Re: CAL AND OTHERS VS. VUT (Appeal)

From: Allen W. Dean, CCC <76557.1122[_at_]compuserve.com>
Date: 07 Nov 94 14:33:44 EST

As a followup to some recent traffic on this list, what follows is a memo and statement from the Copyright Agency Limited (CAL) in Australia about the Victoria University of Technology (VUT) case.

Allen W. Dean
Coordinator, Academic Permissions Service Copyright Clearance Center

222 Rosewood Drive       Tel: (508) 750-4283 x220
Danvers,  MA 01923       Fax: (508) 750-4470

Email: 76557.1122[_at_]compuserve.com

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To:       Copyright Clearance Center
From:     Copyright Agency Limited (CAL)
Subject:  VUT CASE
Date:     Monday, 31 October 1994

CAL has appealed the ruling in the VUT case. We expect the appeal to be heard in March 1995. The statutory licence for education in the Copyright Act does distinguish this case from the situation in the USA and elsewhere. For your reference, I enclose a copy of a summary of the elements of the judgment and a copy of s.135ZZH of the Australian Copyright Act (part of the statutory licence) which was the subject of analysis in the case.

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                        Summary of the Judgment in 
                 CAL v. Victorian University of Technology

Judgment was handed down in this matter on 30 September 1994. His Honour Mr. Justice Gummow ordered that the Application be dismissed, declared that the copying done by the university was licensed copying, and ordered that CAL pay the university's costs of the Application and the Cross Claim.

The issue in the case was whether the university by making and selling the anthologies was acting outside the statutory licence. This was possible if either:

(a) the copies were sold or otherwise supplied for a

          financial profit, or

(b) the copies were used for a purpose other than an

          educational purpose.

The case against the Victorian University of Technology was selected from a range of examples of anthologies presented to CAL because we felt that of all the examples it was the strongest on both these points.

(a) Financial Profit

The parties had approached the case on the basis that the court would decide that "profit" in the Act meant either a gross profit or a net profit. In this context, gross profit means the income from sales less the variable costs incurred relating to these sales and the net profit means income from sales less both the variable costs incurred relating to these sales and the fixed costs of the enterprise which are incurred irrespective of the volume of sales. CAL argued that the relevant test was whether the university had made a gross profit; the university argued that net profit was the relevant test.

Gummow J adopted the approach that the relevant question was not whether the respondent had in fact made a "profit" but whether the university had _intended_ to make a profit from the sale of the anthologies, that is whether or not the university had produced and sold anthologies as part of a profit making venture. He held that the university had produced and distributed the anthologies "with the objective of providing copies at minimum cost." The university's activities were not "quasi publishing or bookselling " and were intended merely to cover the university's cost of producing the anthologies and to make a contribution to overheads.

His Honour also looked at the intention of the lecturers who compiled the anthologies, and said that their intention was to provide course materials to students at a minimum cost. The university did not attempt to maximise sale of the materials.

(b) Purpose of Copying

The test in (b) was not satisfied. His Honour also held that the anthologies "were made only or exclusively with the objective that they be used in connection with the particular courses of instruction suggested by the statements on the covers;" in other words, the anthologies performed an educational purpose and there was no collateral purpose.

                                                  6 October 1994
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                      Australian Copyright Act 1968

Unauthorised use of copies
     13ZZH. (1) Where a copy, record or version of a work, a

sound recording or a cinematograph film, being a copy, record or version referred to in a prescribed provision of this Part:

(a) is sold or otherwise supplied for a financial profit;
(b) is used for a purpose other than the purpose specified

          in the prescribed provision; or


     (c)  is given to an administering body when there is not in

          force a remuneration notice given by that body to the
          relevant collecting society;

with the consent of the administering body by whom, or on whose behalf, it is made, the prescribed provision does not apply, and shall be taken never to have applied, to the making of the copy.

(2) For the purpose of this section, subsection 135ZG (1),
subsection 135ZJ (1), section 135ZK and subsections 135ZL (1), 135ZP (1) and (2) and 135ZS (1) are prescribed provisions. Received on Mon Nov 07 1994 - 19:53:04 GMT