damages for disclosure of confidential information - Talbot v General Television Corporation Pty. Ltd. - [1988] FCA 419 - FCA 1988 case summary

Federal Court of Australia|1988-07-25|Before: Gummow J

MINUTE OF ORDER THE COURT ORDERS AS FOLLOWS:

Bhat the application for interlocutory injunctive relief be dismissed.

Note: Settlement and entry of orders 1s dealt with by Order

be shown tonight, Monday 25 July 1988. The agreement vrovides for both parties to contribute assigned elements to the production and for the ABC to pay to Taffner Ramsay Productions what 1s called a co-producer's fee. The ABC has options fora second and third series, the first option being exercisable no later than the broadcast date of the 35th episode of the first

I have viewed as a typical example the second episode in the first series. This was recorded on 10 July 1988. I accept as accurate the description of the format of the programme contazned in para. 33 of the affidavit of Mr. Scowcroft sworn in these proceedings on 22 July 1988; I shall not set out that paragraph. Mr. Scowcroft has at all material

times been the head of television features at the ABC.

The format bears a close but by no means identical relationship to the format described in exhibit H to para. 32

of Mr. Scowcroft's affidavit. Para. 32 states that:

On or about 11 May 1988, Taffner Ramsay Productions' managing Director, Lorraine Collins, provided me with the developed game by consultant Mark Maxwell Smith of Los Angeles, USA, from which the 0Z GAME has now been produced. The distinctive elements provided by Taffner Ramsay Productions substantially altered my view of the game show that we were seeking and created an entirely new format different even to that which I had proposed.

A copy of the original format devised by Taffner Ramsay

Productions 1s exhibit H to Mr. Scowcroft's affidavit.

On and after 7 June 1988, various newspaper reports appeared concerning the coming programmes of "The Oz Game". These newspaper reports, shortly after their appearance, came to the attention of the applicants. For example, on p. 71 of

the issue of the Australian Financial Review for 14 June 1988,

there appeared a report, portion of which reads as follows:

After viewing more than 50 overseas game shows, the ABC decided to design its own, with a distinctly Australian theme.

Taffner Ramsay 1s the product of a marriage between the Australian Paul Ramsay Company and the Los Angeles-based L.F. Taffner group which produces situation comedies and game programmes for Home Box Office and the Disney Channel stations in the US.

However, now the show has been "formated" [sic] and its first pilot produced last week, The Oz Game will be produced every

night out of the ABC Sydney TV studios using ABC staff.

. The contestants will all be family groups, with a high school student aged between 13 and 16 teaming with another member of his/her family older than 21. This can be a parent, an older sister or brother, or even an uncle or aunt.

But the game 1s not just a simple question of the compere firing questions at the teams. Mr. Scowcroft said the teams 'culd interact with each other, with tactics and strategic elements also affecting the final outcome.

and as such presented the non-commercial ABC with a bit of a problem.

However, 1t was decided that no "free" prize offers would be accepted from any companies. Instead the prizes, which would all involve travel around Australia, would either be donated by the Australian Bicentennial Authority or be paid for by the ABC.

Mr. Scowcroft 1s confident the programme will have a wider audience appeal than EastEnders because he believes viewers at 6.30 pm want a show they can watch while

doing other things, and which 1s not "too engaging".

Other publicity emphasised the selection of Mr. John Derum as

In these proceedings, commenced by application filed 22 July 1988, the applicants seek to restrain the broadcasting of the series "The Oz Game". On that day, that is to say last Friday, I heard an application for interlocutory injunctive relief. The case for interlocutory relief was put on three bases: contract, breach of confidence and contravention of s. 52 of the Trade Practices Act 1974 ("the Trade Practices Act"). The first.-two claims lie in the accrued jurisdiction of the

The first applicant, Concept Television Productions Pty. Ltd., was formerly known as M & N Enterprises Pty. Ltd.. It carries on the business of developing, vromoting and

assessing quiz and game shows for television. For some years,

Mr. Wayne Cameron, a director, and Mr. Michael Boughen have known of a box-board game entitled "Oz Quiz" which was developed by a Mr. Brett Clements and Mr. Phillip Turner of the second applicant, Cartoon Concepts Pty. Ltd.. Mr. Cameron and Mr. Boughen have had an association with Messrs. Clements and

Prior to July 1987, Mr. Cameron and Mr. Boughen wrote and developed an adaptation of the Oz Quiz game as a television game show and quiz. This was contained in the document entitled "Oz Quiz written as a television format". On 22 July 1987, Messrs. Cameron and Boughen attended the premises of the ABC at Gore Hill and met Mr. Scowcroft. They handed him a copy of that format which is now Exhibit A to Mr. Cameron's affidavit sworn 22 July 1988. The documents contained some 8 pages and dealt with such topics as comedy performance, contestant/guest participation, prizes, staging and questions.

There followed, after 22 July 1987, a series of meetings 'or communications between Messrs. Cameron and Boughen with Mr. Scowcroft and other officers of the ABC. These dealings ended with a meeting on 4 May 1988, at which Mr. Scowcroft told the other two gentlemen that: "Oz Quiz 1s cancelled". The principal meetings which followed that of 22

July 1987 were all at the ABC premises and were held on 14

October, 13, 25 and 26 November and 10 December 1987. On 16

December 1987, a "commissioning meeting" was held at the ABC, the minutes of which show the following, under the heading of

CTVProgs was not prepared to commit to a series for an unseen product and an untried format. It was agreed that HdFeats be asked to develop a proposal for a simplistic pilot. However the business relationship for the pilot and for any eventual series had to be developed and signed. (It was also noted that all resources investigations had been on a pilot rather than a series basis and big problems could have been anticipated had series approval been forthcoming.)

It is important to note, in evaluating what transpired at these meetings, that the evidence in its present form - - and no cross-examination has taken place in the limited time available - indicates that:

(a) before the meeting on 22 July, Mr. Scowcroft had

concluded that a travel quiz about Australia would be appropriate for the ABC in 1988 using a large map of Australia with contestants winning

. kilometres instead of points, and applying the kilometres to a trip around Australia;

(b)}) as early as the meeting on 22 July, Mr. Scowcroft expressed reservation as to the adaptability of the board game for TV;

Scowcroft a format for an Oz 88 programme which used the idea of progress across a map of Australia, but with adult and children contestants, rather than simply children;

Mr. Shore's format was given by Mr. Scowcroft to Messrs. Cameron and Boughen on 14 October;

this led to a revision of the applicant's proposal, which 1s exhibit C to Mr. Cameron's affidavit, but Mr. Scowcroft swears that he does not recollect ever having seen that revision; on 14 October, and later on 13 November, Mr. Scowcroft says in his affidavit that he canvassed with Messrs. Cameron and Boughen a combination of the proposals - that is to say, their proposal and Mr. Shore's proposal;

on 14 October, although the versions of what transpired vary, it 1S agreed that in substance Mr. Cameron said to Mr. Scowcroft: "We wish to present the television format for Oz Quiz to Channel 7", and he was told by Mr. Scowcroft to go ahead with 1t 1f he so wished;

there was, over this period, much discussion and some preparation for the making of a pilot but there was never any agreement as to "lock down" dates, as they were called, for a pilot before 8 February 1988. ic. Scowcroft then told Mr.

at no time did Mr. Scowcroft provide any material supplied to the ABC by Concept Television to Taffner Ramsay Productions either in written or verbal [sic] rorm, nor did he copy any of the material supplied by Concept Television into the script which he provided to Taffner Ramsay Productions (para. 31 of Mr. Scowcroft's

Mr. Garnsey, who appears for the applicant, points to

what he says are significant characteristics shared by the

format proposed by his client, at least in its amended form

after the meeting of 14 October, and episode 2 of the Oz Game

which has been viewed as part of the evidence. In particular,

the use of three family groups, each of two members;

a segment dealing with personal questions and personal matters concerning the contestants; the use of a large screen to display material used in the course of the programme, including a stylised map of Australia;

the use of what one might call double-barrelled questions in the course of the programme;

at no time did Mr. Scowcroft provide any material supplied to the ABC by Concept Television to Taffner Ramsay Productions either in written or verbal [sic] form, nor did he copy any of the material supplied by Concept Television into the

Mr. Garnsey, who appears for the applicant, points to

what he says are significant characteristics shared by the

format proposed by his client, at least in its amended form

after the meeting of 14 October, and episode 2 of the Oz Game

which has been viewed as part of the evidence. In particular,

the use of three family groups, each of two members;

the use of what one might call double-barrelled questions in the course of the programme;

It has to be borne in mind that para. 20 of Mr. Cameron's affidavit 1S equivocal as to who first suggested the use of Mr. Derum as the host. Furthermore, the identity of Mr. Derum has been widely publicised since the promotion commenced, as I indicated, in the course of last month. Further, the other features that are referred to by Mr. Garnsey are by no means fairly described as unique to the particular formulation that was propounded by his client, nor would they

appear to be particularly striking in this field of endeavour.

My impression is that, as a matter of degree and significance, the format of the programme as disclosed in episode two is far closer to the format proposed in annexure H (to Mr. Scowcroft's affidavit) by Taffner Ramsay Productions than to the formats earlier put forward both by the applicants and by Mr. Harvey Shore. Further, Mr. Scowcroft has sworn, as I have stated, in para. 31 of his affidavit, as to the lack of

communication of information to Taffner Ramsay Productions.

I should also re-emphasise that the Financial Review account which I have quoted, together with other publicity referred to in para. 26 of Mr. Cameron's affidavit, contains fairly detailed accounts of the format of the programme. I should also point out that the publication of this material is not complained of 1n the statement of claim fiied on 22 July as

My conclusion at this stage on the material before me is that the applicants have not shown, on the confidential information branch of their case, that there 1s a serious question to be tried. I say this because even if on 22 July 1987 an obligation of confidence did arise as alleged in the statement of claim, there was insufficient coincidence between that information as claimed and the format eventually used for the Oz Game. This 1s true also of the revised formulation of

I should also add that whilst the authorities collected by Mr. Gurry in his work "Breach of Confidence", pp. 125-126, including as they do the Victorian decision in Talbot

v General Television Corporation Pty. Ltd. [1980] VR 224

(applied in Fraser v Thames Television [1984] QB 44), show that

there may be an obligation of confidence arising in such situations, nevertheless it 1s essential for an applicant clearly to identify that which is said to constitute the subject matter of the confidence so that it may then be measured against the alleged breach of threatened breach. See

O'Brien v Komesaroff (1981) 150 CLR 310 at 326-328, per Mason

J. and Moorgate Tobacco Co. Ltd. v Philip Morris Ltd. {No. 2]

(1984) 156 CLR 414 at 438, per Deane J. When that 1s done in the present case, then, on the present evidence, the result 1s

I turn now to the contract issue. In paras. 8 and 9

My conclusion at this stage on the material before me is that the applicants have not shown, on the confidential anformation branch of their case, that there 1s a serious question to be tried. I say this because even if on 22 July 1987 an obligation of confidence did arise as alleged in the statement of claim, there was insufficient coincidence between that information as claimed and the format eventually used for the Oz Game. This is true also of the revised formulation of

I should also add that whilst the authorities collected by Mr. Gurry in his work "Breach of Confidence", pp. 125-126, including as they do the Victorian decision in Talbot v General Television Corporation Pty. Ltd. [1980] VR 224 (applied in Fraser v Thames Television [1984] QB 44), show that there may be an obligation of confidence arising in such situations, nevertheless it 12S essential for an applicant clearly to identify that which is said to constitute the subject matter of the confidence so that it may then be measured against the alleged breach of threatened breach. See

O'Brien v Komesaroff (1981) 150 CLR 310 at 326-328, per Mason

J. and Moorgate Tobacco Co. Ltd. v Philip Morris Ltd. [No. 2] (1984) 156 CLR 414 at 438, per Deane J. When that 1s done in

the present case, then, on the present evidence, the result 1s

I turn now to the contract issue. In paras. 8 and 9

of the statement of claim, the applicants plead a contract or contracts made on 17, 25 and 26 November 1987. It claims the injunctive relief it presently seeks in aid of an implied negative covenant stated by counsel to the Court to be that the ABC is not to produce a TV programme with the same format as that proposed by the applicant, this negative obligation to last for 5 years or such other period being the reasonable

There 18 a number of answers to this branch of the case. First, I believe there 1s barely a serious question to be tried as to the existence of a contract such as that pleaded in paras. 8 and 9. The situation remained, as 1t seems to me, in a fluid state of negotiation even as to the making of a pilot and it was therefore quite understandable that on 2 December 1987, Mr. Cameron was asking the ABC about the Provision of a contract. That 18 not to say that the efforts of the applicants up to 4 May 1988 were performed gratuitously and without any obligation of restitution imposed by law on the ABC; see the authorities collected and discussed by Sheppard

J. in Sabemo Pty. Ltd. v North Sydney Municipal Council [1977] 2 NSWLR 880, by Robert Goff J. in British Steel Corp. v

Cleveland Bridge & Engineering Co. Ltd. [1984] 1 All ER 504,

and by Messrs. Lindgren, Carter and Harland in "Contract Law in Australia", para. 2314. But that 1s not how the present Proceedings seem to be framed; even 1£ they were, this would

not found a claim to interlocutory injunctive relief as sought

Secondly, even 1f there were a contract or contracts containing the express terms as pleaded, the applicants have not satisfied (to the standard stated in the well known authorities in this Court as that required for interlocutory relief) the tests for the implication of a term of the width propounded by the applicant. I appreciate what was said on

this subject 1n Fraser v Thames Television [1984] QB 44 at 56,

but the learned judge did not have the advantage of Sir Anthony

Mason's judgment in Codelfa Construction Pty. Ltd. v State Rail

Authority of New South Wales (1982) 149 CLR 337 at 345, 346;

or that of Hope J. in the New South Wales Court of Appeal in

Castlemaine Tooheys Ltd. v Carlton & United Breweries Ltd.

Thirdly, the programme that has been produced does not bear such a relationship to the format proffered by the applicants in the manner I have described as to infringe the implied term on which it seeks to rely.

Finally, for this application, reliance 1s placed on s. 52 of the Trade Practices Act. Reliance is placed on various misrepresentations, many of which are, in the

alternative, said to have been contractual in character.

information and contract applies here to the question of breach of s. 52. Further, statements made in the course of complex negotiations must be assessed in their overall context: Pappas v Soulac (1983) 50 ALR 231 at 234, and see Terry, "Misleading or Deceptive Conduct in Commercial Negotiations" (1988) 16 Australian Business Law Review p. 189 at pp. 195-196. Here, the overall context 1s one of little certainty and much fluidity. Again, the alleged representations, as I read them,

are directed to the type of future conduct dealt with in Bill

Acceptance Corporation Ltd. v GWA Ltd. (1983) 50 ALR 242; and

to statements of opinion as dealt with by the Full Court in

Global Sportsman Ltd. v Mirror Newspapers Ltd. (1984) 2 FCR

No case has yet been made out to any degree at all that these representations even if they were made as pleaded were made recklessly or with knowledge of falsity or without foundation within the meaning of these authorities. Accordingly, I find no serious question has been raised within the meaning of the authorities so far as concerns contravention

of s. 52 of the Trade Practices Act. That is sufficient to dispose of the application for interlocutory relief. But If should add the following as to the

First, the expenditure of the ABC directed to a launch

of the series tonight, and to the transmission of the 64 programmes to follow over 13 weeks, and the contractual arrangements in exhibit AA, are a factor in favour of denying interlocutory relief as sought. The position of an innocent third party also 1s a relevant consideration in such a

situation; see McLean v Burns Philp Trustee Co. Ltd. (1985) 2

NSWLR 623 at 642; Hawthorn Football Club v Harding [1988] VR

49 at 60. I have referred to the state of the evidence as to

Secondly, I should add that, contrary to what appeared to be submitted by the applicant, the consideration that the ABC is funded from public moneys does not to my mind put the ABC in some inferior position as regards its reputation with the public which provides those moneys, or as regards the

stultifying of the use to which it puts those funds.

Thirdly, the applicants complain that 1f the televising of the series goes to air, the applicant's format will be valueless, as the concept of such a programme will lose any value to any other TV proprietor; see para. 27 of Mr. Cameron's affidavit. But the cat was out of the bag last June as 1S apparent from the press reports annexed to para. 25 of Mr. cCameron's affidavit. Since that time, and in the circumstances of this case, there 15 much to be said fer the

view that the appropriate remedy, if any, is pecuniary, not

injunctive, because the grant of an injunction now would not

avoid the detriment the applicants apprehend; see The

Commonwealth v John Fairfax s Sons Ltd. (1980) 147 CLR 39 at

54; and compare Attorney-General v Guardian Newspapers Ltd.

By referring to pecuniary remedies, I refer to the three remedies, the measure of which may differ each from the others. These are: damages for breach of contract; damages under s. 82 of the Trade Practices Act and equitable compensation for breach of confidence analogously with the like

remedy for breach of fiduciary duty: Tito v Waddell [No, 2]

(1977) Ch 106 at 238, 249; Catt v Marac Australia Ltd. (1986)

9 NSWLR 639 at 660. I would not, even at this interlocutory

level, accept what was said in Talbot v General Television

Corporation Utd. (1980) VR 224 as to the source of this

jurisdiction lying in Lord Cairns' Act and its Australian representatives. What was sald in the Victorian decision seems quite to have overlooked the inherent jurisdiction of equity and the fundamental principles that are explained in re Dawson (dec'd) [1966] 2 NSWR 211; Bartlett v Barclays Bank

Trust Co. [No. 2] (1980) Ch 515 at 543 and United States

Surgical Corporation v Hospital Products International [1982] 2

For all these reasons, my conclusion is that the application for interlocutory injunctive vrelisf shouid be

dismissed. That leaves the question firstly, of costs of that

application and secondly, giving of directions for the further

I certify that this and the fifteen (15) preceding pages are a true copy of the Reasons for Judgment of his Honour Mr. Justice Gummow.

damages for disclosure of confidential information - Talbot v General Television Corporation Pty. Ltd.

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Judgment (131 paragraphs)

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