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Federal Court of Australia |
Last Updated: 19 February 2007
FEDERAL COURT OF AUSTRALIA
United Broadcasting International Pty Ltd v TV Plus Int Pty Ltd
COPYRIGHT AND TRADE PRACTICES –
television channel broadcast content derived from Bosnia and Herzegovina (BH)
public broadcaster – earlier transmission
arrangement with broadcaster in
operation in Australia – following dispute with Australian broadcaster BH
broadcaster contracted
with different Australian broadcaster – dispute
between original Australian broadcaster and newly appointed Australian
broadcaster
– contractual and copyright issues arising between the two
Australian broadcasters as to which broadcaster valid appointee
– BH
broadcaster not joined as party to proceedings – copyright issues arising
for resolution
TRADE PRACTICES – conflicting
representations made in Australia in trade and commerce as to lawful
broadcaster of television images of BH broadcaster – issue
arising as to
which broadcaster’s representations not misleading or
deceptive
SECURITY FOR COSTS – whether respondent competing
broadcaster entitled to security for costs – significance of absence of
that respondent’s
joinder of BH public broadcaster in context of
conflicting claims of two broadcasters as to contractual source of television
signals
Broadcasting Services Act 1992 (Cth) Schedule 2
Part 7
Copyright Act 1968 (Cth) ss 14(1), 22(5), 91, 99, 115(2)
and (4)
Corporations Act 2001 s 1335(1)
Trade Practices Act
1974 (Cth) ss 52 and 53
Federal Court Rules
O 28 r 3
Copyright (International Protection) Regulations 1969 reg 3 and 4(6)
Campomar Sociedad Ltd v Nike International Ltd
(2000) 46 IPR 481 referred to
Select Personnel Pty Ltd v Morgan and
Banks Pty Ltd (1988) 12 IPR 167 referred to
First Netcom Pty Ltd v
Telstra Corporation Ltd [2000] FCA 1269; (2000) 101 FCR 77 referred to
Permanent
Promotions Pty Ltd v Independent Distillers (Aust) Pty Ltd (2004) 62 IPR
538 referred to
Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14;
(2004) 218 CLR 273 referred to
Amalgamated Mining Services Pty Ltd v
Warman International Ltd (1988) 19 FCR 324 referred
to
UNITED BROADCASTING INTERNATIONAL PTY LTD v TV PLUS INT PTY
LTD, TV PLUS BROADCASTING COMPANY PTY LTD AND TV PLUS OPERATIONS COMPANY
PTY
LTD
NSD 2379 OF 2006
CONTI J
16 FEBRUARY
2007
SYDNEY
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AND:
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THE COURT ORDERS THAT:
1. The final hearing of the proceedings be expedited.
2. The applicant to provide to the Court (and copy to the respondents) draft orders giving effect to the present proceedings within three clear hearing days of the Court, including orders as to clarification by formal pleading or otherwise of the issues falling for resolution, and any consequential joinder of further parties.
3. The respondents to provide to the Court (and copy to the applicant) any changes required by them to the draft orders within a further two clear hearing days.
4. The proceedings be listed by the parties for further mention with a view to fixing the date for a final hearing of the proceedings, and resolving outstanding matters procedural and other interlocutory matters.
5. The parties to furnish submissions within the next seven days concerning orders as to costs of the proceedings to date, in the absence of any agreement that costs of the interlocutory proceedings to date be reserved.
6. Liberty to either side to apply on seven days’ notice.
Note: Settlement
and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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BETWEEN:
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UNITED BROADCASTING INTERNATIONAL PTY LTD
Applicant |
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AND:
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TV PLUS INT PTY LTD
First Respondent TV PLUS BROADCASTING COMPANY PTY LTD Second Respondent TV PLUS OPERATIONS COMPANY PTY LTD Third Respondent |
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JUDGE:
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CONTI J
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DATE:
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16 FEBRUARY 2007
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PLACE:
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SYDNEY
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REASONS FOR INTERLOCUTORY JUDGMENT
The context to the interlocutory proceedings conducted on 21 December 2006
1 Javni Radio Televizijski Services BiH (‘JRTS’) has been at all material times and continues to be the owner and broadcaster of the television channel known as ‘BHT-1’ in Bosnia and Herzegovina. It owns and operates both Bosnian State radio and television. JRTS has also been referred to in the evidence before the Court in the subject interlocutory proceedings as the Public Broadcasting Service of Bosnia and Herzegovina (‘PBS’). It may therefore be described as a resident corporation of Bosnia and Herzegovina.
2 On or about 25 September 2006, the applicant United Broadcasting International Pty Ltd (‘UBI’), being an Australian resident company, entered into an agreement in writing with JRTS for the conferral upon UBI of what are asserted by UBI as the sole and exclusive broadcasting rights in relation to Australia appertaining to that television channel BHT-1, and their programming content, in whole or in part, along with all associated rights including transmission and copyright. It is the broadcasting of the television channel BHT-1 that gives rise to the controversies the subject of the present proceedings. Thereafter on 10 October 2006, UBI commenced broadcasting the BHT-1 television channel in Australia purportedly on the basis of that agreement, and of a class license for subscription television narrowcasting services, the conditions whereof are set out in Schedule 2 of Part 7 of the Broadcasting Services Act 1992 (Cth). In order to acquire such a license, it appears that the operator must have the capacity to broadcast and to abide by the conditions of the relevant category of the license. That commencement of television broadcasting in Australia by UBI occurred at a time when the respondent TV Plus companies were undertaking television activity in Australia, which originated also in Bosnia and Herzegovina, and thus competitively with the television activity of UBI in Australia. The matrix of background circumstances thus outlined has however a more complex origin.
3 The following informative and directory material, contained within the applicant’s affidavit material of 6 December 2006, refers or relates to JRTS and its present media business relationship with the applicant UBI, and may be included in my threshold description of background circumstances:
(i) a screen-dump of the JRTS website www.pbsbih.ba;
(ii) an extract of the European Broadcasting Union (‘EBU’) Contact Directory for its active members inclusive of JRTS.
(iii) a screen-dump of the UBI website showing active members connected with JRTS listed under Bosnia and Herzegovina.
4 In order to broadcast by television the BHT-1 Channel originating in Bosnia and Herzegovina, UBI acquires the relevant live signal in a German earthstation, and through its global fibre-optic network system, UBI carries that live signal of the BHT-1 Channel to its so-called Broadcast Operations Centre in Sydney. UBI thereupon uplinks the signal to its space on the Optus B3 satellite in order to provide access thereto by Australian viewers by means of small satellite dishes. That BHT-1 Channel is said to be part of UBI’s so-called World TV’s Balkan Bouquet, which currently consists of eleven (11) television and radio channels operating in and from the Balkans region by means of a service, and which in turn is encrypted and made available in Australia purportedly and from UBI’s perspective only to UBI subscribers, and upon payment of monthly fees to UBI.
5 The first respondent TV Plus Int Pty Limited (‘TV Plus’), being also an Australian company, is the holder of twenty narrowcasting subscription broadcasting licenses issued by the Australian Broadcasting Authority (‘ABA’), numbered 2694 to 2713, and it transmits a number of ethnic satellite television and radio channels in Australia and in countries surrounding Australia. It is the policy of TV Plus that if there is a sufficient market demand for a particular segment of Balkan’s originating television content, the related third respondent TV Plus Operations Company Pty Limited (‘TV Plus Operations’) enters into negotiations and ultimately agreements with the relevant content provider for the exclusive rights to broadcast those so-called ethnic channels in Australia. Once having acquired such rights, TV Plus Operations advertises, markets, distributes and broadcasts the content of the programmes so ‘fed’ to TV Plus (I henceforth use the term TV Plus as referable generally to the respondents or any one or more of them unless otherwise stated), in return for payment of subscriptions on a monthly basis. The channels which TV Plus broadcasts to the Australian public are made available on a subscription service, which encompasses the installation of a set-top box and satellite dish in the customer’s home and the provision of a ‘unique’ smart card which permits the decoding of the TV Plus signal by the customer. The present dispute arises in circumstances whereby TV Plus continues to broadcast by television, to its subscribers resident in Australia, notwithstanding that the exclusive right to do so is asserted by UBI to be held now by UBI pursuant to the said 25 September 2006 agreement in writing.
6 There was litigation commenced earlier in 2005 in this Court and concluded in that year, which involved UBI and TV Plus as opponents, as well as certain operators of other Serbian and Bosnian television channels who joined with TV Plus as applicants against UBI and other entities as respondents. As in the present litigation, the causes of action were for infringement of the Copyright Act 1968 (Cth) (‘the Copyright Act’) and of the Trade Practices Act 1974 (Cth) (‘the TP Act’) in relation to the broadcasting of the following foreign television channels:
(i) Pink Plus, Pink Extra and Radio Pink, which were broadcasted by Media Systems;
(ii) Radio Television BN Television Station and Radio Station Radio RTV BN, which were broadcast by BN, a company incorporated in Bosnia and Herzegovina; and
(iii) BK Sat 063 Satellite Television Channel, which was broadcast by BK, a Serbian Company.
7 It was asserted by TV Plus in that earlier litigation that TV Plus Operations and/or the related TV Plus Broadcasting Company Pty Limited (‘TV Plus Broadcasting’) had exclusive rights to broadcast the foregoing channels in Australia and surrounding countries, and that UBI and other related entities had commenced broadcasting, transmitting and selling the channels in Australia without permission or authority from TV Plus, TV Plus Operations and/or TV Plus Broadcasting. As a consequence TV Plus sought injunctions from this Court in 2005 to prevent UBI and other associated companies from broadcasting those channels. No distinction need be drawn hereafter for present purposes between each of the three TV Plus respondents, which may hereafter be included jointly and/or severally within the description TV Plus. Following the grant of interlocutory injunctions, the proceedings were apparently finalised on the day preceding the scheduled Federal Court hearing, upon the basis of orders described by TV Plus as restraining UBI and other associated companies from broadcasting the channels in question for so long as TV Plus held the exclusive rights to broadcast the same in Australia. Since that time the agreement in writing abovementioned was entered into between JRTS and UBI, pursuant to which UBI has been broadcasting in Australia the BHT-1 Channel.
8 It is presently unclear or uncertain as to what bearing the earlier 2005 litigation may have upon the consideration and determination of the issues which fall for ultimate and final determination of the present litigation. My preliminary impression from evidence presently placed before the Court and observations and submissions of counsel is that at least in relation to evidentiary issues presently arising, the circumstances of that earlier litigation will have more than merely a contextual bearing upon the resolution of the issues here arising. The nature and extent of that bearing is too early to delineate with any precision. Senior counsel for TV Plus indicated that ‘[i]t’s [a] background matter at this stage so your Honour doesn’t need to read it unless we take your Honour to it’, which senior counsel for TV Plus in fact did at least on occasion in relation to the ‘general nature’ of the litigation.
9 The circumstances whereby UBI obtained the asserted sole and exclusive rights from JRTS are said by UBI to be of such scope that TV Plus no longer has any entitlement to broadcast in Australia the BHT-1 signal originating from JRTS. That disentitlement is contested by TV Plus, though the consequential controversy between UBI and TV Plus was preceded in a temporal sense with TV Plus broadcasts being adversely affected by incidents of ‘blank screens, frozen still pictures’ and repeated ‘TEST patterns’. Yet TV Plus indicated that coincidentally, so it would seem, with UBI’s subsequent commencement of broadcasting of BHT-1 in Australia, that it experienced a so-called ‘reliable’ signal from JRTS, in that the immediately prior difficulties have no longer occurred. It is within the foregoing context that TV Plus is said to presently broadcast the BHT-1 channel from Bosnia and Herzegovina for about 18 hours each day, in contrast to its immediately prior broadcast of approximately 2 hours per day.
10 It is the case of UBI that irrespective of the assertion of TV Plus to the effect that the ‘feed’ is being taken by TV Plus from overseas, the coincidence of what was described by UBI as the ‘greatly increased broadcast time of BHT-1’, said to have occurred at about the time of commencement of BHT-1 broadcasts by UBI, reflects or tends to reflect the existence of breach of copyright on the part of TV Plus directly referrable to UBI’s entitlement to broadcast BHT-1 signals conferred by JRTS. UBI averred that at the time it entered into its present exclusive license agreement with JRTS on 25 September 2006, it was aware that TV Plus had previously broadcast BHT-1 between May and October 2005, but that at least by December 2005, TV Plus had ceased at least directly broadcasting that channel. The cessation of entitlement of TV Plus to broadcast the BHT-1 television channel was said by UBI to have been confirmed by a person described as a prominent leader in the Australian Bosnian community. In his opening explanation of the UBI case, counsel for UBI drew attention to the factor that whilst TV Plus submitted that it had ‘acted in good faith throughout their dealings with JRTS’, there was present a ‘highly suspect nature’ of TV Plus’s case, in that Mr Jeremic, the director of each of the respondents, stated under cross-examination that ‘we had to pay some serious money to some people’ in the context of the acquisition by TV Plus of access to the BHT-1 signal. Mr Jeremic appears to have been the director of all three respondents at all material times.
11 It was to my understanding part of the case of UBI that whatever may have been UBI’s shortcomings in scope of comprehensive license authority derived from JRTS at the time of the earlier litigation in 2005 involving TV Plus as an adversary, those shortcomings had been overcome by the nature and extent of the contractual rights conferred by JRTS upon UBI by the more recent agreement of 25 September 2006 between those entities relating of course to the BHT-1 channel. Evidence tendered by UBI would appear to be prima facie to that effect. The present dispute between UBI and TV Plus was said to have arisen on 29 November 2006, when the TV Plus respondent companies, or one or more of them, broadcast television signals of the BHT-1 television channel, whereof UBI contends to have been the exclusively authorised provider in Australia since the formation of the said agreement in writing of 25 September 2006 between itself and JRTS.
12 Mr Sam Bilge, the chief executive officer of UBI, explained in his affidavit evidence that Globecast Australia is the technical operator that provides the fibre optic link to bring the BHT-1 channel to TV Plus in Australia, and additionally provides all technical service facilities in distributing the signal across Australia. Speaking in his jargon of international television broadcasting, it is the situation prevailing in the complexity of present circumstances that each of UBI and TV Plus are ‘getting performance’, in the sense of ‘taking feed’ from the JRTS television signals by satellite from Bosnia. In relation to that controversy, it appears that JRTS has joined forces with UBI litigiously (in the sense of providing evidence) as well as contractually.
13 Prior to assembly of the affidavit evidence in the context of the present interlocutory proceedings, there had taken place controversial email communications between TV Plus and JRTS which may be conveniently reproduced in order to exemplify the nature and extent of aspects of the context in which the present interlocutory proceedings came to be structured. A convenient starting point to those communications comprised a letter of 19 October 2006 from TV Plus to JRTS reading as follows:
‘It has come to my attention that [UBI] has in the last 2 days commenced a test transmission of the BHTV1 channel in Australia. I have been advised that Public Broadcasting Service of Bosnia and Herzegovina (PBS) may have by accident permitted UBI to enter into a test transmission of the BHTV1 channel in Australia.
...
You may not be aware that TV Plus took Federal Court action against UBI last year in our Federal Court for transmission of content that was in breach of our rights.’
...
This current transmission by UBI infringes our rights and I request that PBS urgently instruct UBI to cease transmission of BHTV1 which infringes the rights of TV Plus.
...’
14 On 27 October 2006, Mr Ahmed Hadzijamakovic, the head of the Satellite Department of JRTS (and its apparent English synonym abbreviated to PBS as already mentioned), described in the evidence as ‘the entity which owns and manages’ all television and radio channels in that country, one of which being the BHT-1 channel, replied by email to TV Plus as follows:
‘It is a real and great surprise for us that somebody from TV Plus is contacting us since we haven’t heard a word from anybody for more than 18 months.
As per your e-mail I can conclude that you are not informed about all problems we had in connection with the agreement you are mentioning. Our advice for you would be to research within your company all written correspondence between us and Mr John Jeremic for the period as of december 2006 – april 2005. Besides that we made many phone calls. Above all of that we had mediator company ABH line which initiated this agreement, so you can contact them too. For you information - we have signed the contract on 24th December 2004 and till now we have not received the counter signed copy as the confirmation that the agreement is valid. You will find that PBS BiH suffer a great damage as well as our citizens from Bosnia and Herzegovina living in Australia.
We do hope that after this research you will have the clear situation regarding this problem and than [sic] we can exchange arguments and resolve this subject.’
The reference above to Mr Jeremic may be observed, as also the circumstance of an asserted absence by that time of any signed contracts, as between JRTS and TV Plus, having been exchanged and which thus may have brought about a concluded contractual arrangement between JRTS and TV Plus, though on what terms is presently unclear.
15 Mr Harris of TV Plus responded to JRTS by email of 28 October 2006, and after making reference to the conclusion of the earlier 2005 Federal Court proceedings apparently involving UBI and TV Plus or their respective related individuals or companies as at least principal opponents, and which apparently took place in the context of earlier arrangements between JRTS and TV Plus, that response continued as follows:
‘Further file notes show that due to your signal being encrypted we were unable to initially distribute the signal and our supplier requested smart cards from us to allow for decoding and some emails were send [sic] to yourself confirming that you would ship the required cards to decode the signal. Our records also show that we commenced distribution of your channel in Australia early 2005.
We are therefore of the belief that we have fulfilled our obligations under the agreement dated 24th of December 2004 which is based on Australian law and that is why I emailed the below request asking that UBI be instructed to cease the unauthorized transmission of your channel which is in breach of our agreement.
Please can you confirm your position regarding the unauthorised transmission of your channel BHTV1 by UBI ...’
It may be observed that no reference was made to the absence of exchange of signed contracts or otherwise as between JRTS and TV Plus.
16 No response having been apparently received, Mr Harris of TV Plus emailed Mr Hadzijamakovic (of course of JRTS) on 6 November 2006, stating inter alia:
‘I am concerned that I hadn’t received a response to my email from last week, have you sent one yet?
The situation is becoming really urgent and my management is pursuing me for a response as to when UBI will cease transmitting the BHTV signal.
The issue is that it continued and unauthorised transmission of BHTV by UBI is clearly infringing the rights which belong [sic] exclusively to TV Plus and we request that UBI immediately cease transmitting the BHTV signal.
It is our opinion that TV Plus has fulfilled the obligations in our agreement and for your reference I attach some screen snapshots from earlier today of the BHTV1 signal as distributed by TV Plus. ... again I request that you instruct UBI to cease transmitting and marketing the BHTV signal.
...’
17 Mr Hadzijamakovic in turn emailed on 13 November 2006 his response to that email of 6 November 2006 from TV Plus, drawing attention to the following circumstances which he propounded, including from the JRTS perspective the allegedly continuing absence of any contractual relationship between JRTS and TV Plus since 26 April 2005:
‘...We inform you once again that the contract between TV Plus and BHTV is null and void effective from 26 April 2005, as per our correspondence to you as of that date.
The reason for the cancellation was the repeated breach of the terms of the contract signed between our two companies relating to your failure to broadcast BHTV over Australia from the time of signing the contract on 24th December 2004 to the time of cancellation of the contract on the 26th April 2005. Any claims by your side that BHTV was broadcast over Australia on a continuous basis are completely unsubstantiated since we know that this [did] not occur.
We find it interesting that no action was taken on your part and no correspondence was received from April 2005 to October 2006, being the time that UBI commenced the continuous broadcast of BHTV over Australia. Furthermore we remind you that the failure to broadcast BHTV on a continuous basis during this period caused tremendous damage to the image and reputation of BHTV, which as a public broadcaster, has an obligation to service all Bosnian citizens, irrespective of where they live. The lack of professionalism on the part of TV Plus, the complete disregard of your obligations under our contract dated 24th December 2004 and your failure to broadcast BHTV prior to the cancellation of the contract (and whatever sporadic transmissions which may have occurred after we cancelled the contract only added to increased antagonism by Bosnians in Australia) is the reason why we declared the contract null and void on the 26th of April 2005.
Whatever issues TV Plus has had or may have had with UBI are not our concern. However we inform you that effective October 2006, BHTV signed an exclusive agreement with UBI for the broadcast of BHTV in Australia ...’
18 Subsequent emails of 15 November 2006 from TV Plus to JRTS, and of 22 November 2006 from JRTS to TV Plus, confirmed their respective opposing positions already stated in the above correspondence, albeit positions of uncertainty as to whether each of JRTS and TV Plus had ever formally entered into broadcasting contracts relating to Australia and if so, for what duration or term, and whether in any event any contracts were still in force and effect. TV Plus demanded of JRTS by email of 25 November 2006 that ‘you instruct UBI to cease distributing the [BHT-1] Channel otherwise we will be forced to commence legal proceedings, for which you have fully indemnified us in our agreement’. TV Plus did not thereupon institute legal proceedings against UBI or JRTS.
19 Mr Bilge of UBI testified to having accessed the TV Plus website www.tvplus.com.au/ channels.htm on 1 December 2006 and to having observed that the same advertised for subscription the BHT-1 channels and displayed the BHT-1 logo, and further that a domain name registration search disclosed that the first TV Plus respondent is the registrant of that website.
20 In response to a written demand of 29 November 2006 of UBI’s Australian solicitors that Globecast Australia, as the purported service and uplink provider for TV Plus, ‘immediately cease broadcasting distributing and up-link [BHT-1] or any part thereof in Australia’, the solicitors for the TV Plus Companies declined to do so upon the following asserted grounds:
‘...
By a broadcast agreement dated 4 January 2005 ..., [TV Plus Operations Company Pty Limited] was granted by the Public Broadcasting Service of Bosnia and Herzegovina ... the sole and exclusive multimedia, satellite and TV rights in the territory of Australia and New Zealand to the television channel known as ... BHT-1. The term of the Agreement is until 1 December 2009 and the Agreement remains on foot.
... [UBI] is aware of the terms of the Agreement as it was disclosed to your client in Federal Court proceedings VID 134 of 2005.
...
It is not correct to state that [TV Plus Operations] started distributing the BHT-1 channel yesterday.
...
By reason of the matters set out above we are instructed that none of the TV Plus Companies will be providing the undertakings sought ...’.
It may be observed that the foregoing did not join issue upon the allegation advanced by the JRTS communication of 13 November 2006 as to cancellation by JRTS of contractual arrangements on 26 April 2005 (ante).
21 It appears from the evidence that TV Plus had been accepting Australian resident subscribers during the preceding 18 months on the basis of its ongoing comprehensive coverage of JRTS televised signals, which according to UBI’s case was nevertheless not available for longer than about two hours daily. Subsequently on 5 December 2006 the head officer of the Satellite Department of JRTS emailed Globecast Australia, and after pointing out that JRTS owned and operated ‘... all rights to the public TV channel named BHT-1’, and that it had become aware that ‘TV Plus, one of your PAS8 satellite space customers in Australia, is distributing [BHT-1] without our authorization’, and further that ‘... Globecast Australia is providing the satellite space, uplink and related technical services for TV Plus and is acting as an accessory to infringement’, JRTS demanded that Globecast Australia ‘stop transmission of BHT-1 on PAS8 satellite without any further delay’. That has not apparently occurred, or at least has not effectively and satisfactorily occurred from UBI’s perspective.
22 It was broadly in the context of the foregoing evolution of disputation between two Australian companies (or Australian corporate groups) claiming conflicting entitlements to an overseas source of television signals emanating from Bosnia and Herzegovina, yet in the further context of that overseas source asserting an ongoing relevant contractual relationship solely in favour of UBI, that the present interlocutory proceedings were commenced by UBI against TV Plus and came on for interlocutory hearing on the second last day of the Federal Court’s 2006 term, followed thereafter by comprehensive written submissions furnished by the respective parties over the following four weeks or thereabouts, and in the case of TV Plus by two successive sets of written submissions provided on consecutive occasions, the last being the most comprehensive and lengthy.
The pleadings and affidavit material in more detail presented further by the respective parties and the respective conflicting or differing positions adopted
23 It is appropriate to next summarise the evidence presented and other steps taken by the respective parties in the context of the interlocutory hearing which took place in this Court on 21 December 2006, and at which the principal relief sought was to the effect that TV Plus be restrained from representing an entitlement on its part to broadcast or re-broadcast the BHT-1 channel in Australia.
24 The originating application and statement of claim in the present proceedings were filed by UBI on 6 December 2006, the relief sought by UBI being damages for breach of subss 115(2) and (4) of the Copyright Act, and orders, injunctions and further consequential relief concerning the engagement by TV Plus in broadcasting or re-broadcasting (as the case may be) the JRTS television channel BHT-1 in Australia. Issues in relation to broadcasting the radio channels did not feature, or at least prominently, in the course of the single day’s hearing made available on short notice on 21 December 2006. Relief was also sought by UBI for contravention of the TP Act based on alleged misleading and deceptive conduct, each in the context of trade and commerce. The misleading and deceptive conduct alleged were the representations by TV Plus that it held the right to broadcast the BHT-1 channel in Australia, and further that the actions of TV Plus in so broadcasting that channel were authorised by PBS. In short, the circumstances said to give rise to the latter cause of action were essentially the same as those giving rise to the former.
25 The principal affidavit evidence of UBI was provided by Mr Sam S. Bilge, sworn on 6 December 2006, and which was supplemented by his further affidavit evidence of 15 December 2006. That evidence outlined the extensive nature of UBI’s operations in Australia undertaken since December 2004 in relation to a range of ethnic language pay television and radio services licensed from suppliers operating from outside of Australia, and its claim of reach to more than 200,000 television viewers across Australia and in Asia-Africa per medium of 120 television and radio channels broadcast in 12 languages and in 26 countries. In order to broadcast its pay television services, Mr Bilge explained that UBI had put in place long-term contractual arrangements involving the following technology and equipment:
(i) transponder and fibre optic network services with world-known international companies such as MCI Worldcom (now Verizon) and Loral Skynet (being Telstar satellites);
(ii) transponder services on the Australian owned Optus B3 satellite in order to deliver the channels to ‘multi-cultural’ homes in Australia;
(iii) up-link and down-link equipment and earth station facilities in Australia and different parts of the world;
(iv) encryption technology;
(v) broadcasting equipment; and
(vi) customer premises equipment.
26 In addition to maintaining its general overheads since the onset of the dispute, UBI also claimed to have incurred additional costs for the broadcasting of its television channels from Europe, and to the conversion thereof for broadcasting and distribution in Australia. The cost of broadcasting individual channels being presently incurred by UBI was said to be $60,000 per channel per month.
27 Mr Bilge further testified, by affidavit sworn on 15 December 2006, to a conversation ‘[i]n about September 2006’ with the general manager of UBI’s Macedonian operation to the effect that JRTS did have previously an agreement with TV Plus to broadcast BHT-1, ‘but that agreement was cancelled and BHT-1 hasn’t been aired in Australia for over a year’, and moreover that ‘UBI had been granted the exclusive right to broadcast BHT-1 in Australia ...’. He spoke of his awareness that ‘between May and October 2005, TV Plus sporadically broadcasted BHT-1 in Australia’, but that as I have just indicated, BHT-1 ceased being broadcast in Australia since October 2005. Moreover he spoke of UBI having received ‘ ... over a hundred calls from UBI subscribers as well as individuals’, which were said to have expressed ‘their confusion as to why there were now two BHT-1 signals in Australia’. Mr Bilge further testified in particular as to important international soccer games having been very recently broadcast by TV Plus on BHT-1 in Australia, but to his having been informed by JRTS nevertheless that it had not provided TV Plus with any smartcards to access the relevant BHT-1 signal.
28 Generally as to UBI having sustained already loss and damage by the recent conduct of TV Plus complained of, Mr Bilge further testified that ‘UBI has been very successful since its establishment in 2004, however since TV Plus [re]commenced broadcasting BHT-1 in late October 2006, there has been an increase in confusion expressed to UBI by customers, prospective customers and the Bosnian community at large’. He testified further as to an initial substantial increase in subscriptions to the ‘Balkan Bouquet’ package since UBI began broadcasting BHT-1 in 2006, and of the basis for his then expectation of ‘a continual and steady growth in the number of subscriptions of the Balkan Bouquet package for the next 3 to 6 months’, but then explained that the rates of UBI subscriptions ‘suddenly began to plateau’ in November 2006, coincidentally with UBI being ‘inundated with queries and concerns from subscribers, prospective customers and individuals from the Bosnian community about the situation regarding BHT-1’.
29 UBI procured from overseas, at least for the purpose of the present interlocutory proceedings, affidavit evidence from Mr Hadzijamakovic of JRTS completed on 14 December 2006 in Sarajevo, he being as I have earlier stated the head of the Satellite Department of the Public Broadcasting Service of Bosnia and Herzegovina (the anglicised version of JRTS as already indicated in [1] above). Mr Hadzijamakovic recounted in detail the circumstances concerning the original grant to TV Plus of exclusive rights to broadcast BHT-1 in Australia. He further spoke of negotiations for that purpose having commenced in November 2004, and he then recorded as follows:
‘9. On 24 December 2004, Mr Drago Maric, Director General of JRTS, entered into an agreement with TV Plus, which amongst other things, granted TV Plus the exclusive right to broadcast BHT-1 in Australia. The Agreement was forwarded to TV Plus that day ...’.
30 Mr Hadzijamakovic then testified by affidavit (literally) that ‘... when I got the information that TV Plus still is not ready to start broadcasting and that they have some problems I cancel to send already prepared package with smart cards’. Controversy on the subject of smart cards was said to have continued between him and Mr Jeremic, Mr Hadzijamakovic apparently demanding that TV Plus commence broadcasting immediately on the basis that smart cards were not needed to broadcast ‘app.85% of our programmes on BHT-1... [and therefore] did not need to be decoded’. His affidavit testimony continued in par 14 thereof as follows:
‘Therefore, when the date for broadcast was continually postponed, I became extremely embarrassed and concerned that the commercial reputation and credibility of JRTS amongst the Bosnian community in Australia would be affected.’
Consequently by email bearing date 26 April 2005, he notified TV Plus in Australia as follows (again I adopt below his expressions as literally expressed in English):
‘On 24th December 2004 we signed the contract with TV Plus and till now we did not receive the copy of this contract with your sign neither you start to transmit our programs. Because of this we declare null and void this contract.’
I should interpolate at this point to record that the affidavit evidence of Mr Hadzijamakovic was tendered by UBI in the context of his absence from Australia for cross-examination, and on the basis that his averments therein were disputed, and that therefore the reading of the affidavit by UBI was not to be taken as any acceptance on the part of TV Plus of its contents.
31 Mr Jeremic, the deponent of the TV Plus affidavit material, responded from Australia by email bearing date 27 April 2005 to JRTS as follows (it is necessary to keep in mind of course that such 2005 correspondence preceded the events of 2006 already contextual to the present litigation):
‘...
Please be advised that we do not accept your ... email purporting to terminate your agreement with TV Plus for the exclusive right to distribute the BHTV1 channel. Our Broadcast Agreement is based on the laws of Australia, we have been forefilling [sic] our obligations under the Broadcast Agreement so there is no valid reason for your below email, hence I request you immediately withdraw it. As previously advised the BHTV 1 will be located on the Pas8 Satellite with the following details:
...
Further we have previously sent the Broadcast Agreement some time ago by Registered Posted [sic] to your office ...
...
Again Please note that TV Plus has the sole and exclusive right to distribute the BHTV1 channel in Australia and New Zealand, we do not accept any purport to terminate your agreement with us. I request you immediately reply within 24hrs revoking your below email.
...’.
32 The emailed rejoinder of Mr Hadzijamakovic on behalf of JRTS from Bosnia of 28 April 2005 was written in English and reads (literally) as follows:
‘I would be really glad to confirm what you have said in your e-mail below but unfortunately I can not do it. All the time we were patient enough, waiting for you and after the FOUR months of doing nothing you dare to impose the term of 24 hours for my reply.
[For]...more than four months we have been waiting something to happen or to be advised what is going on or to receive any information by your side.
We have not received any information from 25th December 2004 till 23rd March 2005 nor have we received the copy of counter signed contract till now (27th April). The promise from your e-mail of 23rd March after three months is not enough in professional cooperation between two companies. Whether you like it or not it is completely unprofessional by your side and above all we haven’t received the contract after four months of being signed on our side that is why we declare it null and void.
Very precisely I consider your and our current position regarding our cooperation and I will do all I have to protect my interests who are jeopardized by your company and will use my professional influence to introduce to European TV Broadcasters "The professionalism" of you personally as well as of your Company. I have never had such an experience with one company in my 28 years long career spent in broadcasting on the different positions.
Have you ever been so unprofessional to any other partner of you or you consider people from Bosnia totally crazy’
33 Mr Hadzijamakovic’s affidavit evidence of 15 December 2006 thereafter recorded that he was ‘sure that we... never received... the countersigned copy of the Agreement by any means till April 27 2005’, consistently with the emailed response of TV Plus of that date (which I have already extracted), and to which he had rejoined by his above email. He thereafter continued his affidavit evidence as follows (again literally reproduced):
‘17. ... As far as I could remember, after 18 months since that time, I did not have any contact with Mr Jeremic after this date. Even if I have it I would never have recall the termination. Especially I will not do it orally. I am TV professional for almost 30 years and if I am terminating the agreement in written form for sure I will recall it in the same form. I remained on the position of 27 April 2005 what confirm the fact that I have never sent the smart cards to TV Plus. I received no further correspondence from TV Plus until 19 October 2006.
18. I am aware that between May 2005 and October-November 2005, TV Plus broadcasted BHT-1 in Australia. JRTS did not provide its permission for these broadcasts.
19. JRTS had not provided TV Plus any smart cards therefore TV Plus could only have broadcasted programmes that were not encrypted, for example, news programmes and dramas.
20. JRTS did not receive any payment from TV Plus under the Agreement or for their broadcasts of BHT-1 in Australia, between May and October-November 2005.
21. I am aware that in September 2006, JRTS was approached by Ms Senada Softic, the President of the Australian Council of Bosnia Herzegovina Organisations, who requested that JRTS make arrangements to resume broadcasting BHT-1 in Australia.
22. Shortly after, JRTS commenced negotiations with United Broadcasting International Pty Ltd (‘UBI’), regarding an exclusive license to broadcast BHT-1 in Australia.
23. On 25 September 2006, JRTS and UBI entered into an agreement whereby amongst other things, UBI was granted the sole and exclusive rights to broadcast BHT-1 in Australia. The agreement with UBI states the service is "television channel BHT". It is the same channel as BHT-1. On 10 October 2006, UBI commenced broadcasting BHT-1 in Australia.’
34 The principal affidavit evidence provided by TV Plus to date was made by a director of all three TV Plus companies, being the abovementioned Mr JP Jeremic, he being an Australian resident, as in the case of Mr Bilge of UBI. Before further addressing that evidence of Mr Jeremic, I should record that part of his testimony was directed to the interlocutory application of TV Plus largely and prominently for security for costs sought by TV Plus to be provided by UBI in the sum of $200,000.00. A notice of motion for that purpose was filed on 15 December 2006 pursuant to s 1335(1) of the Corporations Act 2001 (Cth) or alternatively under Order 28 rule 2 of the Federal Court Rules. TV Plus has not brought any present claim for injunctive relief, ostensibly because as senior counsel for TV Plus explained, ‘[w]e are getting our feed ...’. In that regard, Mr Jeremic explained ‘TV Plus has continued to this day to broadcast, distribute, advertise and offer for sale the channels which were the subject of the previous proceedings in Australia’; I have of course already made reference to those proceedings involving JRTS and TV Plus (or their respective principals or other related companies) which took place and were finalised in 2005. Nevertheless it is not without significance that TV Plus has withheld from joining JRTS as cross-respondent to the present proceedings for the principal relief sought by UBI, notwithstanding the position adopted by JRTS adversely to the claims of TV Plus, and in support of the position of UBI as I have already recorded.
35 The basis of the TV Plus application for security for costs was set out in the first affidavit of Mr Jeremic sworn on 13 December 2006 (see paras 76 to 80 thereof). Given however the relatively short Court hearing of time available to the parties on the second last day of term for 2006 for any interlocutory proceedings, my consideration of UBI’s objection to that segment of the principal affidavit evidence of Mr Jeremic was deferred for the time being. The affidavit evidence adduced by TV Plus on that occasion was said to be at least partly in response to the principal affidavit of Mr Bilge sworn on 6 December 2006, to which I have already made reference. At the outset of reading the affidavit evidence of Mr Jeremic of 13 December 2006, senior counsel for TV Plus indicated that TV Plus is the holder of twenty narrowcasting subscription broadcasting licenses issued by the ABA numbered from 2694 to 2713, and that it transmits a number of ethnic satellite television and radio channels in Australia and ‘surrounding countries’. As foreshadowed, the practice of TV Plus is that once TV Plus has acquired exclusive rights to broadcasting, it sets in train the advertising, marketing, distributing and broadcasting of the television content, the obtaining of subscriptions from new customers and the collection of monthly subscription fees. The channels of TV Plus are offered to the public on the basis of a subscription service, and TV Plus installs a set-top box and satellite dish in each customer’s home and issues a so-called unique smart card which permits the decoding of TV Plus’ signals by the customer.
36 TV Plus indicated to my understanding that it did not presently intend to pursue causes of action against UBI (apart from the security for costs application), but would put in issue the claims which UBI has sought to bring against TV Plus arising out of the matters raised by UBI in the context of the present proceedings. TV Plus put its present concerns in an abbreviated commercial sense as follows:
‘We have a business where we put on the large number of subscribers and how we’re dependent upon this broadcast and the continuation of this broadcast and if we’re stopped even for a short time it would virtually destroy our business’.
37 UBI emphasised in the context of balance of convenience issues that ‘... the Public Broadcaster in Bosnia wasn’t aware’ that TV Plus was actually taking the feed, and moreover that ‘... it was only when [UBI] became aware that [TV Plus] was being advertised that we sought an injunction’. It was said by UBI in the course of submissions that ‘... the evidence is quite clear , ... there was a failure on the part of [TV Plus] to make any challenge to the purported termination’ by JRTS of the broadcasting rights of TV Plus, and moreover that ‘... there was no true broadcasting of this channel, certainly not in the way that we’re broadcasting now, until we commenced the broadcast two months ago... they’re riding on the back of us, who are prepared to pay for a service [and] we’ve entered into an agreement with’ JRTS. Moreover UBI contended that TV Plus is asserting an entitlement ‘... now to challenge commercially [its] competitor to take that feed, [yet] not pay for it, and just broadcast it effectively to spoil [its] competitor and that’s the issue ...’.
38 As to the absence of joinder by TV Plus of JRTS to the present proceedings as additional respondent, notwithstanding the substantial contractual issues foreshadowed already as between TV Plus and JRTS, senior counsel for TV Plus sought to explain that TV Plus has ‘... in good faith, broadcast this channel for the last 18 months ... we have a continuing contract and a continuing right to the feed ... and over that 18 month period, we’ve taken up thousands of subscribers for the feed’. Moreover TV Plus emphasised that the applicant has conceded ‘... there’s no obligation to make any payment until next January’, being of course January 2007, that payment being ‘only of the order of $10,000 for the first year’, and in any event in relation to the claim for injunctive relief, that there had been laches on the part of UBI ‘in the sense that they have been sitting on their rights’, yet significantly, so the TV Plus position was emphasised, UBI ‘... freely contracted... knowing that the other party ... was holding itself out to the world, and continuing to hold itself out to the world, as the authorised publisher, or as a publisher of this material’. TV Plus argued further that UBI ‘... went into this with their eyes open and didn’t cover all necessary situations for their security’, and accordingly UBI must continue ‘to run with that risk until the matter is decided’.
39 TV Plus undertook nevertheless to keep an appropriate account, and to provide details thereof to UBI, in the following terms:
‘UNDERTAKING OF RESPONDENTS
1. To keep an accurate record of all new subscription agreements entered into by the respondents which provide access to the Bosnian language channel BHT and to provide a regular summary report in confidence to the solicitors for the applicant.
2. To maintain an accurate record of all monies received from new and existing subscribers who receive access to the Bosnian language channel BHT from the respondents.
3. To not enter into any new subscription agreement or to review any existing subscription agreement which provides access to the Bosnian language channel BHT-1 other than on a monthly basis.
20.12.06’
40 TV Plus asserted as a discretionary factor, in relation to balance of convenience issues said to arise, that UBI ‘... has only been around since July 2004 and it emerged out of the embers of a previous company TARBS and the applicant is a $1 company, with one director [and] one shareholder, who is the wife of the Chairman Mr Boulos.’ TV Plus signalled its intention to require production of the minute book of UBI and of its financial statements. Formal call was made by a notice to produce bearing date 20 December 2006 (that is, on the day preceding the hearing of the subject interlocutory proceedings), but no material was produced by UBI in answer, it being pointed out in that regard by counsel for UBI that the notice had only been served at 3:16 pm on the previous day. It would be correct to conclude that the financial circumstances of UBI, to the extent disclosed in the evidence, present apparent concerns in terms of UBI’s present financial standing.
41 As to the significance or otherwise of the prior Federal Court proceedings involving the parties which concluded in 2005, counsel for UBI contended that there was ‘... little if any relevance to the behaviour of the parties in late 2006, and that what was in dispute in the Melbourne proceedings [of the Federal Court] in 2005 is unlikely to assist’.
Substantive claims and counter claims of the respective parties in further detail, including balance of convenience issues
42 As has been already indicated, UBI seeks interlocutory relief upon the basis of an exclusive license, claimed by UBI to have been granted in October 2006 by JRTS, to transmit the television broadcast signals into Australia of the subject Bosnia and Herzegovina television channel BHT-1. That television license is said by UBI to constitute a class license for subscription to television narrowcasting services, the conditions whereof being set out in Schedule 2 to Part 7 of the Broadcasting Services Act 1992 (Cth). TV Plus disputes that claim and denies the existence of any prima facie case at the instance of UBI, and hence of any serious question of copyright infringement on the part of TV Plus to be tried. Alternatively TV Plus contends that if the Court is minded nevertheless to grant any interlocutory relief in favour of UBI, then the usual undertaking as to damages required of UBI should be personally guaranteed by a director of UBI in view of the so-called apparent ‘frailty’ of UBI financially. In that regard, TV Plus put on evidence purportedly to the effect that there would be extensive damage to its existing subscription base, and hence to its business generally, if the injunctive relief sought by UBI was to be granted.
43 UBI pointed out that TV Plus had been obtaining for 18 months up until October 2006 commitments from members of the public by way of subscriptions to TV Plus, on the basis in reality of merely two hours or so of televised material each day (or so UBI contended). UBI contended further that there was a genuine risk to members of the Balkan community in Australia that they may subscribe to the television broadcasting services of TV Plus, yet not receive what they would have thought they had paid for. In that regard UBI further asserted that the evidence demonstrated ‘a general lack of concern for the interests of their customers’ on the part of TV Plus.
44 There is some evidence of the effect of a stance adopted by JRTS that it had terminated its earlier copyright license agreements with TV Plus in April 2005, and that it was only thereafter that JRTS committed itself to an exclusive license in favour of UBI. TV Plus has continued in any event to take or endeavour to take the BHT-1 signal and broadcast it in Australia. The case of UBI is further that TV Plus has not as yet paid JRTS any moneys for taking and broadcasting that signal. Leaving aside the matter of payment (or offer of payment) by TV Plus to JRTS of any outstanding license fees, it was contended by UBI that there exists ‘... a serious matter to be tried in relation to the Copyright claim, the Trade Practices claim and the anticipated breach of contract claim’. In that regard UBI asserted that it ‘... is not getting what it is paying JRTS bona fide, because part of [UBI’s] prospective audience is being dissipated by the actions of [TV Plus]’. As I have elsewhere indicated in these reasons, virtually the same circumstances are relied upon by UBI for the establishment of its TP Act claims as in the case of its copyright claim.
45 As to the standing of JRTS and its absence as a party to the proceedings, it was mutually acknowledged by the parties that the joinder of JRTS as a party to the proceedings would be required at least by the time the proceedings for final relief would fall to be litigated and resolved. UBI acknowledged that whether JRTS should be joined as a respondent in the context of the resolution of issues as to breach of contract, as well as breach of copyright, needed to be addressed and determined before the granting of any final orders.
46 It was the contention of UBI that the balance of convenience supported the imposition of at least the interim restraints it required from TV Plus, for the following reasons:
(i) the absence of any curial challenge by TV Plus to the termination by JRTS of its agreement with TV Plus, whether in Bosnia and Herzegovina or in Australia, which termination was apparently notified by JRTS to TV Plus on 28 April 2005;
(ii) the ongoing use and exploitation by TV Plus of the controversial JRTS material since 28 April 2005, yet without any payment by TV Plus to JRTS in respect thereof; in that context it was said by UBI that the contention that TV Plus was not making payment for the JRTS material it was using and exploiting for profit, ostensibly because it had not been invoiced, was ‘fatuous and an indication that [TV Plus is] prepared to take unfair commercial advantage if it suits them’;
(iii) the ‘alarming admission’ said to have been made by Mr Jeremic (of course of TV Plus) in the course of cross-examination that ‘... steps were taken to improperly bypass the interests of JRTS, and, by extension, the applicant, to obtain increased broadcast time to allow [TV Plus] to compete with [UBI] in the broadcasting of BHT-1’;
(iv) the acknowledgment by Mr Jeremic that TV Plus only obtained capacity to broadcast BHT-1 for 18 hours a day because UBI came into the market.
It was therefore submitted by UBI that there existed already sufficient material on an interlocutory basis to satisfy the Court at least that there were serious issues to be tried in relation to its copyright claim, its TP Act claim and its anticipated breach of contract claim. The restraints which UBI is seeking against TV Plus were said to be justifiable on each of those footings. UBI pointed additionally to what it claimed to be the absence of empirical evidence in support of Mr Jeremic’s testimony as to TV Plus sustaining losses in the prevailing contextual arrangements.
47 UBI submitted moreover that the Court should decline to rule on the issue as to provision of any security for costs sought to be provided conversely by UBI in favour of TV Plus, at least for the time being, for the following reasons:
(i) the ‘strong arguable case’ of UBI;
(ii) despite TV Plus’ assertions that UBI has only a nominal paid-up capital and does not hold any assets which are at least tangible, UBI was able to satisfy an award of costs in the previous proceedings involving TV Plus; and
(iii) the evidence thus far adduced by UBI demonstrates that it is already operating a well-established business.
Alternatively an appropriate security to be provided by UBI was contended by it to be in the sum of $60,000, together with the giving by Mrs Regina Boulos (she being presently the sole director of UBI), of an undertaking personally to meet any such costs.
48 TV Plus submitted that it would be an untenable proposition of law in any event for UBI to advance that TV Plus, or any other entity inclusive of UBI, should not be entitled to re-broadcast or otherwise communicate the BHT-1 Channel originating from Bosnia and Herzegovina to the public in Australia. TV Plus contended in that regard that since at the centre of the dispute there is an issue as to Australian copyright, founded as it must therefore be from the making of a broadcast from a place in Australia as required by s 91 of the Copyright Act, the so-called provenance of the subject broadcast in Bosnia and Herzegovina prior to it being bought into Australia by UBI is ‘quite irrelevant’. That was said to be because there is no provision for the protection of broadcasts made from that overseas country to Australia under the Copyright (International Protection) Regulations 1969 (regs 3 and 4(6)), that country not being a member of the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations 1961. Therefore so the TV Plus submission continued, it will only be the broadcast of the subject television channel from within Australia that can receive protection under Part IV of the Copyright Act, and s 22(5) thereof in particular, unless of course that broadcast may be proscribed as misleading and deceptive conduct under Australian legislation, as is UBI’s additional or alternative case in any event.
49 The yet further matter advanced by TV Plus in the context of the copyright issues, in sequence of presentation, was that broadcast copyright is ‘distinct’ from copyright in other works in relation to what may constitute the taking of ‘a substantial part’ of the copyright work within s 14(1) of the Copyright Act. I was referred in that regard to the decision of the High Court in Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273, and in particular at 299-303. The particular copyright work there established by the High Court consisted essentially of identified televised programmes or certain segments of televised programmes, as established by a majority of the High Court, rather than merely single images. In the course of the reasons for judgment of the majority of the High Court, it was explained that television broadcast copyright concerns broadcasts ‘made from a place in Australia’, and so made ‘under the authority of a license...or class license’ issued under the Broadcasting Services Act 1992 (Cth), and thereby involved the notion that the maker of the broadcaster is taken to be ‘the person who provided the broadcasting services by which the broadcast was delivered’. The statutory scope of ‘provide’ or ‘provision’ may therefore be seen to be comprehensive. TV Plus did not appear to explain at the present stage of the proceedings why the notion of ‘substantial part’ was not susceptible to satisfaction in the particular circumstances of the present proceedings.
50 TV Plus next advanced the submission that in order to establish infringement here on the part of any one or more of the TV Plus companies, it would be necessary in any event for UBI to establish interception and thereafter broadcast (or what may conceivably be termed as ‘re-broadcast’) within Australia, and it would not be enough in that regard for UBI’s copyright cause of action to demonstrate interception from a place outside of Australia. Given the complexity of the modern technology involved in television transmission of televised programs originating offshore, and the apparent need for TV Plus to comprehensively establish the circumstances as to interception etc, it would be inappropriate to resolve any such complex as well as apparently controversial issues at this interlocutory stage. In that regard I refer to what I have earlier merely outlined in [4] above of these reasons. Mr Jeremic testified broadly and in a sense imprecisely as to the signals being transmitted ‘in part from within Bosnia and Herzegovina’, and the signals thus supposedly standing outside any notion of an Australian broadcast. TV Plus also pointed to the need for UBI to demonstrate copying in a television context, explaining that ‘[s]imilarities alone, or even complete identity, between the parties’ works or their subject matter, are not enough in the absence of copying, as copyright is not a monopoly right such as a patent’. It is enough from a practical perspective to merely record and not resolve any such issues at the present stage of the proceedings, particularly given that more evidentiary precision, and further expert evidence, would appear to be required.
51 As earlier foreshadowed, UBI has pleaded further causes of action upon the footing of conduct on the part of TV Plus in trade and commerce in Australia in contravention of ss 52 and 53(a), (b) and (d) of the TP Act, said to be constituted by the making of false, misleading and untrue representations to members of the public, and/or persons interested in receiving ethnic television broadcasts, to the effect that:
(i) TV Plus held the right to broadcast the BHT-1 channel in Australia; and
(ii) The rebroadcasting of the BHT-1 channel by TV Plus and the efforts of TV Plus to obtain subscribers based on their purported right and capacity to broadcast the BHT-1 channel was duly authorised by JRTS.
For the purposes of establishing moreover liability for misleading and deceptive conduct under s 52 of the TP Act, TV Plus emphasised that there must be a relevant misrepresentation in order to be actionable, the Court being referred by TV Plus in that regard to Campomar Sociedad Ltd v Nike International Ltd (2000) 46 IPR 481 at 508-509; however there had been no representation by TV Plus concerning UBI’s own broadcasts, that is, those broadcasts in relation to which UBI might own the copyright, so the TV Plus submission continued, because TV Plus had made those broadcasts from Australia. Nothing in the advertising or promotional activity otherwise of TV Plus was said by it to have suggested any association with UBI, and therefore no issue with respect to ss 52 or 53 of the TP Act arose adversely to TV Plus, so TV Plus further asserted. Essentially or largely, the same circumstances pleaded by UBI for breach of copyright were relied upon to support those pleaded causes of action. Damages and injunctive relief were similarly or correspondingly sought by UBI, in line with the relief sought for breach of copyright.
52 As to the issue of contractual entitlement, TV Plus submitted that there could be no misrepresentation relevantly to be imputed to TV Plus, in view of the fact (being a fact in issue from UBI’s perspective) that there was a subsisting agreement between TV Plus and JRTS reached earlier on 4 January 2005 and which, among other things, constituted TV Plus Operations in particular as an exclusive licensee of the BHT-1 Channel along with ‘its programming contents together with all associated rights ...’. While the purported grant of broadcast rights in the nature of copyright to TV Plus may have been nugatory because broadcasts from Bosnia and Herzegovina are not protected in Australia under the Copyright (International Protection) Regulations 1969, so that TV Plus submission continued, so much was said to indicate that there was in any event a pre-existing contractual relationship between JRTS and TV Plus. Moreover TV Plus asserted that although it was said by UBI to have been acknowledged by TV Plus that there had been an earlier rejection by JRTS of any subsisting contractual obligation on its part in favour of TV Plus, nevertheless that any such rejection had occurred otherwise than within the terms of the TV Plus/JRTS contractual arrangements, and had not been in fact accepted by TV Plus. In that context it was further said by TV Plus to be beside the point for UBI to assert that TV Plus had never made payments under those arrangements, since TV Plus had always acknowledged its contractual liability to make such payments, though it maintained that the time for making even the initial payment falling due to JRTS has not yet crystallised for payment in favour of JRTS. In that regard, TV Plus asserted that no payment was due and payable under that TV Plus/JRTS agreement during the first six months of its term, yet the purported termination by Mr Hadzijamakovic on behalf of JRTS took place before the end of that six months period.
53 The foregoing circumstances propounded by TV Plus were therefore said by TV Plus to provide a firm basis for its asserted continuing belief that TV Plus was entitled to take the broadcast signals from JRTS originating in Bosnia and Herzegovina, and to distribute the same in Australia, and that accordingly the representation said to arise from the conduct of TV Plus was not misleading. Hence TV Plus submitted therefore that there was no prima facie case or serious question arising at least as to the first misrepresentation pleaded by UBI against TV Plus. Once again there needs to be pointed out the difficulties as to giving expression to the TV Plus case in circumstances where it has (at least thus far) withheld from joining JRTS as a third party to the proceedings.
54 As to the second misrepresentation on the part of TV Plus pleaded by UBI pursuant to ss 52 and/or 53 of the TP Act, it was apparently the contention of TV Plus that it had proceeded with its present course of taking television signals from JRTS in the purported belief as to the continued existence of a valid and subsisting contractual arrangement with JRTS in operation in Bosnia and Herzegovina, irrespective of the concession by Mr Jeremic at least to the effect that there may have been some ‘ill feeling’ between he and Mr Hadzijamakovic. Nevertheless Mr Jeremic claimed to have always believed that the purported termination had not been validly effected by JRTS, and had not been in any event accepted by TV Plus, and that accordingly TV Plus remained under a continuing contractual liability to make payments to JRTS upon receipt of an invoice issued in accordance with the relevant contract. Moreover Mr Jeremic testified that in the course of his most recent telephone conversation with Mr Hadzijamakovic, it had been indicated by him to Mr Jeremic that if the agreement between TV Plus and JRTS had not been terminated, then ‘TV Plus Operations should do whatever it considered was appropriate’. It was submitted by TV Plus, in my opinion at least controversially, that there was insufficient evidentiary material presently provided on the part of UBI in order for UBI to maintain a prima facie case for the existence of a serious question to be tried as to contraventions of ss 52 and 53 of the TP Act on the part of TV Plus. UBI’s submissions in reply, filed on 6 February 2007, contended that ‘[h]aving regard to [the] evidence, it is not open to the respondents to say that they believe they have a right to broadcast the BHT-1 signal’. Counsel for UBI further contended that ‘[i]f such a "right" to broadcast had existed, and the respondents considered they were entitled to exercise that "right", the Court is entitled to ask why no action was taken for eighteen months to assert that right by challenging JRTS’s termination of the contract’.
55 No case of imminent damage was said by TV Plus to have been established prima facie by UBI, such that could not be appropriately satisfied by any award of damages at the ultimate trial, for the following reasons next outlined by TV Plus:
(i) BHT-1 represents only one of a large number of TV and radio broadcasts operated by UBI in Australia; Mr Bilge was said to have referred to 120 in total number produced in 12 languages. In particular, it is alleged that this is part of UBI’s ‘Balkan Bouquet’ service to subscribers, comprising 11 TV and radio channels from the Balkan region;
(ii) UBI had only been transmitting the BHT-1 broadcasts since 10 October 2006;
(iii) moneys were not payable under the UBI licence agreement with JRTS until 1 January 2007, which date was subsequent of course to the only interlocutory hearing in the proceedings held on the second last day of the 2006 Federal Court sittings (as I have earlier recorded); I was referred to what appeared under the heading ‘Licence Fee’ on page 5 of the Licence Agreement of 25 September 2006 entered into between JRTS and UBI, and to the contention of UBI that no payment of that fee had been as yet made by UBI to JRTS;
(iv) UBI testified generally as to the large scale of investments that it had made in establishing its ethnic broadcasting services in Australia, but did not seemingly identify what part of that investment had been made directly in relation to establishing the BHT-1 broadcast;
(v) there was no evidence of loss of subscriptions by UBI attributable to the TV Plus activities and at best, the only damage to UBI occasioned by any wrongdoing on the part of TV Plus, and which was open to be inferred from the evidence to date, concerned its ability to gain subscribers which had been ‘slowed down’;
(vi) UBI must have had prior knowledge of the TV Plus broadcast activities relating to what appeared on BHT-1, since TV Plus had been advertising the same to potential Australian subscribers since 2005; moreover the existence of the agreement between TV Plus and JRTS was said to have been disclosed in the course of litigation between the parties in early 2005.
56 The occasioning of ongoing loss to TV Plus, if TV Plus was to be relevantly enjoined in this interlocutory proceeding at the instance of UBI, was asserted by TV Plus to be ‘considerable and would potentially threaten its whole undertaking’, for the following reasons set out in Mr Jeremic’s affidavit evidence (TV Plus used the anglicised description therein of PBS rather than JRTS in those submissions, but for consistency in these reasons I have at least for the most part maintained reference to JRTS):
(i) its primary subscription base involves the Balkan States and approximately 90% of its revenue is derived by reference thereto;
(ii) the BHT-1 broadcasts are a significant part of the so-called ‘Balkans package’ offered by TV Plus and there are close linguistic similarities between broadcasts from each of Bosnia, Serbia and Macedonia, being a factor which has the consequence that the BHT-1 broadcasts are not just taken up by members of the Bosnian community in Australia;
(iii) restraining TV Plus from broadcasting BHT-1 would place the TV Plus in breach of its contractual obligations to its subscribers, since it would no longer be able to offer BHT-1 as part of its Balkans package; Mr Jeremic estimated that there would be cancellations of approximately 1,500 subscribers (out of its approximate 3000 subscriber base) with a consequential loss of revenue to TV Plus of $100,000 per month;
(iv) Mr Jeremic also estimated a further loss of 350 subscribers likely to be sustained by its so-called website streaming platform amounting to $22,750 per month, so much involving more than a 50% reduction in the TV Plus’ income flow;
(v) enjoining TV Plus to the extent proposed would lead to staff reductions and cancellations of service contracts, both in Australia and abroad, and would alone jeopardise the survival of TV Plus;
(vi) there have also been threats to the TV Plus service providers, such as to Globecast Australia (ante); though I should observe that the nature and extent of those threats were not indicated, nor evidence adduced from an officer of Globecast in that regard, despite the extent otherwise of evidence tendered by TV Plus already;
(vii) the evidence was said to suggest that UBI does not have the financial resources to meet any undertakings as to damages necessary in order for UBI to obtain interlocutory relief, TV Plus referring thereby to UBI’s paid up share capital apparently comprising merely one share of $1 par value, and to its membership being confined to one person (Ms Regina Boulos), yet UBI’s assets were subject to a registered charge to secure up to $60 million over all of its undertaking and assets; moreover no balance sheets or profit and loss accounts of UBI had been produced or made available to TV Plus; accordingly no injunction should be granted in any event until an undertaking could be given by a natural person individually, such as the sole director and member presently of UBI earlier recorded Ms Boulos; I was referred in that context to Select Personnel Pty Ltd v Morgan and Banks Pty Ltd (1988) 12 IPR 167, cited with approval by the Full Court of this Court in First Netcom Pty Ltd v Telstra Corporation Ltd [2000] FCA 1269; (2000) 101 FCR 77 at [23]- [24], and also to Permanent Promotions Pty Ltd v Independent Distillers (Aust) Pty Ltd (2004) 62 IPR 538 at [25-26];
(viii) the notice to produce which had been issued by TV Plus to UBI was said to have been in the following terms:
(a) the minutes of board meetings of the applicant for 2005 and 2006;
(b) the most current balance sheet and profit and loss statement of the applicant; and
(c) all subscription agreements entered into by customers of the applicant for its Balkan Bouquet package between July 2006 and 6 December 2006,
and no such material had been as yet produced to the Court.
57 As foreshadowed, a further factor said by TV Plus to ‘tilt’ the balance of convenience factor in favour of the withholding of interim relief by way for instance of injunction against TV Plus, was said to be the fact that TV Plus had already given, and would continue to provide, the undertaking appearing at [39] above. UBI submitted rhetorically that if TV Plus were ‘genuinely at risk of... heavy financial loss, why was nothing done for some 18 months to put the "unreliable" broadcast right’. It was further contended by UBI that ‘the fact that nothing was done by [TV Plus] for so long casts huge doubt on the genuineness, not only of their argument, but of the evidence that has been provided by Mr Jeremic’.
58 As to matters pertaining to what was asserted by UBI to be detrimental to assertions of good faith on the part of TV Plus, and its director Mr Jeremic in particular, the same were said by TV Plus not to be relevant to balance of convenience issues, and not to be decisive in any event, for the following reasons:
(i) it is not appropriate on an interlocutory hearing, where the parties have not had a full opportunity to present their final case, for there to be findings on all relevant disputed questions of fact, inclusive of credit;
(ii) it was acknowledged by TV Plus that there had been difficulties in the relationship between TV Plus and JRTS, but that did not mean, on the partial examination of the evidence in these interlocutory proceedings that had taken place, that their contractual relationship had terminated according to law, as contended by UBI, or that TV Plus had been ‘helping themselves’ to something to which there was no entitlement; TV Plus claimed to have acknowledged throughout the subject litigious disputes a continuing contractual liability to pay JRTS what would become due and payable;
(iii) criticism that TV Plus took no steps against JRTS formally to enforce and/or terminate ‘the agreement’ between them was to be appraised in the broader context that TV Plus had earlier been engaged in very expensive litigation (to which I have already made brief reference) in order to enforce its entitlements, and that so much carried the consequence that so long as TV Plus could still obtain some BHT-1 signals, TV Plus could duly satisfy its obligations to its subscribers, and there was no apparent need therefore for the parties to incur further expenditure on legal proceedings; moreover it was said that the fact that there was ill will between Messrs Jeremic and Hadzijamakovic made the conduct of TV Plus all the more explicable, and all that was not a matter upon which TV Plus needed to incur additional expenditure, at least until the present proceedings arose from ‘the second agreement made by PBS’ (ie of course JRTS);
(iv) as to Mr Jeremic’s acknowledgment that TV Plus only obtained capacity to broadcast BHT-1 for 12 to 15 (and not 18) hours per day because UBI ‘came into the market’, so much was said by TV Plus to be an understandable and purely commercial response that would be made by any businessman in the present circumstances; until that time, there was asserted by TV Plus to have been insufficient complaints from TV Plus’ subscribers about the brevity of the BHT-1 transmission by TV Plus, and further that it only became necessary, as a competitive response, to gain fuller access when there appeared another operator (UBI) providing the same service; TV Plus maintained that JRTS was not contractually free to grant those rights to UBI in any event because of the terms of JRTS’s prior agreement with TV Plus, though it was seemingly accepted that so much would not be relevant in the context of the present application of UBI, and perhaps understandably so in the light of the non-joinder by TV Plus of JRTS in the proceedings;
(v) any liability of UBI to pay JRTS had only arisen from 1 January 2007 and hence at the time of issue of the present proceedings, UBI had not yet incurred any expenditure in favour of JRTS; I am presently unable to perceive why that would be material in any forensic sense.
59 As to the application of TV Plus for security for costs in the sum of $200,000 sought by TV Plus to be provided by UBI, it was emphasised by TV Plus further that there must be grave doubts as to the capacity of UBI to meet any order for costs that may be made against it in the present proceedings, since it appeared to be continuing the same business of a previously failed company, that being TARBS World TV Australia Pty Ltd, and the single director and member of UBI (the abovementioned Mrs Boulos) had been the director, secretary and only member of that failed company. It was further submitted by TV Plus to be an inadequate answer to the case for security that UBI has already met a substantial award for costs in previous proceedings involving TV Plus; that factor alone was said by TV Plus to be suggestive of the opposite conclusion, namely that UBI would now be less able to meet any award for costs hereafter made in the present proceedings in favour of TV Plus than might otherwise have been the case, seemingly an elusive proposition even in the extraordinary context of the present litigation at least as presently structured.
60 It was said by TV Plus that its solicitors had provided a solid basis for their estimate of $200,000 for TV Plus’ likely costs of the subject proceedings, by reference to the applicable costs scale identified in the evidence; it was further said in that regard that the actual cost of the prior litigation between the same parties, which was settled before trial, amounted to $332,000 (presumably attributable to TV Plus alone), but of course it is not feasible to gain sufficient assistance per se from the nomination of that monetary figure in isolation. In any event as I have foreshadowed, TV Plus indicated that it would accept that the minimum that should be provided at this present stage of the proceedings is $60,000, subject however to liberty to apply being granted to increase that amount as the proceedings subsequently progressed.
Conclusions upon the issues for the time being arising in the present abbreviated interlocutory context
61 Resolution of the issues arising in the present interlocutory context for determination are as complex as they are controversial, both as to facts in issue and as to legal principles conceivably in operation. The written submissions presented by the respective parties, following upon a brief interlocutory hearing on the second last day of the 2006 law term, have addressed the implications of what are largely untested and controversial issues. The issues actually or potentially arising have not become as yet the subject of mutually agreed and definitive description in all aspects. However, it was agreed to my understanding that at least a five day final hearing is needed to unravel and resolve the issues arising between the parties.
62 The respective parties to the proceedings appear to derive or else seek to derive the television signals the subject of present controversy from the same overseas source in Bosnia and Herzegovina. Issues confronting the Court in appraising the case of UBI for the grant of interim relief have crystallised in the context of the claims advanced by TV Plus as to contractual entitlement to television copyright to the JRTS signal. That alleged entitlement is denied by JRTS (as well as by UBI) in favour of what JRTS appears to regard as at least the contractual entitlement of UBI more recently derived from JRTS as ongoing producer of course of the subject television signals. The existence of any such contractual entitlement of UBI as the prevailing basis for valid broadcast copyright in Australia is challenged by TV Plus. TV Plus has not thus far formally cross-claimed against JRTS in the present proceedings with a view to establishing what TV Plus contends to be an entitlement on its part continuing from prior to that time to broadcast the subject television signals so originating from and produced by JRTS in Bosnia and Herzegovina.
63 There is no reason that I can presently identify why this Court should not ultimately resolve on a final basis the issues arising as to contractual entitlement and breach of any such entitlement, subject to the provision of any expert evidence as to the principles applicable of the governing law of contract and its operation, if that governing law be that of Bosnia and Herzegovina instead of Australia. Resolution of that contractual issue seemingly requires in my opinion the joinder by TV Plus of JRTS as a cross-respondent to a TV Plus cross-claim in the context of the present proceedings.
64 As foreshadowed, TV Plus has to date withheld from joinder of JRTS, yet TV Plus seeks to obtain from UBI a not insignificant extent of security for costs, being interlocutory relief which at least seems to me to be inappropriate to award, at least at the present time and until such circumstances can be addressed in an appropriately established context. JRTS has made known to TV Plus explicitly for some time its stance as to cessation of any contractual entitlement of TV Plus to broadcast in Australia television signals sourced from JRTS. It would be seemingly inappropriate to the exercise of the Court’s discretion in its favour in the somewhat unique context presently prevailing, if not also inequitable, on the present state of the evidence, for TV Plus to gain the benefit of security for its costs provided by its Australian competitor UBI, in circumstances where it has withheld, at least for the time being, from joining to the proceedings the very entity from whom it claims controversially to derive its source of broadcasting entitlement or authority. In that regard, the present state of the evidence is that JRTS has maintained the position (and has done so in the context of its comprehensive affidavit material) of denial of any present entitlement, contractual or otherwise, of TV Plus to broadcast the television signals of JRTS in Australia, and for TV Plus to seek to do so to the competitive detriment of UBI as JRTS’s asserted exclusive appointee in Australia. The commercial reality of the stance adopted by TV Plus may be described as being at least equally aggressive to that of UBI: Amalgamated Mining Services Pty Ltd v Warman International Ltd (1988) 19 FCR 324.
65 Assuming that an early final hearing is reasonably achievable, the making of final procedural orders should obviously be addressed by the parties and the precise formulation of those orders should be resolved as early as feasible. Of course the presently prevailing circumstances may change in the context of further steps that may be taken by any of the parties in order to resolve this complex as well as volatile dispute, being steps which may conceivably justify a re-opening of interlocutory issues. For the time being however, the status quo is that TV Plus is continuing controversially to utilise the television signals of JRTS in circumstances where UBI alone, and hence to the exclusion of TV Plus, is said by JRTS to be authorised. In the meantime in the context of the presently somewhat deficiently structured proceedings not yet fully and formally pleaded, and from which there has been thus far absent the critical off-shore source (ie JRTS) of the subject television signals, I am of the view that I should defer the consideration of the grant of any interlocutory relief at least until there has been further clarification of the critical issues inherent to the dispute, including issues as to joinder of all necessary parties.
66 I direct that UBI provide to the Court draft orders to give effect
to these reasons within three clear hearing days. I further direct that
TV Plus respond with any changes required within a further two clear
hearing days. The proceedings should then be listed for mention, hopefully
with
a view to fixing the date for a final expedited hearing to take place, and as
early as possible having regard to all the circumstances
for the time being
prevailing, and in any event in order to resolve any remaining disputes in
relation to the context of interim orders required to be put in place.
An indication should be provided as to the nature and scope of what evidence (if
any) remains
to be adduced by each party, and of any additional issues of law
still intended to be pursued. The costs of the present interlocutory
proceedings would normally be ordered in terms merely as to costs of the
proceedings generally, but I will entertain nevertheless
any contrary
submissions from either party so long as the same are furnished in writing
within the next seven days. Of course there
must be liberty to either side of
the record to apply on seven days’ notice to the other, that time taking
into account the
overseas elements of the proceedings.
Associate:
Dated: 16
February 2007
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Solicitor for the Respondent:
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Date of Judgment:
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URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/142.html