Tai Shing Diary Ltd v. Maersk Hong Kong Ltd and Others

HCA 2667/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2667 OF 2004

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BETWEEN

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Before: Hon A Cheung J in Chambers

Dates of Hearing: 4-6 December 2006

Date of Judgment: 22 December 2006

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J U D G M E N T

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Facts

1.This is an Order 14 application.

2.The underlying facts are relatively straightforward.  The plaintiff has an established business in the design, editing, marketing and distribution of diaries and calendars.  It was incorporated in 1993 to takeover the business of its predecessor which could be traced back to 1959.

3.The diaries designed and produced by the plaintiff may be customised to the requirements of customers, such as the inclusion of the corporate name and logo as well as additional pages of information of the customer.

4.One of the plaintiff’s products is a desktop diary known as D908L.  The plaintiff says that D908L was first designed and compiled in 1992, generating a number of copyright protected artistic and literary works.  There is a corresponding pocket diary known as D908S with essentially the same contents.  Since the publication of the first edition of the D908L/D908S diary in late 1992, annual updated and revised editions of the diary have been published by the plaintiff.

5.The 1^st defendant is a shipping company belonging to the well known AP Moller-Maersk group of companies, which operates a global business offering a range of products and services, including one of the world’s largest shipping and container transportation businesses.  It used to be a customer of the plaintiff between 1995 and 2002.  During that period of time, the 1^st defendant purchased from the plaintiff, on a yearly basis, a substantial quantity of the D908L diary, as customised in accordance with its own requirements as its corporate diary.

6.The sales representative of the plaintiff involved in dealing with the 1^st defendant was the 3^rd defendant.

7.The 3^rd defendant worked for the plaintiff as its sales and marketing representative from 1994 to about December 2001.  In December 2002, the 2^nd defendant was formed.  The 3^rd defendant was one of its founding directors.

8.In 2003, as a result of solicitation by the 3^rd defendant on behalf of the 2^nd defendant, the 1^st defendant switched to the 2^nd defendant for the supply of its 2004 corporate diary.  The undisputed evidence is that the 2004 Maersk diary was required and intended to be a close reproduction of the 2003 Maersk diary, which was a customised version of the plaintiff’s D908L diary (2003 version).  In due course, the 2^nd defendant supplied to the 1^st defendant the required quantity of the 2004 Maersk diary.

9.The plaintiff therefore sues the defendants for copyright infringement in relation to various sections of the D908L/D908S diaries for the calendar years 1993 to 2003.

Preliminary observations on Order 14 applications

10.A number of matters were canvassed at the hearing, which lasted three days.  Before turning to those matters, some preliminary observations are helpful.

11.First, in an Order 14 application, the touchstone is whether the defendant has an arguable defence.  In exceptional cases, if there is some other reason which justifies the holding of a trial, leave to defend may be given.

12.Second, the law and practice relating to applications for summary judgment in intellectual properties cases are no different from that in other cases.  The court is no more and no less willing, or, looking at it from another angle, reluctant, to examine the materials to see whether there is an arguable defence or any other reason for trial.  On the one hand, the court will not conduct a mini-trial on affidavit evidence.  On the other, generally speaking, the court will not be daunted by the sheer amount of materials filed or the number of supposed issues raised by the defendant from granting summary judgment if, upon examination, they disclose no triable issue or any other reason for trial.

13.Third, the burden is on the defendant to show an arguable case or some other reason for trial.  The defendant must condescend upon particulars of his claimed defence.

14.Fourth, it is true that in the context of copyright infringement, issues such as originality and infringement very often depend on an evaluation of qualitative matters.  It does not follow that where those issues are involved, no summary judgment can be granted, or put another way, an Order 14 application is inherently inappropriate.  It all depends on the facts and circumstances.  The law reports, both local and overseas, are not short of illustrations where the courts were prepared to undergo a detailed examination of the claimed copyright work and allegedly infringement copy to see whether any arguable defence or triable issue had been raised in relation to the questions of originality and/or infringement.  The mere fact that a court has to look at the works and do comparison is not per se fatal to an application for summary judgment.  It all depends on the facts and circumstances.

15.Macmillan Publishers Ltd v Thomas Reed Publications Ltd [1993] FSR 455 is a neat illustration of the court’s willingness to examine the questions of originality and infringement in an Order 14 application and to grant a final injunction against the defendant after concluding that the evidence placed before the court did not disclose any triable issue in relation to those matters.  See also Yuen Chuk v Muhammad, HCA 14695/1998, Cheung J (7 May 1999).  Many of the cases cited in this judgment provide further examples of the courts’ approach.

16.Equally, there are many cases in the law reports where such applications for summary judgment failed, because the courts found that the question of originality or infringement, on the facts of the cases, could not be summarily deposed of on affidavits.  These cases – and many of them have been cited to me during argument – are no more than illustrations of the basic principle that if a defendant is able to demonstrate a triable issue or any other reason for trial, no summary judgment should be granted, and vice versa.  Copyright infringement cases do not constitute an exceptional category of its own.

Originality

17.I now deal with the various issues raised in the course of hearing.

18.First, originality.  The plaintiff claims originality and thus ownership and copyright in the literary and artistic works relating to various sections of the D908L/D908S diaries for 1993 to 2003.  The literary works relate to the text and compilation of the sections entitled “Internet and website of government”, “World time”, “International direct dialling/international direct dialling codes/IDD codes”, “International business abbreviations/business abbreviations”, “Metric conversions”, “International airport guide”, “World in summary”, “World holidays/international holidays” and “World air distances”, as well as the compilation of the world map section.  The artistic works relate to all the sections described above (with the exception of the world map section), as well as the sections entitled “Year planning chart”, “Names and telephones” and “Notes”.  The artistic works also relate to the monthly planner as well as the weekly day blocks in the diary.

19.The Plaintiff relies on a very detailed affirmation filed by its director, Ku Yu Sing.  The affirmation sets out the authors of the literary works and artistic works in question and how those works were first compiled and written and subsequently revised by these persons, including Mr Ku himself, for and on behalf of the plaintiff.

20.The affirmation follows the requirements stated in section 121 of the Copyright Ordinance (Cap 528), the consequence of which is set out in section 121(3), namely that the Court shall presume, “in the absence of evidence to the contrary”, that the statements made in the affirmation are true.

21.The defendants all put originality, and thus copyright subsistence, in issue.  They argued that the works lack sufficient originality in that they are common to all diaries and calendars.  Authorship of the works is not admitted.  They said that there had been prior works which had been available to the plaintiff for copying.  In respect of the literary works, it was said that insubstantial skill and labour had been expended on the works, and in respect of the artistic works, it was said that the design was common and obvious layout design.

22.I approach the question of originality from the twin premises of the statutory presumption under section 121(3) and the general requirement under Order 14 that it is for a defendant to condescend upon particulars of his defence.

23.So far as the statutory presumption is concerned, the Court shall presume the statements made in Mr Ku’s affirmation are true.  Based on Mr Ku’s very detailed account of the authorship of the works in question, there can be no doubt that the requirement of originality has been satisfied, and thus the question of subsistence of copyright overcome.  In this regard, it must be remembered that the requirement of originality is a low one.  Ms Tam SC, representing the plaintiff, has reminded the Court that as a matter of law, the work in question must originate from the author and must not be copied from another work.  The author may draw on existing material, so long as more than negligible or trivial effort or relevant skill and judgment have been expended in the creation of the work.  The standard required is a low one, but the effort must not be as trivial as to be characterised as a purely mechanical exercise.  The skill and effort protected is not only that expended on its manner of presentation, but of collecting, selecting, arranging and presenting the available information in an intelligible manner.  Copinger & Skone James on Copyright (15^th ed) paras 3-128 and 3-145.

24.It is not in dispute that tables and compilations are works on which copyright is capable of subsisting.  The same threshold test for originality applies to such works as any other literary works: Copinger, para 3-145.

25.It is accepted that there is no copyright in information or ideas, but only in the manner of expressing them.  What is required to attract copyright protection is the minimum threshold skill and labour involved in making the compilation, as distinct from skill and labour in ascertaining information.  Elanco Products Ltd v Mandops (Agrochemcial Specialist) Ltd [1979] FSR 46, 52.

26.The degree of originality required for copyright to subsist is original skill and labour in execution, not originality of thought.  Copyright subsists regardless of artistic merit.  In the case of a diary, whilst there is no copyright in the concept of a diary, there is copyright in the distinctive compilation of the features in a diary.  Artifakts Design Group Ltd v NP Rigg Ltd [1993] 1 NZLR 196.

27.GA Cramp & Sons Ltd v Frank Smythson Ltd [1944] AC 329 is an example of a mere compilation work in a diary falling short of the low threshold test for originality.  The decision, in my view, turns on its own facts, and does not establish any general principle that the test of originality in compilation cases, particularly in the context of diaries, is any different.  It is a question of facts and circumstances in individual cases.

28.As I said, based on what has been described in Mr Ku’s affirmation, which the Court is required to presume as true, in the absence of evidence to the contrary, the test of originality has been satisfied.

29.Put another way, in the light of Mr Ku’s affirmation, it is incumbent upon the defendants to adduce “evidence to the contrary”.  Admittedly, this is a lower requirement than the previous one under the former section 9 of the Copyright Ordinance, which required the “contrary” to be “proved”: Phonographic Performance (South East Asia) Ltd v California Entertainments Ltd [1988] 2 HKLR 237.  Nonetheless, the presumption in its present form still imposes an evidential burden on the defendant.  It is for a defendant to place materials before the court to cast doubt on the truth of the statements contained in the relevant affidavit: Tse Mui Chun v HKSAR [2004] 1 HKLRD 351.  Transposed to an Order 14 context, what is required is some arguable evidence to the contrary.

30.The general requirement under Order 14 for a defendant to condescend upon particulars needs no further elaboration.

31.What have the defendants managed to come up with?

32.Some alleged prior works have been exhibited for the purpose of defending the application for summary judgment.  They were said to be works which were at all material times available to the plaintiff for copying.

33.During the hearing, Ms Tam has very helpfully taken the Court through all the relevant alleged prior works and compared them with the plaintiff’s works.  The exercise required some patience on the part of those participating in it.  But it bears much fruit.  After the comparison, the Court is left in no doubt that the so-called alleged prior works (and in many cases, no such prior works are available) are not substantially identical or similar to the plaintiff’s works.  It is true that the general ideas were already present in these alleged prior works.  However, in copyright cases, one is not seeking protection of an idea but its mode or manner of presentation.

34.Whilst I will come to the defendants’ allegedly infringing copies in a later section of this judgment, I must say that a similar comparison between the plaintiff’s works and the 2004 Maersk diary provided a stark contrast between how independently designed works based on the same or similar idea or concept could end up looking quite differently from each other in terms of choice, selection and presentation (as is in the case of the alleged prior works and the plaintiff’s works), and how a slavishly copied work would look closely similar if not identical to the original one (as is in the case of the 2004 Maersk diary and the plaintiff’s diary).

35.Ms Tam submitted that the alleged prior works only served to demonstrate the endless artistic options that were available to a designer, and to rule out any possibility of the defendants arriving at such closely similar designs without slavish copying.  I agree.

36.It is noteworthy that Mr Bruce SC, appearing for the 1^st defendant, did not even bother, in his submission, to invite the Court to look at the alleged prior works again, with a view to persuading the Court that they or some of them were substantially similar to the plaintiff’s works so that the plaintiff’s works could have been copied from the prior works, contrary to Ms Tam’s argument.  To his credit, senior counsel made no such futile attempt.

37.If Mr Bruce’s apparent lack of interest in defending the alleged prior works is understandable because after all they were not produced by his client, the refusal or failure of Mr Chang, the 2^nd and 3^rd defendants’ counsel who produced the alleged prior works in the first place, to join battle with Ms Tam during his submission in defence of the alleged prior works can only be interpreted as a tacit admission that the position was indefensible. 

38.Mr Chang, in his succinct submission, only drew the Court’s attention to a particular page in one of the alleged prior works (bundle C4, page 1438) to point out that a footnote on that particular page was identical to a similar footnote in one of the plaintiff’s works.  However, that is a non-point because the plaintiff’s works predated the page relied on by counsel.  The only other page in the alleged prior works which Mr Chang referred to was bundle C4, page 1339.  It related to the size or dimension of a certain box in the weekly day block.  I am afraid it did not even begin to cast any doubt on what Mr Ku had said in his affirmation regarding creation of the weekly day block.

39.To be fair to Mr Chang, he admitted, with disarming frankness, that he did not have much material to work on.  He was right.

40.And then it was said, particularly by Mr Bruce on behalf of the 1^st defendant, that the features/information of the plaintiff’s diary are in fact common features of diaries published by various publishers.  The alleged prior works show that the features, information or ideas had been around for a long time even though the alleged prior works that the 2^nd and 3^rd defendants managed to produce within the time available may not look substantially identical or similar to the plaintiff’s works.  Nonetheless, the fact that what is involved is commonplace is by itself sufficient to constitute the requisite arguable evidence to the contrary, giving rise to a triable issue.  Rebuttal of the presumption will therefore be a matter for trial.

41.Counsel further submitted that the normal discovery and interrogatory procedures would enable the defendants to find out more about the plaintiff’s claim of originality in the works in question.  They could, counsel suggested, provide the defendants with materials to challenge the plaintiff’s claim and rebut the presumption.

42.A variation of the same theme is that at trial, provided that the defendants can get leave from the court to cross examine Mr Ku (pursuant to section 121(8)(b) of the Ordinance), Mr Ku may be “shaken” (Mr Chang’s word) in his evidence and thus the defendants may be able to resist the plaintiff’s claim of originality.

43.I do not accept these points.  As had been pointed out by the Vice-Chancellor in Lady Anne Tennant v Associated Newspapers Group Ltd [1979] FSR 298, an Order 14 case based on copyright infringement,

“A desire to investigate alleged obscurities and a hope that something will turn up on the investigation cannot, separately or together, amount to sufficient reason for refusing to enter judgment for the plaintiff.  You do not get leave to defend by putting forward a case that is all surmise and Micawberism.” (at page 303)

44.In Hong Kong Stationery Manufacturing Co Ltd v World Wide Stationery Manufacturing Co Ltd, HCA No. A434 of 1990 (25 October 1991), the 2^nd defendant asserted in his affirmation that to a greater or lesser degree, all the drawings in which the plaintiff claimed copyright depicted parts or features which had been taken from earlier machines, specifications of parts, standards or other relevant materials.  He claimed that the issues of originality and infringement could only be fairly and properly determined at trial.  Mayo J (as he then was) had no difficulty in rejecting the argument and granted summary judgment after a hearing which lasted 7 days.  At page 6 of the unreported judgment, his Lordship said that a general statement along the lines described above was insufficient to comprehensively raise the issue of originality.

45.Similarly, in C Art Ltd v Ability Manufactory Ltd [1989] 1 HKC 320, Nazareth J (as he then was) had no hesitation, in the context of an Order 14 application based on infringement of registered designs, to reject the bare assertion of the defendant, which did not condescend upon particulars, that the design in question was neither novel nor original by reason of “common general knowledge”.

46.It is trite, of course, that each case depends on its own facts.

47.On the facts of the present case, I have considered carefully the points raised by Mr Bruce and Mr Chang on behalf of the three defendants.  I am unable to accept that on the question of originality, the defendants have raised any triable issue.  Nor do I see any other reason for trial.

48.Mr Ku’s affirmation sets out matters that are not inherently incredible.  The pre-existence of similar idea or concept does not by itself prevent the plaintiff or its predecessor from exercising independent skill, labour and judgment in coming up with the subject works.  The artistic works in question may not be particularly unique or complicated.  But their simplicity does not prevent them from passing the low threshold for claiming originality.  The important thing here is that according to Mr Ku’s affirmation, none of the works in question was the product of copying from any prior work.  That claim, by itself, is neither inherently improbable or incredible.  In other words, the contents of the affirmation do not provide any arguable evidence to rebut the statutory presumption.

49.As described, after the comparison exercise, it is plain that the alleged prior works do not even begin to cast any doubt on the truthfulness of the statements made in the affirmation of Mr Ku.  They do not provide any evidence to the contrary.  Any contention to the contrary is wholly unarguable.

50.The mere hope that the normal litigation procedures and trial process may enable the defendants to come up with something arguable is not a reason for giving leave to defend.  The defendants’ wish to undertake a fishing expedition whether in the pre-trial process or at trial is not a good reason for giving such leave.

51.A bare assertion that the works in question are commonplace, without condescending on particulars, is insufficient to raise a triable issue.  Surmise and conjecture is not equivalent to arguable evidence to the contrary.

52.At one stage, Mr Chang argued enthusiastically in his (written) submission that some of the subject works were works belonging to a Ms Alice Au or her company (Exeltop).  However, having listened to Ms Tam’s submission to the effect that even assuming that it was the case, the plaintiff’s case is wholly unaffected because of its ability to rely on versions of the D908L diary that predated Ms Au’s period of work with Exeltop and when she was still with the plaintiff’s predecessor, Mr Chang conceded in his oral submission that Ms Tam’s submission had rendered his argument on Ms Au’s employment history wholly academic.  I agree and need say no more about it.

53.In conclusion, I find that there is no triable issue in relation to originality or subsistence of copyright.  On that particular matter, there is no other reason for trial either.

Infringement

54.I can dispose of the question of infringement very quickly.  First, the comparison exercise that Ms Tam has guided the Court through has demonstrated beyond argument that the relevant parts in the 2004 Maersk diary are substantial reproductions of the plaintiff’s works.

55.No contrary submission was made by Mr Bruce or Mr Chang at the hearing.  None of them asked the Court to revisit any part of the 2004 Maersk diary again, with a view to persuading the Court that no copying was involved.

56.Second, it is plain from the affidavit/affirmation evidence filed on behalf of the defendants that the express instructions given by the 1^st defendant to the 2^nd and 3^rd defendants were to prepare and print the 2004 diary by reproducing the contents of the 2003 Maersk diary as closely as possible.  In terms of following their customer’s instructions, the 2^nd and 3^rd defendants have plainly done a good job.

57.Notably, in the evidence filed on behalf of the 2^nd defendant, there was no denial of copying the plaintiff’s diary.  Nor was there any assertion that the 2004 Maersk diary was the product of an independent design, or was copied from another source not connected with the plaintiff.

58.Neither Mr Bruce nor Mr Chang put forward the question of infringement as a triable issue in their oral submissions at the hearing.

59.In my view, there is no triable issue on the question of infringement.

Knowledge

60.The next matter is knowledge.  Where as here, primary infringement is involved, knowledge is irrelevant to establishing liability.  But it is relevant to the award of damages sought by the plaintiff.

61.Section 108(1) governs the situation.  It provides that:

“Where in an action for infringement of copyright it is shown that at the time of the infringement the defendant did not know, and had no reason to believe, that copyright subsisted in the work to which the action relates, the plaintiff is not entitled to damages against him, but without prejudice to any other remedy.”

62.In Frank Smythson Ltd v GA Cramp & Sons Ltd [1943] 1 Ch 133 (reversed on appeal on another point: [1944] AC 329, supra), Lord Greene MR explained the meaning of section 8 of the Copyright Act 1911 (at pp 138-139).  The wording of section 8 was very similar to our section 108(1) except that instead of requiring the defendant to have had no reason to believe that copyright subsisted in the work in question, the English section required the defendant to have had “no reasonable ground for suspecting” that copyright subsisted.  This is what the Master of the Rolls said:

“The next matter which has to be mentioned is the argument presented on s. 8 of the Copyright Act, 1911.  It is said that in 1942 the defendants were not aware that copyright subsisted and had no reasonable ground for suspecting that copyright subsisted in the “Liteblue” diary.  In my opinion that argument cannot succeed.  The defendants copied a work in respect of which, at the lowest, copyright was capable of subsisting, and they did so without inquiring or troubling themselves about the question whether the work was in fact entitled to copyright.  I cannot see how the language of s. 8 can cover such a case.  Not merely must a defendant who relies on that section show that he was not aware that copyright subsisted – and that, in my judgment, cannot protect him if his ignorance is due merely to a mistake in law – but he must have no reasonable ground for suspecting that copyright subsisted.  The defendants, without making any inquiry or any investigation, resolved in their own favour all doubts as to the existence of copyright in this compilation.  The section was never designed to protect people who act in that way.”

63.Infabrics Ltd v Jaytex Shirt Co Ltd [1980] FSR 161, 175 a more modern case, likewise emphasized the importance of making enquiries and investigation as one reasonably can to satisfy oneself that the work to be made use of is free of copyright, failing which it “must be” difficult to suppose that there have been no grounds for suspecting that it may be subject to copyright.

64.As far as the 1^st defendant is concerned, the question of knowledge turns on the knowledge of Ms Joanne Lau, the person in the 1^st defendant responsible for ordering the 2004 Maersk dairy from the 2^nd defendant through the 3^rd defendant.

65.Having considered the evidence filed, I am of the view that there is a triable issue as to whether Ms Lau knew (subjectively) that copyright subsisted in the relevant pages in the diary.

66.But I need to consider further whether the 1^st defendant had no reason to believe that copyright subsisted in the work.  That is an objective test.

67.Ms Tam strongly relied on what Lord Greene had said in Smythson v Cramp and argued that the works in question were works in respect of which, at the lowest, copyright was capable of subsisting.  By blindly copying the works without enquiring or troubling itself about the question whether the works were in fact entitled to copyright, the 1^st defendant must have failed the objective knowledge requirement.

68.I think Mr Bruce was correct in stressing the difference in wording between the English section and our section 108(1).  The English section on which Lord Greene commented required the defendant to have had no reasonable ground to suspect that copyright subsisted.  That, arguably, was a lower requirement than the “no reason to believe” requirement in our section.  Put another way, the fact that copyright is capable of subsisting in a particular work is by and of itself a reason for suspecting that copyright does subsist in a work.  However, that same fact per se is, arguably (not forgetting the present Order 14 context), insufficient as a reason for one to “believe” that copyright does subsist.

69.Ms Lau said in her affidavit that she had inquired with the 3^rd defendant whether copyright subsisted in the plaintiff’s diary and was told that save for the world maps, the contents of the plaintiff’s diary were only standard items used by all diary printers and no copyright licence would be required.  That conversation was denied by the 3^rd defendant in his affirmation.

70.For the purpose of determining the present issue, I am prepared to accept that what had been allegedly said by Ms Lau might indicate that she had reasons to suspect that copyright subsisted in the works in question.  But to elevate that to reasons for believing that copyright did subsist is quite another matter, which calls for further exploration and argument at trial.

71.Given the factual assertions in the evidence, I think the matter must go to trial.  For that reason, I do not propose to further comment on what has been asserted in the affidavit/affirmation evidence.

72.The position of the 2^nd and 3^rd defendants is entirely different.  I agree that the knowledge of the 3^rd defendant can be imputed to the 2^nd defendant.  In other words, it all boils down to the knowledge of the 3^rd defendant in terms of section 108(1).

73.Given the employment history of the 3^rd defendant with the plaintiff and his experience in the trade, albeit as a sales representative, it is simply unarguable that the 3^rd defendant had no reason to believe that copyright subsisted in the works in question.  As mentioned, that is an objective test.  Turning a blind eye to the obvious is, in my view, insufficient to satisfy the requirement of the section.

74.To be fair to Mr Chang, he did not even bother to make submission, whether in writing or orally, in relation to section 108(1) at the hearing.

Liability as joint tortfeasor

75.The next matter is the liability of the 3^rd defendant as a joint tortfeasor.

76.The 3^rd defendant was a director of the 2^nd defendant.  He was the person who successfully solicited the order from the 1^st defendant.  He said he was only involved in the marketing side of the business of the 2^nd defendant.  He was not involved in the design and printing of the diary.

77.The law in this area has been reviewed in England by Chadwick LJ in MCA Records Inc v Charly Records Ltd (No 5) [2003] 1 BCLC 93 as well as by Lam J in Kabushiki Kaisha Yakult Honsha v Yakudo Group Holdings Ltd (No 4) [2004] 2 HKLRD 587, 626 to 629.  See also Morton-Norwich Products Inc v Intercen Ltd [1978] RPC 501, an earlier patent infringement case, on the question of joint tortfeasor. 

78.Briefly stated, a director would not be personally liable if he does no more than carrying out his constitutional role in the governance of the company.  However, if he participated or was involved in ways which went beyond the exercise of constitutional control, he could be liable as a joint tortfeasor.  In particular, a director who intends, procures and shares a common design that the infringement should take place may be liable as a joint tortfeasor.  As far as procurement is concerned, a director may procure an infringement by inducement, incitement or persuasion.  As regards common design, there is no need for an explicit plan.  A tacit agreement will be sufficient.  It is not required that the director knew or ought to know that the acts in question were tortious.

79.Having considered the role played by the 3^rd defendant in the matter even according to his own account, and given the undeniable background of the case, I am satisfied beyond argument to the contrary that the 3^rd defendant was a joint tortfeasor with the 2^nd defendant in terms of the above legal principles.

80.The 3^rd defendant obtained the order from the 1^st defendant personally.  The express instructions of the customer were to make only minor changes to the contents of the 2003 Maersk diary.  He was familiar with the contents of the 2003 diary.  And he must have been well familiar with the contents of the 2004 diary as it was eventually printed.  He must have known that the 2004 version was substantially identical to the 2003 version.

81.It is impossible for the 3^rd defendant to claim ignorance of the contents of the 2004 Maersk diary as printed.  He did not make any such assertion in his affirmation.

82.That the 3^rd defendant may have played no part in the actual printing work is neither here nor there.

83.The 3^rd defendant quite clearly secured or procured the printing of the infringement diaries and their supply to the 1^st defendant, in fulfilment of the order that he had so successfully solicited from the 1^st defendant, the long-term customer of his former employer. 

84.Not only was the order obtained by him, the 3^rd defendant was also one of the directors of the 2^nd defendant.  It is noteworthy that in his affirmation, he was absolutely silent on the question of who, if not he himself, in the board or management of the 2^nd defendant had decided to accept and execute the order on the company’s behalf. 

85.Likewise, Mr Chik, a co-director in the 2^nd defendant, never dealt with this aspect of the case in his affirmation.  What is notable though is that Mr Chik did not say the 3^rd defendant as director and the person who personally obtained the order from the 1^st defendant did not take part in the board or management’s decision to accept and implement the order by printing the infringing copies.  Given the duty to condescend upon particulars, the 3^rd defendant’s case on procurement is simply untenable.

86.Furthermore, he must have known, given his many years of employment with the plaintiff and experience in the trade as a hardworking salesperson of the plaintiff’s diaries, that copyright subsisted in the contents of the plaintiff’s D908L/D908S diary based on which the 2003 Maersk diary was customised.  It is simply impossible for him not to have shown the contents of the plaintiff’s diaries to potential customers and mentioned to them their special compilations, features and design, or drawn comparison with competitors’ products, in order to solicit orders in the ordinary course of his work for the plaintiff.  Any suggestion that he was unaware that copyright subsisted in those contents of his company’s diaries which he was responsible for selling is simply unbelievable. 

87.In those circumstances, the 3^rd defendant must have realised that unless the 2^nd defendant had obtained the necessary permission or licence from the plaintiff, the 2004 diaries printed by the 2^nd defendant for the 1^st defendant must be infringing copies.

88.As mentioned, in an Order 14 application, it is for the defendant to condescend upon particulars of his defence.  In the circumstances of this case and based on the above analysis, it is incumbent upon the 3^rd defendant to say, if he is to have any arguable defence at all, that he believed that the 2^nd defendant had obtained the necessary permission or licence from the plaintiff to copy its diary for the production of the 2004 Maersk diary.  And if that was his belief, he must supply the necessary particulars for it.  He must name all the persons in the 2^nd defendant involved.  It is no good for the 3^rd defendant to simply say that he did not know.  The facts of the present case require a positive assertion that he believed that the 2^nd defendant had secured the necessary permission or licence.  Anything short of that would simply be a deliberate turning of a blind eye to the obvious.

89.No such case was put forward by the 3^rd defendant in his opposing affirmation.

90.In the circumstances and based on the materials that have been put forward before the Court, the irresistible inference is that the 3^rd defendant was very much in the know and procured the carrying out of the order that he had personally solicited from Ms Lau by copying the plaintiff’s diary without permission or licence. 

91.What has just been described is, in any event, more than sufficient to show that the 3^rd defendant ought to know that copyright subsisted in the contents of the plaintiff’s diary, that no permission or licence was ever obtained by the 2^nd defendant from the plaintiff to copy them and therefore that the 2004 dairies printed by the 2^nd defendant for the 1^st defendant were infringing copies. 

92.In fact, as mentioned above, the law does not even require that the 3^rd defendant as director knew or ought to know that the acts in question were tortuous.

93.In my view, quite uncontrovertibly, he was a joint tortfeasor in terms of the legal principles outlined above.

94.Mr Chang cited CBS Songs Ltd v Amstrad Consumer Electronics Plc [1988] 1 AC 1013 and argued that the mere offering for sale does not amount to procuring infringement in a joint tortfeasor situation. 

95.In my view, the case does not assist the 3^rd defendant.  What Lord Templeman has said on p 1058G-H of the law report is that sales and advertisements to the public generally of a machine which may be used for lawful or unlawful purposes, including infringement of copyright, cannot be said to procure all breaches of copyright thereafter by members of the public who use the machine.  That has little to do with the facts of the present case. 

96.Rather, as Lord Templeman pointed out on the same page (next to letter H), generally speaking, inducement, incitement or persuasion to infringe must be by a defendant to an individual infringer and must identifiably procure a particular infringement in order to make the defendant liable as a joint infringer.  That latter statement, in my view, comes much closer to what has happened in the present case.

97.In my view, there is no triable issue here.

Permanent injunction

98.As far as relief is concerned, I think there is no triable issue on whether a permanent injunction is the proper relief.  Plainly it is.

99.I am not concerned with an application for interlocutory injunction.  I am concerned with the grant of a permanent injunction after liability is established.

100.On the facts of the present case, it is clear that a permanent injunction is appropriate, and there are no special circumstances negating the grant of such an injunction.  If nothing else, the injunction would serve as a vindication of the plaintiff’s right that has been infringed by the defendants. 

101.Moreover, the 2^nd defendant has not asserted that it is no longer in the business of printing diaries and the risk of repetition cannot be ignored.

102.As for the 3^rd defendant, although he has left the 2^nd defendant, given his experience in the trade and the absence of any information about his present and future intentions, there is a real risk of repeated infringement in future if no injunction is granted.

103.As for the 1^st defendant, it cannot be denied that it is in the habit of obtaining the supply of diaries on an annual basis for internal use as well as distribution to customers and so forth.  In the absence of any undertaking, one simply cannot safely exclude the possibility of a future infringement, regardless of the background of 1^st defendant and the group of companies to which it belongs.  I make no comment on whether a suitably worded undertaking, in lieu of injunction, would be acceptable to the Court.  That would be a matter for the returned hearing (see below), if the 1^st defendant were so minded to raise it with the Court.

104.As pointed out in Macmillan, supra, when it comes to a final injunction, it is not a matter of weighing the damage the defendant would suffer as a result of the injunction against the damage the plaintiff would suffer if no injunction is granted.  It is a matter of looking at what the defendant has done. 

105.Like Macmillan, what has happened here is that copyright, which is a property right, has been infringed.  It is not a trivial matter to infringe the copyright in the pages in the plaintiff’s diary in question and to do so in a systematic way without attempting to condescend on particulars of the defence.  The case is not within the exceptional circumstances that require for damages to be awarded instead of an injunction.

106.As to the form of the injunction, I am minded to grant a permanent injunction in terms of the plaintiff’s summons, which is in the normal form, instead of any restricted form: Coflexip SA v Stolt Comex Seaway MS Ltd [2001] 1 All ER 952.

107.However, Mr Bruce has asked that his client be heard, in case the Court is disposed to grant a permanent injunction, on the terms of the injunction.

108.In the circumstances, what I would do, to do justice between the parties, is to grant an interlocutory injunction against the 1^st defendant in terms of the plaintiff’s summons pending the further hearing on the terms of the permanent injunction to be granted, with a direction that the matter be restored for argument before this Court in consultation with counsel’s diaries. 

109.No such complication arose in respect of the 2^nd and 3^rd defendants.  A permanent injunction in terms of the summons is granted against the 2^nd and 3^rd defendants respectively.

Outcome

110.In summary, I order that summary judgment be entered against the three defendants respectively in terms of the plaintiff’s summons, save that in relation to the 1^st defendant, I give leave to the 1^st defendant to defend the claim for damages, and also save and except what I have just said, again in relation to the 1^st defendant, regarding the holding of a further hearing on the terms of the permanent injunction to be granted and the grant of an interlocutory injunction in the meantime to hold the position.  I so direct and order.

111.Another modification is that during the hearing, Ms Tam has on behalf of her client modified the scope of the application for summary judgment in relation to some items of work.  They of course must be reflected in the draft order to be prepared by the plaintiff’s solicitors for the Court’s approval.  I will simply leave this to the plaintiff.

112.As regards costs, I make an order nisi that the costs of the action, including the present application, be paid by the defendants respectively to the plaintiff, to be taxed if not agreed.

113.I thank counsel for their assistance.

Ms Winnie Tam SC, instructed by Messrs Liu, Chan & Lam, for the plaintiff

Mr Andrew Bruce SC, instructed by Messrs Deacons, for the 1^st defendant

Mr Jonathan T Y Chang, instructed by Messrs Tso Au Yim & Yeung, for the 2^nd & 3^rd defendants