Boyapati v Rockefeller Management Corporation [2008] FCA 995 | Case summary

Boyapati v Rockefeller Management Corporation [2008] FCA 995 | Case summary | Zoe

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Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) 224 CLR 193 referred to Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479 referred to Desktop Marketing Systems Pty Ltd v Telstra Corporation Ltd (2002) 119 FCR 491 referred to Acohs Pty Ltd v RA Bashford Consulting Pty Ltd (1997) 37 IPR 542 cited Interlego AG v Tyco Industries Inc [1989] AC 217 cited Desktop and Autodesk Inc v Dyason (1992) 173 CLR 330 cited Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273cited A-One Accessory Imports Pty Ltd v Off Road Imports Pty Ltd (1996) 34 IPR 306 cited Redwood Music Ltd v Chappell & Co Ltd [1982] RPC 109cited Warwick Film Productions Ltd v Eisinger [1969] 1 Ch 508cited Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577referred to Polygram Pty Ltd v Golden Editions Pty Ltd (No 2) (1997) 38 IPR 451cited Caxton Publishing Co Ltd v Sutherland Publishing Co Ltd [1939] AC 178cited Birdseye v Sheahan (2002) 196 ALR 598cited Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306 referred to Daemar v Industrial Commission of NSW (No 2) (1990) 99 ALR 789 cited Gosden v Dixon (1992) 107 ALR 329cited Medical Benefits Fund of Australia Ltd v Cassidy (2003) 205 ALR 402referred to Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216referred to British Telecommunications PLC v One In A Million Ltd (1998) 42 IPR 289cited CSR Ltd v Resource Capital Australia Pty Ltd (2003) 128 FCR 408cited Boyapati v Rockefeller Management Corporation [2006] FCA 897cited Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575referred to Li v The Herald & Weekly Times Pty Ltd [2007] VSC 109applied Reader's Digest Services Pty Ltd v Lamb (1982) 150 CLR 500referred to Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293referred to Sim v Stretch [1936] 2 All ER 1237applied Howden v 'Truth' and 'Sportsman' Ltd (1937) 58 CLR 416referred to Toogood v Spyring (1834) 1 C M & R 181; 149 ER 1044 cited Mowlds v Fergusson (1946) 64 CLR 206 referred to

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A. INTRODUCTION 1 In 2004, Ann and Ray Boyapati, with some assistance from Edward Boyapati, operated a business under the name "MedEntry". At that time, Ann and Ray were medical students at Monash University, although by the time of trial, Ray had graduated and was practising medicine. In 2004, Edward Boyapati was a senior lecturer in the Engineering Faculty at RMIT. At the time of trial, he was retired from this position and had become the director of the MedEntry business. He was also the practice manager for his wife, Dr Nirmala (Nimi) Boyapati, who is a general medical practitioner. Ann, Ray and Edward Boyapati are the applicants in this proceeding. Their claim essentially concerns an alleged infringement of copyright in 800 questions and answers in certain practice exams that MedEntry sold as part of a preparation course for candidates for the Undergraduate Medicine & Health Sciences Admission Test ("UMAT"). The 800 questions and answers represent two sections of 10 multiple choice practice exams sold by MedEntry in 2004. The applicants sue for damages, declaratory, injunctive, and other relief, primarily for breach of copyright. They also sue for conversion, detention, breach of moral rights, and for breach of s 52 of the Trade Practices Act 1974 (Cth) ("TPA"). The respondents' cross-claim is also for damages, declaratory, injunctive and other relief. 2 For the following reasons, I would uphold the applicants' claim for breach of copyright and dismiss the cross-claimants' cross-claim. 3 The Boyapatis (including Dr Nimi Boyapati), Ace Umat, and Anzie Pty Ltd ("Anzie") are also cross-respondents. The seventh cross-respondent, Anzie, is incorporated under the Corporations Act 2001 (Cth) and, since 2006, has carried on business in Australia under the name MedEntry. The nature of the sixth cross-respondent, Ace Umat, is explained below. 4 The first respondent, Rockefeller Management Corporation ("RMC"), is incorporated in the State of Illinois, in the United States of America. It is also engaged in the business in Australia of selling, via a website, practice exams and answers to persons studying to sit the UMAT. It can sue and be sued in Australia and is a foreign corporation within the meaning of the TPA. The second respondent, Dallas Gibson, is a director of RMC and a local agent of RMC pursuant to the Corporations Act 2001 (Cth). Since 1994, Dallas Gibson has been teaching, training and preparing students for psychometric aptitude tests, particularly entrance tests for medicine, dentistry and physiotherapy (and possibly other courses). RMC and Dallas Gibson are also the cross-claimants in these proceedings. 5 The applicants' case was that, in about April 2004, the respondents infringed the applicants' copyright in the 800 practice questions and answers contained in MedEntry's practice exams by making available, offering for sale, or selling 45 practice exams, online via RMC's website. MedEntry's practice exams were, so the applicants said, original 'literary works' within the meaning of s 10 of the Copyright Act 1968 (Cth) ("Copyright Act"). Against both respondents, the applicants also alleged: (1) detention and conversion; and (2) infringement of their right of attribution of authorship in respect of the works. Against RMC, they alleged misleading and deceptive conduct contrary to s 52 of the TPA. Against Dallas Gibson, they alleged that he was knowingly concerned in and a party to RMC's contravention of s 52 and, by operation of s 75B, was also liable as a person involved in the contravention. In final submissions, however, the applicants did not refer to their claims for detention, breach of moral rights, or breach of s 52 of the TPA. This was no doubt because, by the end of the trial, it was apparent that these claims added little, if anything, to the applicants' primary claim of copyright infringement. Since I would uphold the applicants' copyright infringement claim, I too do not discuss these matters further. 6 The respondents denied that the applicants have copyright in the 800 questions and answers, which they say lacked originality. Alternatively, the respondents relied on innocent infringement defences under ss 115(3) and 116(2) of the Copyright Act. As part of this, they said they purchased the 800 questions and answers from a Minh Van Tran on or about 25 May 2004; and, at the time of the infringement, they were not aware and had no reasonable grounds for suspecting that they were infringing the applicants' copyright. Furthermore, the respondents affirmed that, if they had infringed the applicants' copyright in the works, then the infringement was limited to the period between early June 2004 and mid August 2004, or early June 2004 and 27 October 2004. The respondents otherwise denied all the allegations made by the applicants against them. 7 RMC and Dallas Gibson cross-claimed that Dallas Gibson, not the applicants, created 160 of the questions and answers that made up the 800 questions and answers in the applicants' claim; and that RMC, not the applicants, was the owner of the copyright in these 160 questions and answers. The cross-claimants claimed that Dallas Gibson assigned the copyright in these 160 questions and answers to RMC in September 2003. RMC and Dallas Gibson alleged that the cross-respondents: (1) infringed the copyright assigned by Dallas Gibson to RMC; (2) defamed Dallas Gibson and, in some instances, RMC, by the publication of statements on MedEntry's website; and (3) engaged in passing off (through the use of the "MedEntry" name) and conduct in contravention of ss 52, 53(c) and 53(d) of the TPA (through the use of the "MedEntry" name and the unauthorised use of third parties' logos). In particular, they alleged that the cross-respondents engaged in passing off MedEntry's business for the cross-respondents' business; MedEntry's business as having the respondents' sponsorship or approval; and MedEntry's goods and services as those of the respondents. (The details of the cross-claimants' allegations regarding the logos are set out below.) They claimed that Ann, Ray and Edward Boyapati were knowingly concerned in and a party to the TPA contraventions and were therefore liable under the TPA on this basis as well. Finally, the cross-claimants sought an order under s 88 of the Trade Marks Act 1995 (Cth) ("the Trade Marks Act") that the word "MEDENTRY" be cancelled or removed as Australian Trade Mark No 1032625. 8 The applicants/cross-respondents joined issue with the respondents/cross-claimants. In their defence to the cross-claim, they alleged that, since Dallas Gibson was made bankrupt with effect from 18 October 2000 until 19 October 2003, there could be no effective assignment of copyright to RMC in September 2003 when he purported to effect the assignment. As to the alleged defamations, they relied on various defences, including qualified privilege and that the publications were true. 9 On 10 July 2006, the Court ordered that, save in relation to any questions concerning quantum of damages or account of profits on each party's copyright claims and save in relation to any expert evidence concerning the quantification of damages arising on the trade practices and passing off claims, the matter was to proceed to trial. At the trial, all matters of liability fell for determination.

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B. CONTEXTUAL FACTS 10 MedEntry offers preparation courses for the UMAT. The UMAT, which is conducted by the Australian Council for Educational Research on behalf of certain admitting universities, is used by these universities to assist with the selection of students into medicine, dentistry and other health science degree programs at the undergraduate level. The UMAT is conducted annually in late July and is a closed-book, multiple-choice examination. The UMAT is essentially an aptitude test designed to assess critical thinking and problem-solving, interaction skills and abstract non-verbal reasoning. Whilst the questions change from year to year, the exam maintains the same basic structure. The UMAT generally consists of a number of sections designed to test: (a) logical reasoning and problem-solving (section 1 - 44 questions); (b) interaction skills and understanding people (section 2 - 36 questions); and (c) abstract, non-verbal reasoning (section 3 - 30 questions). 11 When the Boyapatis commenced to set up their business in December 2003, various organisations were already selling UMAT preparation or training courses, an important part of which was providing prospective candidates with UMAT-style practice exams and answers. These organisations included the respondents' business, Australian Medical Entry Preparation Program ("AMEPP"), National Institute of Education ("NIE"), and "Agoneyes", which was the trading name of a Mr Ryan Schulman. All but Agoneyes provided workshops and tutorials at schools and other locations in Australia and New Zealand. 12 Ray and Ann Boyapati both sat the UMAT to gain admission to Monash University medical school. Ray did so in July 2001 and Ann, in July 2003. In order to prepare for the UMAT, they both took courses offered by these providers, including the respondents. After taking these courses and doing the UMAT, Ray and Ann Boyapati perceived deficiencies in the then providers' practice exams and determined that they might improve upon them so as to simulate the UMAT more accurately. Ann gave evidence, which I accept, that the respondents' questions were deficient because many contained an American flavour in their language, grammar and style instead of the Australian style of the UMAT. Furthermore, the respondents' exams had a five-multiple choice format instead of the four consistently used in the UMAT and, generally, the respondents' exams did not reflect the structure of the UMAT. 13 As a consequence, in December 2003, Ann and Ray Boyapati decided to prepare their own sample questions and answers to sell to students intending to sit the UMAT in 2004. They did so with the encouragement of their father, Edward. Ray and Ann Boyapati gave evidence that they originally had in mind to operate their business under the name ACE UMAT (as the sixth cross-respondent is called). They registered this as a business name and Ray Boyapati established a website with the domain name "www.aceumat.com.au". In December 2003, however, before their business was fully operational, they changed their business name to "MedEntry", and Ray Boyapati created a new website with the domain name "www.medentry.com.au", following Dallas Gibson's warning telephone calls to Dr Nimi Boyapati's practice. 14 Dr Nimi Boyapati gave evidence at the trial, which I accept, that in early December 2003 her secretary, Josephine Fsadni, put a telephone call through to her from a person who introduced himself as "Dallas Gibson, 'UMAT' coach", inquiring after Ray Boyapati's phone number. She stated that the same man rung back later that day and told her that "he was the only one who could use the word 'UMAT' and that he was going to closely watch and monitor AceUMAT and asked [her] to inform Ray and Ann about his intention to do so". Dr Nimi Boyapati impressed me as an entirely reliable witness on the matters she was asked to address. Ms Fsadni also gave evidence in which she said that, in early December 2003, a man who called himself "Dallas" wanted to leave a message for Ray Boyapati, which he dictated to her over the phone. Her handwritten note of that message, made at the time, read as follows: Closely monitoring his products and the remotest resemblance will result in depositions. Suggest that he refrains from using the word UMAT he obtains permission from UMAT Pty Ltd, as it is a registered trademark. 15 Dallas Gibson agreed that he had a telephone conversation with Ms Fsadni, although he disputed the terms of the conversation. He agreed that the purpose of the call was to tell Ann Boyapati not to use the word "UMAT" in a domain name. Having regard to the fact that Ms Fsadni's account of her conversation with Dallas Gibson is supported by a note made by her at the time, I accept her account in preference to Dallas Gibson's account. I find that Dallas Gibson twice spoke with Dr Nimi Boyapati and left a message with her secretary, Ms Josephine Fsadni, in the terms set out in Ms Fsadni's note. 16 Ann and Ray Boyapati registered the name "MedEntry" as a business name in early 2004. The business name registration was subsequently amended to substitute Edward for Ray, to assist in meeting financial requirements. The Boyapatis' evidence was that "MedEntry" was a contraction for Medical Entry. At the time of trial, a web search for "Aceumat" led the searcher to the web site for MedEntry. 17 Ann and Ray Boyapati gave evidence concerning their ability to design and run an UMAT preparatory course. Both Ann and Ray gave evidence, which was uncontested, as to their significant achievements in the VCE and the UMAT. They said that they each "received interviews for all medical schools in Australia, and was offered a place in all medical schools". Both stated that they were assisted in preparing UMAT practice exams by their family, some of whom were medically qualified or otherwise involved in the health sciences. Furthermore, both Ann and Ray were members of MENSA or Mensa International and Ann said she was familiar with aptitude tests of the UMAT kind. 18 Edward, Ann and Ray Boyapati gave evidence that, for some years prior to December 2003, Edward had collected questions and answers for use in aptitude tests, as well as other material from which such questions and answers might be created. In a witness statement adopted at the trial, Edward Boyapati said that he had "long held an interest in aptitude and intelligence testing" and that "[m]uch of [his] interest … has been self-taught through reading books and other academic materials". He said that "since around the late 1980s, [he had] collected materials from books and journals ... relevant to testing critical reasoning, problem solving, logical thinking, inter-personal skills and non-verbal reasoning". He said that this material might consist of "questions, graphs, tables, and illustrations, articles, sample questions or stimuli that may form the basis of a question that could be used in some form of aptitude or intelligence test". He said that some of these materials found "their way into" the works in suit. He added that, if he identified something of interest, he would photocopy the relevant part and retain the photocopy. In this way, he said that he had collected "probably … hundreds of samples". He did not keep a note of the original reference because he had not anticipated that he would need the reference in the future. 19 I accept the evidence given by Ann, Ray and Edward Boyapati that they began to prepare sample practice exams between December 2003 and around 24 April 2004. MedEntry started to take orders for copies of the MedEntry exams from around March 2004, although the practice exams were not in final form until the following month. As soon as they were completed, Ray Boyapati converted them from Microsoft Word format to Adobe Portable Document format (.pdf). According to Ray Boyapati, he did this "to make the content more difficult to copy by cutting and pasting into other software applications". The MedEntry exams and related materials were burned onto compact discs for sale and delivery to students. I accept that, as Ann and Ray Boyapati said, each compact disc was marked with a copyright notice that identified "MedEntry" as the copyright owner. Each of the MedEntry exams also bears such a notation. MedEntry's customers purchased the MedEntry exams by ordering them online at the MedEntry website. Once orders were received, it was Ray Boyapati's role to respond to and fill the orders by burning an encrypted version of MedEntry's exams onto a compact disc and mailing this to the customer. The first purchase was on about 22 March 2004, as a pre-ordered copy, and other copies were sold until about December 2004. MedEntry sold approximately 300 packs of exams during this period. Thereafter, MedEntry provided practice exams in electronic format via its website. In around May 2004, in addition to selling the practice exams, Ray and Ann Boyapati conducted a series of workshops for students who would sit the UMAT in 2004. Edward Boyapati has continued to conduct such workshops. 20 In all, Ann and Ray Boyapati, assisted by Edward, created 10 practice exams, which they subsequently sold through the MedEntry business. These exams were headed "MedEntry UMAT Practice Exam [1-10] - 2004". Each MedEntry exam mirrored the UMAT's organisation, consisting of the three sections mentioned above. Each section had its own questions and answers. Section 1 consisted of 44 questions and answers on logical reasoning; section 2 consisted of 36 questions and answers on interaction skills; and section 3, which is not presently material, was directed to non-verbal reasoning. 21 Ray Boyapati was principally responsible for section 3. Ann Boyapati was principally responsible for the 800 questions and answers in sections 1 and 2, although Ray and Edward Boyapati assisted her to a limited extent. This meant that the works the subject of the applicants' claim were principally created by Ann Boyapati, although they were also the product of a joint effort by all the applicants. Nimi Boyapati's role in the preparation of the works in suit was more limited than that of Ray or Edward Boyapati. According to Ann Boyapati's evidence, she assisted Ann in the preparation of the questions and answers in section 2, by discussing topics, reading questions, and making and suggesting amendments to them.

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C. REPRODUCTION 22 Section 8 of the Copyright Act provides that, subject to a presently irrelevant exception, copyright does not subsist otherwise than by virtue of the Act. Section 32 provides for copyright to subsist in original literary and other works in the circumstances stated. The term "literary work" is defined in s 10 to include a compilation. A compilation might include a compilation of aptitude-testing questions and answers. In general, the author of a literary work is the owner of any copyright in the work: see s 35(2). 23 The copyright in a literary 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 authorizes the doing in Australia of, any act comprised in the copyright": see s 36(1). In determining whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the copyright owner, the Copyright Act directs that a number of matters be taken into account: see s 36(1A). 24 The applicants have been less than precise in identifying the exact basis of the alleged legal liability of each respondent under s 36 of the Copyright Act. On one view, it might be said that the respondents' liability was essentially of the same kind and lay in the fact that both had done the same infringing acts directly, although the second respondent had also authorised the first respondent's infringing conduct. On another view, it might be said that the first respondent had done the infringing acts directly whilst the second respondent had authorised the doing of these acts. The failure to draw a distinction between directly infringing and authorising the infringement may lie in the fact that little practical significance flows from it. Be that as it may, I have preferred the former view as it appeared to be more consistent with the footing upon which the parties have conducted the case; indeed, in their defence, the respondents admitted that it was them who placed the 800 questions and answers on their website. 25 In the case of a literary work, copyright is the exclusive right, amongst other things, to reproduce the work in a material form and to communicate the work to the public: see s 31(1)(a)(i) and (iv). In s 10, the word "communicate" is defined as "make available online or electronically transmit (whether over a path, or a combination of paths, provided by a material substance or otherwise) a work or other subject-matter". Hence, in making the 800 questions and answers available on line over the Internet, RMC and Dallas Gibson communicated the works to the public. These 800 questions and answers were also reproduced in a material form when Dallas Gibson converted them from files stored on Mr Van Tran's compact disks into files stored on Dallas Gibson's laptop and ultimately converted into the practice exams files made available to students through the Icarus College learning management system: see s 21(1A). Pursuant to s 10, as applicable at the relevant time, "material form", in relation to a work, included "any form (whether visible or not) of storage from which the work … or a substantial part of the work … can be reproduced". In the present case, the difficulties discussed in Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) 224 CLR 193 do not arise. 26 Section 14(1)(b) of the Copyright Act provides that, unless the contrary intention appears: [A] reference to a reproduction, adaptation or copy of a work shall be read as including a reference to a reproduction, adaptation or copy of a substantial part of the work, as the case may be. 27 In May 2004, the applicants discovered that Dallas Gibson and RMC, trading as Icarus College, were providing the 800 questions and answers in sections 1 and 2 of MedEntry's practice exams to Icarus College students over the Icarus College website. Icarus College had 45 practice exams that it provided over the Internet to students who paid for UMAT preparation courses. MedEntry's 800 questions and answers were contained in these 45 practice exams. The gist of the applicants' complaint in these proceedings was that their copyright had been infringed by the respondents' reproduction, via the Icarus College website, of the 800 questions and answers principally created by Ann Boyapati for sections 1 and 2 of MedEntry's practice exams. 28 Inspection of the 45 Icarus College practice exams showed that, apart from some immaterial differences, the Icarus College practice exams contained all the 800 questions and answers in precisely the same terms as the works in suit. The respondents did not contest that all 800 questions and answers were there in some form. In some of the Icarus College practice exams, the sequence of questions was the same as in the MedEntry practice exams whilst in others, there were identical questions, or series of questions which were the same as the MedEntry practice exam questions. Only four of the 45 Icarus College practice exams contained none of the questions and answers appearing in MedEntry's practice exams. Neither RMC nor Dallas Gibson had permission from any of the applicants to reproduce or use the MedEntry exams. In the circumstances outlined, the respondents infringed the applicants' copyright unless their submissions regarding lack of originality are upheld. Dallas Gibson and RMC took the steps that ensured that the works in suit were communicated to the public via the Icarus College website, or were reproduced in material form, in the course of the business operated by them.

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(1) Originality 29 The respondents argued that MedEntry's 800 questions and answers were not original. The respondents' case was that these works had been derived and copied from the work of third parties, most of whom were the true copyright-holders. The respondents argued that, on the evidence, the applicants could not exclude the probability that any particular question was copied verbatim or with immaterial adaptations from third-party copyright sources. The respondents contended that on Ann Boyapati's evidence: (a) the major portion of the works in suit were created by being copied from unidentified third party sources, which were probably subject to copyright; (b) where no third party copyright source was retained, her memory may be unreliable; (c) many source materials were not retained, and the origins of those retained cannot be identified with certainty; (d) many sources cannot be identified now; and (e) she cannot exclude there having been a source from which any particular question was copied. I reject this characterisation of Ann Boyapati's evidence. 30 Ann Boyapati gave evidence that she was chiefly responsible for compiling MedEntry's practice exams. She began the task in December 2003 and completed sections 1 and 2 of each of the exams in about 24 April 2004. Her evidence was that she derived many of the questions and answers from materials that her father had collected over the preceding years, without writing down the sources. She said that, to the extent she incorporated this material, she "selected these materials from among all the materials that [her] father and [she] had collected", "based on how appropriately [she] considered that they would fit within the structure of a sample UMAT exam". 31 Ann Boyapati also said that she "[had] learned to keep an eye out for material that might form the basis of, or the inspiration for, a question or series of questions" and that she "actively searched for such materials in libraries, newspapers, journals and on the Internet". She said that when she found appropriate material, she would either take a copy of the page or passage, or make a note of it. She stated that her source materials were very varied, including textbooks, medical journals, problem solving books, logical reasoning books, newspapers, novels, plays, the Internet and interviews, and she did not keep track of them. She gave evidence too that, between December 2003 and April 2004, Ray and Edward Boyapati also identified and collected materials to assist her preparation of sections 1 and 2 of the MedEntry exams. 32 Ann Boyapati's evidence was that she wrote many questions and answers for sections 1 and 2 from scratch. In cross-examination, she was more precise, saying that she created about half the works in suit from third party sources and wrote the others from scratch, especially the section 2 questions and answers. Her evidence was that, in creating the questions, she "generally started with an idea that was inspired by books, newspapers, journals and university resources … as well as based on [her] recollection of the 2003 UMAT and … discussions with others". She said that she was assisted by Edward and Ray Boyapati in writing a small proportion of the questions and answers, although she later amended some of their questions. She chose not to include all the questions that Edward and Ray prepared. She said that Ray Boyapati also assisted her in proof-reading all section 1 questions and answers once a draft was completed. 33 Ann Boyapati stated that, in compiling the MedEntry exams, she reviewed the collected materials and, in consultation with Edward and Ray, selected items appropriate for inclusion in the MedEntry exams on the basis that "they had the potential to be created into a question that would simulate the UMAT effectively in terms of style and content". In her witness statement, she said that, in compiling the questions, she reproduced only a very few verbatim from her father's collection and that, in most instances, she amended existing questions so as to make them more appropriate for inclusion in MedEntry's exams. Sometimes these amendments were slight and sometimes they were substantial. In cross-examination, she said that she thought that there were at least one or two amendments in every question. Given the number of questions involved and the passage of time, she was, understandably, unable to recall the authorship details of every question. 34 Throughout the process of preparing for and drafting the practice exams, Ann Boyapati stated that she "had in mind the need to reflect the structure of the UMAT". She said that "[t]his involved not only having 44 questions of a section 1 type and 36 questions of a section 2 type in each exam, but also striking a balance of questions within each section of the exam so that the MedEntry [e]xams would resemble the UMAT structure as far as possible". I accept that, as Ann Boyapati said, the creation of the MedEntry exams was time-consuming and not at all straightforward. 35 Ann Boyapati gave her evidence, particularly concerning her involvement with the MedEntry business, the creation of the works in suit, and her dealings with Dallas Gibson, in a generally forthright way. She properly conceded that her memory about creating some questions might be faulty in some respects, but I formed the impression that, taken overall, her evidence was well-balanced and reliable. I accept Ann Boyapati's evidence on these matters. It was very largely corroborated by the evidence of Edward and Ray Boyapati. Her evidence of the manner in which the questions and answers for sections 1 and 2 came to be written was credible. It was supported by those source materials she was able to produce; by some handwritten notes prepared by her when she was writing the questions for section 2 of the MedEntry practice exams; and by working documents that grouped draft questions for subsequent inclusion in MedEntry's exams. 36 To the extent he was able to do so, Ray Boyapati corroborated Ann Boyapati's account of her role in preparing the works in suit. He was an entirely credible witness. Ray Boyapati also said that, in the early stage, his role was "primarily [in] setting up the website and other related IT tasks", although he subsequently took responsibility for preparing section 3 of each of the MedEntry practice exam (which was not part of the works in suit). He added that he "had a focus on IT related work, including developing the MedEntry website". 37 As already noted, Edward Boyapati gave evidence that, since the late 1980s, he had a particular interest in aptitude and intelligence testing and, since that time, he had collected relevant materials. He said that, in December 2003, he retained much of this material as photocopies of the original sources and kept them in piles or bundles on his desk or in his office. He corroborated the evidence of Ann and Ray Boyapati as to the preparation and completion of the works in suit. His evidence was that he assisted Ann by collecting additional "stimulus material that would form the basis of questions for section 2 of the practice exams". To this end, he borrowed books on patient-doctor interaction from libraries and located additional material in these books for Ann to use. He also created some questions that Ann reviewed and edited, and proofed Ann's and Ray's work. 38 In cross-examination, the respondents' counsel asked Ann Boyapati about the close similarity between some of the questions in the works in suit and pre-existing sources. She agreed that the authors of UMAT and similar tests would make "a lot of use of third party sources that might turn out to be the same". 39 The respondents argued that this last-mentioned evidence indicated that there was little skill or labour involved in the creation of the works in suit. For the reasons already stated, I reject this contention. In any case, these questions formed a relatively small part of the works in suit. 40 I reject the respondents' submission that the applicants failed to establish that on the balance of probabilities the works in suit were original works that were subject to copyright. 41 In order to attract copyright protection, a literary work that is a compilation must be original. As Dixon J said in Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479 at 511: No doubt the expression 'literary work' includes compilation. The definition section says so … But some original result must be produced. This does not mean that new or inventive ideas must be contributed. The work need show no literary or other skill or judgment. But it must originate with the author and be more than a copy of other material.

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In that case, the High Court held that copyright did not exist in information posted by the race-course proprietors inside the course as to the name and numbers of the starting and scratched horses and the numbers of the winners. 42 Whether or not a compilation has sufficient originality to attract copyright depends on the degree of skill, judgment or labour involved in producing it. The Full Court of this Court in Desktop Marketing Systems Pty Ltd v Telstra Corporation Ltd (2002) 119 FCR 491 ("Desktop") discussed the concept of originality. Lindgren J, with whom Black CJ agreed, summarised the principles concerning originality (at 532-534) where, amongst other things, his Honour said: 5. One must apply the test of originality to the literary work, including a compilation, in which copyright is claimed to exist, as a whole, rather than dissecting it and applying the test to the individual parts … 6. The test of originality is whether the work was not copied, but originated from the putative author … 7. The test is not an 'all or nothing' one but raises a question of fact and degree as to the extent of the putative author's contribution to the making of the particular literary work in questions, in the present case, a compilation … 8. For this purpose, no particular kind of antecedent work contributed by the putative author is, a priori, to be left out of account, except, perhaps, antecedent work which was undertaken for a purpose or purposes which did not include the making of the literary work at all … … 10. … [T]here is no principle that the labour and expense of collecting, verifying, recording and assembling (albeit routinely) data to be compiled are irrelevant to, or are incapable of themselves establishing, origination, and therefore originality; on the contrary, the authorities strongly suggest that labour of that kind may do so… See also Desktop at 591 per Sackville J, with whom Black CJ also agreed. 43 Sackville J's summary of the relevant principles (at 593) included the following statements: (i) A compilation will ordinarily be an original literary work for copyright purposes if the compiler has exercised skill, judgment or knowledge in selecting the material for inclusion in the compilation … or in presenting or arranging the material … (ii) In addition, a compilation of factual information will ordinarily be an original literary work for copyright purposes if the compiler has undertaken substantial labour or incurred substantial expense in collecting the information recorded in the compilation. 44 Where the skill, judgment and labour involved in making a compilation is trivial or insubstantial, there may be no originality sufficient to attract copyright: see Desktop at 535 per Lindgren J and Acohs Pty Ltd v RA Bashford Consulting Pty Ltd (1997) 37 IPR 542 at 556 per Merkel J. This is not the case here. The evidence disclosed that the Boyapatis had contributed a sufficient amount of independent skill, judgment and labour to satisfy the requirement for originality. 45 The evidence established that Ann Boyapati created about half the questions and answers in the works in suit from scratch. Whilst the evidence established that she derived the balance of the questions and answers from third party sources, she used these sources in different ways, selecting, adapting and modifying them to varying degrees to suit her purpose of compiling sets of practice exams that simulated the UMAT. Even where she made minimal modification to a pre-existing question, she exercised skill and judgment in selecting the question and including it in either section 1 or 2, depending on whether it concerned logical reasoning or interaction skills. There was also a degree of skill and judgment involved in organising the sequence and, to a lesser extent, the number of questions in sections 1 and 2 so as to simulate the UMAT. The practice exams that she created were therefore a product of her skill, judgment and labour, combined with that of Ray and Edward Boyapati to the extent that they contributed to the process. The skill, judgment and labour involved were sufficiently substantial to attract copyright: compare Desktop at 599 per Sackville J. The preparation for, and the creation and development of, the practice exams were not easy tasks and involved some considerable time and effort on the Boyapatis' part: compare Interlego AG v Tyco Industries Inc [1989] AC 217 at 263. 46 The respondents invited me to infer from the evidence that the third party sources would attract copyright since it might be inferred that the sources had been produced in the last fifty years. The respondents cited Desktop and Autodesk Inc v Dyason (1992) 173 CLR 330 in support of the proposition that there could be no originality in a work that derived "from other copyright sources without permission (or acknowledgement)". This was, so they said, due to a lack of originality. These two cases concerned copyright in factual information and, accordingly, are not directly in point in the present case. In any event, I would reject the respondents' basic submission on two bases. First, I accept that, as the applicants submitted, it would be a question of fact in each case as to whether the applicants had infringed copyright in any particular pre-existing work. Secondly, even if copyright in a pre-existing work was infringed, the proposition for which the respondents contend is unsupported by the authorities and authors learned in the field of copyright. 47 In Copyright and Designs (Butterworths, Australia, 2004) at 10,092-10,113 [10,055], James Lahore and Warwick A Rothnie state: Copyright can subsist in a selection of material such as poems, short stories or letters, although the material selected is in the public domain. The copyright is in the selection, not in the component parts of it, and the originality of the work lies in the labour, skill, and discrimination of the author in putting together the material. … The selection is a new work quite separate from the works selected. Copyright will subsist, for example, in Palgrave's Golden Treasury of Songs and Lyrics although the songs and lyrics may themselves be in the public domain … The selection by Palgrave was the subject of copyright as a work in itself and irrespective of whether or not copyright subsisted in the individual items selected. … In the case of compilations that consist entirely of existing material the originality may be found in the selection alone, that is, in the skill labour and judgment involved in making the selection. There are numerous authorities that can be cited in support of the statements in this passage: see, for example, Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273 ("Ladbroke (Football) Ltd") at 277-278 per Lord Reid, 286-287 per Lord Hodson, 289-290 per Lord Devlin, and 292-293 per Lord Pearce. See also S Ricketson and C Creswell, The Law of Intellectual Property: Copyright, Designs & Confidential Information (Lawbook Co, 2nd ed (revised) 2002) at 7-2064 [7.100]. 48 The judgment of Drummond J in A-One Accessory Imports Pty Ltd v Off Road Imports Pty Ltd (1996) 34 IPR 306 at 316 is particularly helpful. The applicant claimed to be the copyright owner in the literary work that was its motorcycle parts catalogue, as updated from time to time. It alleged that the respondents had infringed its copyright by producing the respondents' 1993 parts catalogue. A major issue in the case was whether the applicant's catalogue was the product of copying other catalogues, with the result, so the respondents argued, that the applicant's catalogue was not the subject of copyright. Drummond J rejected this argument. His Honour observed (at 316) that "the question is whether the compilation, looked at as an entity, is original: it is not proper to dissect the work into its parts, and by determining that the individual parts lack originality, to deny originality to the whole work". He concluded that the original version of the applicant's catalogue infringed the copyright in an earlier work. His Honour went on to say, however, that: But, in my opinion, the fact that the 1986 A-One catalogue may be an infringement of the copyright in the 1984 Phoenix catalogue does not prevent A-One having copyright in its own 1986 catalogue. I do not read Ladbroke (Football) Ltd … as limiting the proposition that, so far as compilations that consist of or include existing material are concerned, originality for the purposes of copyright can be found in the work of selection, to compilations consisting only of material that is not the subject of copyright. In that case, Lord Pearce, in the course of dealing with the question whether the defendants had infringed the plaintiff's copyright in their football coupon by reproducing a substantial part of it, said, at 293: The reproduction of a part which by itself has not originality will not normally be a substantial part of the copyright and therefore will not be protected. For that which would not attract copyright except by reason of its collocation will, when robbed of that collocation, not be a substantial part of the copyright and therefore the courts will not hold its reproduction to be an infringement. It is this, I think, which is meant by one or two judicial observations that 'there is no copyright' in some unoriginal part of a whole that is copyright. They afford no justification, in my view, for holding that one starts the inquiry as to whether copyright exists by dissecting the compilation into component parts instead of starting it by regarding the compilation as a whole and seeing whether the whole has copyright. It is when one is debating whether the part reproduced is substantial that one considers the pirated portion on its own. Although Lord Pearce was dealing with the question of infringement where the copyright work was composed of non-original and original material, his Lordship, in the latter part of this statement, in my opinion, clearly accepted that copyright can exist in a compilation even though the compilation consists of partly pirated material and partly non-pirated material. This would seem to follow logically from what the House of Lords had to say in Ladbroke (Football) Ltd to the effect that, so far as compilations of existing material are concerned, originality sufficient to attract copyright in a compilation can be found entirely in the work of selecting the material to be included in the compilation, as opposed to the work of reducing those selections to written form. 49 Drummond J also referred to Redwood Music Ltd v Chappell & Co Ltd [1982] RPC 109 at 120 per Goff J and Warwick Film Productions Ltd v Eisinger [1969] 1 Ch 508 at 524-525 per Plowman J, both of which supported the proposition that a work might be an original work in which copyright subsisted, even though infringing copyright in an earlier work because it is in part a copy of a substantial part of the earlier copyright work. 50 The respondents also submitted that the evidence showed that it was common for providers of preparation courses for the UMAT and the like to reproduce material from other copyright sources without permission or acknowledgment. Relying on Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577 ("Concrete") at 595-596 per Kirby and Crennan JJ, they argued that this "might be said to give rise to an implied licence or right based on industry practice to 'borrow' or reproduce such material (even though it is accepted that there was no direct or other contractual relationship between the applicants and the respondents in relation to the material)". The relevant passage in Concrete referred to the principle established in cases concerned with architectural drawings and plans, that a licence may be implied where architects, artists and other persons prepare written material on the basis that it should be used in a particular manner for a particular purpose. I do not consider that there is any basis for applying this principle to the subject-matter of this case, even if the evidence were as the respondents contended. The evidence supports the proposition that practice exams are written on the basis that they should be used by students enrolling in the providers' courses for the purpose of preparing for the UMAT and not for the purpose of assisting other commercial providers to make their products. 51 It follows from the foregoing that I would reject the respondents' submissions on lack of originality.

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(2) Other statutory protections under the Copyright Act 52 In view of the conclusions I have reached above, it is unnecessary to consider the applicants' claim in so far as it was based on s 38 of the Copyright Act or involved an alleged breach of moral rights. In any event, at trial, the applicants did not strenuously press these alternative bases for the respondents' liability. 53 The applicants also relied on s 116 of the Copyright Act. This provision treats a copyright owner as if the copyright owner were also the owner of the infringing articles: see Polygram Pty Ltd v Golden Editions Pty Ltd (No 2) (1997) 38 IPR 451 ("Polygram") per Lockhart J. Section 116 is in the following terms: (1) The owner of the copyright in a work or other subject‑matter may bring an action for conversion or detention in relation to: (a) an infringing copy; or (b) a device (including a circumvention device) used or intended to be used for making infringing copies. (1A) In an action for conversion or detention, a court may grant to the owner of the copyright all or any of the remedies that are available in such an action as if: (a) the owner of the copyright had been the owner of the infringing copy since the time the copy was made; or (b) the owner of the copyright had been the owner of the device since the time when it was used or intended to be used for making infringing copies. (1B) Any relief granted by a court in an action for conversion or detention is in addition to any relief that the court may grant under section 115. (1C) A court is not to grant any relief to the owner of the copyright in an action for conversion or detention if the relief that the court has granted or proposes to grant under section 115 is, in the opinion of the court, a sufficient remedy. (1D) In deciding whether to grant relief in an action for conversion or detention and in assessing the amount of damages payable, the court may have regard to the following: (a) the expenses incurred by the defendant, being a person who marketed or otherwise dealt with the infringing copy, in manufacturing or acquiring the infringing copy; (b) whether the expenses were incurred before or after the infringing copy was sold or otherwise disposed of by the defendant; (c) any other matter that the court considers relevant. (1E) If the infringing copy is an article of which only part consists of material that infringes copyright, the court, in deciding whether to grant relief and in assessing the amount of damages payable, may also have regard to the following: (a) the importance to the market value of the article of the material that infringes the copyright; (b) the proportion the material that infringes copyright bears to the article; (c) the extent to which the material that infringes copyright may be separated from the article. (2) A plaintiff is not entitled by virtue of this section to any damages or to any other pecuniary remedy, other than costs, if it is established that, at the time of the conversion or detention: (a) the defendant was not aware, and had no reasonable grounds for suspecting, that copyright subsisted in the work or other subject-matter to which the action relates; (b) where the articles converted or detained were infringing copies - the defendant believed, and had reasonable grounds for believing, that they were not infringing copies; or (c) where an article converted or detained was a device used or intended to be used for making articles - the defendant believed, and had reasonable grounds for believing, that the articles so made or intended to be made were not or would not be, as the case may be, infringing copies. 54 As I have already found, copyright in the works in suit rests with the applicants. Dallas Gibson and RMC uploaded the works in suit onto the Icarus College website as part of their own course materials for their own students. These infringing copies are deemed, by virtue of s 116 of the Copyright Act, to be the property of the copyright owners, being the Boyapatis: see A-One Accessory Imports Pty Ltd v Off Road Imports Pty Ltd (1996) 34 IPR 332. A notice on the Icarus College website stated that it was the owner of the copyright in the materials published on the website. When the respondents made the works in suit available to their students via the Icarus College website, they treated the infringing copies as their own and acted in a manner inconsistent with the applicants' rights as deemed owners and, accordingly, converted them: see Caxton Publishing Co Ltd v Sutherland Publishing Co Ltd [1939] AC 178 at 189 per Lord Russell of Killowen and 202 per Lord Porter.. 55 Ann, Ray andEdward Boyapati gave evidence, which I accept, that the works in suit, even in compact disc format, contained copyright notices, including the name "MedEntry". Bearing this in mind and for the reasons set out below, the respondents cannot successfully rely on s 116(2) of the Copyright Act (or s 115(3), as discussed hereafter). 56 Section 116(1B) provides that the relief that the court grants for conversion is in addition to any relief that the court may grant under s 115 of the Copyright Act. The grant of relief for conversion is, however, subject to the proviso in 116(1C) - that the "court is not to grant any relief to the owner of the copyright in an action for conversion … if the relief that the court … proposes to grant under section 115 is, in the opinion of the court, a sufficient remedy". In deciding whether to grant relief for conversion and in assessing the amount of damages payable, the court's attention is directed to the factors in s 116(1D) of the Copyright Act, to which it may have regard: see generally Sony Entertainment (Australia) Ltd v Smith (2005) 64 IPR 18 at 34 per Jacobson J and Polygram (1997) 38 IPR 451at 453-454 per Lockhart J. 57 As indicated above, the applicants have made out their case respecting the conversion of infringing copies by the respondents. Neither the applicants nor the respondents have yet made submissions, however, concerning the application of ss 116(1C) and (1D) of the Copyright Act. This may be on account of the Court's order of 10 July 2006, which deferred any questions concerning quantum of damages to a later stage in the proceeding. Accordingly, I propose to invite the parties to make such submissions as they consider appropriate on the application of ss 116(1C) and (1D) of the Copyright Act.

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(3) Innocent infringement 58 The respondents rely on ss 115(3) and 116(2), or what is sometimes referred to as the "innocent infringement" defence. In the present context, both provisions raise essentially the same issues. 59 Subject to s 115(3) of the Copyright Act, amongst other things, in a successful action for copyright infringement, the court may grant an injunction and either damages or an account of profits. Subsection 115(3) provides: Where, in an action for infringement of copyright, it is established that an infringement was committed but it is also established that, at the time of the infringement, the defendant was not aware, and had no reasonable grounds for suspecting, that the act constituting the infringement was an infringement of the copyright, the plaintiff is not entitled under this section to any damages against the defendant in respect of the infringement, but is entitled to an account of profits in respect of the infringement whether any other relief is granted under this section or not. The applicants submitted that the innocent infringement defence is, at best so far as the respondents are concerned, only a partial defence because the copyright owner is nonetheless entitled to an account of profits in respect of the infringement. More fundamentally, they submitted that the defence has no operation at all. 60 The respondents contended that the defence was made out on account of the circumstances in which Dallas Gibson came to acquire the works in suit. Dallas Gibson gave evidence that, on or about 25 May 2004, he purchased the questions and answers from which he compiled the 45 Icarus College practice exams from a person describing himself as a sociology student at RMIT by the name of Minh Van Tran, in the belief that Mr Van Tran was the true author of them. The applicants argued that the respondents failed to make out this defence. The applicants submitted that the respondents' assertion that Dallas Gibson genuinely believed Mr Van Tran was the true author of the questions and answers that Dallas Gibson acquired from him was not credible. 61 Mr Van Tran did not give evidence at the trial. To make out the innocent infringement defence, the respondents relied on the evidence of Dallas Gibson and his partner, My Hanh Ton. 62 Dallas Gibson gave evidence that, on or about 25 May 2004, Mr Van Tran came to his home office in Deer Park, where he showed him the questions, which were then stored on two compact discs. In his witness statement adopted at trial, Dallas Gibson said: I loaded the CD onto my computer and had a brief look at the questions on both CDs for about ten minutes. … I recall thinking that the questions were reasonable questions and that I could use the questions as part of the course... I haggled with Mr Tran about the price. I wanted to pay him $1500 for the two CDs. We haggled for a short time before Mr Tran asked me as to whether I had cash on me at that moment. I said yes. Mr Tran then agreed on the price of $1500. I then went into the house and called for My Ton to come into the office and to bring $1500 cash with her. My arrived in my Office. I introduced My to Mr Tran. I asked My to hand to Mr Tran the $1500 cash. My handed to Mr Tran an envelope. I thought that it was strange that Mr Tran did not count the cash but just thanked us and left. We did not ask him for a receipt. Dallas Gibson's evidence was that three or four days' later he spent about half an hour looking at the questions. He subsequently converted them into HTML format, compiled them into tests and loaded them onto RMC's learning management system. The questions and answers stayed inside the server until mid August 2004, when they were disabled, and access to them denied. According to Dallas Gibson, he threw away the original CDs acquired from Mr Van Tran because he thought he would not need them again. Dallas Gibson also said that Mr Van Tran stated that he provided the questions and answers in response to a notice that Dallas Gibson had posted at the RMIT. The evidence regarding the notice was thin. 63 According to Dallas Gibson, he no longer had the material he purchased from Mr Van Tran, because he threw away the two compact discs Mr Van Tran gave him after copying the files to his laptop and loading them onto the learning management system of the Icarus College webserver. Further, according to Dallas Gibson, he no longer had the laptop he had then because, on his evidence, he either "discarded" it or, according to his affidavit of 25 July 2006, it was stolen. He was evasive when questioned about these differing accounts and said that the "discarded" laptop was not the same as the "stolen" laptop. A Police Report dated 26 July 2006 recorded that Dallas Gibson had in fact reported a burglary, but it did not otherwise assist the respondents. Dallas Gibson did not adequately explain these inconsistent accounts. Having regard to this and the evidence referred to below, I find that Dallas Gibson was not an honest witness. I would infer from the evidence taken as a whole that he disposed of the compact discs and laptop in order to avoid subsequent inspection of the material that Mr Van Tran (assuming he existed) gave him. 64 Was Mr Van Tran a figment of Dallas Gibson's imagination as the applicants suggested? Dallas Gibson stated that, in 2005, he had engaged a private enquiry agent named Mr Hughes to find Mr Van Tran, but Mr Hughes' efforts were unsuccessful. Mr Hughes did not give evidence at the trial, however, and the respondents did not seek to put into evidence any instructions to, or reports from, him. In his evidence at trial, Dallas Gibson referred to other private investigators but none was called to give evidence. In a third witness statement, Dallas Gibson stated that he had made further unsuccessful attempts to find Mr Van Tran through RMIT and had personally visited a number of addresses at which Mr Van Tran might have been residing. Ms Hanh Ton corroborated this. Ultimately, the correct answer to this question does not matter, because, assuming Mr Van Tran did in fact present himself to Dallas Gibson as he claimed, the "innocent infringement" defence is nonetheless not made out. 65 Accepting that Mr Van Tran existed and Dallas Gibson's account of his meeting with him is correct as far as it goes, I reject the respondents' submission that there was nothing about the transaction that should have put Dallas Gibson on notice that he might be buying material pirated from a competitor. On the contrary, I infer from the evidence that, at the time of the infringing acts, Dallas Gibson either knew or strongly suspected that Mr Van Tran had provided him with pirated material. 66 I accept that there was nothing unusual about UMAT preparation course providers buying practice exam questions and solutions from students. Ann, Ray and Edward Boyapati gave evidence that MedEntry and Anzie also bought sets of questions from students, usually in blocks of 10 or 20. Ray Boyapati gave evidence that, at the time of trial, the going rate was $10 to $20 per question, depending on the quality of the questions. As we have seen, Dallas Gibson's evidence was that, three years' earlier, he had paid $1,500 in cash for the 800 questions and answers. This amounted to $1.87 per question and solution. Indeed, he gave evidence that he thought he was buying 1000 questions and answers for the price, which equated to $1.50 per question and solution. Even allowing for the passage of time, this was a comparatively modest price. The Boyapatis also said that, when they made a purchase, they obtained a copyright assignment and other details from the student author. There was evidence that when the respondents purchased questions and answers from third parties, they also obtained tax invoices or receipts from the sellers, notwithstanding that Dallas Gibson said that he was "not in the habit of asking for receipts". No such documentation accompanied the alleged transaction between Dallas Gibson and Mr Van Tran. By way of explanation, Dallas Gibson claimed that the possibility of obtaining a tax deduction for the price paid to Mr Van Tran "never crossed [his] mind". He denied in cross-examination that the low price accepted by Mr Van Tran and the fact Mr Van Tran did not check the money paid him at the time indicated that the material might be pirated. His evidence in this regard was unbelievable. I would infer from this evidence that Dallas Gibson knew or strongly suspected that he was buying pirated material belonging to a competitor. 67 Dallas Gibson gave evidence that the applicants did not notify him of the asserted breach of copyright until he received a formal letter of demand from their then solicitors in late October 2004. I reject this evidence. On 24 June 2004 Steven Shi informed Dallas Gibson that the Icarus College practice exams and MedEntry's practice exams were the same, as did Edward Boyapati (through an email using the name "Robert Tam") on 17 July 2004. Dallas Gibson responded to the Tam email with the comment "HOW WOULD I KNOW?" In relation to Mr Shi's email, Dallas Gibson stated in his witness statement that he replied saying "that it was impossible". A copy of the relevant email exchange showed that this was wrong. He first replied: Really? Interesting Steven Thanks for this pal. Did you buy their prods? How are you going with your tests? Mr Shi responded affirmatively, which led Dallas Gibson to say (amongst other things): Can you do me a favour by mailing me a photocopy of one of their test pages? Something has gone amiss here and I will quietly look into it. Keep it to yourself. I accept that, as the applicants submitted, this is not the kind of response that might ordinarily be expected from a person in Dallas Gibson's position had Mr Shi's claim come as a surprise. Dallas Gibson's evidence about his responses to these communications was unbelievable. His responses were indicative of the fact that he knew or strongly suspected that the material in question had been pirated. He had in fact reasonable grounds for that suspicion. 68 I note too that Edward Boyapati gave further evidence that, in early June 2004, he sent two emails and subsequently a letter to Dallas Gibson dated 21 June 2004, which read: Hi Dallas I believe you have copied MedEntry's materials. Stop it immediately or you will be hearing from our lawyers shortly. Edward Boyapati did not keep copies of the emails. He also said he sent another email on 11 July 2004, and he produced a copy of this email at trial. Dallas Gibson denied receiving these communications. Edward Boyapati was cross-examined about his failure to mention these emails and letter prior to the filing of his second witness statement, filed on the first day of the trial. Amongst other things, he said that he had only found a copy of the letter when he was cleaning his office on the occasion of his retirement the preceding month. Assuming Edward Boyapati sent the emails in June 2004 and the letter, there is nonetheless no evidence that permits me to determine one way or another whether Dallas Gibson received them. The respondents did not suggest, however, that the July 2004 email (which disclosed the email address to which it was sent) was sent to an incorrect address and there would appear to be no reason why in the ordinary course Dallas Gibson would not have received it. On the balance of probabilities, I find that at least this email was sent by Edward Boyapati and received by Dallas Gibson. 69 It must be borne in mind that, although Dallas Gibson had been notified of the fact that the Icarus College practice exams were the same as the MedEntry practice exams in late June and July 2004, he did not take the infringing material down from the Icarus College website until mid August 2004. 70 Further, Dallas Gibson's evidence in cross-examination concerning his failure to observe any copyright notices was unbelievable. In cross-examination, he said that he did not observe any copyright notice on Mr Van Tran's files because, first of all, he only had an "extremely quick look". He did not see them later because, so he said: "[t]he purpose of the exercise wasn't to read the questions. It was to put them up". The propositions that he did not read the questions before he put them up and that he thought he "recognized" some of them around June 2004 are simply incredible. 71 Ms Hanh Ton, who described herself as the receptionist and administrative officer at Icarus College, said in her witness statement that, in late April or early May 2004, she withdrew $5000 cash from a bank in Carlton, including $1000 from the flexi-teller. She stated that this money was subsequently used to pay Mr Van Tran. Reference to her bank records showed that her account was incorrect as regards the place from, and manner in which, the withdrawal was made. 72 In her witness statement, Ms Hanh Ton stated that, on or about 25 May 2004 in Dallas Gibson's home office, she was introduced by Dallas Gibson to Mr Van Tran. She said that Dallas Gibson asked her to pay Mr Van Tran $1500 in cash for some UMAT training questions, which she did. She said that she got the cash from the $5000 that she had previously withdrawn and handed it to Mr Van Tran in an envelope. She too said that he did not count it. After he left, she said that she wrote down his name and the date of purchase in her records. In cross examination, she conceded that she had not presented to the court any primary accounting document that recorded the name of the person to whom she paid $1500. 73 In her witness statement, Ms Hanh Ton also said that she asked Dallas Gibson "whether the questions were good questions". In cross-examination, she was vague about why she asked this question. When asked whether she was concerned that Mr Van Tran's questions might be pirated from someone else, she said "[a]t the time I wasn't thinking that at all". This explanation is unconvincing. She also said that it was not unusual for her to have $5000 in cash "sitting around [her] house for three weeks". I do not find this believable. 74 Ms Hanh Ton attempted to explain that the failure to get a receipt from Mr Van Tran was merely an oversight. This was unconvincing. I accept that if, as she (and Dallas Gibson) thought, it was unusual for someone like Mr Van Tran to fail to count the money given to him, then this would have indicated to them both that there was something wrong with the transaction. Further, her evidence that he was in a hurry to leave tended to confirm this impression. When asked in cross-examination, however, whether she thought there might be something amiss with Mr Van Tran's material, she said: "[t]he questions, I am not concerned, because Dallas look after that … I am just concerned about Dallas make mistake, not Mr Van Tran". Her evidence in this regard must be considered with her earlier evidence that her initial reaction was to ask Dallas Gibson if the questions were "good questions", to which Dallas Gibson replied "okay". Notwithstanding her denial that she was alive to the risk that Mr Van Tran's questions were pirated copies, her evidence, especially as to her enquiry, betrays a concern either about their quality or about their provenance. In the circumstances disclosed by the evidence, I infer that her actual concern was about the provenance of the documents and whether or not they were pirated questions. 75 Ms Hanh Ton was clearly anxious to give evidence that would support and protect Dallas Gibson's position. At times she was evasive and not altogether truthful. I do not consider her a reliable or an entirely honest witness. 76 The respondents challenged the applicants' dealing with certain evidence, saying in written submissions that it was "suspicious that the applicants appear to have deliberately destroyed potentially relevant evidence and refused to discover it or otherwise make it available". Generally speaking, the applicants provided adequate explanations for their inability to provide documents formerly held by them. I accept these explanations.

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D. THE RESPONDENT'S CROSS-CLAIM FOR COPYRIGHT INFRINGEMENT 83 Dallas Gibson alleged that he created 160 of the 800 questions and answers constituting the works in suit on the applicants' claim. He said that he created these 160 questions and answers ("the cross-claim works in suit") during the period between August 2000 and December 2000: see cross-claim at [27]. In his first witness statement adopted at trial, he stated that the cross-claim works in suit were "similar or identical" to those he had written in 2000. In his second witness statement, he stated that the questions in the cross-claim works in suit were "identical" to those he authored in 2000. During cross-examination, however, he accepted that the cross-claim works in suit were not identical to the works in suit in the applicants' claim. He did not say that they were not similar. 84 Dallas Gibson claimed to be well credentialed. In cross-examination, however, it became clear that, at as 1994, when he claimed to begin his business, his qualifications were slight. He stated that he had "devised, adapted and modified many methods of teaching" and described the Icarus College training techniques, course materials and software as "unique". I doubt these claims, but it is unnecessary to dwell on them further. 85 Dallas Gibson's evidence was that a large part of RMC's business was preparing Year 12 students for the UMAT. He said that this preparation involved "the students' attendance at a two day clinic in capital cities in Australia and New Zealand as well as the studying of online notes and software". He said he taught at all the clinics. He stated that his UMAT course was accredited by the Office of Tertiary Training and Education in Victoria and maintained that no other UMAT course was similarly accredited. He also said that he and others had collated the material for section 1 of his practice exams from materials prepared by third parties. According to Dallas Gibson, a person by the name of Christian Stapleberg had created his section 2 material and interview material in about 2001. Dallas Gibson also said that he had purchased a substantial quantity of material from numerous other persons. 86 For reasons that have already been stated and for further reasons appearing below, I do not find Dallas Gibson a reliable, credible or honest witness on his cross-claim.

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(1) A fundamental impediment 87 Dallas Gibson gave evidence that, in September 2003, he "sold [his] entire portfolio of software, notes and interests in [his] business" to RMC. He claimed to have assigned his copyright in the cross-claim works in suit to RMC on 12 September 2003. Accordingly, on the respondents' case, RMC held the copyright in the cross-claim works in suit. 88 The applicants contended, and I accept, that Dallas Gibson's bankruptcy created a fundamental impediment to this claim. This was because Dallas Gibson's bankruptcy commenced on 18 October 2000 and ended on 19 October 2003: see Bankruptcy Act 1966 (Cth) ("Bankruptcy Act"), s 149(4). It is not entirely clear whether, on Dallas Gibson's version of events, he claimed to have acquired copyright in the cross-claim works in suit before or after his bankruptcy in October 2000. As it happens, nothing particularly turns on this. Section 58(1)(a) of the Bankruptcy Act vests the property of the bankrupt in the trustee when he or she becomes a bankrupt. Section 58(1)(b) vests after-acquired property (as defined in s 58(6)) of the bankrupt after the date of bankruptcy in the trustee as soon as the acquisition or devolution occurs. Section 58(6) provides that, in this context, "after-acquired property" in relation to a bankrupt means "property that is acquired by, or devolves on, the bankrupt on or after the date of the bankruptcy, being property that is divisible amongst the creditors of the bankrupt". Section 116 specifies property that is divisible amongst the creditors of the bankrupt. The term "property" for the purposes of ss 58 and 116 is defined broadly in s 5 of the Bankruptcy Actto mean "real or personal property of every description, whether situate in Australia or elsewhere, and includes any estate, interest or profit, whether present or future, vested or contingent, arising out of or incident to any such real or personal property". This definition encompasses copyright, which s 196(1) of the Copyright Act recognises as a form of personal property: see also Birdseye v Sheahan (2002) 196 ALR 598 at 607 [52] per Carr J. Copyright does not fall within one of the classes of enumerated exceptions in s 116 of the Bankruptcy Actand the Bankruptcy Regulations 1966 (Cth). Accordingly, copyright in the cross-claim works in suit (if it existed) vested in the trustee at the time Dallas Gibson became a bankrupt or as after-acquired property. As at September 2003, Dallas Gibson was incapable of assigning the proprietary interest in the cross-claim works in suit to RMC. Notwithstanding that Dallas Gibson sought to make an assignment of copyright to RMC at this date, RMC in fact acquired nothing. It follows that the purported assignment of the copyright in September 2003 from Dallas Gibson, whilst a bankrupt, was ineffective. 89 It seems probable (and it was not suggested otherwise) that Dallas Gibson's bankruptcy ended on 19 October 2003 pursuant to s 149(4) of the Bankruptcy Act, as a consequence of automatic discharge consequent on the expiration of three years from the date he filed his statement of affairs. Section 153 sets out the effect of an automatic discharge. This provision does not, however, have the effect of revesting in the bankrupt the property vested in the trustee: see Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306 at 320 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ; Daemar v Industrial Commission of NSW (No 2) (1990) 99 ALR 789 at 795-796 per Kirby P, Clarke and Meagher JJA agreeing; and Gosden v Dixon (1992) 107 ALR 329 at 331 per McLelland J. There was no evidence that the trustee in bankruptcy had assigned or transferred the copyright to Dallas Gibson since the discharge of his bankruptcy. Assuming that his discharge was by force of s 149(4), the copyright continued to vest in the trustee in bankruptcy, and neither Dallas Gibson nor RMC is entitled to bring this part of the cross-claim. 90 The position would be different had Dallas Gibson's bankruptcy been annulled under ss 153A or 153B of the Bankruptcy Act. There was, however, no submission to this effect from the respondents and no evidence was led to show that the requirements of either provision were satisfied. 91 Accordingly, I accept that, as the applicants maintained, there was a fundamental impediment to the respondents' cross-claim for copyright infringement. The respondents' cross-claim for copyright infringement was not maintainable.

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(2) The merits of the copyright infringement cross-claim 92 As already noted, Dallas Gibson gave evidence that he wrote the 160 questions and answers the subject of his cross-claim in 2000. In one account, he said that Ms Jo-Anne Tyler, who operated the Drummond Street Business Centre, typed up some "notes" for him; that he copied the notes from his laptop to a grey floppy disk for safe keeping; and that he gave the grey floppy disk to his solicitors, Middletons, in response to a request by them in mid 2005 for relevant documents. He gave evidence that he did not discover the 160 questions and answers until he examined the contents of the grey floppy disk. His copyright infringement cross-claim as put by him is, of course, inconsistent with the applicants' infringement claim, which, as I have said, I would uphold. The following discussion proceeds against that background, although I discuss the respondents' evidence on this part of the case separately below. 93 As the cross-respondents have pointed out, there are numerous difficulties with Dallas Gibson's account. First, the 160 questions and answers were questions and answers organised into 8 practice exams. They are not properly described as "notes". Secondly, there was no adequate explanation of what happened to the laptop from which the files on the grey floppy disk were allegedly created. When asked about this in cross-examination, Dallas Gibson was evasive, saying the laptop was "discarded" though he could not recall when. Thirdly, there was the fact that the grey floppy disk was not discovered to the applicants until 6 April 2006. In cross-examination, Dallas Gibson was unable to explain why he did not make discovery earlier, especially as his solicitors had asked him to provide relevant documents in mid 2005. He was also unable to explain why the 160 questions and answers were not specifically identified when the cross-claim was first advanced. His explanation for not noticing earlier that these specific questions and answers were his was entirely unconvincing. 94 Dallas Gibson gave two different accounts of the relevant events. On one account, he said that the "notes" were stored on a grey floppy disk after they were copied from his laptop. On another account (in his affidavit of 25 July 2006) he stated that the practice exams on the floppy disk were typed up and saved to the disk directly by Ms Tyler. A letter from his solicitor, Stuart Gibson, to Craig Macaulay of PPB Forensics, which was exhibited to his second witness statement, also said the practice exams on the floppy disk were typed up and saved to the disk directly by Ms Tyler. When pressed about the differences in these accounts in cross-examination, Dallas Gibson claimed, for the first time, that there were two grey floppy disks. I reject this explanation, however, because there had been no suggestion until this point in the trial that there were two grey floppy disks and, in any event, Dallas Gibson proffered each explanations, when it was given, as an exhaustive account of how the relevant floppy disk had been created on the clear assumption that there was in fact only one grey floppy disk. 95 Ms Tyler gave evidence, which ultimately did not particularly assist the respondents' case. She stated that she did some work for Dallas Gibson in September 2000, although this was inconsistent with an account exhibited to her witness statement indicating that the work was done in May 2000. She said that she provided her work in both hard copy and on floppy disk. Ms Tyler could say no more than that the questions she typed up were of a "similar style" to those that Dallas Gibson's solicitors had given her for identification. Unsurprisingly, given the passage of time, she was unable to identify any particular questions as having been typed up by her. Thus, I accept that Ms Tyler did some typing for Dallas Gibson in 2000, although I do not accept that this was the cross-claim works in suit. Any UMAT-style or general aptitude question might be described as having a "similar style" to the exams provided to her for identification. Accordingly, her evidence did not advance the respondents' case to any significant extent. 96 The respondents relied on the report and evidence of Mr Macaulay, who prepared a report concerning the grey floppy disk. His report stated, amongst other things, that: 1. The metadata showed that the files were created and last saved during December 2000 (on 8, 9 and 19 December). 2. The metadata showed the files were authored and saved by the user "Dallas". 97 If Ms Tyler had typed the questions up and saved them to the floppy disk said to have been handed to Dallas Gibson, then presumably she would have been identified in the metadata as the author. The respondents did not suggest that Ms Tyler, although a free-lance typist, was using his computer to process the work. The creation date of the material on the disks as recorded in the metadata was, moreover, 8 to 10 December 2000, which was inconsistent with the possible dates of May or September 2000 given by Ms Tyler. The metadata were inconsistent with the possibility that Ms Tyler had typed up and saved the questions to the grey floppy disk. 98 As the applicants acknowledged, the metadata were consistent to some extent with the other version of events that Dallas Gibson advanced (in his second witness statement), namely, that he was properly identified in the metadata as the author by reason of his having copied the material from his laptop to the disk. It is, however, problematic as to why the metadata would identify Dallas Gibson, not Ms Tyler, as the author even in this case. 99 In the end, Mr Macaulay's evidence leads me to conclude that, in this case, the metadata cannot properly be regarded as reliable evidence supportive of either side's case. Mr Macaulay said that determining the authenticity of the files recovered from the floppy disk can be "quite complex" and that he did not do it due to "complexity, and budget and time constraints". He was unable to exclude the possibility that someone had altered the metadata. He agreed that it was not always possible to determine whether or not this had occurred and, for this reason, the utility of metadata for determining authenticity was limited. 100 In order to refute the cross-respondents' allegation that he had altered the metadata relating to the files on the grey floppy disk, Dallas Gibson denied in cross-examination that he knew what metadata were. This proposition was unbelievable. The expert report, which he commissioned, dealt expressly with the concept of metadata and his assertion that he had not read the report was, in view of his interest in the matter, unbelievable. It is worth recalling that Dallas Gibson was in the business of teaching high-achieving students reasoning skills. He was both a literate and fluent witness, with a clear interest in knowing the evidence to be adduced in his own interest. 101 In addition to the matters already mentioned, there were other occasions that confirmed my opinion that Dallas Gibson was a dishonest witness. When shown a letter from his own solicitors, Gibson Legal, to Mr Macaulay, dated 17 October 2006, he said "this is the first I have seen of this ever in my life" notwithstanding that the letter was an exhibit to his second witness statement. As already noted, this letter affirmed, amongst other things, that Ms Tyler had saved her typing to the grey floppy disk and given it to him in about mid December 2000. In summary, Dallas Gibson was not a credible witness. At times, as shown in the following discussion, he was evasive or deliberately sought to obfuscate the evidence. At other times, he gave dishonest answers. 102 There were further difficulties with the cross-claimants' copyright infringement cross-claim. The cross-claimants did not attempt to explain how the copying could have occurred. Ann Boyapati's evidence was that she had independently compiled the 160 questions and answers the subject of the cross-claim, without reference to Dallas Gibson. The materials that she said were given to her in 2003 when she did an Icarus College UMAT preparation course were exhibited to her witness statement and in evidence. These materials did not include the 160 questions and answers. Furthermore, David Wilson, solicitor for the Boyapatis, deposed that he had received the course materials that Dallas Gibson said he and RMC supplied to Ray and Ann Boyapati in 2001 and 2003 from the cross-claimants' solicitor pursuant to a notice to produce. The 160 questions and answers did not appear in this material either. 103 There were some specific similarities in the language used by the MedEntry questions and Dallas Gibson's questions, which, when contrasted with the pre-existing sources, indicated that Dallas Gibson's questions had been copied from the MedEntry questions. In cross-examination, Dallas Gibson accepted that at least some of the cross-respondents' questions were closer to what was probably the original source than his questions. He accepted ultimately that this made it more likely that they had worked from the original source and not his questions. 104 It became increasingly plain at the trial that Dallas Gibson was simply making up much of his evidence as he went along, in order to support his copyright infringement cross-claim. The materials that the cross-claimants gave Ray and Ann Boyapati as students in their course had five possible answers whilst the cross-claim works in suits had four possible answers. As previously noted, the "four possible answers" style more closely simulated the UMAT and, for this reason, the cross-respondents had adopted it. Dallas Gibson explained, both orally and in a witness statement, that he considered the five possible answers format to be useful because "it forces students to train to read faster and think faster than [for] the actual UMAT test itself". I do not, however, consider that this adequately answered the criticism that the cross-respondents' format was new when compared to Dallas Gibson's previous practice exams. In any event, Dallas Gibson also gave a different explanation, which was to the effect that he "created a new question without reference to the prior question" and the "questions evolved". When asked to explain the creation of new questions, he answered that it "augments my question bank". His evidence in this regard was unconvincing. Further, Dallas Gibson was unable to recall any third party source for his own alleged work in 2000. He was also unable to say whether or not he had written any questions from scratch. 105 The cross-claimants called Phillip Roumanos, Jennifer Macks, Frank Stitt and Kaitlyn Williams, all of whom had done the cross-claimants' UMAT preparation course. For the following reasons, I do not consider that their evidence assisted the cross-claimants' case. 106 Mr Roumanos stated that he was a medical student at the University of Newcastle and that, in 2001, he had attended a two-day UMAT preparation course that Dallas Gibson taught. He stated that, whilst attending the course, Dallas Gibson had given him two tests in hard copy, which he had subsequently studied. His evidence was that the certain questions and answers (in the cross-claim works in suit) "look[ed] to be of the same style to the questions [he] reviewed in … 2001" and that he recognised some four questions. In cross-examination, he said that he had subsequently attended UMAT courses presented by Dallas Gibson in 2003 and 2004, and had done Dallas Gibson's UMAT practice exams in 2003. He was unable to say what triggered his memory about any particular question, since he had seen "so many". He conceded that it was possible that he had confused the year in which he had seen a particular question or questions. Mr Roumanos was an honest witness and his concession was properly made. 107 Dr Macks stated that she was doing an internship at the Hunter New England Area Health Service. She stated that, in 2001, she had attended a two-day UMAT preparation course run by Dallas Gibson. She stated that she had looked at certain questions and answers (within the cross-claim works in suit) and that they were the "same or similar" as the documents she viewed during the course in 2001. She stated that she particularly recalled one question because it related "to real life experiences [she] had had while living and working in Malaysia". However, when the cross-examiner showed her another question dealing with the same subject matter (not being part of the cross claim works in suit), she was unable to say which question she had seen in 2001. She affirmed only that "[w]hat I remembered was the style of the question and the content of the question". I accept her evidence on this point, but it does not much advance the cross-claimants' case. 108 Dr Stitt, who was a physician educator, had consulted Dallas Gibson in or about late 2000 "to assist [him] in recruiting students for prospective entry into the new Samoan Medical School". In the course of so doing, Dr Stitt had reviewed some of Dallas Gibson's materials in depth in 2000. In his witness statement, he said that "[a]lthough [he] cannot exactly recall each and every question, [he is] able to say that the questions and answers generally look identical to the questions and answers [he] reviewed in … 2000". In cross-examination, Dr Stitt stated that his review was limited to "test one section two questions", which related to ethics and communication. He also stated that there was "no way" he could have a clear recollection of the questions. He could not say whether the questions given him by Dallas Gibson's solicitors were identical to the questions that he had considered in 2000. He could only say that they covered the same material. I accept Dr Stitt's evidence but, once again, it does not particularly advance the cross-claimants' case. 109 In summary, the evidence of these three witnesses, all of whom were credible, was that in 2000-2001 or thereafter, they had seen questions concerning the same or similar subject matter, or of the same style, as the 160 questions and answers that were the cross-claim works in suit. It was not in contest that, in 2000 and thereafter, Dallas Gibson was using these sorts of questions and answers in his UMAT preparation course. The evidence of these witnesses did not, however, show that what they saw in 2000 or 2001 were the 160 questions and answers that were identical to the cross-claim works in suit. 110 Ms Williams' evidence was of a different kind. She described herself as "a second year distance education student at Southern Cross University, studying for a Bachelor of Health Science". She stated that, in 2001, she too attended a two-day UMAT preparation course run by Dallas Gibson and that she had been given two practice tests in hard copy at this time. She said that she had found one of them, test number 8, in her garage. 111 In cross-examination, she also said that she attended an UMAT preparation course conducted by Dallas Gibson in 2005, although she was not entirely certain of the year. She explained that she had not "really looked at it since". She stated that she found test number 8 "in the garage in the box", "along with a whole lot of other stuff". She was also unclear about when she went back and did the HSC for a second time. She stated that she did the HSC again because she did poorly the first time, although she apparently obtained sufficiently high marks the first time to undertake a science degree part-time at Sydney University. She was also very unclear about how she came to be identified as a witness in the proceeding, although she denied speaking with Dallas Gibson or his solicitors beforehand. She agreed that Dallas Gibson's solicitors had given her a test to look at, which happened to be test number 8. She was unable to remember whose markings appeared on her copy of test number 8. 112 Having regard to the forgoing, it is apparent that Ms Williams was a most unsatisfactory witness. I would not regard her evidence as at all reliable. I am not satisfied that the test that Ms Williams produced was given to her in 2001. It is more likely than not that, if indeed she found the test in her garage, she acquired it from Dallas Gibson at a later date when she undertook his UMAT preparation course for the second time. 113 The cross-claimants also relied on the expert evidence of John Olsson, a forensic linguist resident in the United Kingdom. Mr Olsson stated that he had been informed that Dallas Gibson alleged that "examination questions prepared by his college were plagiarized by a person or persons known to Mr Gibson". 114 On its face, Mr Olsson's report supported the cross-claimants' case, although, for the reasons set out below, its significance was greatly diminished in cross-examination. In his report, Mr Olsson stated that he had been sent "copies of a sample of questions … as two blind sets". As a result of his examination of the material, he concluded in his report that "it is highly likely that [MedEntry's questions] were plagiarised from [the cross-claim works in suit]"; "that the person who perpetrated this activity is not likely to be a native-speaker of English"; "that he or she has medical or other scientific knowledge or training"; and "that the possibility exists that there is more than one author, given the varying standard of diligence shown in the phrasing, punctuation and organisation of some of the questions". 115 In cross-examination, however, it became plain that Mr Olsson's report was based on incorrect assumptions. In some cases, Mr Olsson had not been provided with an accurate copy of the MedEntry questions, so that criticisms of them were plainly misplaced. Further, Mr Olsson had made his report on the erroneous assumption that there was no third party source for what he thought was the plagiarised material. This added, so Mr Olsson said, "a new dimension". Mr Olsson agreed, and indeed it was clear to see, that many of the MedEntry questions were closer to the pre-existing source questions than were the cross-claim works in suit and that it was therefore more likely that the MedEntry questions were based on the source questions than the cross-claim works in suit. 116 In cross-examination, Mr Olsson said that it was necessary to see "the whole thing in the round to get a fuller picture of the degree to which text has been borrowed from one source rather than another". He agreed that he would need to modify his conclusions. He concluded his evidence in cross-examination with the observation that he had only an "incomplete picture". 117 Mr Olsson's assertion that Dallas Gibson's questions displayed a more "teacherly" character than the MedEntry questions may reflect the fact that he had more experience in preparing students for the UMAT and other aptitude tests than the Boyapatis. I would not, however, accept that the more pedagogical version was the original version because this would disregard the fact that the MedEntry questions were most probably derived from pre-existing third-party sources. 118 The cross-claimants failed to discharge their onus of proof on the cross-claim. I reject the cross-claimants' submission that, on the balance of probabilities, the cross-claim works in suit were created in 2000. I accept that the 160 questions and answers saved to the grey floppy disk and given to PPB Forensics were created in or after 2004 by reference to the applicants' work in order to provide some basis for a cross-claim which did not otherwise exist.

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E. THE SPONSORSHIP/LOGO CLAIMS 119 In further support of their cross-claim, RMC and Dallas Gibson argued that, from at least 1 January 2005, MedEntry and Anzie had made representations to the public in trade or commerce that were misleading or deceptive in breach of ss 52, 53(c) and 53(d) of the TPA. They alleged that the following representations were made by placing the logos of third party organisations on the MedEntry website: (1) the organisations supported MedEntry or MedEntry's or Anzie's materials; (2) MedEntry and/or Anzie has or have a connection with the organisations; and (3) MedEntry and/or Anzie is or are sponsored, approved, or licensed to use the logos of the organisations. The organisations in question were Rural Workforce Agency Victoria ("RWAV"); Diabetes Australia, Victoria ("Diabetes Australia"); Arthritis Victoria; Australian Nursing & Midwifery Council ("ANMC"); Australasian College of Nutritional & Environmental Medicine ("ACNEM"); Novartis Consumer Health Australasia Pty Ltd ("Novartis"); Holistic Health House; and the Australian Dental Association Victorian Branch ("ADA"). 120 In written submissions the cross-claimants made a further allegation that the cross-respondents claimed Government accreditation they did not have. This allegation was not part of their pleaded case. I do not propose to deal with it further. 121 There is, in any event, a preliminary difficulty with the cross-respondents' claim. MedEntry was not a corporation to which ss 52 or 53 of the TPA could apply. The difficulty with Anzie (trading as MedEntry) was that, although it was apparently a corporation to which these provisions could apply, since it carried on business in Australia, it had done so only since 2006. Some or all of the alleged offending conduct apparently preceded Anzie's operation of the business. If this is correct, then this claim fails in whole or in part at the outset. 122 I propose to deal with the merits, however, since this was how it was argued. Edward Boyapati gave evidence as to how the logos came to appear on MedEntry's website. He stated that, around mid 2004, he drafted and sent pro-forma letters to about 250 organisations that he thought might sponsor or support MedEntry. A form of the letter, asking for financial sponsorship, was in evidence. His evidence was that some organisations returned a slip, on which their representative had ticked a box stating "[w]e are unable to offer financial support, but offer our best wishes and support in kind". Some of these slips were in evidence. In cross-examination, Edward Boyapati said that he had telephoned the organisations that had returned these slips, to ask whether MedEntry might use their logo for promotional purposes. His handwritten notes of some of these telephone calls were in evidence. He said that, where the organisations had consented, he uploaded their logos onto the MedEntry website. According to him, it was in this way that the RWAV, Diabetes Australia, Arthritis Victoria, ANMC, ACNEM, Holistic Health House, and Novartis had come to give their permission to use their logos on MedEntry's website. He drew a distinction between sponsorship, which he believed MedEntry had, and endorsement, which he did not claim. 123 Generally speaking, as I have said, Edward Boyapati was an honest and credible witness. His evidence on these issues was consistent with the notes he had made at the time and with other contemporary documents. Against this background, the evidence as to each organisation was as follows.

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(8) ADA 133 There was no reference to the ADA in Edward Boyapati's contemporary handwritten notes. Nor was a "reply slip" from it in evidence. Although his evidence concerning the ADA was imprecise, I understood Edward Boyapati's evidence in cross-examination to be that he received the ADA's consent in the same way as he had received the consent of the other organisations. Stanley Aldous of the ADA, a witness called by the cross-claimants, gave evidence that, following a telephone call from Dallas Gibson in June 2006 about the display of the ADA's logo on MedEntry's website, he had made internal enquiries, following which the ADA asked MedEntry to take its logo down from the MedEntry webite. In cross-examination, Mr Aldous conceded that he had not been employed by the ADA at the relevant time and that there could have been relevant staff changes. He could not, therefore, exclude the possibility that Edward Boyapati had had the communications he alleged with a representative of the organisation. In this circumstance, the cross-claimants failed to discharge their onus of proof with regard to the cross-respondent's use of the ADA logo. 134 Accordingly, the cross-claimants have failed to show that MedEntry or Anzie used the logos of the relevant organisations without first obtaining consent. There is therefore no basis for the claims made against either of them under ss 52 or 53 of the TPA. Even if the cross-claimants made out their case in whole or part, there is no evidence that the cross-claimants suffered any resulting (though necessarily unquantified: see [9] above) loss or damage. Furthermore, if there was any breach, it would have been as a result of a simple mistake on Edward Boyapati's part. I reject the proposition that the cross-respondents displayed third party logos on the MedEntry website other than in the belief that consent had been given. The logos were taken down when a request to do so was made. In these circumstances, I would not grant any relief even if this part of the cross-claim had been made out in some way.

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F. PASSING OFF AND TRADE PRACTICES CLAIMS 139 RMC and Dallas Gibson argued that, by using the name "MedEntry", MedEntry and Anzie had represented falsely that: (1) RMC and Dallas Gibson had sponsored or approved MedEntry and Anzie or their goods and services in breach of s 52, 53(c) or 53(d) of the TPA; and (2) their business was the same as that of RMC and Dallas Gibson, or was sponsored by or connected with their business (or MedEntry's and Anzie's goods and services were those of RMC and Dallas Gibson), which conduct amounted to passing off. 140 These arguments depended on the cross-claimants showing that: (1) at the relevant times their business was called "Medical Entrance"; (2) they had a sufficient reputation in the name "Medical Entrance"; (3) the use of the name "MedEntry" misrepresented that the MedEntry business was the same as the business operated by them, or was connected with or sponsored by their business; and (4) that they suffered loss and damage as a result. 141 It must be borne in mind that the cross-claimants' business was to provide services to help students gain entrance to medical schools. Furthermore, the cross-claimants' use of the name "Medical Entrance" was not unique. Another provider of UMAT preparation courses used it too, in the name "Australian Medical Entrance Preparation Programme". The evidence established that the cross-claimants used the words "Medical Entrance" in identifying their business but that this use was essentially descriptive of the services the business provided. Thus, the words "Medical Entrance" were used on the cross-claimants' website in conjunction with other names. Dallas Gibson was taken to printouts of this website in cross-examination. He conceded (as he had to do) that "one point of view of looking at it" was that these words were purely descriptive of the services provided. 142 As Stephen J said (Jacobs J agreeing) in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 at 229-230: There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name. Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public. In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor's trade name will render the latter immune from action … The risk of confusion must be accepted, to do otherwise is to give to one who appropriates to himself descriptive words an unfair monopoly in those words and might even deter others from pursuing the occupation which the words describe. If this be so in the case of passing off actions the case of s 52(1), concerned only with the interests of third parties, is a fortiori. To allow this section of the [TPA] to be used as an instrument for the creation of any monopoly in descriptive names would be to mock the manifest intent of the legislation. Given that a name is no more than merely descriptive of a particular type of business, its use by others who carry on the same type of business does not deceive or mislead as to the nature of the business described … Evidence of confusion in the minds of members of the public is not evidence that the use of the Hornsby Centre's name is itself misleading or deceptive but rather that its intrusion into the field originally occupied by the Sydney Centre has, naturally enough, caused a degree of confusion in the public mind. This is not, however, anything at which s 52(1) is directed.

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Since the cross-claimants' use of the name "Medical Entrance" is essentially descriptive, they bore a heavy onus to show that the name had gained a secondary meaning referring specifically to the goods and services of their business. 143 The evidence established that neither of the cross-claimants had traded under the name "Medical Entrance" alone. The evidence showed that Dallas Gibson (from 2000) and RMC (from September 2003) gave various names to their business and business products, including: (1) UMAT Superprep Courses; (2) Dallas Tertiary Prep Skills; (3) Dallas Medical Entrance; (4) Dallas Super Prep (according to Dallas Gibson, prior to 2004); (5) Tertiary Prep Skills (according to Dallas, this was an "early" usage); (6) Icarus College (from around March 2004); and (7) Dallas SuperKeenEye. There was little other evidence relating to the reputation of the cross-claimants in the use of the name "Medical Entrance": see also [144]-[145] below. 144 Since the cross-claimants used the words "Medical Entrance" descriptively and did not, in any event, trade under these words alone, I reject the proposition that the words "Medical Entrance" had become relevantly associated with them by the end of 2003. When the cross-respondents began their business in early 2004, the cross-claimants did not have a sufficient reputation in the name "Medical Entrance" to support their passing off claim. The fact that "Medical Entrance" was used as the domain name for their website did not establish that they had any reputation in the name. This is not a case at all like British Telecommunications PLC v One In A Million Ltd (1998) 42 IPR 289 or CSR Ltd v Resource Capital Australia Pty Ltd (2003) 128 FCR 408, to both of which the cross-claimants referred. Further, there was in the circumstances no basis for the cross-claimants' assertion that, by their adoption of the name "MedEntry", the cross-respondents misrepresented that their business was the same as, or relevantly associated with, the cross-claimants' business. Nor was there any sufficient basis for the claim that the cross-respondents misrepresented that the cross-claimants had sponsored or approved MedEntry and Anzie or their goods and services in breach of ss 52, 53(c) or 53(d) of the TPA. 145 In any case, the evidence as to confusion was thin. Dallas Gibson gave evidence that he had received telephone calls, emails and other correspondence from businesses and prospective students who had mistaken the cross-claimants' business with MedEntry. None of the students or business-people was called to give evidence. The circumstances in which the alleged mistakes were made were entirely unclear. Furthermore, I reject the cross-claimants' submission that they would appear to have lost business to the cross-respondents on account of the cross-respondents' use of the name "MedEntry". I do not consider that the evidence, at least as it stood at the trial, permitted this inference to be drawn: see also the discussion of Mr Peck's evidence at [190]. 146 The cross-claimants' passing-off and TPA claims must fail. The cross-claimants failed to establish that: (1) they had any particular reputation in the name "Medical Entrance" that would support their claim for passing off ; (2) there was any misrepresentation involved in the cross-respondents' use of the name "MedEntry"; or (3) (subject to the orders of 10 July 2006) that they suffered any resulting loss and damage.

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G. TRADE MARK REVOCATION 147 On 2 December 2004, Ray and Ann Boyapati applied for trade mark registration of the word "MEDENTRY" in class 41, with an acceptance date of 14 March 2005. The cross-claimants argued that the registered trade mark number 1032625, "MEDENTRY", ought to be revoked pursuant to s 88 of the Trade Marks Act. The basis for this part of their cross-claim (as explained by the cross-claimants' counsel in opening) was that the trade mark ought not to have been registered because the cross-claimants' reputation in the name "Medical Entrance" was likely to deceive or cause confusion as at the date of application for registration. This claim relied on s 60 of the Trade Marks Act. For the reasons already stated, the cross-claimants have failed to establish any particular reputation in the name "Medical Entrance". The cross-claimants' submissions in this regard are not made out. 148 In final submissions, the cross-claimants also argued that, if the name "Medical Entrance" was merely descriptive of the cross-claimants' business services, then so too was the name "MedEntry". I would reject this submission. "MedEntry" is more than just a short form of "Medical Entrance". Relevantly, in the trade marks context, the cross-claimants have not made out a case that the name "MedEntry" lacked distinctiveness and for this reason was incapable of distinguishing the cross-respondents' services or goods as s 41 of the Trade Marks Act required. 149 Furthermore, I note that, although the cross-claimants referred to s 41 of the Trade Marks Act in their pleading and skirted around s 41 in opening, they did not in truth seriously put a case of s 41 "lack of distinctiveness" at trial. I accept that, as counsel for the cross-respondents said, the cross-respondents would have made a different answer at trial if the cross-respondents had understood the "distinctiveness" of the mark to have been seriously in issue. In any event, nothing turns on this because, as I have said, the cross-claimants have not made out a case based on a lack of distinctiveness for s 41 purposes.

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(1) First Publication 152 The background to the alleged defamatory publications was dealt with in the evidence of Ann and Ray Boyapati. They gave evidence that, shortly after the creation of the MedEntry website, they visited the cross-claimants' Icarus College website, at www.medical-entrance.com.au , where the following message had been posted: WARNING - Recently I have been advised that a former student of mine by the name of Boyapati a child of Dr Boyapati of Fawkner, Melbourne intends to start UMAT preparation training with other medical students trained by me. Be advised these students have no appropriate professional teaching qualifications or professional experience. They have learnt as students from me and accordingly were successful with their entrances into medicine. They are full time students and this makes me wonder how they will answer and respond to enquiries on a 24 hour basis given they are supposed to be studying medicine full time. It is unfortunate that 'easy pocket money through uni medical students' injure other students by disillusioning them. I shall continue to monitor misleading and inappropriate services and place updates on this website of further occurrences. The latest 'Johnny come lately' med school student site is --www.medentry.com.au---. If any of my former medical students commence training using my systems or selling notes incorporating my successful intellectual concepts, I wish to make the unsuspecting public aware that there is a strong likelihood such courses and or notes will be subject to the expedition of injunctions in the Federal Court of Australia resulting in a loss of your paid fees - Caveat Emptor - Buyer beware! Remember the acid test before you spend money! Just ask - Have you gotten many students IN over the past 10 years and may I have many names of your successful students to contact and speak with them? If in doubt call me on 1800996659 to verify as I have complete lists for all institutions. Best wishes Dallas Dallas Gibson agreed that he had posted the so-called warning in about December 2003. He denied that he had any malicious intent in making these statements and said that he was concerned only for future prospective students. 153 I accept, however, that, as the cross-respondents submitted, Dallas Gibson published this warning in an attempt to denigrate the Boyapatis' qualifications, experience and commitment to students. The warning also suggested that the MedEntry's services involved the unlawful use of his systems and intellectual concepts and that students enrolling in MedEntry courses, and who purchased the MedEntry notes, might lose their fees. 154 By way of defence to this and other attacks on them, so the cross-respondents said, Edward Boyapati wrote the following notice, which Ray Boyapati put up on MedEntry's website on 28 March 2004. Ann, Ray and Edward admitted the publication. The first publication read as follows: Unprofessional Conduct 28/3/2004 - 18 It has come to our attention that a UMAT preparation course has placed false and misleading comments about other providers on their website. We have sought legal counsel and been advised that these comments are clearly defamatory. It is with great reluctance that we put forward this message, as we do not believe such illogical and irresponsible accusations warrant a response. However, we have felt it necessary to dispel some of the myths raised: The students involved in MedEntry have the most important experience of all performing outstandingly in the UMAT and interviews. No one else can make this claim. The academics and health professionals involved in formulating the course materials have qualifications that are far superior to those who may criticise us. It takes significant time and effort to provide a course such as ours, which is why we have a support team to answer your questions 24 hours a day, 7 days a week, 365 days a year. Be wary of 'one-man shows' with dogmatic declarations, fictitious testimonials and little substance. Only those who are in some way inadequate would feel so threatened as to place such comments on their website. Perhaps our program has been deemed so successful that it has posed a threat to their cosy financial situation, to the extent that they have resorted to entirely unethical and unprofessional behaviour to undermine other providers. The students involved in Medentry will one day be your colleagues. We do not believe in making false promises or undermining our integrity. Unfortunately, these principles may not apply to others. 155 At common law, the cross-claimants have the burden of proving on the balance of probabilities that: (a) the words were published of and concerning them; (b) the words were in a permanent form; (c) the words were published to a third person; (d) the words were published by the named persons as alleged; and (e) the words were defamatory of them. See Li v The Herald & Weekly Times Pty Ltd [2007] VSC 109 per Gillard J. The cross-claimants are entitled to recover damages if they establish these matters. Damages are presumed, and they are not required to prove actual damage. They have, however, also pleaded economic loss. This must be proved. 156 Dallas Gibson may of course bring an action for defamation. In all jurisdictions other than New South Wales, a trading corporation such as RMC may sue for defamation in so far as the imputations attack its commercial reputation and can generally be shown to have caused some financial harm: see RP Balkin and JLR Davis, Law of Torts (LexisNexis Butterworths Australia, 3rd ed, 2004) ("Balkin and Davis") at p 563-564. Section 8A of the Defamation Act 1974 (NSW) denied a cause of action in defamation to a corporation other than one that employed less than 10 employees and had no subsidiaries. 157 Whether or not words are defamatory is a question of fact. This question of fact in turn depends on (1) what the words mean; and (2) whether the imputations are defamatory. The intention of the alleged defamer is irrelevant to the question of liability. In Reader's Digest Services Pty Ltd v Lamb (1982) 150 CLR 500 at 505-506, Brennan J, for the Court, said: Where no true innuendo is pleaded and the published words clearly related to the plaintiff, the issue of libel or no libel can be determined by asking whether hypothetical referees - Lord Selborne's reasonable men … or Lord Atkin's right thinking members of society generally … or Lord Reid's ordinary men not avid for scandal … - would understand the published words in a defamatory sense. That simple question embraces two elements of the cause of action: the meaning of the words used (the imputation) and the defamatory character of the imputation. Whether the alleged libel is established depends upon the understanding of the hypothetical referees who are taken to have a uniform view of the meaning of the language used, and upon the standards, moral or social, by which they evaluate the imputation they understand to have been made. They are taken to share a moral or social standard by which to judge the defamatory character of that imputation … being a standard common to society generally. Consideration must be given to what the ordinary reasonable reader would think when reading the publication over the Internet. This is in part a matter of impression. The ordinary reasonable reader relies on his or her own knowledge and experience of human affairs: see Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 at 301 per Mason J. 158 Whether or not words are defamatory depends on whether the words lower the defamed in the estimation of right-thinking people generally. In Sim v Stretch [1936] 2 All ER 1237 at 1240, Lord Atkin stated the well-accepted test in the following passage: The question, then, is whether the words in their ordinary signification are capable of being defamatory. Judges and textbook writers alike have found difficulty in defining with precision the word 'defamatory'. The conventional phrase exposing the plaintiff to hatred, ridicule and contempt is probably too narrow. The question is complicated by having to consider the person or class of persons whose reaction to the publication is the test of the wrongful character of the words used. I do not intend to ask your Lordships to lay down a formal definition, but after collating the opinions of many authorities I propose in the present case the test: would the words tend to lower the plaintiff in the estimation of right-thinking members of society generally? 159 In considering whether words are defamatory, the context in which the words are used must be considered. The whole publication must be considered. The circumstances of the publication, the words used and the context may all have an effect on the imputation conveyed to the reader. Balkin and Davis stated at p 558: Whether statements which have a clearly disparaging meaning are to be found defamatory depends very much on the context in which they are made, and the audience to whom they are made. The words are taken to have their ordinary and natural meaning, which is that meaning that is reasonably understood by the ordinary reasonable reader using his or her knowledge and experience of human affairs. 160 A person need not be referred to by name to be defamed. It is sufficient if some people, proved to have knowledge of extrinsic circumstances, might reasonably believe that the statement referred to him or her: see Balkin and Davis at 564-565. They added at 565: Identification of the plaintiff as the person referred to may come from others' knowledge of extrinsic facts. Thus, a statement that an (unnamed) business college has misled the public as to the efficacy of its courses will be defamatory on proof that some readers thereof understood the statement to refer to a particular college. (References omitted.) An action for defamation will lie only where the matter is made known to someone other than the person claiming to be defamed. 161 At common law, it is a complete defence to show that the words complained of are true in substance and effect: see Howden v 'Truth' and 'Sportsman' Ltd (1937) 58 CLR 416 at 424-425 per Evatt J. At the relevant time, this defence was available in South Australia, Victoria, Western Australia and the Northern Territory: see Balkin and Davis, at p 574. In other jurisdictions, it had also to be shown that the publication of the imputation was for the public benefit or, in New South Wales, that it related to a matter of public interest: see Balkin and Davis, at p 574. The cross-respondents invoked these defences. They also invoked "qualified privilege" as a defence. In Toogood v Spyring (1834) 1 C M & R 181 at 193; 149 ER 1044 at 1049-1050, Parke B said that a person would be liable for a false and defamatory publication unless it is fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned. … If fairly warranted by any reasonable occasion or exigency, and honestly made, such communications are protected for the common convenience and welfare of society; and the law has not restricted the right to make them within any narrow limits. A person whose good name is brought into question is granted qualified privilege in making a response provided the person to whom the response is made is "proper to receive it": see Mowlds v Fergusson (1946) 64 CLR 206 at 214 per Dixon J. As Dixon J said, at 214-215, however: Where the defamatory matter is published in self-defence or in defence or protection of an interest or by way of vindication against an imputation or attack, the conception of a corresponding duty or interest in the recipient must be very widely interpreted. The response must be proportionate to the original attack. 162 Ann, Ray and Edward Boyapatieach gave evidence that, at the time of this publication, MedEntry was under attack from other participants in the UMAT preparation course market and the first publication was intended to deal with these challenges. They said that they published the statements in dispute on the MedEntry website in response to the attacks being made against them by Dallas Gibson and other UMAT preparation course providers. I accept their evidence. 163 Ann, Ray and Edward Boyapati conceded that the first line of the first publication referred to the course run by Dallas Gibson and RMC, but Ann and Edward Boyapati gave evidence that the second sentence of the fourth paragraph - "Be wary of 'one-man shows' with dogmatic declarations, fictitious testimonials and little substance" - was not intended to refer to Dallas Gibson but rather was intended to refer to Ryan Schulman, who operated the UMAT business trading as "Agoneyes". 164 According to Edward Boyapati, and I accept, this first publication was removed from the MedEntry website soon after it was published, and overwritten by other postings. 165 At about this time, Dallas Gibson's own website enjoined others to be "[b]e wary of one-man shows with fictitious testimonials". In cross-examination, Dallas Gibson said that he was referring to a Michael Cobucci from AMEPP, and not Ryan Schulman. Dallas Gibson agreed that he was not a one-man show in 2004. 166 Having regard to Dallas Gibson's evidence, and to the evidence of Ann and Edward Boyapati, I am not satisfied that the cross-claimants have discharged the onus of proof that, so far as the ordinary reasonable reader was concerned, the second sentence of the fourth paragraph in its ordinary and natural meaning identified the cross-claimants as opposed to Ryan Schulman, Michael Cobucci or anyone else. This is so notwithstanding Dallas Gibson's evidence that he also conducted an Internet forum at the relevant time and that the first line of the publication was intended to refer to him. 167 Although the Boyapatis admitted that the "UMAT preparation course" mentioned in first line of the first paragraph was a reference to Dallas Gibson, I doubt that an ordinary reasonable reader would have understood the passage in this way. It must be borne in mind that at the time of publication there were a number of UMAT preparation course providers and, on the evidence, the Boyapatis were under attack from more than one of them. All or most of these providers communicated with prospective students via the Internet. I am not satisfied that the cross-claimants have discharged the onus of proof that, so far as the ordinary reasonable reader was concerned, the first line of the first paragraph in its ordinary and natural meaning identified the cross-claimants' UMAT preparation course as opposed to another provider's UMAT preparation course. 168 Furthermore, to the extent that the first publication referred to the cross-claimants, the cross-respondents denied that it was defamatory of them or capable of carrying the imputations the cross-claimants alleged. I am inclined to agree. If the ordinary reasonable reader did understand the words in the first line of the publication to refer to the cross-claimants, this would have been because he or she knew about the "warning" that they had published on the Icarus College website. In this context, the reader, who was most likely a prospective student, would have understood that the first two paragraphs of the publication were by way of a response to this "warning". Such a reader would have understood the publication to assert that the "warning" contained "false and misleading comments" about the Boyapatis and that the accusations against them were "illogical and irresponsible". Did this publication give rise to defamatory innuendos? I do not think so. Drawing on his or her knowledge and experience of human affairs, the ordinary reasonable reader would have understood that the first publication was essentially no more than a statement by the Boyapatis that what had been said about them was incorrect. I do not consider that, in this context, the first publication would have tended to lower the regard in which the cross-claimants were held by right-thinking people generally. On this view, the publication made on 28 March 2004 was not defamatory of the cross-claimants. 169 In any event, if the first two paragraphs of the first publication were in fact defamatory of the cross-claimants, I would accept the cross-respondents' claim of qualified privilege. They bore the onus of proof, on the balance of probabilities, of establishing the defence. In the context in which the first publication was made, I accept that the publication was a reasonable and appropriate attempt by them to vindicate their personal and business reputation in response to the cross-claimants' attack on them via the warning on the Icarus College website. The publication was made to the same audience that received the cross-claimants' "warning". In this circumstance, this audience was the proper recipient of the publication. It was a proportionate response. 170 I reject the cross-claimants' submission that the first publication was made with malice. There was an entirely insufficient basis for such a finding. 171 It is, therefore, unnecessary to discuss the various other defences pleaded in relation to this publication. For the reasons set out above, it is probable that s 22(1) of the Defamation Act 1974 (NSW), s 16 of the Defamation Act 1957 (Tas) and s 16 of the Defamation Act 1889 (Qld) would also confer statutory qualified privilege on the cross-respondents.

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(2) Second Publication 172 Some time later, on 11 April 2004, Edward Boyapati wrote a further publication in the following form and Ray Boyapati posted it on the MedEntry webpage. It read as follows: Warning - Forums - 11/4/2004 -19 A UMAT course provider markets itself so aggressively that it anonymously runs on-line forums on the UMAT that criticise other courses and praise itself lavishly. These forums permit limited criticism of their own courses and limited praise of other courses to ensure it is seen as unbiased. Beware of forums that are run by that UMAT course provider - it is important to be critical, don't believe such postings. 173 Like the earlier publication, this publication did not specifically identify Dallas Gibson or RMC. Dallas Gibson said in cross-examination that he ran his own Internet forum in the early 2000s, called "Talk UMAT". There was, however, no evidence that his forum was anonymous. 174 The cross-respondents denied that the second publication was defamatory of the cross-claimants. They said that the publication had nothing to do with Dallas Gibson or RMC. 175 According to Ann, Ray and Edward Boyapati, the second publication also referred to Ryan Schulman, who was moderating a forum about the UMAT over the Internet. That is, according to the Boyapatis, this publication had nothing to do with Icarus College and the cross-claimants, but was concerned with Schulman and Agoneyes. According to Ray and Edward Boyapati, the problem, as the Boyapatis perceived it, was that Ryan Schulman's forum carried laudatory comments about Schulman's course and adverse comments about other UMAT preparation courses, including their own, without disclosing that Schulman was moderating the forum. In cross-examination, Ann Boyapati said that "given what was happening at the time, I would say people would understand [this] to mean Ryan Schulman". Ray and Edward Boyapati gave evidence to the same effect. 176 In any case, according to Edward Boyapati, the publication was removed from MedEntry's website soon after it was published and overwritten by other postings. 177 I accept the Boyapatis' evidence and, in particular, I accept Ann Boyapati's evidence that the relevant audience (prospective UMAT preparation course students) would have understood that the second publication concerned Ryan Schulman and not the cross-claimants. I accept that an ordinary reasonable reader in this audience would not have identified Dallas Gibson and RMC as being discussed in this publication. The evidence at trial was that there was more than one UMAT course provider that ran on-line forums on the UMAT. There was no evidence that the cross-claimants ran an anonymous forum. There was, however, evidence that Ryan Schulman did. Indeed, Dallas Gibson agreed in cross-examination that Schulman operated a forum anonymously. Hence the comments in the second publication were shown to be apposite for Mr Schulman's forum and not for the cross-claimants' forum. The cross-claimants called no third party to say that the publication was understood to refer to them. For these reasons, I am not satisfied that the cross-claimants have discharged their onus of proof that, so far as the ordinary reasonable reader was concerned, the second publication referred to them, as opposed to some other UMAT course provider running an on-line forum. On the contrary, the evidence showed that this reader would probably have understood the second publication as referring to Mr Schulman.

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(3) Third, Fourth and Fifth Publications 178 On 7 November 2004, Edward Boyapati wrote a third commentary, which Ray Boyapati posted on MedEntry's website. This was in the following terms: MedEntry sues Dallas Gibson - 7/11/2004 -26 MedEntry has launched legal action in the Federal Court of Australia suing Dallas Gibson of Icarus College for breach of copyright. In early 2004, Dallas Gibson blatantly plagiarized MedEntry's practice exams and sold them as his own. MedEntry is suing Dallas for breach of copyright and prosecuting him for contravention of section 52 of the Trade Practices Act. The case will be heard at the Commonwealth Law Courts (claim number V1289). 179 On the same day, 7 November 2004, Edward Boyapati wrote a fourth commentary, which Ray Boyapati posted on MedEntry's website: MedEntry sues Dallas Gibson - 7/11/2004 -26 MedEntry has launched legal action in the Federal Court of Australia against Dallas Gibson and Icarus College for breach of copyright and breach of Trade Practices Act. The action relates to the copying and sale by Icarus College in early 2004 of practice exams authored by MedEntry. The case will be heard at the Commonwealth Law Courts (claim number V1289 - 2004). 180 On 16 April 2005, Edward Boyapati wrote a fifth commentary, which Ray Boyapati put up on the MedEntry website in the following terms: MedEntry sues Dallas Gibson - 16/04/2005 -26 MedEntry has launched legal action in the Federal Court of Australia against Dallas Gibson and Icarus College for breach of copyright and breach of Trade Practices Act. The action relates to the copying and sale by Icarus College in early 2004 of practice exams authored by MedEntry. The case will be heard at the Commonwealth Law Courts (claim number V1289 - 2004). 181 The Boyapatis said that the third, fourth and fifth publications were true and, further, that it was appropriate for the allegations made in these publications to be made known to students in light of the Icarus College webpage warning and the confusion amongst students as to the copyist's identity. Ann Boyapati said in cross-examination that she thought "the purpose of the publications which refer to Mr Gibson were to clear the air and to make people understand that some unfair accusations were being made against MedEntry and to clear our reputation more than anything else". Ray and Edward Boyapati gave substantially the same evidence. The Boyapatis each denied that they had misstated the position by not referring to the cross-claimants' cross-claim. It was, so Edward Boyapati said, up to Dallas Gibson to put up this reference on his own website. Each of the Boyapatis said that they believed Dallas Gibson's claims to be spurious. 182 The third publication was defamatory of Dallas Gibson, in so far as it stated that he had "blatantly plagiarized MedEntry's practice exams and sold them as his own". The cross-respondents admitted as much. On the findings that I have already made, however, this statement was true in substance and effect. In so far as it is necessary to do so, I accept that the publication of the imputation was for the public benefit, or that it related to a matter of public interest. The public benefit lay in seeking to remove the doubt and confusion brought about by the "warning" on the cross-claimants' website amongst prospective students as to the copyist's identity, and as to the identity of the actual authors of the practice exams that students might buy. This also related to a matter of public interest. 183 I doubt that the fourth and fifth publications were defamatory since I doubt that they raised any imputation that would tend to lower the cross-claimants in the estimation of right-thinking members of society. This conclusion flows very much from the context in which the publications appeared. The cross-claimants had first attacked the Boyapatis on their website. There was evidence, both documentary and oral (through Ann, Ray and Edward Boyapati) that students were aware that the respective providers' practice exams were alike. In this circumstance, the fourth and fifth publications did no more than notify them that action was being taken in the court to determine the position. On this view, it might have been better if, by the fifth publication, the cross-respondents had referred to the cross-claim, which was filed on 11 February 2005, but this was unnecessary because the effect of the cross-claimants' warning was much the same. I note that the cross-claim had not been filed at the time the fourth publication was made. 184 If, however, the fourth and fifth publications were defamatory, because they carried with them the imputation that the proceedings had been properly instituted and would establish that the cross-claimants were plagiarists, then the cross-respondents are entitled to rely on the defence of justification. That is, the fourth and fifth publications were true in substance and effect. For the reasons already stated, the publication of these imputations was for the public benefit and related to a matter of public interest.

[49]

(4) Sixth publication 185 There was a sixth publication, in 2006, although the parties disputed its precise terms. The Boyapatis admitted (and I accept) that a publication to the following effect was put up on the MedEntry website: Be wary of some organisations that may claim they are the ONLY registered Training Organisation in Australasia offering UMAT training. There was no dispute that Icarus College made such a claim. Dallas Gibson stated at the trial that, as at the date of this publication, and for some time previously, Icarus College was a registered training organisation ("RTO") in Australia offering a Government approved course in preparation for studies in health sciences. 186 The cross-claimants contended that this publication was defamatory because it carried the imputation that they were prepared to mislead and tell untruths in order to secure business and that they were dishonest in making claims they knew to be untrue. The cross-respondents argued that the sixth publication was not defamatory but, if defamatory, it was true. 187 Edward and Ann Boyapati gave evidence, which I accept, that the Icarus College website claim was not true because there was at least one other RTO in Australasia offering UMAT training - namely, NIE. They argued that, in these circumstances, it was appropriate for the sixth publication to be made. Edward Boyapati said that this statement was removed from the website in around mid 2006. 188 I accept that the ordinary reasonable reader would understand that the publication concerned the cross-claimants, since they made the claim about being the only RTO offering UMAT training on their website. Doubtless, the ordinary reasonable reader would understand that the imputation was that the claim to be the only registered training organisation offering UMAT training might be untrue. The use of the words "[b]e wary" clearly raised a doubt about the cross-claimants' claim and their entitlement to make it. I reject the proposition that this reader would understand the sixth publication to carry the imputation that the cross-claimants made claims they knew were untrue. I do not consider that the use of the words "be wary" went so far. Further, I doubt that the ordinary reasonable reader would understand the sixth publication to carry the imputation that the cross-claimants were prepared to mislead in order to secure business. Again, I do not consider that the use of the words "be wary" went so far. Hence, I doubt that the sixth defamation was defamatory. 189 If, however, the sixth publication carried the imputation that the cross-claimants were prepared to mislead in order to secure business, then it was defamatory of the cross-claimants. In this event, however, I accept that the imputation was true in substance and effect. That is, the cross-claimants' claim that their course was the only RTO offering UMAT training was untrue because, at the relevant time, NIE (which was also an UMAT trainer) was also a RTO. Furthermore, the evidence at trial established that the cross-claimants were in fact prepared to mislead and tell untruths in order to secure business. I accept that the sixth publication, which was designed to put students on notice about the nature of the claim the cross-claimants made about their RTO status, was for the public benefit and in connection with the public interest.

Boyapati v Rockefeller Management Corporation

At a glance

Court

Decision date

Before

Source

Judgment (52 paragraphs)

Parties

Legislation Cited (12)

Cases Cited (25)

Cited By (3)