2011: a year of Aussie legal wrangles
It seems like the most frequent words said in 2012 were: "Well, then I'll sue you!" Some of these cases were even held down under, in Australia's court rooms. We bring you the biggest Aussie face offs of 2012.
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1. Apple vs. Samsung
Samsung and Apple sued each other in so many countries that you'd have to take a break for a breath to list them all. But Australia became one of the major battlegrounds, with Justices Annabelle Bennett, John Dowsett, Lindsay Foster, David Yates and even the High Court all weighing in on the cases.
First, Apple went to court looking to ban Samsung's Galaxy 10.1 tablet, saying that the device infringed on its patents. Then Samsung fired back with a case saying that iPhones above the 3GS infringed on its patents.
Apple was initially granted its wish, with Samsung's devices being banned from Australian shelves. But Samsung appealed, and a panel of judges overturned the preliminary injunction. Apple tried to take the case to the High Court, but the High Court declined to hear it, saying that Apple's claims lacked merit. The device went on sale just before Christmas.
However, Apple is bringing another case against Samsung devices, and the case that Samsung is pushing in the hopes that iPhones will be banned in Australia is yet to be heard, so stay tuned for more patent-fuelled madness in the new year.
2. AFACT vs. iiNet
Back in 2008, we first heard that a conglomerate of film and television studios were taking internet service provider (ISP) iiNet to court, saying that by not acting on infringement notices received from AFACT, it had been authorising its users' copyright infringements when they downloaded copyright films. This led to a court case, which iiNet won, and then an appeal, which iiNet also won.
This year, the battle reached the High Court, with iiNet and AFACT duking it out for three days in December for the final time. We heard all of the arguments about the validity and efficacy of warning notices, user privacy and whether an ISP was really responsible for its customers' misdemeanours.
iiNet argued that whatever it had done with the notices, nothing would have been enough without a termination clause. Meanwhile, AFACT believed that as soon as iiNet received infringement notices, it was authorising the users' infringement.
The case has wide-ranging implications for how ISPs deal with copyright infringements, something that has been not only on film studios' minds, but also on providers' minds; they proposed their own method of discouraging users from pirating this year.
The High Court's decision will be handed down next year.
3. ACCC vs. Optus
It's just an ad. Well, unless it's deceptive. Then it's a bill for $5.26 million, or at least in Optus' case it was. The conclusion of the Australian Competition and Consumer Commission's (ACCC) court case against Optus came this year. The ACCC had said that Optus' "Think Bigger" and "Supersonic" broadband advertising was deceptive, because the telco hadn't made it clear that users would have their speed reduced to 64 kilobits per second once they had exceeded their peak or off-peak allowances.
Optus had tried to convince the court that consumers didn't rely solely on an advertisement when making a purchasing decision; however, the court didn't agree, finding in favour of the ACCC and fining Optus a hefty $5.6 million, and banning it from conducting similar ad campaigns for three years. Optus said it would appeal the fines.
Optus had also taken Vodafone to court over the advertising for the latter's "Infinite" plans, which it considered to be misleading, but ultimately decided not to proceed with the case, and was ordered to pay Vodafone's costs.
4. Groupon vs. Scoopon
Groupon was just too good a name to pass up for daily deals site Scoopon, which registered the business name and domain name. Unfortunately for Scoopon, US daily deals site Groupon wanted to come to Australia, and wasn't impressed about Scoopon's use of its name.
Groupon said that it had previously offered to pay US$286,000 for the Groupon.com.au domain and Groupon Pty Ltd trademark, which Groupon said the Scoopon founders initially accepted. Problems arose, however, according to the US coupon site, when the founders changed their minds, and told Groupon that they would only part with the name if they purchased the entire Scoopon business.
Groupon took the matter to the court and launched in Australia under Stardeals while it waited. The case was settled before it was heard, with Scoopon ceding control to the Groupon name in Australia. The settlement details were undisclosed.
5. Gary Cohen vs. iSoft
CSC announced its plans to acquire troubled e-health specialist iSoft back in April for $0.17 per share in cash, which drew the ire of ex-iSoft chairman Gary Cohen, who claimed that he had been approached by other investors with better offers.
A Cohen-controlled company, RJL Investments, said that it was party to a pre-emptive legal agreement with a key iSoft investor, which Cohen claimed required Oceania to give RJL a transfer notice with respect to about 15 per cent of Oceania's 24 per cent shareholding in iSoft. The transfer notice would allow Cohen to make use of the alleged offers, delaying the CSC takeover.
However, the court ruled that RJL's propositions were without foundation, dismissing the proceedings. The CSC acquisition was completed in August.
6. Attachmate vs. Department of Defence
The government has egg on its face in this case, which has seen Attachmate accuse the Department of Defence of breaching the terms of a licensing contract that it had signed with the software vendor.
Attachmate had provided the Department of Defence with 8000 licences for emulation software, along with five CDs for their installation over 10 years ago. In the licensing agreement, the Department of Defence agreed to use each copy on one computer at a time, transfer software between computers no more than once every 30 days and not to copy the software.
Attachmate had independent auditors from KPMG prepare a report in November 2009, which revealed that the Department of Defence was using tens of thousands of copies of the software that it had no licences for. The Department of Defence may have reproduced software, against Attachmate's licences, as many as 77,078 times.
The Department of Defence admitted that it had installed Extra 6.5 on "an undisclosed number of machines" in order to access a UNIX server application, while installing the same software on 23 "silo" computers accessible from an infinite number of virtual machines across the Department of Defence network.
The case between Attachmate and the Department of Defence is set to go back before a court in February next year.
7. Telstra vs. Amazon
Amazon in 2003 lodged a patent with the patent office for its one-click buy facility. Amazon's one-click buy facility speeds up transactions by using pre-filled payment and shipping information to avoid a customer re-entering this information for every purchase.
This patent has attracted controversy in other markets because of concerns that it isn't an innovation. Telstra shared this opinion in Australia, and opposed the patent. The case reached court, with delegate of the Commissioner of Patents Ed Knock finding in July that Amazon's one-click buy facility "lacks novelty [and] an inventive step", making Amazon's claim unpatentable.
Amazon's patent application included 141 claims, 60 of which were deemed invalid by the court. To be successful, a patent must not contain any invalid claims.
However, the story isn't over yet, with Amazon having 60 days from that date to amend the application to be in compliance with patent regulations. Knock said that if this is not carried out, the application would be refused. According to the record in the Australia Patent Office, Amazon has produced amendments. The period to oppose the amendments expires on 29 December. The office said that there had been no oppositions to the amendments as yet, but normally opposition comes in at the last moment.
8. Sage vs. MYOB
This case with global relevance was started after MYOB looked to be bought by Sage, but the MYOB owner Archer Capital changed its mind at the last minute, instead deciding to go for a deal with Bain Capital.
In court documents, it was revealed that Sage had been engaged in discussions, and had provided an indicative offer of $1.35 billion for 100 per cent of the share capital. The discussions progressed to a final-offer stage, but, after getting access to MYOB's confidential business information necessary for deal completion, Sage proposed to drop its offer by $175 million.
Archer Capital saw this as a breach of the sale contract, and attempted to get back in contact with other bidders. Bain Capital bit, and its offer of $1.045 billion was accepted. Archer Capital accepted the Bain Capital deal, and hastily began legal proceedings against Sage for breach of the sale contract, demanding that the failed bidder pay back the difference between the net value of the Bain Capital deal and the $1.35 billion deal that was dumped. This case continues next year.
9. NRL vs. Optus
Optus TV Now, first announced in July, allows customers to use Optus' storage cloud to schedule, record and play back free-to-air digital TV on 15 channels from a 3G mobile or PC. It is understood that the recording is delayed by two minutes from the live broadcast.
The Australian Football League (AFL) and the National Rugby League (NRL) were none too pleased about the program, as it brought into question a five-year $153 million deal that the AFL had in place with Telstra to provide streaming video of live matches to mobiles, and it also limited the NRL's ability to sign a similar deal.
Optus made a pre-emptive strike in September, starting a case that tries to prove that the two sporting bodies can't sue for breach of copyright because of "time-shift" provisions in the Copyright Act 1968. The football organisations have made counterclaims, and Telstra has joined in on the case.
According to law firm DLA Piper, the case will likely set the standard for cloud storage of video in the future, and will also address the issues surrounding personal video recording (PVR) in the digital age.
"Success for Optus would throw open the doors to an already burgeoning market, allowing enterprising Australian companies to capitalise on the 'time-shift' and related 'format-shift' exceptions in the Copyright Act to provide online locker services for media content."
The effect would be that the cost for broadcast rights of any sporting event could be called into question, including deals surrounding the 2012 Olympic Games.
The hearing was held just before Christmas, with the two days of hearing focussing on the definition of "a time more convenient" to watch films (ie, whether it is two minutes after live) and whether Optus' service could be counted as personal use. The judge promised as quick a decision as possible.
10. The Vodafail class action that failed
After Vodafone's network issues left customers with connections that timed out or had no reception at all, over 20,000 people expressed their interest in entering a class-action suit against the company. However, those 20,000 people obviously weren't willing to open their wallets, forcing the law firm to look elsewhere for funding, meaning that it seemed to go nowhere this year.