companies using the Infosafe system. Bialkower suggested that McCann might use that information as a selling point. At the time McCann was seeking to persuade The Australian Gas and Light Co. (AGL) to select the Chemwatch, rather than the Infosafe, chemical management system. McCann assumed that the success, to which Bialkower referred, was in relation to litigation by Chemwatch against the proprietors of Infosafe. He regarded the information as appropriate to pass on to AGL. Accordingly, on 19 November 1993 he sent a facsimile to Ken McCall of AGL which stated: I thought that you and Elizabeth might be interested in hearing that the CHEMWATCH company has recently won court cases in Victoria against INFOSAFE. INFOSAFE were found to be breaching copyright laws by using CHEMWATCH MSDS'S in their databases. CHEMWATCH MSDS's have such a wide usage now that it will be difficult for companies such as INFOSAFE to avoid breaching copyright conditions on a regular basis.

[8]

Bialkower disputed McCann's evidence that Bialkower made the claims set out in the article and said that he did not know of the article until after its publication. He said that on receiving the copy McCann sent to him, he immediately telephoned McCann and informed him that the Chemwatch news item was not correct. I do not accept Bialkower's evidence on this issue. It is unlikely that McCann would have invented the content of the letter to AGL and the article in its entirety and then proceed to publish it to customers, which obviously included persons dealing with Acohs, without any communication or authorisation from Bialkower. Secondly, McCann's evidence was consistent with his previous conduct of checking an item in relation to Chemwatch with Bialkower prior to publishing it. Thirdly, McCann's evidence is supported by the contemporaneous documentation, being the letter of 19 November 1993 and the newsletter facsimiled by him to Bialkower which states, in McCann's handwriting, that it is being sent for Bialkower's approval. Fourthly, McCann, who is no longer in the employ of RMC, presented as a credible and honest witness doing his best to recall the relevant events. I found Bialkower's evidence as to the events to be self-serving, unreliable, not supported by the contemporaneous documentation and to have an air of unreality about it. If Bialkower's version is accepted, RMS acted in serious dereliction of its duty. Yet, on Bialkower's own version, he made little or no immediate complaint about McCann's conduct and otherwise continued with RMS's agency without serious complaint. Finally, there is no rational explanation for McCann's conduct if Bialkower's version is accepted. In contrast McCann's version is inherently likely. Bialkower believed he had made an important breakthrough with the Australian Navy for his copyright claims and that led him to make the general, albeit exaggerated, claims he made to McCann. Although originally the claims were not intended by Bialkower to be published in a newsletter, Bialkower intended that they be used as a selling point and, more importantly, did not prevent publication of the newsletter. It is likely that McCann may have misunderstood Bialkower's initial statement by assuming that the success to which Bialkower referred was in litigation. However, I am satisfied that Bialkower was prepared to take the benefit of the misunderstanding when he did not prevent the publication of the Chemwatch news item. In my view Bialkower's precaution in suggesting that Infosafe not be mentioned in the newsletter related to not being caught making misleading statements rather than not being misleading. After McCann decided to publish the Infax newsletter, he sent 39 copies to customers. McCann then received a call notifying him that Acohs had complained about the Chemwatch news item, contending that it was false. McCann checked the complaint with Bialkower who said that there had not been any litigation but that demands had been made on two companies which had removed Chemwatch MSDSs from their databases. McCann then refrained from further distributing the newsletter. There were unsuccessful negotiations between Acohs and RMS concerning a retraction. Finally, on 14 December 1993, RMC sent a retraction to the 39 recipients of the newsletter in the following terms: RETRACTION In our INFAX Newsletter of November 1993 we had an article which related to CHEMWATCH successfully suing another company relating to the use of INFOSAFE MSDS sheets. This article was incorrect. We apologise to INFOSAFE unreservedly with respect to this matter.

[10]

On the facts I have found, Bialkower was the source of the misleading information published by RMC to 39 customers. Bialkower also authorised the publication of the information although he suggested, but did not require, deletion of the reference to Infosafe. In these circumstances I am satisfied that Bialkower was a person involved in the contravention of s.52 by RMS and RMC: see s.75B of the TPA and Yorke v. Lucas (1985) 158 CLR 661. As Bialkower's conversations with McCann took place over the telephone he is probably directly liable, as a principal, under ss.52 and 6(3) of the TPA, notwithstanding that he is an individual and not a corporation. However, as I am satisfied as to his liability under s.75B it is not necessary to pursue that aspect. 4.4 Did Acohs suffer any loss by reason of the contravention? Acohs adduced extensive evidence in order to establish that as a result of the publication of the AGL letter and the November 1993 newsletter it lost, or lost the opportunity of entering into, profitable contracts in relation to Infosafe with Blackwood and AGL. It is necessary for Acohs to establish actual loss, which can include loss of opportunity: see Sellars v. Adelaide Petroleum NL (1992) 179 CLR 332, 348, 355. Evidence on this issue was given by representatives of Acohs and of Blackwood and AGL. I am not satisfied, on the balance of probabilities, that any loss of business with Blackwood or AGL by Acohs was caused by the publication of the AGL letter or the Chemwatch news item. In my view if any such business was lost, or more accurately not gained, by Acohs it was as a result of Bialkower's claims of copyright infringement in relation to the use of Chemwatch MSDSs in the Infosafe system. Bialkower had made such claims independently of the publication of the newsletter, both before and after its publication. Once the issue of copyright infringement in relation to Chemwatch MSDSs had been raised, resolution of that issue became a matter of concern to both AGL and Blackwood. Mr. Cowie, a director of Acohs, suggested that copyright was not an issue prior to December 1993. In my view the issue had been raised on a number of occasions by Chemwatch and also by Blackwood prior to December 1993. However, more importantly, once raised it remained an issue until its resolution in these proceedings. Accordingly, I am satisfied that the reluctance of Blackwood and AGL, as Infosafe customers, to extend their Infosafe systems, or any deferral of a decision on that issue was as a result of the failure to resolve Bialkower's claims of copyright infringement rather than the publication of the November 1993 Infax newsletter or the letter of 16 November 1993. The retraction which was sent to Blackwood and AGL on 14 December is also of relevance to this issue. Whilst I am satisfied that the representatives of Blackwood and AGL who received the retraction accepted its accuracy, those persons were likely to have been aware that any underlying copyright dispute in relation to Chemwatch MSDSs remained unresolved. That strengthens my view that it was the failure to resolve that dispute, rather than the publication of the newsletter, that may have resulted in a failure by Acohs to enter into further contracts with Blackwood and AGL. Put another way, applying a common-sense and practical common law approach to causation, the contravention I have found to have occurred did not cause the loss of further contracts with Blackwood and AGL: see Wardley Australia Ltd v. The State of Western Australia (1992) 175 CLR 514 at 525 per Mason CJ, Dawson, Gaudron and McHugh JJ. Accordingly, I am not satisfied that damages should be awarded for loss of custom with AGL and Blackwood. However, that is not the end of the matter. The Chemwatch news item was seriously misleading and was inherently likely to damage Acohs' reputation and goodwill in relation to the Infosafe system. One witness said that the retraction confused him on the issues it addressed, rather than clarified them. It is likely that other recipients were also confused over the copyright issue as a result of the newsletter and the retraction. The newsletter was sent to 39 businesses, many of which were actual or potential customers of Acohs. It was likely to have been read or discussed by a significant number of persons. I am not satisfied that the retraction, sent 12 days later, was seen by all of those persons or was accepted by them to be a complete negation of the impact of the Chemwatch news item. In my view the publication seriously damaged Acohs' repute and goodwill in relation to its Infosafe system. In Typing Centre of NSW Pty Ltd v. Northern Business College Ltd (1989) ATPR 40-943 and FAI General Insurance Co Limited v. RAIA Insurance Brokers Limited (1992) 108 ALR 479 it was accepted that seriously misleading conduct may well cause actual loss by reason of the damage such conduct caused to the repute and goodwill of a business. In Typing Centre of NSW Wilcox J at 50,290-1 accepted that although there was no evidence of any loss of income, the consequence of the misleading publication: ... must have been to affect the goodwill of the applicant's business and that, in determining the extent of the loss, the court ought to have regard to the nature of the statements made by the respondents and to the manner and extent of their publication.

[14]

4.5 Other relief Acohs also sought declaratory and injunctive relief. The respondents have denied the breaches of ss.52 and 75B which were alleged against them. I have determined that dispute in favour of Acohs. In these circumstances, and notwithstanding the retraction by RMC, in my view it is appropriate to grant the declaratory relief sought by Acohs in respect of the breaches I have found to have occurred: cf FAI General Insurance Co Limited at 508 per French J. The issue of injunctive relief is more complex. Section 80(5) of the TPA provides that the Court may grant an injunction to restrain conduct which contravened the TPA notwithstanding that there is no further threat or intention to contravene the Act. However, the Court has a discretion to refuse injunctive relief in an appropriate case, particularly if there is no reason for the grant of such relief. RMS and RMC retracted the misleading news item within a reasonable time of becoming aware of its falsity. I am satisfied there is no real prospect or possibility of them republishing the misleading information. As far as Bialkower is concerned, the issue of copyright infringement in respect of Chemwatch's MSDSs is now before the Court for determination. The present action will determine Bialkower's claims against Acohs for past infringement. I have no reason to expect that Bialkower will misrepresent the outcome of the proceedings or his rights under the Copyright Act 1968 (Cth). If, contrary to my expectation, Bialkower does so, it will be appropriate for that matter to be dealt with in the circumstances then arising. In all the circumstances it is my view that it is inappropriate to grant the injunctive relief sought. 4.6 Claim for contribution by RMS and RMC against Bialkower The Court has a wide discretion to make appropriate orders for contribution between wrongdoers to ensure that each party liable in respect of the same damage makes a just contribution by paying a proper share towards discharging the common obligation: see Albion Insurance Company Limited v. Government Insurance Office of New South Wales (1969) 121 CLR 342 at 350-1 per Kitto J and Jones v. Mortgage Acceptance Nominees Ltd (1996) 142 ALR 561 at 563-5 per Davies J. On the facts I have found, I am satisfied that Bialkower was the primary, but not the sole, cause of the breach of s.52 by RMS and RMC. McCann misunderstood the information initially communicated by Bialkower and failed to adopt Bialkower's suggestion that Infosafe not be mentioned in the item. Bialkower had the opportunity, but failed, to correct McCann's misunderstanding when the proposed article was facsimiled to him. In these circumstances I am satisfied that RMS and RMC are entitled to a substantial contribution from Bialkower in respect of the damages and any costs awarded against them in relation to Acohs' Application. In my view that contribution should be 75%. 5.0 Copyright Section 32 of the Act provides that, subject to the Act, copyright subsists in an original literary work that is unpublished, where the author of the work was a qualified person at the time the work was made. Section 32(4) provides that a qualified person means, inter alia, an Australian citizen or person resident in Australia. Section 10 defines a literary work as including a table or compilation in words, figures or symbols. Under s.22(1) a literary work is made when the work is first reduced to writing. Section 32(2) provides that subject to the Act, where an original literary work has been published, if copyright in the work subsisted immediately before the first publication, copyright continues to subsist in the work if the first publication of the work took place in Australia. Section 29(1)(a) provides that subject to the section, a literary work shall be deemed to have been published if reproductions of the work have been supplied (whether by sale or otherwise) to the public. Section 35(2) provides that, subject to the section, the author of a literary work is the owner of any copyright subsisting in the work. Under s.35(6), if a literary work is made by an author in pursuance of his or her employment by another person under a contract of service, that other person is the owner of any copyright subsisting in the work. Accordingly, if an author is commissioned to prepare a literary work under a contract of services as an independent contractor, rather than as an employee, the author will be the owner of any copyright subsisting in the work. Section 31(1)(a) provides that copyright in relation to a work is the exclusive right, inter alia, to reproduce the work in a material form or to publish or make an adaptation of the work. Section 36(1) provides: Infringement by doing acts comprised in the copyright 36. (1) Subject to this Act, the copyright in a literary, dramatic, musical or artistic work is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorises the doing in Australia of, any act comprised in the copyright.

[17]

In Kalamazoo (which related to a compilation of basic accounting forms), Thomas J declined to adopt either formulation, and concluded at 124 that, although the authors had not exercised "great skill", the preparation of the forms required a degree of concentration, care, analysis, comparison, and a certain facility in using and adapting the altered forms to a composite 'one-write' system....there is sufficient originality of expression, shape and content to compose an original literary work. It is clear that the process of selection alone may involve sufficient skill, labour or judgment to give rise to the requisite originality. In Ladbroke (Football) Ltd v. William Hill (Football) Ltd [1964] 1 WLR 273, Lord Reid noted at 277 that ...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. However, if the selection process does not involve any element of originality or skill, but is rather a selection which is of an "obvious and commonplace character", the compilation will fail to display the qualities required to attract copyright: G.A. Cramp at 338. In that case, tables of various information (including, for example, weights and measures) which were included in a diary, were held not to be capable of attracting copyright, as that sort of information was commonplace information which was commonly found prefixed to diaries. The tables did not involve any feature "which could be pointed out as novel or specially meritorious or ingenious from the point of view of the judgment or skill of the compiler": per Viscount Simon LC at 336. In Victoria Park Racing and Recreation Grounds Company Limited v. Taylor (1937) 58 CLR 479 at 511, Dixon J concluded that a list, displayed at a racecourse, of scratchings and places at the barrier was not the subject of copyright as although it was not necessary, for a work to attract copyright, for it to have a new or inventive idea, some "original result" must be produced. In Interlego A.G. v. Tyco Industries Inc [1989] AC 217 at 263 the Privy Council stated: There must in addition be some element of material alteration or embellishment which suffices to make the totality of the work an original work. Of course, even a relatively small alteration or addition quantitatively may, if material, suffice to convert that which is substantially copied from an earlier work into an original work. Whether it does so or not is a question of degree having regard to the quality rather than the quantity of the addition.

[18]

Accordingly, the exercise of skill, labour or judgment merely in the process of copying may not involve sufficient originality to confer copyright. An assessment is to be made of the "merit" or "ingenuity" of a selection or compilation (see G.A. Cramp at 336) or of the quality of an alteration or embellishment of work (see Interlego at 263) in relation to a work which has been compiled or copied from existing works. In order to do so it is necessary to be able to ascertain what elements of the original works have been used as the basis for the compiled work, so that a comparison may be made which reveals the extent and nature of the efforts of the compiler. I am satisfied that, in general, the compilation of a MSDS involves sufficient skill, judgment and labour for it to constitute an original literary work in which copyright subsists. However, whether the 43 Chemwatch MSDSs are such works requires careful consideration of the criteria to which I have referred, in the context of the very general evidence given by Bialkower as to their origin. A number of problems have arisen as to the authorship and originality of the 43 MSDSs. Over the last 5 years Chemwatch has prepared a large number of MSDSs; Bialkower had little or no recollection of his role in the preparation of the 43 MSDSs the subject of his cross-claim. That is not surprising as the 43 MSDSs were of no particular significance. Their sole special feature is that they were Chemwatch MSDSs which were able to be identified as forming part of the 50,000 or so items in the Infosafe database. Bialkower's evidence is that since about 1991 Chemwatch has been engaged as an independent contractor on a regular and ongoing basis by chemical manufacturers and importers to prepare data sheets, including MSDSs, which conform to the Australian national standards. In that period Chemwatch has prepared in excess of 20,000 product data sheets pursuant to such engagements. Bialkower's evidence was that the MSDSs were requested in the usual course by the manufacturers or importers which provided Bialkower with any relevant data, including any existing or previous MSDSs, in respect of the chemical. There does not appear to have been any discussion as to copyright ownership of the MSDSs commissioned although from time to time some manufacturers or importers queried Chemwatch's copyright note on the last page of its MSDSs. When that occurred Bialkower responded that his copyright would not interfere with the manufacturer's or importer's use of the MSDSs commissioned from Chemwatch in respect of their products. Any copyright subsisting in a MSDS produced by Chemwatch, i.e. Bialkower, pursuant to such an engagement would be owned by Bialkower pursuant to s.35(2), if he was the author, and s.35(6) if an employee of Bialkower was the author. However, these findings do not resolve the issue of copyright ownership for the 43 Chemwatch MSDSs in issue in the present case. Bialkower was unable to give any specific evidence as to the authorship of the 43 MSDSs. The evidence does establish that the MSDSs were prepared by Chemwatch mainly for manufacturers or importers who became customers since 1991. However, the evidence also establishes that the information contained in the MSDSs may have been derived from: • American MSDSs which were provided for imported chemicals; • the extensive MSDS library of the Adchem system which was acquired in 1989 by Oakridge Pty Ltd (a company owned, in part, by Bialkower) which permitted Bialkower to use the library; • existing MSDSs for the particular chemical; and • texts or other documentation which describe properties of the chemical in question. The difficulty is that Chemwatch MSDSs are updated from time to time and the records make it difficult to identify whether a MSDS was derived from an earlier MSDS and, if so, the format of that earlier MSDS. I accept Bialkower's evidence that all or most of the 43 Chemwatch MSDSs tendered in evidence were produced during the period of his proprietorship of Chemwatch since 1991 but that does not lead to the conclusion that each MSDS was an original literary work authored by Bialkower or his employees for the purposes of s.35. A further problem is that, in addition to his staff, from time to time, Bialkower also employed at least 4 appropriately qualified "outside persons" to assist in the preparation of Chemwatch MSDSs. The evidence does not enable me to form a view as to the role, if any, these experts played in the preparation of the 43 MSDSs. If they were the authors of the MSDSs, copyright ownership might vest in them as they did not appear to be employed as employees under a contract of service: see s.35(2) and (6). When this problem became apparent Bialkower gave evidence that the 43 MSDSs were in fact prepared by him and his employees. However, I have difficulty in accepting that evidence. It was inconsistent with his earlier evidence that Chemwatch MSDSs were prepared by a mix of Bialkower, his employers and "outside persons". Further, it does not sit comfortably with Bialkower's lack of recollection of the circumstances in which the 43 MSDSs were prepared. Further, my rejection of Bialkower's evidence in relation to the Chemwatch news item has led me to approach the generality of his evidence on authorship with some caution.

[19]

In all the circumstances I have had great difficulty in being satisfied that Bialkower has discharged the onus upon him to establish the authorship of and copyright in any particular MSDSs. However, the high probability is that a number of the 43 MSDSs do fall into the category of MSDSs: • which constitute original literary works of Bialkower and his employees and in which copyright subsists; and • which were transcribed by Acohs into the Infosafe system. Notwithstanding the difficulty to which I have referred, obviously it is desirable for the dispute in relation to past copyright infringement to be resolved. In view of the conclusions at which I have arrived in relation to Acohs' defences to Bialkower's infringement claims, that dispute is able to be resolved without it being necessary to reach a final conclusion to the question of copyright ownership in respect of particular MSDSs. Accordingly, for the purpose of resolving these issues I am prepared to assume copyright subsists in a number of the 43 MSDSs and is owned by Bialkower. 5.2 Implied licence Infringement is only established under s.36(1) of the Act if the conduct alleged to constitute the infringement is engaged in "without the licence of the owner of the copyright". The onus of establishing the absence of an express or implied licence lies on the copyright owner suing for infringement: see Avel Pty Ltd v. Multicoin Amusements Pty Ltd (1990) 171 CLR 88 and Devefi Pty Ltd v. Mateffy Pearl Nagy Pty Ltd (1993) 113 ALR 225 at 234, cf De Garis v. Neville Jeffress Pidler Pty Ltd (1992) 37 FCR 99 at 110 per Beaumont J. In Avel Mason CJ and Deane and Gaudron JJ stated the underlying principle for ss.37 and 38, but which applies equally to s.36, at 94-95: The onus of proving the absence of the licence of the owner of the copyright in relation to an issue of infringement under s.37 or s.38 of the Act lies on the party who asserts infringement. The reason why that is so is that the absence of such licence constitutes an element of the wrong of infringement under those sections as distinct from a justification or excuse for doing something which prima facie constitutes infringement.

[21]

Jacobs J was satisfied that, as no term of the architect's contract of engagement dealt with copyright, any licence, consent or permission must be one which is implied. On the first question Jacobs J said at 1581-2: The question raised is quite a broad one because it applies not only to architects but would apply for instance to artists who are engaged to prepare a particular work which would of its nature be reproduced, for instance a cartoon for a tapestry or a mosaic, or which would apply to persons who prepared written material with the intention that it should be used in a particular manner. It seems to me that the principle involved is - that the engagement for reward of a person to produce material of a nature which is capable of being the subject of copyright implies a permission or consent or licence in the person making the engagement to use the material in the manner and for the purpose in which and for which it was contemplated between the parties that it would be used at the time of the engagement. It seems to me that this must be regarded as a principle of general application. It seems to me that it was the principle applied in the cases to which I was referred by Mr. Hutley, Cooper v. Stephens and W. Marshall & Co Ltd v. A.H. Bull Ltd. I think it is a principle which can be found to be applied in a number of cases. It relates to permission or consent to what must have been taken to have been within the contemplation of the parties at the time of the engagement. After all, it must be borne in mind that it is the engagement which brings the copyright material into existence. When that principle is applied in the present case it seems to me to be inevitable that one should conclude that the payment for sketch plans includes a permission or consent to use those sketch plans for the purpose for which they were brought into existence, namely, for the purpose of building a building in substantial accordance with them and for the purpose of preparing any necessary drawings as part of the task of building the building.

[23]

The principles enunciated by Jacobs J in Beck have been followed and applied in Australia: see Ng v. Clyde Securities Ltd (1976) 1 NSWLR 443, Bourke v. Filmways Australasian Distributors Pty Ltd Supreme Court of NSW, 9 October 1979, unreported, R & A Bailey & Co Ltd v. Boccaccio Pty Ltd (1986) 4 NSWLR 701 at 711, Gruzman Pty Ltd v. Percy Marks Pty Ltd (1989) 16 IPR 87 at 89, De Garis at 110-112 and most recently in Tucker v. Bentley & Ors O'Loughlin J, unreported, 20 December 1996. Beck has also been applied in the United Kingdom: see Blair v. Osborne and Tomkins (1971) 2 QB 78. Further, as was pointed out by the Full Court in Devefi at 241, Beck has been referred to with apparent approval in leading copyright texts. Beck has been accepted as authority for the principle that if copyright material is produced for a particular purpose, then there is an implied permission, consent or licence to use that material to carry out that purpose: see De Garis at 110 and R & A Bailey at 711. In my view the Beck principle involves the following questions: • is there an implied licence to use the copyright material to carry out a particular purpose? • what is the purpose? • is the use by the alleged infringer in accordance with the licence conferred? If the "purpose" is restricted to use by the person upon whom the licence was conferred, an additional question might arise. That question, which arose in Beck, is whether the person upon whom the licence was conferred was entitled to transfer the right to the alleged infringer? From time to time the question has arisen as to whether the contractual licence relied upon is an implication of a term by law which is necessary to give the contract business efficacy: see Interstate Parcel Express Co at 548, R & A Bailey & Co Pty Ltd at 711-712, Devefi at 239-241, Tucker at 50; see also Stovin-Bradford v. Volpoint Properties Ltd [1971] 1 Ch 1007, 1017-8 per Salmon LJ. The significance of this question was explained by Hope JA in Castlemaine Tooheys Ltd v. Carlton & United Breweries Ltd (1987) 10 NSWLR 468 at 486-7: (c) Implication of terms by law and otherwise: Terms may be implied in a contract in a number of ways. Of these ways one is commonly called implication by law, when terms may be implied regardless of the actual intention of the parties; another is the implication of a term which is necessary, in the circumstances of a particular case, to give business efficacy to the contract. The distinction between these two kinds of implication was referred to by Mason J in Codelfa Construction Pty Ltd v. State Rail Authority of New South Wales (1982) 149 CLR 337 at 345-346 in these terms: "Of course, I am speaking of an implied term necessary to give business efficacy to a particular contract, not of the implied term which is a legal incident of a particular class of contract, of which Liverpool City Council v. Irwin [1977] AC 239 is an example. The difference between the two categories of implied term was mentioned by Viscount Simonds in Lister v. Romford Ice and Cold Storage Co Ltd [1957] AC 555 at 576, where he referred to the search for the second category of implied term as being based 'upon more general considerations', a comment endorsed by Lord Wilberforce in Irwin [1977] AC 239 at 255." One basic distinction between these two classes of implied terms is this. Terms implied by the application of the business efficacy test are terms unique to the particular contract under consideration; they depend upon the express terms of that contract and the relevant surrounding circumstances. Terms implied by law, on the other hand, are, or at least are relevantly for these proceedings, terms which, prima facie, are to be implied in all contracts of a particular class. As I will seek to show, whether the implication is excluded requires regard to be had to the express terms of the contract and to the relevant surrounding circumstances of the case, but the prima facie implication depends upon the contract falling within the class in respect of which the law has decided that particular terms should be implied. Although the distinction between the two classes of implication has not been and perhaps is still not universally appreciated, classes of contract in respect of which terms will be implied by law, and the terms which will be implied, have in many cases been long established. Typical classes are contracts between master and servant, for the sale of goods, for the provision of work and materials and between landlord and tenant. However the classes of contracts in which the law will imply terms are not closed; the difficult question is to determine what test should be applied before the courts imply such a term for the first time.

[28]

In the present case it is necessary to decide the point as, unlike Devefi, there are no relevant circumstances which would exclude any implied licence. Chemwatch's commissions to prepare MSDSs were under "open contracts" i.e. contracts which do not deal with the issue of copyright: see Devefi at 240. I am satisfied that such discussions as may have occurred in relation to Bialkower's copyright note on MSDSs did not have contractual effect and went no further than recognition that any copyright in the MSDS vested in Bialkower. Indeed, in his evidence Bialkower referred to the MSDSs as MSDSs of the manufacturer or importer and gave assurances that his copyright would not interfere with their use of the MSDSs. Put another way, Bialkower has not discharged the onus upon him of negating any implied licence, for example by establishing that the contract was not an "open contract". In my view, the licence considered in Beck is one which is implied by law to a particular class of contract. Jacobs J clearly regarded the licence he implied as falling within that category. In Beck at 1581 His Honour said that the question raised was quite a broad one which applied not only to architects but to artists and to persons who prepared written material with the intention that it should be used in a particular manner. Jacobs J concluded that the principle enunciated by him must be regarded as a principle of general application. In doing so His Honour decided that the licence was to be implied by law for the particular class of contract with which he was concerned, i.e. where copyright material is commissioned for a particular purpose. It is important to define with precision the particular purpose, which is to be determined by reference to the circumstances of the particular case. If the purpose includes use of the material by persons other than the person commissioning the copyright material, then use by those other persons to carry out that purpose will fall within the licence implied by law. If the particular purpose does not involve use of the material by others, as seems to have been the case in Beck, then the issue of an implied right to transfer the implied licence will arise by reference to the circumstances and terms of the particular contract. The initial issue is whether the engagement of Bialkower to prepare MSDSs, by manufacturers or importers falls within the class of contract described in Beck. The contract of engagement of Bialkower, by manufacturers and importers, is an "open contract" to prepare written material, being MSDSs, with the intention that they be used for a particular purpose, being the provision of ready access to the information contained in the MSDSs for safety related purposes. Such a contract falls within the class of contract described in Beck. Accordingly, a licence is implied by law which permits or consents to the use of the MSDSs to carry out those purposes. The purpose is to be determined objectively by reference to the contract entered into by the parties and the regulatory and factual matrix in which the transaction took place. There is little difficulty in ascertaining the relevant matrix in the present case. The MSDSs were commissioned by manufacturers and importers to be in the Worksafe Australia standards format for use, inter alia, as set out in the standards. Bialkower accepted that he was commissioned to prepare MSDSs which would be distributed by manufacturers and importers on the sale of their products in accordance with the standards. They were commissioned in relation to substances, including hazardous substances, for the purpose of ensuring the ready availability and accessibility of the MSDSs for safety related purposes for or at any workplace in Australia at which the substances are or will be stored, used or transported. The manner in which the MSDSs were to be made available or accessible was set out in Worksafe Australia Standard for Control of Workplace Hazardous Substances (1994) (on which the parties agreed I was to act for purposes of the present case). The Regulations, which form part of the standard, provide that: • manufacturers and importers shall produce MSDSs for all hazardous substances which they supply, and shall review and revise MSDSs to keep them up to date (clause 6(1)); • suppliers shall ensure, in relation to any hazardous substance supplied for use at work, that a current MSDS is provided with the first supply to a purchaser and also on request (clause 6(2)); • an employer shall obtain a MSDS on the first supply of a hazardous substance to a workplace and ensure that a MSDS provided by the supplier is available for all hazardous substances used in the workplace and is readily accessible to employees with potential for exposure to those substances (clause 8). The National Code of Practice which forms part of the standard provides: • the purpose of MSDSs is to provide the information needed to allow the safe handling of hazardous substances used at work (clause 7.1); • a current MSDS shall be provided by the supplier on the first supply and on request to each person who purchases the hazardous substance from the supplier (clauses 7.4 and 7.5); • retailers are not required to provide MSDSs but may choose to do so by arrangement with suppliers. Where a person purchases a hazardous substance for use at work from a retailer and the MSDS is not available, the purchaser can obtain, on request, a copy of the MSDS from an upstream supplier (clauses 7.7 and 7.8);

[32]

Although the standards relate to hazardous substances they also apply, on a voluntary basis, to chemicals which may have the potential to cause harm but do not fall within the definition of a hazardous substance for the purposes of the standard. A number of the 43 Chemwatch MSDSs in issue between the parties relate to non-hazardous chemicals. National standards in respect of MSDSs have been adopted in legislation or under regulations in New South Wales, Queensland, South Australia, Australian Capital Territory and Northern Territory. They also apply to Commonwealth work sites. Although the standards have not yet been implemented in Victoria, Tasmania or Western Australia, the evidence is that implementation in those States was imminent. The specific obligations in the standards for the provision of MSDSs may not go a great deal further than the general legal obligations imposed on manufacturers, importers, suppliers and employers in any event. These obligations arise both at common law and under statute. At common law a duty to warn is imposed on a manufacturer of a product where the danger is unknown to the user and is not likely to be discovered in the course of the normal use of the product: see Donoghue v. Stevenson [1932] AC 562 and Norton Australia Pty Limited v. Streets Ice Cream Pty Limited (1969) 120 CLR 635 at 642-3 and 651. In Norton at 651 Kitto, Menzies and Owen JJ accepted that in the case of potentially dangerous material, a high degree of care in warning users of the dangers would reasonably be required. Essentially, MSDSs are designed to satisfy that duty. A similar situation arises under State and Territory occupational health and safety legislation. Under such legislation there is a general statutory duty imposed on employers to provide a safe work environment. Obviously, MSDSs for hazardous chemicals used in the workplace are an important factor in achieving such an environment. In the regulatory and factual matrix to which I have referred, there is little difficulty in identifying the manner in which the parties contemplated that the Chemwatch MSDSs commissioned by manufacturers and importers were to be provided. The availability and accessibility of the MSDSs for or at workplaces was to be in a photocopy or microfiche format or from a computer data base. The reproduction or copying of the MSDSs in any of these formats may be commissioned by a manufacturer, importer, supplier, retailer, a public emergency service or by or for any employer from contractors engaged for the purpose if for any reason that is not achieved "in house".

[33]

It was submitted on behalf of Bialkower that any implied licence was limited to hard copy reproduction by suppliers, employers or their employees. Whilst such a limitation might suit Bialkower's underlying object of preventing a competitor, such as Acohs, from providing a computerised chemical management system using Chemwatch MSDSs, there is no basis in the evidence for any such limitation. Whether reproduction is by staff or independent contractors or in hard copy or on computer depends on practical exigencies which may differ from user to user. I am satisfied that, in accordance with Beck, an accurate copying, reproduction or adaptation of any of the 43 Chemwatch MSDSs in the manner and for the safety related purposes to which I have referred falls within the implied licence of Bialkower. If I am in error in my conclusion that the particular purpose results in the implied licence extending to manufacturers, importers, suppliers, retailers, employers and to any other person requiring a MSDS for the safety related purposes for which it was prepared, I would arrive at the same conclusion as was reached in Beck in respect of the right to transfer the licence. In my view, using the words of Jacobs J in Beck at 1582, "it must inevitably be implied" that the manufacturer or importer which commissioned the MSDSs obtained the right to use them for the safety related purposes for which they were brought into existence and "should have the right to transfer that right" to suppliers, retailers, employers and others requiring MSDSs for the same safety related purposes. Finally, I would add that in the event that I am also in error in treating the implied licence as being implied by law to the particular class of contract described in Beck, I would have arrived at the same result on the basis of implying the same licence in relation to each particular contract for the commissioning of each of the 43 MSDSs, as a term which is necessary to give business efficacy to the contract: see Codelfa Construction Pty Ltd v. State Rail Authority New South Wales (1982) 149 CLR 337 at 345-347 per Mason J and 403-4 per Brennan J. The terms and purposes of the commissioning and the relevant factual matrix to which I have referred compel such an implication. 5.3 Is Acohs' use of Chemwatch MSDSs in accordance with the implied licence?

[34]

Acohs made use of some or all of the 43 Chemwatch MSDSs in its possession in two ways: • it transcribed them to form part of an Infosafe computer software system specifically commissioned by a manufacturer, importer, supplier or employer using the hazardous or other chemicals the subject of the MSDSs. The system is a user controlled database for the electronic management of chemical safety data ("the industrial use"); and • it maintains a central Infosafe computer database comprising, inter alia, all MSDSs transcribed by it and provides that "library" for a fee to public emergency or safety organisations being WorkCover (NSW), the Queensland Government Emergency Response Centre and the ICI Chemical Emergency Response unit ("the library use"). The central Infosafe database is also made available to the Commonwealth Surgeon General for use by those sections of the defence forces which use chemicals. That use accords with the industrial use described above. The industrial use clearly falls within the implied licence. The use is by the entities for whose benefit MSDSs are prepared. These entities commission Acohs, as an independent contractor, to prepare and provide for their individual use the Infosafe software program which gives them and their employees electronic access to the MSDSs for the chemicals supplied or used by them. It is less clear whether the library use falls within the implied licence. However, on careful analysis, that use falls within the safety related purposes for which the 43 MSDSs were brought into existence. The sole function of the library use is to ensure that public emergency services or organisations can provide instant access to MSDSs for safety related purposes to those in need of that information. The only reason for any of these entities to obtain or provide access to a MSDS is that such access is necessary for that entity to provide safety information to those in need of it, as a result of using the chemical the subject of the MSDS. Before departing from the issue of implied licence it is necessary to deal briefly with the submission made on behalf of Bialkower that the copying of Chemwatch MSDSs wrongly deleted the Chemwatch copyright note which formed part of the MSDS. In my view nothing turns on this issue. The note may have formed part of Chemwatch's MSDSs but is not a matter provided for under the national standards nor does it touch upon any safety related matter. Accordingly, the failure to incorporate the copyright note does not take the reproduction or copying outside of the ambit of the implied licence. If the information contained in a MSDS was altered in a material respect, that may take its reproduction or copying outside of the implied licence. The copyright note is not material as it is irrelevant to the matters required to be dealt with in a MSDS. There are additional problems with the copyright note. In its current form it requires the written permission of Chemwatch prior to any reproduction of the MSDS. As the implied licence itself constitutes permission no further licence or permission is required. In those circumstances the note in its current form is misleading. Further, the copyright note appears to have been inserted on all Chemwatch MSDSs. As pointed out earlier, there is considerable doubt as to whether copyright subsists in and is owned by Bialkower in all of those MSDSs. Accordingly, I am satisfied that there has been no infringement of copyright in respect of the 43 Chemwatch MSDSs as the transcribing, copying, reproduction or adaptation of the MSDSs by Acohs is within the implied licence of Bialkower. 6.0 The public interest defence Acohs also submitted that the Court ought to refuse relief for infringement of copyright in any event as its disclosure of MSDSs, including the 43 Chemwatch MSDSs, is in the public interest. In the United Kingdom, where public disclosure of certain copyright material has been regarded as being "in the public interest", the courts have regarded themselves as entitled to refuse to enforce the statutory rights of the copyright owner notwithstanding that no public interest defence was provided under the United Kingdom legislation: see Beloff v. Pressdram Ltd (1973) 1 All ER 241 at 259-260 per Ungoed-Thomas J and Lion Laboratories Ltd v. Evans (1985) 1 QB 526 at 550 per Griffiths LJ. The defence is now recognised by statute in the United Kingdom in s.171(3) of the Copyright, Designs and Patents Act 1988 which provides that nothing in the Act "affects any rule of law preventing or restricting the enforcement of copyright, on the grounds of public interest or otherwise". Until recently a public interest defence was also assumed to be applicable in Australia: see The Commonwealth of Australia v. John Fairfax & Sons Ltd (1980) 147 CLR 39 at 56-7 per Mason J who, inter alia, cited Beloff as authority for the proposition that: Although copyright is regulated by statute, public interest may also be a defence to infringement of copyright.

[37]

In several recent cases Gummow J has suggested that there is no such defence: see Smith Kline & French Laboratories (Australia) Ltd v. Secretary, Department of Community Services and Health (1990) 17 IPR 545 and Collier Constructions Pty Ltd v. Foskett (1990) 97 ALR 460. In Collier at 471 Gummow J explained his view that there is no public interest defence to a copyright claim in Australia: Divisions 3, 4, 5, 5A, 5B, 6 and 7 of Pt III of the 1968 Australian Copyright Act contain very detailed provisions specifying a range of activities which do not constitute infringement of copyright in various works. The provisions dealing with fair dealing are, of course, well known and have a legislative history beginning with s.2 of the 1911 Act: Copinger and Skone James [on Copyright 12th ed], 510-513. Further, in Australia, the Copyright Act, since it came into force in 1969, has been amended substantially from time to time to provide for particular regimes where copying will be permitted. ... It would be an odd result if this complex of provisions, reflecting an accommodation by the legislature of a range of competing interests, were overlaid with some defence springing from the general law and defined with none of the precision apparent in the legislation. And at 743: Notwithstanding the recent developments in the United Kingdom, the objections in principle, taken by Messrs Laddie and Prescott and Miss Vitoria in their work [The Modern Law of Copyright, 1980] to the introduction of a 'public interest' defence to infringement of copyright are compelling; in my view, there is no legislative or other warrant for the introduction of such a concept into the law of this country. This is so whether the plaintiff's work is published or unpublished. I should add that it is by no means settled that even as regards equitable obligations of confidence, there is a 'public interest' defence of the scope as is suggested in the English decisions: Corrs Pavey Whiting & Byrne v. Collector of Customs (Vic) (1987) 14 FCR 434 at 451-6; 74 ALR 428; David Syme & Co Ltd v. General Motors-Holden's Ltd [1984] 2 NSWLR 294 at 298, 305-306, 309-310.

[46]

Accordingly, the discretionary considerations which operate in relation to the grant of equitable relief, such as an injunction and an account of profits, have been treated as relevant to the analogous statutory relief under s.115(2). Similar considerations would govern the grant of declaratory relief by the Court. Although damages were described by their Honours as being non-discretionary there may be some situations where, acting upon public policy considerations such as illegality, dishonesty or unconscionability a court may refuse to enforce a legal right including a right to damages: see Kalamazoo (Aust) Pty Ltd v. Compact Business Systems Pty Ltd (1985) 84 FLR 101 at 127-8 per Thomas J. The process of reasoning employed in LED Builders leads to the conclusion that relief under s.116(1) in detinue and conversion for the delivery up of infringing copies, as opposed to damages, is also discretionary: see Blackie & Sons Ltd v. The Lothian Book Publishing Company Pty Ltd (1921) 29 CLR 396 at 404 per Starke J, Howard E. Perry & Co v. British Railways Board (1980) 1 WLR 1375 at 1381-2 per Megarry VC. In the present case the substantive relief which Bialkower, as cross applicant, ultimately sought was: • a declaration as to his ownership of copyright in the Chemwatch MSDSs or alternatively the 43 MSDSs copied by Acohs; • injunctions restraining Acohs from infringing Bialkower's copyright in the Chemwatch MSDSs or alternatively the 43 MSDSs copied by Acohs; and • delivery up on oath to the cross applicant of all infringing copies of the MSDSs. Ultimately damages and an account of profit were not sought. In view of the uncertainty as to the copyright subsisting in and ownership of the copyright in the specific MSDSs, and the conclusions I have reached on implied licence and the public interest, declaratory relief is clearly inappropriate. In any event the Court is reluctant to grant such relief if it is of little or no consequence to the dispute between the parties: see Ozmanian v. Minister for Immigration (1996) 141 ALR 322 at 348, 351. In the absence of other relief this would be such a case. Accordingly the main relief sought and in issue, being an injunction and delivery up of infringing copies, is discretionary. In accordance with the principles set out above such relief may be refused on public policy grounds or in the public interest. In the present case if, contrary to the conclusions I have reached, Acohs infringed Bialkower's copyright in any of the 43 MSDSs, I would refuse the relief sought on two discretionary grounds. The first is that it would be contrary to the public interest for the Court to make orders preventing or impeding the disclosure of MSDSs for safety related purposes. Such disclosures are obviously in the public interest and should not be prevented or impeded by court order whenever the need arises for such disclosure. It is difficult to conceive of a situation where a court would grant an injunction the effect of which will deprive members of the public of the benefit of information necessary for their safety. That category of disclosure clearly falls within the public interest: see John Fairfax at 57 and Beloff at 260. Such a situation is analogous to that considered in Roussel-Uclaf v. G.D. Searle and Co Ltd [1977] FSR 125 in which Graham J refused to grant interlocutory injunctive relief in a patent infringement claim where the effect of the injunction would be to deprive members of the public of the benefit of a life-saving drug which may be prescribed for otherwise fatal heart disorders. At 131 Graham J stated that the onus in such a situation requires the applicant to show that there is little, if any, likelihood of the public being injured by their inability to obtain the drug in question. I am not satisfied that there is little, if any, likelihood of the public being injured by their inability to obtain the safety information set out in Chemwatch MSDSs provided by the Infosafe system. In my view it is no answer to say Chemwatch might provide a similar system. The fact remains that if the information contained in a Chemwatch MSDS is required for safety related purposes then a court ought not prevent its supply by the grant of injunctive or other similar relief for copyright infringement. It is difficult to accept that a court would by injunctive or any other coercive order prevent a user or any emergency organisation from obtaining access to MSDSs for emergency or other safety related purposes. Whether or not damages, if any, would be awarded raises entirely different questions which need not be considered in the present case as no damages are claimed. The second discretionary reason is that the grant of the relief sought is likely to affect the interests of the manufacturers or importers which commissioned the MSDSs. The national standards have been adopted as law in several states. In any event the manufacturers and importers of hazardous substances for industrial use are probably under a duty to users of those substances to take reasonable steps to ensure ready availability or access to the safety related information contained in the MSDSs. It would require exceptional circumstances, which are not present in this case, for the Court to exercise its discretion to make injunctive orders at the instance of the copyright owner, without notice to and in the absence of the manufacturer or importer commissioning the MSDS, if those orders had the effect of preventing or hindering users from obtaining ready access to the MSDSs. The orders sought would have the practical effect of limiting or impeding access to information which importers and manufacturers are under a duty to take proper steps to provide or make available at or to workplaces where their hazardous substances are used. The importers or manufacturers which commissioned the 43 MSDSs are not parties to the present proceeding and may not be aware of the proceeding or the consequences it may have for the fulfilment of their legal duties. I do not go so far as to hold that they are necessary parties on the ground that their rights or liabilities will be directly affected by any order which may be made in the action: see Pegang Mining Co Ltd v. Choong Sam [1969] 2 MLJ 52 at 55-6 and News Ltd v. Australian Rugby Football League Ltd (1996) 139 ALR 193 at 297-301. However, the importers and manufacturers, in a real and practical sense, have an interest in the injunctive relief sought including the delivery up of infringing copies of their MSDSs. In these circumstances, even if infringement was established, it would be inappropriate to make the injunctive or delivery up orders sought: cf Gregg v. Tasmanian Trustees Ltd, unreported, Merkel J 28 February 1997, at 69-71. 7.0 Fair dealing Acohs also relied upon the defence of fair dealing for the purpose of research or study (s.40). The defence was considered by Beaumont J in De Garis at 104-105. The defence requires that the relevant purpose is that of Acohs. Acohs' purpose was to copy, reproduce or adapt Chemwatch MSDSs to enable their use for safety related purposes. Primarily those purposes were to enable users of chemicals, the subject of the MSDS, to ensure the safe use, handling and transportation of the chemicals. The purposes did not involve research or study within the meaning of s.40 of the Act. Section 43A of the Act was also relied upon by Acohs. The section relates to copyright in relation to computer programs. No such copyright is claimed by Bialkower. Accordingly, the section has no application in the present case. 8.0 Relief I have concluded that:

[47]

• Acohs is entitled to declaratory relief and damages in the sum of $20,000 against the respondents in respect of its claims based on s.52 of the TPA. Acohs' proceeding is to be otherwise dismissed; • the cross-claim of Bialkower against Acohs in relation to copyright infringement is to be dismissed; • RMS and RMC are entitled to contribution and therefore an indemnity by Bialkower in respect of 75% damages and costs awarded against them. I turn to the appropriate orders as to costs. Acohs has had substantial success in establishing the liability of all respondents in relation to its s.52 claim and in defeating Bialkower's claims for infringement of copyright. Although Acohs failed to obtain injunctive relief and all of the damages claimed by it, those matters ought not result in it not obtaining an order for all of its costs. Bialkower has failed in his defence of Acohs' s.52 claim and also in his cross-claim for infringement of copyright. Accordingly Bialkower should be ordered to pay Acohs' costs of the claim and cross-claim. The s.52 and the copyright claims were, in one sense, discrete but they were intertwined at a number of levels. Bialkower's copyright infringement claim was relied upon by him as a ground of defence to the grant of all but nominal relief in respect of Acohs' s.52 claims. Rather than attempt to disentangle the costs of the application and cross-claim it is appropriate to apportion one-third of the costs of the proceeding to the application and two-thirds of the costs of the proceeding to the cross-claim. RMS and RMC failed in their defence of Acohs' s.52 claim but substantially succeeded in their claim for contribution against Bialkower. The defence and cross-claim were closely related. In all the circumstances it is appropriate that Bialkower pay one-third of RMS's and RMC's costs of the proceeding. It is appropriate to make the following orders as to costs: (a) RMS, RMC and Bialkower pay one-third of Acohs' taxed costs of and incidental to the proceeding. (b) Bialkower pay two-thirds of Acohs' taxed costs of and incidental to the proceeding. (c) Bialkower pay to RMS and RMC one-third of their costs of and incidental to the proceeding.

Legislation Cited (4)

National Occupational Health and Safety Commission Act 1985(Cth)

Trade Practices Act 1974(Cth)

Cases Cited (35)

Jones v. Mortgage Acceptance Nominees Ltd (1996) 142 ALR 561 A-One Accessory Imports Pty Ltd v. Off Road Imports Pty Ltd (1996) 34 IPR 306 A-One Accessory Imports Pty Ltd v. Off Road Imports Pty Ltd (No 2) (1996) 34 IPR 332 G.A. Cramp & Sons Limited v. Frank Smythson Limited [1944] AC 329 Football League Ltd v. Littlewoods Pools Ltd [1959] 1 Ch 637 Computer Edge Pty Ltd v. Apple Computers Inc (1986) 161 CLR 171 Ladbroke (Football) Ltd v. William Hill (Football) Ltd [1964] 1 WLR 273 Interlego A.G. v. Tyco Industries Inc [1989] AC 217 Avel Pty Ltd v. Multicoin Amusements Pty Ltd (1990) 171 CLR 88 Devefi Pty Ltd v. Mateffy Pearl Nagy Pty Ltd (1993) 113 ALR 225 De Garis v. Neville Jeffress Pidler Pty Ltd (1992) 37 FCR 99 Interstate Parcel Express Co Pty Ltd v. Time Life International (Nederlands) B.V. (1977) 138 CLR 534 Beck v. Montana Constructions Pty Ltd (1963) 80 WN (NSW) 1578 Ng v. Clyde Securities Ltd (1976) 1 NSWLR 443 Bourke v. Filmways Australasian Distributors Pty Ltd Supreme Court of NSW, unreported, 9 October 1979 R. & A. Bailey & Co Ltd v. Boccaccio Pty Ltd (1986) 4 NSWLR 701 Gruzman Pty Ltd v. Percy Marks Pty Ltd (1989) IPR 87 Blair v. Osborne and Tomkins (1971) 2 QB 78 Castlemaine Tooheys Ltd v. Carlton & United Breweries Ltd (1987) 10 NSWLR 468 Beloff v. Pressdram Ltd (1973) 1 All ER 241 Lion Laboratories Ltd v. Evans (1985) 1 QB 526 Commonwealth v. John Fairfax & Sons Ltd (1980) 147 CLR 39 Smith Kline & French Laboratories (Aust) Ltd v. Department of Community Services & Health (1990) 17 IPR 545 Collier Constructions Pty Ltd v. Foskett (1990) 97 ALR 460 Lord and Lady Perceval v. Phipps (1813) 2 V & B 19 Glyn v. Weston Feature Film Company (1916) 1 Ch 261 Attorney General v. Guardian Newspapers Ltd (No. 2) [1988] 3 All ER 545 LED Builders Pty Ltd v. Masterton Homes (NSW) Pty Ltd (1995) 54 FCR 196 Kalamazoo (Aust) Pty Ltd v. Compact Business Systems Pty Ltd (1985) 84 FLR 101 Blackie & Sons Ltd v. The Lothlean Book Publishing Co Pty Ltd (1921) 29 CLR 396 Howard Perry & Co v. British Railways (1980) 1 WLR 1375 Roussel-Uclaf v. G.D. Searle and Co Ltd (1977) FSR 125 Pegang Mining Co Ltd v. Choong Sam [1969] 2 MLJ 52 News Ltd v. Australian Rugby Football League Ltd (1996) 139 ALR 193 VG 517/1993 - ACOHS PTY LTD V R.A. BASHFORD CONSULTING PTY LTD & ORS MERKEL J MELBOURNE 9 MAY 1997

(1992) 175 CLR 514

(1992) 108 ALR 479

(1969) 121 CLR 342

(1996) 142 ALR 561

(1996) 34 IPR 306

(1996) 34 IPR 332

(1986) 161 CLR 171

(1990) 171 CLR 88

(1993) 113 ALR 225

(1992) 37 FCR 99

(1977) 138 CLR 534

(1976) 1 NSWLR 443

(1986) 4 NSWLR 701

(1987) 10 NSWLR 468

(1980) 147 CLR 39

(1990) 17 IPR 545

(1990) 97 ALR 460

(1995) 54 FCR 196

(1985) 84 FLR 101

(1921) 29 CLR 396

(1996) 139 ALR 193

(1996) 139 ALR 689

(1996) 141 ALR 525

(1985) 158 CLR 661

(1992) 179 CLR 332

(1986) 65 ALR 500

(1984) 53 ALR 225

(1937) 58 CLR 479

(1989) 16 IPR 87

(1982) 149 CLR 337

(1992) 26 NSWLR 234

(1969) 120 CLR 635

(1987) 14 FCR 434

(1996) 141 ALR 322

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