Sony Music Entertainment (Australia) Limited v CEL Music Pty

That the Third Respondent infringed the copyright of the First Applicant in the following recording (being the recording defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): Mi-Sex Computer Games MAB-D14

That the Fourth Respondent infringed the copyright of the First Applicant in the following recording (being the recording defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): Mi-Sex Computer Games MAB-D14

That the First Respondent infringed the copyright of the Second Applicant in the following recordings (being the recordings defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit CDB Hey Girl MAB-D3 CDB Let's Groove MAB-D4 Daryl Braithwaite As The Days Go By MAB-D5 Grace Knight Fever MAB-D6 Margaret Urlich Burnt Sienna MAB-D8 Margaret Urlich Only My Heart Calling MAB-D9 Men At Work Be Good Johnny MAB-D10 Men At Work Down Under MAB-D11 Mi-Sex Computer Games MAB-D14 Noiseworks No Lies MAB-D15 Rick Price River Of Love MAB-D16 Skunkhour Up To Our Necks In It MAB-D17 Skunkhour That's The Way MAB-D18 The Black Sorrows Stir It Up MAB-D19 Things Of Stone & Wood Happy Birthday Helen MAB-D20 Wa Wa Nee Stimulation MAB-D21

That the Third Respondent infringed the copyright of the Second Applicant in the following recordings (being the recordings defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST RECORDING TITLE exhibit CDB Hey Girl MAB-D3 CDB Let's Groove MAB-D4 Daryl Braithwaite As The Days Go By MAB-D5 Grace Knight Fever MAB-D6 Margaret Urlich Burnt Sienna MAB-D8 Margaret Urlich Only My Heart Calling MAB-D9 Men At Work Be Good Johnny MAB-D10 Men At Work Down Under MAB-D11 Mi-Sex Computer Games MAB-D14 Noiseworks No Lies MAB-D15 Rick Price River Of Love MAB-D16 Skunkhour Up To Our Necks In It MAB-D17 Skunkhour That's The Way MAB-D18 The Black Sorrows Stir It Up MAB-D19 Things Of Stone & Wood Happy Birthday Helen MAB-D20 Wa Wa Nee Stimulation MAB-D21

That the Fourth Respondent infringed the copyright of the Second Applicant in the following recordings (being the recordings defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit CDB Hey Girl MAB-D3 CDB Let's Groove MAB-D4 Daryl Braithwaite As The Days Go By MAB-D5 Grace Knight Fever MAB-D6 Margaret Urlich Burnt Sienna MAB-D8 Margaret Urlich Only My Heart Calling MAB-D9 Men At Work Be Good Johnny MAB-D10 Men At Work Down Under MAB-D11 Mi-Sex Computer Games MAB-D14 Noiseworks No Lies MAB-D15 Rick Price River Of Love MAB-D16 Skunkhour Up To Our Necks In It MAB-D17 Skunkhour That's The Way MAB-D18 The Black Sorrows Stir It Up MAB-D19 Things Of Stone & Wood Happy Birthday Helen MAB-D20 Wa Wa Nee Stimulation MAB-D21

That the First Respondent infringed the copyright of the Third Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Boom Crash Opera Tongue Tied MAB-D2 John Farnham Burn for You MAB-D7

That the Third Respondent infringed the copyright of the Third Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Boom Crash Opera Tongue Tied MAB-D2 John Farnham Burn for You MAB-D7

That the Fourth Respondent infringed the copyright of the Third Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Boom Crash Opera Tongue Tied MAB-D2 John Farnham Burn for You MAB-D7

That the First Respondent infringed the copyright of the Fourth Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Mental As Anything Mr Natural MAB-D12 Merryl Bainbridge Mouth MAB-D13

That the Third Respondent infringed the copyright of the Fourth Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Mental As Anything Mr Natural MAB-D12 Merryl Bainbridge Mouth MAB-D13

That the Fourth Respondent infringed the copyright of the Fourth Applicant in the following recordings (being the recordings defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): ARTIST recording title exhibit Mental As Anything Mr Natural MAB-D12 Merryl Bainbridge Mouth MAB-D13

THE COURT FURTHER ORDERS THAT: 14. The Third Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of the following recording without the licence of the First Applicant: Mi-Sex Computer Games MAB-D14

The Third Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Second Applicant: ARTIST recording title exhibit CDB Hey Girl MAB-D3 CDB Let's Groove MAB-D4 Daryl Braithwaite As The Days Go By MAB-D5 Grace Knight Fever MAB-D6 Margaret Urlich Burnt Sienna MAB-D8 Margaret Urlich Only My Heart Calling MAB-D9 Men At Work Be Good Johnny MAB-D10 Men At Work Down Under MAB-D11 Noiseworks No Lies MAB-D15 Rick Price River Of Love MAB-D16 Skunkhour Up To Our Necks In It MAB-D17 Skunkhour That's The Way MAB-D18 The Black Sorrows Stir It Up MAB-D19 Things Of Stone & Wood Happy Birthday Helen MAB-D20 Wa Wa Nee Stimulation MAB-D21

The Third Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Third Applicant: John Farnham Burn for You MAB-D7 Merryl Bainbridge Mouth MAB-D13

The Third Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Fourth Applicant: Boom Crash Opera Tongue Tied MAB-D2 Mental As Anything Mr Natural MAB-D12

The Fourth Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of the following recording without the licence of the First Applicant: Mi-Sex Computer Games MAB-D14

That the Fourth Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Second Applicant: ARTIST recording title exhibit CDB Hey Girl MAB-D3 CDB Let's Groove MAB-D4 Daryl Braithwaite As The Days Go By MAB-D5 Grace Knight Fever MAB-D6 Margaret Urlich Burnt Sienna MAB-D8 Margaret Urlich Only My Heart Calling MAB-D9 Men At Work Be Good Johnny MAB-D10 Men At Work Down Under MAB-D11 Noiseworks No Lies MAB-D15 Rick Price River Of Love MAB-D16 Skunkhour Up To Our Necks In It MAB-D17 Skunkhour That's The Way MAB-D18 The Black Sorrows Stir It Up MAB-D19 Things Of Stone & Wood Happy Birthday Helen MAB-D20 Wa Wa Nee Stimulation MAB-D21

The Fourth Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Third Applicant: John Farnham Burn for You MAB-D7 Merryl Bainbridge Mouth MAB-D13

The Fourth Respondent be permanently restrained from reproducing or authorising the reproduction of, in a material form, the whole or a substantial part of any of the following recordings without the licence of the Fourth Applicant: Boom Crash Opera Tongue Tied MAB-D2 Mental As Anything Mr Natural MAB-D12

The Third Respondent be permanently restrained from authorising the making of or the sale of the following records without the licence of the First, Second, Third and/or Fourth Applicants: Cat no. Compact disc title ARTISTs exhibit CEL075/3 Off The Leash Boom Crash Opera MAB-C22 CEL046-3 Full On Hits CDB, MAB-C23 Mental As Anything Skunkhour CEL097/3 90's Dance Box Vol 2 CDB MAB-C24 CEL120/3 The History Of Love Daryl Braithwaite, MAB-C25 John Farnham, Margaret Urlich CEL022/3 Deep Heat Vol 1 Grace Knight MAB-C26 CEL008/3 From A Woman's Heart Margaret Urlich MAB-C27 CEL083/3 The Rockin 80's Men At Work, MAB-C28 Noiseworks CEL039/3 The 80's Mix Men At Work MAB-C29 CEL070/3 Hitz Blitz Merril Bainbridge MAB-C30 CEL129/3 Classic Rare Hits Of The 70's Mi-Sex MAB-C31 CEL057/3 Hit After Hit Rick Price, MAB-C32 Skunkhour CEL060/3 Home Made The Black Sorrows, MAB-C34 Things Of Stone & Wood CEL122/3 Classic Rare Hits Of The 80's Wa Wa Nee MAB-C35 CEL038/3 Greatest One Hit Wonders Wa Wa Nee MAB-C36

The Fourth Respondent be permanently restrained from authorising the making of or the sale of the following records without the licence of the First, Second, Third and/or Fourth Applicants: Cat no. COMPACT DISC TITLES ARTISTs exhibit CEL075/3 Off The Leash Boom Crash Opera MAB-C22 CEL046-3 Full On Hits CDB, MAB-C23 Mental As Anything Skunkhour CEL097/3 90's Dance Box Vol 2 CDB MAB-C24 CEL120/3 The History Of Love Daryl Braithwaite, MAB-C25 John Farnham, Margaret Urlich CEL022/3 Deep Heat Vol 1 Grace Knight MAB-C26 CEL008/3 From A Woman's Heart Margaret Urlich MAB-C27 CEL083/3 The Rockin 80's Men At Work, MAB-C28 Noiseworks CEL039/3 The 80's Mix Men At Work MAB-C29 CEL070/3 Hitz Blitz Merril Bainbridge MAB-C30 CEL129/3 Classic Rare Hits Of The 70's Mi-Sex MAB-C31 CEL057/3 Hit After Hit Rick Price, MAB-C32 Skunkhour CEL060/3 Home Made The Black Sorrows, MAB-C34 Things Of Stone & Wood CEL122/3 Classic Rare Hits Of The 80's Wa Wa Nee MAB-C35 CEL038/3 Greatest One Hit Wonders Wa Wa Nee MAB-C36

The Third Respondent be permanently restrained from distributing, in relation to the Sony Recordings (as defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999) or the BMG Recordings (as defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): (a) the Indemnity Document (exhibited to the affidavit of Jorg Michael Speck sworn 14 December 1999); and (b) any document which is substantially identical to the Indemnity Document (exhibited to the affidavit of Jorg Michael Speck sworn 14 December 1999). 25. The Fourth Respondent be permanently restrained from distributing, in relation to the Sony Recordings (as defined in paragraph 9 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999) or the BMG Recordings (as defined in paragraph 14 of the Statement of Claim and exhibited to the affidavit of Meredith Adrienne Brooks sworn 14 December 1999): (a) the Indemnity Document (exhibited to the affidavit of Jorg Michael Speck sworn 14 December 1999); and (b) any document which is substantially identical to the Indemnity Document (exhibited to the affidavit of Jorg Michael Speck sworn 14 December 1999). 26. The Third Respondent be permanently restrained, from being a party to or directly or indirectly knowingly concerned in the making of: (a) the First and/or Second Representations; and (b) any document which is substantially identical to the First and/or Second Representations. 27. The Fourth Respondent be permanently restrained, from being a party to or directly or indirectly knowingly concerned in the making of: (a) the First and/or Second Representations; and (b) any document which is substantially identical to the First and/or Second Representations. 28. Liberty be granted to the Applicants and any one or more of the Respondents to apply on seven days' notice. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

BETWEEN: SONY MUSIC ENTERTAINMENT (AUSTRALIA) LIMITED (ACN 000 033 581)

ARIOLA INTERACTIVE ENTERTAINMENT (AUSTRALIA) PTY LIMITED (ACN 000 999 664)

AND: CEL MUSIC PTY LIMITED (ACN 068 254 526) (IN LIQUIDATION)

CEL ENTERTAINMENT PTY LIMITED (ACN 056 990 348) (UNDER EXTERNAL ADMINISTRATION)

REASONS FOR JUDGMENT The history of the proceedings 1 These proceedings were commenced by Application and Statement of Claim ("S/C") filed on 15 December 1999. The First and Second Applicants are engaged in the businesses respectively of licensing the reproduction of sound recordings of artists in Australia and of making recordings of sound recordings, and are referred to respectively as "Sony Music Entertainment" and "Sony Music Productions". The Third Applicant ("BMG Australia") is engaged in the business of licensing the reproduction of sound recordings of artists within the BMG Catalogue, and the Fourth Applicant ("Ariola Interactive") is related to BMG Australia. 2 The First Respondent and the former Second Respondent, referred to respectively as "CEL Music" and "CEL Entertainment", were alleged by the S/C to have engaged in the unauthorised making of records which infringe the copyright of the respective Applicants conferred by the Copyright Act 1968 (Cth) by reason that they have reproduced the whole or a substantial part of certain sound recordings of the respective Applicants. The conduct of CEL Music and CEL Entertainment complained of is alleged by the S/C to have also constituted conduct in trade and commerce in contravention of ss 52, 53 and 51A of the Trade Practices Act 1972 (Cth). 3 The Third and Fourth Respondents, referred to respectively as "Comer" and "Gallagher", are alleged by the S/C to have authorised, directed and procured the conduct of infringement of copyright of CEL Music, and of engaging in that infringement of copyright as part of a common design, in each case without the license of the Applicants, and thus themselves to have engaged in the infringements of copyright complained of, and also to have been party to, and/or directly or indirectly knowingly concerned in the contraventions of the Trade Practices Act. 4 On 15 December 1999, orders were made by this Court (Katz J), which restrained CEL Music from making or authorising the making of certain of the infringing records, from selling or authorising the sale thereof, and from making certain representations in trade and commerce, and which also restrained Comer and Gallagher from authorising the making and selling of the infringing records, and from being party to or directly or indirectly knowingly concerned in the making of certain representations. An order was also made purportedly against Gallagher (but perhaps it was intended to be made against CEL Music or Comer), to deliver up all infringing records and certain documentary records. Such orders were expressed to be made up to and including 17 December 1999. 5 Subsequently on 17 December 1999, this Court (Beaumont J) renewed the said orders against CEL Music until further order, and also the orders against Gallagher and Comer as to authorising the making and selling of certain of the infringing records, and from being party to or directly or indirectly knowingly concerned in making the same representations. An order that CEL Music deliver up the infringing records by 4 January 2000 was also renewed. The proceedings were stood over until 16 February 2000. To substantiate the obtaining of the interlocutory orders set out above, the Applicants filed numerous affidavits. 6 Notices of Appearance were filed on behalf of CEL Music, Comer and Gallagher on 30 December 1999, and on 24 December 1999, Comer made an affidavit as to compliance with the order made by Beaumont J as to delivering up of the records the subject of that order, which affidavit was filed with the Court on 30 December 1999. 7 The proceedings first came before me for mention on 8 September 2000, when I stood the same over for further directions on 20 October 2000. On 20 October 2000, I directed that, inter alia, the Applicants file and serve any application for summary judgment, together with any evidence in support, on or before 10 November 2000, and relisted the matter for further directions on 8 December 2000. 8 On 8 December 2000 the matter was stood over generally with liberty to restore on 10 days notice. Further directions were given in the absence of the Respondents on 5 May 2001 and subsequently, as a result of it being placed under external insolvent administration, CEL Entertainment was dismissed from the proceedings on 2 July 2001. 9 Pursuant to leave granted on 14 December 2001, the Applicants have applied by notice of motion ("N/M") for summary judgment in the form of declarations and injunctions against Comer and Gallagher in respect of their authorising, directing and procuring the unauthorised reproduction of certain sound recordings and records in contravention of the Copyright Act, and being a party to, or directly or indirectly knowingly concerned in the contraventions of the Trade Practices Act alleged in [2-3] above. In addition, at the hearing of the N/M on 15 February 2001, the Applicants sought and were granted leave to proceed on a similar basis against CEL Music. No application was made for an order for costs. 10 It is evident that the sound recordings and records, in relation to which injunctive and declaratory relief is sought in the N/M dated 20 December 2001, are the same in substance as those contained in the original S/C filed in Court on 15 December 1999, as set out at para 20 in that document. 11 Furthermore, in the context of the joint Statement of Defence ("S/D') filed by the First, Third and Fourth Respondents on 5 May 2000, those Respondents did not challenge the subsistence of the relevant copyrights in the subject recordings and records, nor have they questioned the ownership of the copyrights by the Applicants. Hence for the purposes of the proceedings these matters are not in dispute.

The hearing of the Notice of Motion dated 20 December 2001 12 On 8 February 2002, the original return date for the N/M dated 20 December 2001, Mr Blackburn, counsel for the Applicants, made application for the abovementioned declarations and injunctions. There was no appearance by CEL Music or Comer, only the Fourth Respondent, Gallagher, appearing before the Court. She was accompanied by Ms Tracy Unwin, her sister-in-law, who informed the Court that she was not the current holder of a New South Wales Practising Certificate, but had been acting as a solicitor in London prior to returning to Australia, and sought to assist her sister as an amicus curiae. In those circumstances the Court granted leave for Ms Unwin to assist Gallagher in relation to the proceedings on that day. 13 Mr Blackburn made submissions to the effect that at all material times, Gallagher was directly involved in the authorisation, manufacture, and distribution of the infringing records and sound recordings. He contended that in her capacity as the 'Label Manager' of CEL Music, Gallagher's functions and responsibilities were such that even though she did not hold office as a director, she participated in and was thus responsible for the conduct which constituted the alleged infringements. 14 In reply, Gallagher submitted that she was a mere employee of CEL Music in a position which did not involve managerial duties, and further that she had no substantive authority to act on behalf of CEL Music, nor any appreciation of the infringing activities which were taking place. 15 In the light of the need to resolve the contentious factual issues that surfaced on 8 February 2002 with respect to Gallagher's involvement, I ordered that the Court adjourn the hearing of the N/M until 15 February 2002, so as to allow the Fourth Respondent to provide any affidavit evidence relating to the extent of her involvement or otherwise in the infringing activities, to obtain advice from her sister-in-law, and possibly obtain legal representation. 16 During the course of the adjournment the solicitors for the Applicants filed with the Court further evidence purportedly proving the extent of Gallagher's personal involvement in the infringing conduct. At the adjourned hearing of 15 February 2002, the Applicants' legal representatives provided to me the following material: (i) an outline of submissions upon the particular documentary evidence which allegedly founded the Applicants' claims against Gallagher; (ii) three volumes of documentary evidence; and (iii) an affidavit made by Angela Blackhall on 14 February 2002, which deposed, inter alia, to the fact that Gallagher had been engaged purportedly as an employee at Sony Music Entertainment, for a period of approximately two years between 1991 and 1993. 17 On 14 February 2002, my Associate was advised by telephone by Mr Papallo, barrister-at-law, that Gallagher would probably not defend the proceedings the subject of the N/M returnable on 15 February 2002, and that his brief engagement as Counsel for Gallagher, which had commenced after the first return date of the N/M, had been terminated. 18 On 15 February 2002 the substantive hearing of the notice of motion for final relief, originally returnable on 8 February 2002, was resumed. Mr Blackburn again appeared for the Applicants. There was no appearance by either CEL Music, Comer, or Gallagher. Gallagher's non-appearance was consistent with the instructions of Mr Papallo, conveyed to my Associate on 14 February 2002. During the course of the hearing of the N/M, Mr Blackburn referred me to the documentary evidence in support of the proposed orders set out in the N/M, particularly that which implicated Gallagher personally, to which I will shortly turn.

The evidence against the Respondents and Gallagher in particular

i) CEL Music 19 A Receiver and Manager was appointed to CEL Music on 29 March 2000, and an official liquidator was appointed on 28 September 2000. Nevertheless, in the course of his submissions made on 15 February 2002, counsel for the Applicants sought leave to proceed against CEL Music for declarations in respect of its infringing conduct. That was an appropriate course, considering that CEL Music had admitted in its S/D that it had manufactured and distributed the subject records albeit that it denied doing so in breach of copyright, and particularly given the relief which is sought against Comer and Gallagher as well. Moreover there is utility in adopting that course, since the Applicants are concerned to have title to the relevant copyright materials formally declared, in order to provide a form of official notice to any entities or persons in whose present possession or control the same may presently or might hereafter reside. The evidence implicating CEL Music is to be found primarily in the affidavits of Meredith Adrienne Brooks and Jorg Michael Speck sworn 14 December 1999, and the documents exhibited thereto.

ii) Comer 20 It is not in dispute that Comer, was, at the time of the infringing acts, first a director and secondly a secretary of CEL Music. Additionally, as stated in the S/D, it is not in dispute that Comer authorised, directed and procured the manufacture and distribution of the subject records particularised in para 20 of the S/C, notwithstanding that he has denied doing so in breach of copyright. Furthermore, I would draw further comfort as to Comer's involvement relevantly in the acts, which are said to constitute the misleading and deceptive conduct, by virtue of his non-appearance before the court on both return dates of the N/M, and also on previous occasions. In that latter regard, evidence tendered by the Applicants, particularly by the Affidavit of Michael Williams sworn 19 February 2002, is supportive of the fact that repeated and diligent efforts have been made to inform Comer of the progress of the proceedings. I am satisfied that there exists a sound basis for granting declaratory as well as injunctive relief, and for making in principle the declaratory and injunctive orders sought against Comer. In further justification for granting declaratory as well as injunctive relief, I think that the utility of granting declaratory relief against Comer is heightened by firstly, the magnitude of the infringements and the fact that the infringing compact discs have apparently found their way into the possession of retailers, and secondly, the circumstance that the Applicants have lodged proofs of debt against Comer as well as Gallagher, which proofs of debt would be underpinned by a declaration made by this Court.

iii) Gallagher 21 In order to obtain the relief sought against Gallagher under the Copyright Act, it is necessary for the Applicants to satisfy the Court that the evidence supports a finding that Gallagher authorised, directed and procured the infringing acts. In contrast to the First and Third Respondents, Gallagher denies that she authorised the making of the records the subject of the alleged infringements set out in para 20 of the S/C, by para 27 of her S/D filed 5 May 2000. It is also material that in contrast to Comer, Gallagher held the prima facie non-directorial position at CEL Music of Label Manager. That being so, I considered that the burden rested squarely on the Applicants to satisfy the Court that Gallagher authorised, directed and procured the manufacture and distribution of the infringing compact discs in contravention of the Copyright Act,and also was directly or indirectly knowingly concerned in, the alleged contraventions of the Trade Practices Act. 22 Substantial evidence was identified by Mr Blackburn on 15 February 2002 for the purpose of seeking to implicate Gallagher in the alleged infringement, otherwise than in the capacity of a mere or non-executive employee of CEL Music, as follows: (a) indications that Gallagher had purportedly signed Individual Track licences made between Ariola Interactive and CEL Music; (b) the circumstance of Gallagher's attendance and participation in a meeting between Sony Music Entertainment and CEL Music at which the licensing of Sony records to CEL Music was organised and notified in the absence of Comer; (c) the nature of Gallagher's work duties whilst an employee at Sony Music Entertainment between 1991 and 1993, which inferentially appeared to be executive in character; (d) the fact that Gallagher had corresponded by fax of 10 September 1998 with Mr Terrey of Sony Music Entertainment, particularly in circumstances which gave rise to the inference that Gallagher was aware that the Track Licences for certain relevant records had earlier expired; moreover the manufacturing activity which reproduced the relevant sound recordings and records, and which infringed the Applicants' copyrights, occurred as from 10 September 1998, taking place subsequent to Gallagher initiating this correspondence; (e) multiple work order forms to which Gallagher was a signatory, which purported to require compact disks to be manufactured, or 'pressed' (to use the terminology common in the industry), and which orders were placed after the expiry of licenses all held by CEL Entertainment, being orders placed by Gallagher on behalf of CEL Music; and (f) correspondence by fax from Gallagher to Michael Gordon of BMG Australia dated 26 August 98, which amounted to a request for CEL Music, as distinct from CEL Entertainment (which entered insolvent administration on 31 July 1998) to be granted a renewal of the relevant Track Licenses, once outstanding royalties had been paid, and which correspondence evidenced an offer by Gallagher and Comer jointly to guarantee debts owed by CEL Music to BMG Australia. 23 As a consequence of the non-appearance of Gallagher on 15 February 2002, all of the foregoing documentary evidence, and the accumulating implications flowing therefrom, remain unchallenged by Gallagher, save for the assertions detailed in her affidavit sworn 7 February 2002. In that affidavit, Gallagher reiterated that she was unaware that CEL Music, her employer, was breaching the copyrights owned by the Applicants, and that she had no control over the day-to-day activities of CEL or its employees, being denials which I find are inconsistent with the documentary material in evidence. She also requested by that affidavit that the Court allow her the opportunity to properly prepare and present her case, which request was acceded to when the Court stood over the substantive hearing of the N/M dated 20 December 2001 until 15 February 2002. On this date, as I have already indicated, Gallagher did not appear before the Court to challenge the evidence adduced by the Applicants, nor filed any affidavit material explanatory thereof. I should add that Gallagher's affidavit of 7 February 2002 also annexed an Amended Statement of Defence which in substance, sought to add to the original S/D filed jointly with the First and Third Respondents, by pleading, inter alia, that Gallagher had no part in any common design with Comer and CEL Music in relation to the claims made by the Applicants under the Trade Practices Act, nor had the capacity to authorise, direct or procure the infringing acts of CEL Music, such as to have constituted the infringement postulated pursuant to the Copyright Act. Again I find such protestations of non-involvement to be inconsistent with the documentary material tendered by the Applicants. 24 I should here take the opportunity to formally record subs 36(1) of the Copyright Act, as follows: "Subject to this Act, the copyright in a literary, dramatic, musical, or artistic work is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorises the doing in Australia of, any act comprised in the copyright." 25 In submissions to the Court on 15 February 2002, counsel for the Applicant made reference to Microsoft Corporation & Others v Goodview Electronics Pty Ltd & Others (2000) 49 IPR 578, a decision of Branson J, where her Honour stated the proposition that employees other than directors, such as Gallagher, could be primarily liable as tortfeasors. 26 In Goodview, Branson J referred to the test for tortious liability of directors enunciated by Lindgren J in Microsoft Corporation & Anor v Auschina Polaris Pty Ltd and Anor (1996) 71 FCR 231. After extensively reviewing the relevant authorities at 242-246, Lindgren J had affirmed a "procured or directed" test, that is, a test which considered whether the relevant director expressly or impliedly procured or directed the infringing conduct. In preferring this test to a higher test of whether the director had the made the infringing conduct his own, Lindgren J made the following observations at 243-244: "The 'procured or directed' test, sometimes referred to as the 'authorised, procured or directed' test, focuses attention on the relationship between the director's intention and the particular corporate conduct which the law characterises as tortious. What seems to underlie this test is the notion that, necessarily, companies can engage in tortious conduct only through human beings, and, at least ordinarily, where a particular human being involved and responsible to an appropriate extent can be identified, he should, as a matter of policy, be liable." 27 Whilst Lindgren J was in context specifically ruling on the liability of a director, it does not follow that the dictum would not apply to an employee involved in executive decision-making, albeit not formally appointed to the office of director. In the circumstances of Gallagher's conduct as a Label Manager to which I have been referred, and in the context of the operations of CEL Music, I would infer that her functions were executive in character, being an inference I would more readily draw in the light of her non-appearance after first consulting with counsel briefed on her behalf. 28 In Goodview Electronics, in the process of ruling that a non-director employee was primarily liable as a tortfeasor for copyright infringements of an employer company, Branson J also referred to the decision of Merkel J in this Court in Henley Arch Pty Ltd v Clarendon Homes (Aust) Pty Ltd (1998) 41 IPR 443, where, at 463, Merkel J expressly stated that it was unnecessary for an individual to be a company director in order for him or her to be primarily liable as a joint or concurrent tortfeasor, in the following terms: "If a company has infringed copyright a person (including a director) may also be liable if that person personally authorised the company to commit the act of infringement… Authorisation for the purpose of s 36(1) is established by evidence that the relevant person sanctioned, approved or countenanced the infringing conduct in a manner which thereby authorised it." Further, citing Auschina in support, Merkel J continued at 463: "A person (including a director) may also be primarily liable as a joint and concurrent tortfeasor in relation to the infringement by involvement in the tortious acts which constitute the infringement." 29 The documentary materials to which I have referred, the employment circumstances of Gallagher to which I have also referred, and the fact of her ultimate withdrawal from participation in the proceedings, has enabled me to be satisfied that Gallagher was not only fully aware of, but in fact authorised, directed and procured the reproduction of the relevant sound recordings and records which constituted the copyright infringements against the Applicants, and was a party to, or at least indirectly concerned in the contraventions of the Trade Practices Act which have been pleaded. 30 At the conclusion of the substantive hearing of the N/M, I reserved judgment and directed the Applicants to send to my Associate, evidence probative of service on Comer and Gallagher, or attempts at service, of the original S/C in the proceedings, and of the N/M dated 20 December 2001. Subsequent to those directions, I have been provided by the solicitors for the Applicants with the following documentation: (a) an affidavit of Mr Alexander Graham Hutchens sworn 7 February 2002 and filed with this Court on 19 February 2002, which deposed to efforts made by the Applicants to effect service on Comer of notification of the hearing of the N/M before this Court on 8 February 2002 (pursuant to orders I made on 14 December 2001); and (b) an affidavit of Michael John Williams sworn on 19 February 2002, which deposed to service on CEL Music, Comer and Gallagher of the Application and S/C, and of attempts to serve on Comer notification of the substantive hearing of the N/M originally returnable on 8 February 2002. 31 Although Comer seems to have eluded service in the circumstances evidenced by these affidavits, I am satisfied that genuine and repeated efforts have been made to notify him of the progress of this matter, and in particular of the N/M originally returnable on 8 February 2002. 32 Furthermore, having benefit of the appearance of Gallagher in Court on 8 February 2002 in the company of her sister-in-law, I am also satisfied that she too was fully aware of the nature of the allegations made against her, and of the substantive hearing of the N/M which was returnable on 15 February 2002.

Conclusion 33 In my opinion, there exists sufficient basis and justification for my granting the declaratory relief and injunctive relief to which these Reasons relate and to the extent appearing in the formal declarations and orders made. Nevertheless it is appropriate in the circumstances that I also grant to all parties liberty to apply on 7 days' notice. To the extent of the declaratory relief which I have granted I have accepted the submission advanced on behalf of the Applicants to the effect that there is utility in so doing, in the light of the need to enable the Applicants to more effectively put on notice any retailers into whose possession the offending discs and recordings may have unknowingly entered. I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti.