Acohs Pty Ltd v Ucorp Pty Ltd

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 873 of 2004

JUDGE: JESSUP J DATE: 7 OCTOBER 2013 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 The background to the matter presently before the court is to be seen in my judgment of 10 June 2010 in Acohs Pty Ltd v Ucorp Pty Ltd (2010) 86 IPR 492, and in two judgments delivered by the Full Court on appeal, Acohs Pty Ltd v Ucorp Pty Ltd (2012) 201 FCR 173 and Acohs Pty Ltd v Ucorp Pty Ltd (No. 2) [2012] FCAFC 67. In the latter judgment, the Full Court made orders which included the following: [Ucorp], whether by its servants, agents or otherwise, is restrained from, without the licence of [Acohs]: (a) reproducing in a material form the whole or any substantial part of any of the copyright works; (b) communicating to the public the whole or any substantial part of any of the copyright works; or (c) authorising any other person to do any of the acts specified in paragraphs (a) or (b) hereof. In this order "copyright works" shall mean any of the material safety data sheets listed as "Authored by ACOHS" in Annexure A and Annexure A1 to the Amended Particulars of Copyright Ownership dated 31 August 2009. Otherwise, the proceeding was remitted to me for determination in the light of the Full Court's reasons for judgment. 2 The matter presently before the court involves Acohs' claims for final relief, save to the extent that they were dealt with by the Full Court. 3 The injunctive order made by the Full Court, set out in para 1 above, is based upon a finding, made at first instance and not disturbed on appeal, that Acohs owns the copyright in the Material Safety Data Sheets ("MSDSs") listed in Annexures 'A' and 'A1', to the extent only that those MSDSs were authored by Acohs. Starting with those copyright works, it has now become necessary, as a result of the judgment of the Full Court, to make a further distinction for the purposes of identifying the extent to which Ucorp infringed Acohs' copyright, namely, between relevant acts (i.e. those identified in sub-paras (a), (b) and (c) of the Full Court's injunction) done without the licence of Acohs, and such acts done under cover of such a licence. 4 Although it does not in terms appear from the injunction made by the Full Court, the circumstances in which it is now to be assumed that Ucorp had an implied licence to do things which would otherwise be infringements of copyright are those - … where a person having the benefit of an implied licence to reproduce, or to authorise others to reproduce, an MSDS, requested a service provider, such as [Ucorp], to carry out that work on its behalf. (201 FCR at 199 [152]). Thus, in practical terms, it may be seen that the licence exclusion from the Full Court's injunction would operate in any instance in which a user of a relevant product requested Ucorp (taking the most obvious case) to reproduce the MSDS which related to that product. 5 Against that background, I turn to the relief which is sought by Acohs. First, Acohs seeks an order binding Dr Bialkower in the same terms as the injunctive order made by the Full Court. That is not opposed by the respondents, and such an order will be made. 6 Secondly, Acohs seeks orders in the following terms: 2. Within 7 days, the second respondent, in his personal capacity and on behalf of the first respondent, make file and serve and affidavit: (a) identifying by file name, Infosafe number and product name each copy of the copyright works stored on electronic storage devices in the respondents' possession, custody or power (infringing copies); and (b) identifying each such electronic storage device on which the infringing copies are stored. 3. Within 7 days of the filing and service of the affidavit required by order 2, the respondents permanently delete all infringing copies from all electronic storage devices in their possession, custody or power under the supervision and to the satisfaction of a representative of the applicant. Thirdly, Acohs seeks damages, additional damages and interest. It is agreed that the question of costs will be determined on a subsequent occasion once the terms of Acohs' final relief have been settled. 7 With respect to the orders sought for the delivery up and destruction of infringing works, that would be a conventional, and commonplace, remedy to be granted at the conclusion of a successful copyright action. It having been held that reproductions of MSDSs authored by Acohs without the licence of Ucorp were done in infringement of Acohs' copyright, the court would normally (and in the present case) need to be persuaded that the infringing parties should be permitted to keep those reproductions within their files and records. However, Ucorp advanced a number of special considerations which were said to justify the court refusing to make an order for the delivery up and destruction on the present occasion. 8 It was said first that the purpose of an order for delivery up was to protect a successful applicant, rather than to punish an unsuccessful respondent. It was a remedy granted in aid of an injunction, and, in the circumstances of the present case, it should not be assumed that the respondents would disobey the injunctions made by the Full Court and about to be made in this proceeding. On the basis that the injunctions would be obeyed, there was no need, it was said, for the court to go further and require the respondents to destroy the works that had previously been made in breach of copyright. 9 While I am prepared to impute to the respondents a conscientious intention to observe the injunctions, such exposure as I have had in this proceeding to the workings of The Collection - the name given for the totality the respondents' electronic store of copy MSDSs - has not left me with any high level of confidence that reproductions previously made in breach of Acohs' copyright would not, whether by oversight, misadventure or otherwise, occasionally be communicated to the public in the course of Ucorp's business. As a matter of discretion, I am persuaded that the safest course would be to require Ucorp, at this stage, to bite the bullet and root out of The Collection all of the copy MSDSs that were created in breach of copyright. That would, in my view, maximise the prospect of such infringing work no longer being available to the staff of Ucorp in any form, and thus no longer the potential source of future breaches of the injunctions. 10 The respondents' next point was that they should not be obliged to delete infringing works from their records because there might be, in the future, an occasion upon which they would be called upon, by those with a legitimate interest in the relevant industries, to make the MSDSs in question available. This was put two ways. It was first said that, although MISs were required to review and, if necessary, to update their MSDSs every five years, there might well be occasions upon which recourse to old MSDSs became necessary. In such circumstances, it would be contrary to the public interest for Ucorp to be unable to supply such a need. In the second place, it was put that an employer or user might request access to a particular MSDS, thereby giving rise to an implied licence, and taking the supply of the MSDS to the requester outside the prohibition in the injunctions. Thus, although the copy of the relevant MSDS in Ucorp's storage may, as things presently stand, have been made in breach of copyright, the supply of the MSDS to a requesting party at some time in the future would be legitimate. 11 In dealing with the matter of delivery up, I must assume that Ucorp will, permanently, be bound by the injunction made by the Full Court. Therefore, however much it might be thought to be in the public interest for Ucorp to have access to an Acohs-authored MSDS in The Collection, unless the circumstance were such as could give rise to an implied licence, Ucorp could not communicate the MSDS to a third party. To the extent that Ucorp's present submission is to be understood as seeking to preserve to itself the ability to make (presumably commercial) use of an MSDS previously reproduced in breach of Acohs' copyright (ie disconnected from a request such as would give rise to an implied licence), I would reject it. Such a reproduction should not have been made, and the harvest of Ucorp's unlawful activity should not, in my view, be permitted to remain in store for such advantage as it may later be to the infringer (or, for that matter, to a third party). 12 The delivery up point comes down, therefore, to the question whether Ucorp should be permitted to retain infringing reproductions of Acohs' MSDSs against the possibility that, at some point in the future, users, for instance, will request access to them in circumstances where an implied licence would arise. Such a licence, however, would operate only with respect to the supply to the requester (ie the matter otherwise covered by para (b) of the injunction). It would not operate retrospectively to make the original act of reproduction a non-infringing one. Thus the respondents' position is that Ucorp should be permitted to retain infringing reproductions of MSDSs against the possibility that a future provision of them would not, as such, amount either to an infringement of copyright or to a breach of para (b) of the injunction. The problem with this approach, however, is the same as identified in the previous paragraph, namely, that this would amount to Ucorp deriving a commercial advantage from its earlier act of infringement. The approach, therefore, is not one which the court should find attractive. 13 For the above reasons, I am persuaded that a delivery up order should be made. However, I do not think that such an order should be made in the unqualified terms sought by Acohs. Those terms make no allowance for the existence in The Collection of MSDSs the reproduction of which was done pursuant to an implied licence as clarified in the reasons of the Full Court. For reasons which follow below, the court now finds that Ucorp did have such a licence in relation to the MSDS which were reproduced on the request of J Blackwood & Son Ltd ("Blackwoods"). Additionally, I propose to give the respondents the opportunity to identify any other MSDSs, still in any storage device in their possession, custody or power (Acohs' formula), as to which evidence of a request sufficient to give rise to an implied licence has been led at the trial of this proceeding. MSDSs in that category need not be delivered up. 14 The first head of damages claimed by Acohs relates to its loss of the business of Blackwoods between around February 2004 (the effective date of the termination of Blackwoods' first period of engagement of Acohs) and 13 October 2005 (the effective date of the re-engagement of Acohs by Blackwoods). In this respect, I refer to paras 75-78 of my reasons of 10 June 2010 (86 IPR at 518-519). Of the 10,748 MSDSs that were copied by Ucorp in the circumstances to which I referred, 3,808 had been authored by Acohs and were, therefore, its copyright works. 15 The first question which arises is whether that copying was covered by the implied licence, within the understanding of that concept as upheld by the Full Court. The circumstances under which the copying came to be done were explained by Dr Bialkower, in his affidavit affirmed on 15 May 2009, in the following terms: At the meeting, I demonstrated the Chemwatch system to the Wesfarmers and Blackwoods personnel. There was discussion about the existing database Acohs had created for Blackwoods which was accessible via the Blackwoods website (the Blackwoods database). Mr Beveridge and Mr Morrison stated that Wesfarmers wanted to cease using Acohs as they believed that Acohs was charging too much for their transcription services. I stated that Ucorp would be able to create and service a new site for Blackwoods, but estimated that the project would take approximately 4 to 5 months. Mr Beveridge said that Wesfarmers did not wish to wait that long and suggested downloading the MSDS on the existing site and making those available via the Chemwatch system while Ucorp constructed the new site. Mr Beveridge stated that he thought this would be a good idea because Wesfarmers did not have a record of Blackwoods' current chemical supplies and he thought the existing website would be the best way of creating an accurate inventory. I agreed to look at the Blackwoods site serviced by Acohs and determine whether there would be any practical difficulties with downloading the materials. I told the Wesfarmers and Blackwoods personnel present they would need to be sure there were no issues in relation to the use of the MSDS from the website created by Acohs as Acohs did not like losing customers to Chemwatch. At the conclusion of the meeting, Mr Morrison took me and Mr Luxon to his office in order to show us how to use the existing Blackwoods site. I remember him pointing to a box of MSDS that were to be sent to Acohs and saying that Blackwoods spent a lot of money paying Acohs to transcribe MSDS. He may also have shown us an Acohs invoice. He was very concerned about the amount that Wesfarmers was paying Acohs for this service. Dr Bialkower then gave the instruction pursuant to which the copying took place. 16 It is submitted on behalf of the respondents that the Blackwoods MSDSs were copied pursuant to a request from the user, Blackwoods, and that this was covered by the implied licence. It is submitted on behalf of Acohs, on the other hand, that the copying was done for purely economic reasons, rather than for safety-related reasons, and was not, therefore, covered by the licence. 17 In the appeal, the Full Court expressed its conclusion on the implied licence point as follows (201 FCR at 199 [154]): In our view, therefore, the implied licence did not extend to the first respondent's reproduction of the Acohs-authored Infosafe MSDSs or its communication or supply of those works in the absence of a request for those works for safety related purposes. An examination of their Honours' reasons which led to this conclusion, however, demonstrates that they used the expression "safety related purposes" as a high-level reference to the purposes which would necessarily be imputed to any company or organisation which used hazardous (etc) materials and which thereby was required to have the relevant MSDSs readily accessible. It seems to have been uncontroversial in the appeal that, as Acohs accepted, "an MIS's contractual rights would be 'sufficiently protected' by the implication of a licence that permitted the MIS and any employer or occupier who used the relevant product to reproduce and to authorise others to reproduce the necessary MSDS on their behalf." (201 FCR at 195 [122]) Their Honours referred to the judgment of Merkel J in Acohs Pty Ltd v RA Bashford Consulting Pty Ltd (1997) 144 ALR 528 ("Bashford"), and noted that the "library use" of MSDSs arose where transcribing had been "specifically commissioned by an MIS or employer using the hazardous or other products the subject of the MSDSs and having access to the system." (201 FCR at 195 [124]) Their Honours noted that Acohs made "no complaint" about transcription (necessarily encompassing copying in the context of the respondents) "where a person having the benefit of an implied licence to reproduce, or to authorise others to reproduce, an MSDS, requested a service provider, such as the first respondent, to carry out that work on its behalf." (201 FCR at 199 [152]) 18 In the case of Blackwoods, its contract with Acohs was not terminated until after Ucorp had done its copying. During the period of that copying, Blackwoods' needs for MSDSs were being satisfied by Acohs, under the contract. Thus it is submitted by Acohs that Blackwoods' safety-related needs in relation to MSDSs were being met, and that Ucorp's copying, although done at the request of Blackwoods, did not have a safety-related purpose. The purpose of the copying, rather, was to avoid the lengthy and costly process of Ucorp having to access every MIS to obtain the relevant MSDSs from source, as it were. This was, it was submitted, an economic purpose, not a safety-related one. 19 I do not accept that submission. It is based on a distinction for which there is no warrant either in the reasons of Merkel J in Bashford or in those of the Full Court in the present case. Upon the making of a request by a user for a safety-related purpose, Ucorp was implicitly licensed to copy. It is not to the point that there might have been a more cumbersome means by which Ucorp could have furnished itself with the MSDSs in question. The very point of the licence is to permit copying. Neither is it to the point that, at the time of making the request, Blackwoods was not bereft of MSDSs for the hazardous materials with which it dealt. Blackwoods had a safety-related need for a convenient, electronic, system which gave access to the relevant MSDSs. That need had been supplied by Acohs. As was its entitlement, Blackwoods changed suppliers. The need, as later supplied by Ucorp, was that same need. The purpose of Blackwoods' request of Ucorp was a safety-related one because of the reason for which it required to have access to the MSDSs. The timing of the copying apropos the termination of Acohs' contract is, legally, neither here nor there. 20 For the above reasons, I would hold that the copying by Ucorp of the Blackwoods MSDSs was covered by the implied licence. Acohs' claim to damages in this area of the case must be rejected. 21 The other head of damages claimed by Acohs relates to Victoria University. This aspect of its case was not dealt with in my earlier reasons, and a brief recitation of the relevant facts will, therefore, be necessary. At the time which is material to the present question, 2005, the university had 12 campuses. It was a subscriber to Acohs' service. In an audit conducted on behalf of the university by Acohs in 2001/2002, it was found that the university used 6,668 hazardous substances at the premises to which the audit related. At the time, Acohs already had in its system the MSDSs for 3,888 of these substances, and transcribed the remainder from the MISs' MSDSs. However, not all of the university's campuses, and laboratories and sites within campuses, used the Acohs service: some did, but others had developed their own spreadsheets with links to the relevant MISs' websites, while yet others kept folders of the hard-copy MSDSs that were relevant to the substances and materials with which their staff worked. 22 Although there appears not to have been any identified shortcoming in the university's compliance with the then regulatory standards, it was decided that the university should review its relevant practices with a view to achieving consistency, across all campuses, in relation to MSDSs. That review was undertaken by Zoltan Goli, then the university's occupational health and safety consultant (who gave evidence) and Kay Darbyshire, an employee in the university's information technology section. An aspect of the review was to identify and to assess the online database services that were available in relation to MSDSs, and to recommend a single service provider that would best meet the university's needs. 23 For that purpose, Mr Goli and Ms Darbyshire identified Acohs, Ucorp and a third company as possible providers of the database services which were required. They invited each to submit its proposal in this regard. They (and to some extent scientists and others who would make use of the services) conducted interviews with representatives of each. In October 2005, they recommended that the university engage Ucorp for a five-year period. In their report, they expressed their "Conclusion" as follows (where "Chemwatch" is a reference to Ucorp's system and "ChemAlert" is a reference to the third company referred to): While the basic feature set of the three products appeared to be similar, the size of the associated MSDS databases and the cost of loading missing MSDS records had an impact on the setup and running costs of each product. The ChemWatch product is being used successfully in a large number of University environments using similar chemical products as Victoria University. (See Appendix B) The existence in the ChemWatch product of the majority of our chemical MSDS records will speed up the initial loading of University data and allow the new system to be commissioned earlier. The cost of setting up the new system is a major factor in determining what product will be recommended for used [sic] by the University. The fact that ChemWatch loaded missing MSDS records at no cost in the first year providing the University with significant cost savings when compared to the other products was a major factor in its recommendation. While INFOSAFE and ChemAlert2 products have lower license [sic] fees, both have higher associated setup costs as more MSDS records used by the University are missing from the products databases. INFOSAFE database is missing SIGMA MSDS records and if chosen as the University chemical database management system will need to have these records loaded. This constitutes about 30% of our chemicals, [sic] ChemAlert2, while providing an allowance of loading additional 200 records per year in the base license, still has high costs associated due to the high qualities [sic] of MSDS records needing to be included. In addition, staff dissatisfaction with the existing INFOSAFE system was also considered as the University will be relying on these members of staff to manage and maintain whatever system is adopted. This review recommends that the ChemWatch product be selected by Victoria University as the system used to manage [sic] Victoria University chemical database. The recommendation made by Mr Goli and Ms Darbyshire was accepted by the university, which discontinued using Acohs' system, and commenced to use Ucorp's system, in about mid-2006. 24 Acohs' case for damages is based on the proposition that, but for Ucorp's infringements of copyright, it (ie Acohs) would have been recommended by Mr Goli and Ms Darbyshire and would have had the benefit of the contract which the university let in 2006. Its claim is based on lost profits (see TS & B Retail Systems Pty Ltd v 3Fold Resources Pty Ltd (No 3) (2007) 158 FCR 444, 495-496 [207]) down to 30 June 2009. There is no other respect in which it claims to have been damaged by the infringements. 25 It is evident not only from the Goli/Darbyshire report but also from the tenor of Mr Goli's evidence that the university's decision to engage Ucorp was based on the balancing of a range of factors. There were plusses and minuses in the case being presented by each of the three competing companies. A plus upon which Ucorp relied was that most of the MSDSs which the university required were already in The Collection, and that the remainder would be obtained and placed into The Collection, for the university's use, without charge. From this Acohs submitted that the presence in The Collection of many MSDSs which must have previously been copied in infringement of copyright was a significant factor in the university's decision to engage Ucorp: so significant, in fact, that it justified the conclusion that, absent those infringements, the university would probably have engaged Acohs. 26 There are several reasons why this submission should not be accepted. The first is that, at least to the extent that it was drawn to my attention, the only evidence about the number of Acohs-authored MSDSs that were required by the university and were already in The Collection was that given by Mr Goli under cross-examination. At a time which he was unable to identify precisely, but which was after the commencement of this proceeding and also after the university had commenced to use the services of Ucorp, he received what he recalled was a telephone call from a representative of Acohs warning him that, in making use of Infosafe MSDSs that had made their way into The Collection, the university might have been acting "in breach of copyright". This led him to undertake a search, an object of which was to see which of the MSDSs used by the university had been authored by Acohs and which had originated from the MIS concerned. Under cross-examination, he was not pressed as to how he could have made that distinction, but, on the present occasion, counsel (for both sides) were content with the fact that he could, and did. The majority were what Mr Goli called "supplier MSDSs", while he did find "a couple of Acohs ones". That the latter would be significant to the university's decision to engage Ucorp rather than Acohs strikes me as a rather unlikely proposition. 27 The second reason is that Mr Goli was called to give evidence, and did give evidence, about the circumstances in which, and the reasons for which, the university did engage Ucorp rather than Acohs. He was cross-examined at some length. But it was not put to him that Ucorp would not have been engaged, or that Acohs would have been engaged, had The Collection not already been stocked with some Acohs-authored MSDSs. In the absence of some legitimate explanation (and I cannot see that there was one), that omission effectively precludes Acohs from advancing such a proposition in the submissions which it presently makes. 28 The third reason is that Acohs itself has not done what is within its own capacity to establish the extent to which its own authored MSDSs were of interest to the university. Having conducted the audit in 2001/2002 to which I have referred, I can think of no reason why Acohs might not have volunteered evidence as to the number of substances then identified that were covered by MSDSs that it had itself authored. Not too much emphasis should perhaps be placed on this consideration, because of the time that had passed since the audit, but it is a factor which makes some contribution to the resolution of the question now before the court. 29 I would not hold that the evidential onus to establish which of the MSDSs of interest to the university both had been authored by Acohs and were held in The Collection in 2005 lay upon the respondents. Acohs' particulars of copyright infringement, provided as late as 1 September 2009 (the second day of the trial), still made nothing of the distinction between MSDSs which had been authored and MSDSs which had been transcribed. In each of Annex A and Annex A1 there were "folders" which were organised by reference to this distinction, but it was not a distinction to which Acohs assigned any legal significance, or which was said to mark out a line between the areas in respect of which Acohs would, and would not, claim damages. At the time when evidence was being led at trial, the respondents were not on notice that Acohs' case would make it material that MSDSs in The Collection had been authored by it, rather than merely transcribed. The respondents were not, in the circumstances, under an evidential onus to lead evidence (otherwise than in response to evidence led by Acohs) of the extent to which MSDSs in The Collection in 2005 had been authored, as distinct from transcribed, by Acohs. 30 The fourth reason is an overriding one, and for that reason an important one. It draws upon the first two reasons mentioned. The Goli/Darbyshire report prepared for the university was substantial and thorough. It dealt with many matters. The university's decision to engage Ucorp rather than Acohs or the third company was obviously, from both financial and health and safety viewpoints, of some importance. Quite apart from the second reason referred to above, the facts generally provide no sustenance for the notion that Ucorp would not have been engaged had The Collection then not contained the small number of Acohs-authored MSDSs that it did. As counsel for the respondents pointed out, the much more likely course which events would then have followed would have been for the university to have made a request of Ucorp to download the MSDSs concerned on its behalf, which Ucorp was doing for the university (free of charge) in relation to MSDSs that were not in fact in The Collection in any event. Such a request would have given rise to an implied licence. The counterfactual by reference to which Acohs seeks to have its damages assessed - that the university would not have engaged Ucorp at all had there been no infringement of copyright - must, therefore, be rejected. 31 For the above reasons, I cannot accept Acohs' factual case that, without the presence in The Collection of the previously-copied, Acohs-authored, MSDSs, the university would have engaged it rather than Ucorp. 32 Since I have rejected Acohs' case for compensatory damages, no question of an award of interest arises. 33 Acohs seeks additional damages pursuant to s 115(4) of the Copyright Act 1968 (Cth), which provides: … Where, in an action under this section: (a) an infringement of copyright is established; and (b) the court is satisfied that it is proper to do so, having regard to: (i) the flagrancy of the infringement; and (ia) the need to deter similar infringements of copyright; and (ib) the conduct of the defendant after the act constituting the infringement or, if relevant, after the defendant was informed that the defendant had allegedly infringed the plaintiff's copyright; and (ii) whether the infringement involved the conversion of a work or other subject-matter from hardcopy or analog form into a digital or other electronic machine-readable form; and (iii) any benefit shown to have accrued to the defendant by reason of the infringement; and (iv) all other relevant matters; the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances. In this regard, Acohs relies particularly on subparas (i), (ia), (ib) and (iii) of s 115(4)(b), as well as upon the circumstances of the case generally, as available under subpara (iv). 34 Acohs says that the infringements by the respondents were flagrant, in that the staff of Ucorp routinely caused the Internet to be "trawled" for MSDSs which, when found, were indiscriminately added to The Collection by a process which amounted to reproduction. That appears to have been the case and, as submitted on behalf of Acohs, Dr Bialkower gave no instructions for Ucorp's staff to look out for legal or copyright notices which asserted the rights of the relevant MISs, or those associated with the authorship of the MSDSs in question. This omission occurred notwithstanding that Dr Bialkower had occasionally observed such notices himself, and notwithstanding that his own consciousness of the potential for copyright to exist in this area must surely have been heightened by his involvement in the Bashford proceeding. 35 This argument, which is of some attraction so far as it goes, encounters a number of difficulties by reason of the subject matter of the present case and the limited findings of infringement which the Full Court made. The matter of present concern is the flagrancy of the infringement. It was no infringement for Ucorp to have downloaded and reproduced MSDSs which, notwithstanding that they bore the marks of having originated from Acohs, had been transcribed rather than authored. Indeed, there was, as far as I can see, nothing on the face of any Infosafe MSDS that would have indicated to a reader whether it had been authored or transcribed. I do not here suggest that the respondents were, at the time of the infringements, making an effort to avoid downloading Acohs-authored MSDSs. My point, rather, is that the only way that they might have guaranteed that they did not infringe Acohs' copyright would have been to deny themselves participation in what was otherwise a legitimate commercial activity (ie downloading transcribed MSDSs). This is not, of course, to give any approbation to the respondents' infringements, but it is to draw attention to a distinction of some practical significance in the context of Acohs' present application for the respondents to be, in effect, punished for the flagrancy of their conduct. 36 As I mentioned in para 123 of my earlier reasons (86 IPR at 532), there is no evidence of an Acohs copyright notice having appeared on its MSDSs (authored or transcribed) before January 2007. By then, the present proceeding was more than two years old, and it is convenient to consider the relevant conduct of the respondents under subpara (ib) of s 115(4)(b). Acohs' letter before action was dated 5 July 2004, and read as follows: Dear Sir/Madam We advise that this office acts on behalf of Acohs Pty Ltd. We are instructed that on the Blackwood MSDS website (which appears to have been established by Chemwatch) there are a large number (approximately 10,000) of our client's HTML files which are currently being displayed. Our client is the copyright owner of those HTML files and the compilation of those files. Without prejudice to our client's rights our client demands - (a) the removal of all of our client's HTML files from Ucorp's systems including the Blackwoods' MSDS website; (b) provision of full details (including all relevant documentation of all sales licences or fees claimed and or received by Chemwatch (Ucorp Pty Ltd) in relation to Chemwatch systems in which our client's HTML files are situate. (c) a written undertaking (drafted by us) and executed by Ucorp Pty Ltd and each of its directors, that neither it nor they will breach Acohs' intellectual property rights in its HTML files or compilation of the same at any time in the future. (d) the handing over of full details of any sales licences or fees claimed and/or received by reason of the copying and publication of our client's copyright material of which Ucorp Pty Ltd may be aware by any other entities, whether by related or associated companies or otherwise. Further, we advise that unless those files are removed from the Blackwoods' site within 24 hours of the date hereof we are instructed to seek an injunction without further notice. Although some of the demands contained in this letter were more generally expressed, the focus of the letter was upon the Blackwoods matter, as to which I have rejected Acohs' copyright infringement case. 37 The proceeding was commenced on 13 July 2004. In addition to Ucorp and Dr Bialkower, Wesfarmers Ltd, Blackwoods, Bunnings Ltd and Motion Industries Pty Ltd were named as respondents. In its Statement of Claim, Acohs alleged that it had "collected, developed and compiled a large database of MSDS files in HTML format in which it owns the copyright". In particulars to this allegation, it was said that Acohs "claim[ed] copyright in the compilation of HTML files being a compilation collected from many manufacturers, importers and suppliers of MSDS after expending great trouble and expense in doing so and in checking the accuracy of the contents of each MSDS." It was said that "the compilation [was] in a form, presentation, style, appearance and order which is unique to Acohs and makes it a most useful and sought after database." This was, clearly, a claim to copyright in the database as a compilation, rather than in MSDSs as such. Extensive allegations were then made in connection with Blackwoods, and the circumstances of the termination of its contract with Acohs. 38 Then, under the heading "The respondents' wrongful conduct", the following was alleged: From dates currently unknown to ACOHS (until after discovery inspection and interrogation herein), internet websites created and maintained by one or more of the respondents and providing access to the public, and subsequent to the termination of the Blackwoods License Agreement and Service Agreement as aforesaid, have been stocked with a version of ACOHS' Infosafe database. Particulars Details of what appears and is accessible on, such websites as detailed in the affidavits herein sworn by Paul Moody and Ian Thomas Cowie. In broad terms however, what has happened is that Bialkower has caused Ucorp to create a Chemwatch website for Blackwoods located at chemwatch.net:9080/msdscollwesfarm/searchprod.jsp. Such site contains the Infosafe database. The Chemwatch site has hyperlinks to it from a number of websites operated and maintained by the other respondents, namely: (a) Wesfarmers operates wesfarmers.com.au, in which website appears blackwoods.com.au which is a site run by Blackwoods. Such site has a hyperlink to the Chemwatch site; (b) another westfarmers.com.au [sic] site is motionind.com.au which is operated by Motion Industries, a company owned by Blackwoods. motionind.com.au has a hyperlink to the Chemwatch site; (c) Bunnings operates a site also on the wefarmers.com.au site [sic] which is blackwoods.co.nz which has a hyperlink to the Chemwatch site; (d) another site on the wesfarmers.com.au site is protectoralsafe.com.au operated by Blackwoods which has a hyperlink to the Chemwatch site. ACOHS is unable to give further particulars as to which sites are hyperlinked to the Chemwatch site and any other wrongful conduct of the respondents and in particular is unable to say what the terms are of any understandings or agreements between on the one hand Ucorp and Bialkower and on the other hand Blackwoods or the other respondents, until after discovery, inspection and interrogation herein, but ACOHS will make claim [sic] in respect of all such wrongful conduct. 39 Three further allegations of wrongful conduct were made, relating to hyperlinks on the websites of the four then respondents which are no longer respondents, to the fact that the "version of the ACOHS Infosafe database appearing on the said Chemwatch website [was] out of date, inaccurate and not regulation-compliant" and to the fact that the HTML files on the Chemwatch website included "indicators such as copyright notices, use of 'Infosafe' names and Infosafe MSDS numbers which would be recognised as indicating a trade source which they did not have". 40 Acohs' Statement of Claim then made a number of allegations under the heading "Causes of Action", the presently relevant one of which was that Ucorp had infringed its copyright "in the Infosafe database compilation by reproducing it or a substantial part of it on the Chemwatch website". 41 To this point, two things stand out: first, the artefact which Acohs then alleged was protected by copyright does not line up with the works by reference to which it succeeded in the case; and secondly, there was nothing, either in Acohs' letter before action or in its pleading, that put the respondents on notice of the defining feature which ultimately led to its (Acohs') success, namely, that a particular MSDS had been authored by Acohs' staff. Neither circumstance was relevant to the viability of Acohs' cause of action in copyright as such, of course, but both place in context the proposition which silently informs Acohs' present claim for additional damages, namely, that it should have been self-evident to the respondents that the way they conducted their business was such as would inevitably lead to infringements. If Acohs was not able to articulate the nature of the infringements, why should the respondents have been expected to do so? 42 When the proceeding came before Finkelstein J on 3 September 2004, his Honour accepted an interlocutory undertaking from the respondents that they would not - … (i) reproduce or use a reproduction or substantial reproduction of any of the Applicant's HyperText Mark up Language (HTML) files relating to Material Safety Data Sheets (MSDS) or the Applicant's compilation of such HTML files known as Inforsafe [sic] MSDS database; and in particular [would] not … (ii) conduct, operate or maintain a website, which contains or uses the database of HTML files or a substantial reproduction of the HTML files relating to the MSDS contained in Appendix A to the affidavit of Ian Thomas Cowie herein sworn 9 July 2004 or any of the databases which are exhibits JAG-1, JAG-2 and JAG-3 to the affidavit of Jason Andrew Gossit herein sworn 9 July 2004; and not to (iii) represent that they or any business operated by them or any website operated by them is that of the Applicant or associated with or authorised by the Applicant or contains or uses the applicant's MSDS HTML files or Infosafe MSDS database compilation; … 43 On 16 October 2006, the respondents were released from those undertakings, and in place of them the respondents gave the following undertakings, which operated from the original date, ie from 3 September 2004: … (a) Save as to the extent contemplated by sub-paragraph (b) below and order 2 below, the Respondents and each of them will not, by themselves, their servants or agents or otherwise howsoever include in any electronic storage means or database created by either or both of them or on their behalf or otherwise make available to any person, a copy or substantial reproduction or adaptation of any HTML source code relating to any Material Safety Data Sheet ("MSDS") that contains the words "Infosafe No" and/or "Chemsafe" ("the Infosafe MSDS"). (b) For the avoidance of doubt, this undertaking does not prevent the Respondents from: (i) copying, substantially reproducing or adapting an Infosafe MSDS that is made available to the Respondents in a format other than HTML, including by locating and viewing the MSDS, including the MSDS in an electronic storage means or database and making the MSDS available to any person; or (ii) locating and viewing an Infosafe MSDS in HTML format, printing the MSDS, photocopying or electronically scanning such print and thereafter including such scanned print in an electronic storage means or database and making it available to any person. … At the same time, the following orders were made: … 2. By 16 February 2007, the Respondents will remove from any electronic storage means or database created by either or both of them or on their behalf all HTML source code relating to the Infosafe MSDS. 3. Pending the hearing and determination of this proceeding or further order, the Respondents will not copy, print or convert any of the Infosafe MSDS already contained in "The Collection" in HTML format before their deletion as required by order 2 hereof. … 44 On 16 December 2008, Acohs moved for judgment in default under O 35A of the Federal Court Rules then in force. In that respect, Acohs relied on alleged breaches of Orders 2 and 3 made on 16 October 2006 (and a number of other orders the breach of which would not bespeak infringement of copyright), but not on a breach of an undertaking given on that date or previously. That motion was heard on 11 and 12 March 2009, and determined by a judgment delivered on 3 June 2009: ACOHS Pty Ltd v Ucorp Pty Ltd [2009] FCA 577. In that judgment, I upheld Acohs' claim that Order 2 had been breached, but rejected its claim that Order 3 had been breached. 45 In that motion, in the alternative to its application for judgment in default, Acohs also alleged that the respondents had breached their undertakings given on 16 October 2006, and sought corresponding orders pursuant to O 35 r 11 of the Rules. I accepted that allegation, granted the application (see [2009] FCA at 577 [49]-[52]), released the respondents from their undertakings of 16 October 2006, and in place of them made the following order: … 11. Save to the extent necessary to permit - (i) copying, substantially reproducing or adapting a material safety data sheet that contains the words "Infosafe No." and/or "Chemsafe" (referred to in this order as "Infosafe MSDS") that is made available to the respondents in a format other than HTML (including by locating and viewing the data sheet), including the data sheet in an electronic storage means or database, and making the data sheet available to any person; or (ii) locating and viewing an Infosafe MSDS in HTML format, printing the data sheet, photocopying or electronically scanning such print and thereafter including such scanned print in an electronic storage means or database, and making it available to any person; the respondents and each of them be restrained, whether by themselves, their servants or agents or howsoever otherwise, from including in any electronic storage means or database, created by either or both of them or on their behalf, or otherwise making available to any person, a copy or substantial reproduction or adaptation of any HTML source code relating to any Infosafe MSDS. … 46 In their response to Acohs' motion of December 2008, the respondents relied on the affidavit of Ridwan Ahmed affirmed on 3 March 2009. Mr Ahmed set out in detail the steps which the respondents had taken to comply with the undertakings given on 16 October 2006. Amongst the matters addressed in that affidavit was an explanation of how it came to pass that some MSDSs which had, evidently, been copied from Infosafe MSDSs ended up in one or more of the respondents' storage means. On the present occasion, I have not been invited by the applicant to revisit these events, but Ucorp's administration manager, Catherine Imelda Jeddou, whose affidavit affirmed on 24 June 2013 was read on behalf of the respondents, did refer to, and rely on, Mr Ahmed's earlier affidavit. 47 Returning to s 115(4)(ib) of the Copyright Act, once the proceeding was instituted and the relevant interlocutory undertakings given, the relevant "conduct of the defendant" should, realistically, be measured against those undertakings. That is to say, rather than divining the terms, and the limits, of the prohibitions which, as ultimately became clear in the judgment of the Full Court, were imposed by the Copyright Act itself, it was the undertakings which the respondents had given which, as a matter of practical reality, defined their relevant obligations during the interlocutory period. While the court did find that there had been a breach of the undertakings in one respect at least, there was no finding that the respondents' conduct was in contumelious disregard of their obligations or of Acohs' rights. Indeed, it is clear from the evidence before the court on Acohs' motion that the respondents had made a conscientious attempt to comply with their undertakings. Regrettably, in a business as large and as comprehensively automated in its systems as the respondents' was, mistakes and omissions can occur. In this respect I refer, for example, to para 14 of my reasons of 3 June 2009. 48 In my consideration of the matter of additional damages, I would not hold that that the respondents' infringements of copyright were flagrant within the meaning of subpara (i) of s 115(4)(b), and, for the above reasons, I am not persuaded that the respondents' conduct after they had been informed of Acohs' allegations was reprehensible to the extent necessary to add weight to Acohs' case in relevant respects. 49 With respect to s 115(4)(b)(ia), I do not think that the need arises to provide for any deterrent, additional to the sobering impact which Acohs' success in this long, expensive and distracting litigation will presumably have had on the respondents. With respect to the possible future use of reproductions of copyright works made in the past, the delivery up order which I propose to make should, of course, obviate the need for any further deterrent. With respect to the possibility of future infringing conduct, it must be remembered that, unlike a criminal prosecution, the disposition of the present case will be marked by the making of permanent injunctions binding the respondents not to act in ways that would amount to infringements of Acohs' copyright. I have no reason not to assume that the respondents will comply with those injunctions, and, to the extent that there may be a risk of non-compliance, I cannot see that the awarding of additional damages at this stage would effectively add to the unlikelihood of that occurring. 50 Turning to s 115(4)(b)(iii), the evidence is that there are, in the annexures referred to in the orders of the Full Court, in the region of 22,000 - 23,000 MSDSs marked as "Authored by ACOHS". Even in a business of the size of Ucorp's, this is a large number. The presence of those MSDSs in The Collection must surely have been beneficial to it. Indeed, I do not understand the respondents to have submitted otherwise. Neither was there any evidence that these MSDSs had been of little or no benefit to Ucorp. In his submissions on the present occasion, counsel for Acohs reminded me that the MSDSs in question included those which related to industrial and chemical products which must surely have had widespread use, such as those produced by Nuplex, Shell, BP, Castrol, Caltex and others. In the circumstances, I would infer that the ability to give ready electronic access to the MSDSs was of some benefit to Ucorp. That benefit was not limited to the particular occasions upon which Ucorp was able, presumably for reward, to give one of its customers access to an Acohs-authored MSDS. It included also the unquantifiable, but nevertheless significant, advantage of being the more able to promote its business as containing a comprehensive repository of MSDSs covering many products and substances. 51 Although Acohs formally relied also on subpara (iv) of s 115(4)(b), nothing was put in that regard additionally to the matters with which I have already dealt. 52 In the result, the only circumstance which would move the court to impose additional damages is the benefit which I have inferred Ucorp derived from having in The Collection a large number of MSDSs which had been reproduced in infringement of Acohs' copyright. I propose to award $22,500 additional damages in recognition of that circumstance. Although not the derivation of the figure as a matter of calculation, I consider it to be a just outcome - perhaps coincidentally - that the figure represents about $1 for every MSDS which Ucorp reproduced in infringement of Acohs' copyright. I certify that the preceding fifty-two (52) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup.