Yellow Pages in copyright fight
A court case taken by Yellow Pages Group against a rival it accuses of stealing its directories database has taken on greater significance following an Australian court ruling that phone books hold no copyright.
Yellow Pages obtained a temporary injunction against Auckland firm Image Marketing Group (IMG) in December after accusing it of illegally obtaining details of about 315,000 businesses from Yellow Pages and selling the information via its own products.
The case is due back in the High Court on May 13 for a full hearing.
In a recent Australian Federal Court judgment, Justice Michelle Gordon ruled there was no copyright on the White Pages or Yellow Pages produced by Sensis, Telstra's directories business.
The case has stirred up a hornets' nest in Australia with suggestions that any business aggregating data through the likes of phone directories, financial data, television guides, betting guides, real estate listings, airfare prices or transport timetables should be concerned.
Matt Sumpter, a Chapman Tripp partner specialising in intellectual property, says New Zealand businesses should be wary too.
"If I was in the data business in Australia or New Zealand I'd be very concerned about these developments," says Mr Sumpter.
The Sensis case, on the heels of one last year between IceTV and the Nine Network, marks a departure in Australia from the traditional British legal approach that copyright protection would be granted if sufficient time and labour were applied to a product. The Australian courts are instead adopting a similar approach to those of the United States and Canada.
"What the courts are saying in these [Australian] decisions is `wait a moment. There's nothing particularly creative about what's going on here and moreover we can't really identify an author'," says Mr Sumpter.
Because no-one can be pinpointed as the person behind the creation of the phone directories, and because much of the database is computer generated and simply updated, courts are struggling to understand whether copyright law should continue to protect the work.
Mr Sumpter says although there are subtle technical differences between Australian and New Zealand copyright law, the Australian thinking is likely to be "very, very" influential here.
When New Zealand's Copyright Act was passed in 1994 Mr Sumpter says consideration was given to whether there ought to be a special law to protect databases. Although no clear decision was reached, the definition of "compilations" to cover "multimedia" works arguably extends to databases.
Mia Sudzum, solicitor at Hudson Gavin Martin, says New Zealand courts have tended to follow the British "sweat of the brow" approach but agrees they are likely to look closely at the ground-breaking Australian ruling.
According to marketing director Kellie Nathan, Yellow Pages believes New Zealand copyright law differs from Australia "insofar as it relates to directory databases". She declined to comment further while the IMG case is before the courts.
Brendon Battles, IMG director and shareholder, says he is aware of the Sensis case but notes each case is different. Mr Battles, nicknamed the Spam King due to a reputation for sending out millions of unsolicited email and cellphone messages, says IMG is contesting Yellow Pages' allegations, which he says are unproven.
For Yellow Pages, uncertainty over database copyright comes at a particularly bad time. Investment bank UBS is working on a restructure of the group's $1.7 billion of debt in an economic environment that Yellow Pages chief executive Bruce Cotterill expects to remain tough until the second half of next year.
Yellow Pages' annual accounts show that, valued at $2.2b, directories' brand names and goodwill comprise the lion's share of the group's $2.5b in assets. Meanwhile, spokeswoman Karina Keisler says Sensis is challenging the ruling against it, with a hearing expected in August.
Sensis unsuccessfully sued rival Phone Directories Company, which it accused of illegally reproducing entries from Sensis directories.
Ms Keisler says Sensis has historically done everything it can to protect its listings and wants to ensure others don't "springboard off our hard yards".
Other companies following the case closely include Tabcorp, Foxtel, Seek, News Ltd and The Dominion Post publisher Fairfax Media, according to The Sydney Morning Herald.
Foxtel chief executive Kim Williams told the newspaper: "We believe it critical that the billions of dollars Australian businesses invest in their databases be protected." Any "gap in the law" needed "legislative change."
Mr Williams said a solution might lie in the approach of the European Union. There laws that protected "database rights" had been passed to stop billions of dollars of investment "being ripped off".
The Dominion Post