Aveau v Timanu Samau and Sons Truck Services Ltd [2002] WSSC 52; CP 128 2001 (20 November 2002)

IN THE SUPREME COURT OF SAMOA
HELD AT APIA

CP 128/2001

BETWEEN

TUISUGALETAUA A S AVEAU
of Fagali'i, Minister of Agriculture, Forests, Fisheries & Meteorology
FIRST PLAINTIFF

FA'ALEPO ASAVEAU
of Fagali'i and Malua, Minister of Religion
SECOND PLAINTIFF

AND

TIMANI SAMAU & SONS TRUCK SERVICES LIMITED
a duly incorporated company at Matautu, Apia, Samoa
DEFENDANT

HEARD ON: 28, 29, 30 August 2002

COUNSEL: Mr M Leung Wai for Plaintiffs
Ms Tuatagaloa for Defendant

JUDGMENT: 20 November 2002

JUDGMENT OF JUSTICE COOPER

BACKGROUND

[1] In the 1970's the first plaintiff composed the song 'Alofa Moni' and the second plaintiff composed the song 'Malolo Ita'.

[2] In those days the two plaintiffs, who are brothers, were members of a band called Ma'atulua. In the 1970's the Ma'atulua band recorded both songs for broadcast on Radio 2AP in Samoa and in 1981 the band put out a music cassette called' Alofa Moni' which featured both songs.

[3] The defendant company operates a successful band - Le Eva Eva Band.

[4] In 2000 Le Eva Eva Band put out a CD and music cassette called 'Le Eva Eva Band Volume II - Fugalaau O Le Alofa'. There are 10 tracks on the CD, one of which is a song called 'Momoli Atu'. It is acknowledged by the defendant that 'Momoli Atu' is in fact a recording of the first plaintiff's song' Alofa Moni' and that this song was recorded by Le Eva Eva Band without the first plaintiff's permission.

[5] In 2001 Le Eva Eva Band put out a CD and musical cassette called 'Le Eva Eva Band Volume III - Fetu E Tasi'. One of the 10 tracks on this CD is the second plaintiff's song 'Malolo Ita'. The defendant initially denied the second plaintiffs authorship of this song. However at the end of the plaintiff's case the defendant formally conceded that the second plaintiff was indeed the composer of 'Malolo Ita'. This song was recorded by Le Eva Eva Band without the second plaintiff's permission.

[6] After the first plaintiff became aware of the breach of his copyright in the' Alofa Moni', he entered into an agreement with the defendant at a meeting with Mr Semi Samau in October 2000.

[7] The terms of that agreement was:

a) That the defendant would pay the first plaintiff the sum of T$6,000.OO.

b) That the first plaintiffs name as composer would be acknowledged and written on future copies of the Le Eva Eva Band Vol II album that might be produced.

c) That copyright and ownership of the song 'Alofa Moni' remained with the first plaintiff.

d) That Le Eva Eva Band would play free of charge at one function nominated by the first plaintiff and the band would pay its own transport expenses from Savai'i.

e) That if any of the above conditions were not met the matter would be 'brought before the law to be dealt with'.

[8] The defendant paid the first plaintiff only T$4,000 of the T$6,000 agreed; and the first plaintiff alleges that after the agreement the defendant produced further copies of the CD Le Eva Eva Band Vol II without acknowledging the first plaintiff's authorship of 'Momoli Atu' ('Alofa Moni'). The defendant accepts that T$2,000 has not been paid but says it has not received a formal written demand for payment.

THE FIRST PLAINTIFF'S CLAIM - ISSUES

a) Has the agreement of October 2000 been breached by:-

i) Non payment of the T$2,000.

ii) The production of further copies of the CD without acknowledging the first plaintiffs authorship of the song.

b) .... there is a breach, what are the consequences:-

i) Are the first plaintiffs rights to be determined in light of the agreement, or

ii) Is the agreement at an end.

c) What are the appropriate damages.

First Issue: Has the Agreement of October 2000 Been Breached?

[9] The agreement of October 2000 has been breached in that the balance of T$2,000 due to the first plaintiff has not been paid.

[10] I find also that the agreement has been breached in that 300 further CDs of Le Eva Eva Band Vol II were produced, after the agreement of October 2000, without any acknowledgement of the first plaintiff's authorship of his song.

[11] Exhibit D produced by the defendant is an invoice to the company dated 27 July 2001 from Software Images Limited for this production run.

[12] The defendant's witness, Semi Samau, said in evidence that this run of CDs was made without the company's authority. Semi Samau's evidence was that this run of CDs must have been instigated by his brother-in-law in New Zealand, Danny Fa'alogo. I do not accept the evidence that this run of CDs was made without the company's authority. While it is true that Danny Fa'alogo's name appears on the invoice as the contact person, his name also appears as such on all the other invoices produced in evidence for CDs and cassettes ordered by the defendant company. The invoice, Exhibit D, was directed to the defendant; it was paid; and importantly it was among the documents which were in the company's possession and which Semi Samau himself produced in evidence.

[13] There is a suspicion on the first plaintiff's part that more than these 300 CDs were produced, however such evidence as is before the Court does not take that beyond mere suspicion. There is evidence that after the dispute between the parties arose there were no public performances of 'Momoli Atu' ('Alofa Moni') by Le Eva Eva Band. The evidence of infringement after the October 2000 agreement relates to the 300 CDs only.

Second Issue - What is the Effect of the Breach?

[14] The agreement of October 2000 must be taken as settling the rights and obligations of the first plaintiff and the defendant in respect of that breach of the first plaintiffs copyright occurring before October 2000. Although the first plaintiff's secretary contacted Semi Samau on more than one occasion with reminders to pay the balance owing, there was no formal written demand for payment. I accept that the defendant has been at all times willing to make the payment in full.

[15] Therefore the first plaintiff's entitlement to damages must be:-

a) The balance of T$2,000 outstanding;

b) Damages in terms of the Copyright Act 1998, in respect of the further breach of copyright relating to the 300 CDs produced, after October 2000, without acknowledgement of the first plaintiffs authorship of his song.

Third Issue - The Measure of Damages Under the Copyright Act 1998

Section 26(1) Copyright Act 1998 provides:-

"Civil Remedies - (1) The owner of any right arising in Samoa and protected under this Act, whose right has been infringed shall be entitled to payment, by the infringer, of damages for the prejudice suffered as a consequence of the act of infringement, as well as the payment of expenses caused by the infringement, including reasonable legal costs. The amount of damages shall be fixed by the Court, taking into account the importance of the material and moral prejudice suffered by the owner of the right, as well as the extent of the infringer's profits attributable to the infringement:

Provided that where the infringer did not know or had no reasonable reason to know that he or it was engaged in infringing activity, the Court may limit damages to the profits of the infringer attributable to the infringement.'

[16] It can be seen that s.26 provides for:

a) Damages for the prejudice suffered as a consequence of the act of infringement.

b) The payment of expenses caused by the infringement including reasonable legal costs.

In fixing the amount of damages, the Court is required to take into account:

a) The importance of the material;

b) The moral prejudice suffered by the first plaintiff;

c) The extent of the defendant's profits attributable to the infringement:

Provided that if the defendant did not know or had no reasonable reason to know that it was engaged in infringing activity, the Court may limit the damages to the profits of the defendant attributable to the infringement.

...

[18] Given the agreement in October 2000 and my earlier finding that the defendant company did authorise the production of the further 300 CDs, it is not possible for the defendant to claim that it did not know or that it had no reasonable reason to know that it was engaged in infringing activity.

[19] In looking at 'the extent of the (defendant's) profits' as required by s.26(1), the Court must take into account the net profits, i.e. the gross receipts from sales of the infringing CDs deducting the necessary and proper expenses of production and delivery (International Credit Central Ltd v Axelsen [1974] NZLR 695 following Caxton Publishing Co Ltd v Sutherland Publishing Co Ltd [1938] AC 178). Where, as here, the infringing song is one of 10 songs on an album; a proportional approach is required, but making a qualitative as well as J quantitative assessment (Caxton Publishing Co Ltd v Sutherland Publishing Co Ltd AC 178, 205).

[20] The figures provided by the defendant in relation to gross profit and expenses incurred in production of Le Eva Eva Band Vol II are said to be estimates only. The record keeping and accounting methods employed by the defendant are quite inadequate. The plaintiffs specifically do not want the Court to order a taking of accounts in relation to profits and asks that damages be assessed on the basis of what the Court makes of the evidence before the Court.

[21] Assessing the profit to the defendant from the 300 CDs is a difficult exercise because of the lack of proper accounting. It must be remembered that the Court is dealing with these 300 infringing CDs only and not the CDs and cassettes produced before the October 2000 agreement.

[22] I do not accept all of the expenses claimed for by the defendant (Exhibit A). The total cost of the lead singer's vehicle has been charged as a production cost in respect of Le Eva Eva Band Vol II only. There seems no justification for that. The estimated duty and freight costs seem unreasonably high and the costs of transportation and travel within New Zealand also seems unreasonably high.

[23] However, for the purposes of assessing the profits attributable to the infringement, I will take as the starting point the evidence of Semi Samau that the net profit per CD is estimated at T$30.00. Therefore the total estimated profit from the 300 infringing CDs is T$9,000.

[24] The song 'Alofa Moni' ('Momoli Atu') is one of 10 songs on the album. It is not as popular as the title song but the evidence establishes that it is one of the most popular songs on the album. Adopting the qualitative and quantitative approach required, I assess the extent of the profits attributable to the first plaintiff's song at 20%. In relation to the 300 infringing CDs, this equates to a profit of T$1.800.

[25] I turn now to assess 'the importance of the material' and 'the moral prejudice suffered by this first plaintiff.

[26] I accept that within Samoa the song 'Alofa Moni' is a respected original musical work; that the defendant pirated the song without acknowledgement of the first plaintiff's copyright; and that the defendant did so after the agreement of October 2000 in which it agreed that the first plaintiff's authorship would be acknowledged.

[27] On the other hand it must be borne in mind that the infringement relate to 300 CDs only and that the song's audience is largely limited to Samoa and the Samoan community in New Zealand.

[28] Taking into account all those factors in s.26(1), I fix the damages to the first defendant for the prejudice suffered as a consequence of the act of infringement in relation to the 300 CDs in the sum of T$5,800 (including profits).

[29] The first plaintiff is entitled to legal costs. In assessing the amount I take into account that the first plaintiff has succeeded on the second (and lesser) limb of his claim.

[30] Therefore costs are awarded in favour of the first plaintiff in the sum of T$5,000.

FIRST PLAINTIFFS CLAIM – JUDGMENT

[31] In summary there will be judgment against the defendant in favour of the first plaintiff as follows:-

a) An order for specific performance pursuant to the agreement of October 2000; in particular:

i) To pay the first plaintiff the sum of T$2,000.

ii) To acknowledge the first plaintiffs copyright in the song 'Alofa Moni' (Momoli Atu) on all covers of the album Fugalaau O le Alofa. This is to be done by placing a sticker to that effect on all CD and cassette covers still in the possession or control of the defendant, and on any covers to be printed in future printed on the cover itself.

b) The sum of T$5,800 damages for the prejudice suffered as a consequence of the infringement.

c) The sum of T$5,000 for legal costs.

SECOND PLAINTIFFS CLAIM - ISSUES

[32] The defendant accepts there has been a breach of the second plaintiffs copyright in 'Malolo Ita'. The sole issue here is the remedy and damages due to the second plaintiff.

[33] This requires an assessment of damages due to the second plaintiff in light of the principles already discussed.

Measure of Damages

[34] In this case all of the Le Eva Eva Band Vol III CDs and cassettes produced have infringed the second plaintiff's copyright in the song 'Malolo Ita'.

[35] The defendant's record keeping and accounting methods in respect of this song are again totally inadequate.

[36] The evidence is that a total of 4,000 cassettes and 400 CDs were produced.

[37] The defendant's evidence as to sales figures is that approximately 1,400 cassettes and 200 CDs were sold in Samoa. His evidence was that he is unaware of how many were sold in New Zealand. He gave no evidence as to how many CDs and cassettes were still in stock. His evidence was that Le Eva Eva Band Vol III album was not as great a success as Vol II. He estimates the profit on Vol III was 'maybe' approximately T$18,000 but produces no evidence of this. This contradicts his other evidence that the profit on each CD is approximately T$30 and each cassette approximately T$18.

[38] If one were to accept sales of:

1,400 cassettes at net profit	T$25,200
200 CDs at net profit	T$6,000
the net profit would be	T$31,200

[39] This relates to sales in Samoa only and takes no account of those sales in New Zealand. If one assumes that ultimately all 400 CDs and 4,000 cassettes will be sold in Samoa and New Zealand, the net profit on the above basis is:

4000 cassettes	net profit	T$72,000
400 CDs	net profit	T$12.000
		T$84,000

[40] That figure seems high - particularly as the Vol III album did not enjoy the same success as Vol II.

[41] I am loathe to simply accept without question the bare estimates provided by Semi Samau in relation to sales and I note the inadequacy of the evidence in relation to sales in New Zealand.

[42] The infringement of the second plaintiff s copyright also included those occasions where the song 'Malolo Ita' was played by the band at public performances and in the band's niteclub in Savai'i. It is difficult to assess the extent of the defendant's profits in relation to these performances because the playing of the song is one item in a larger performance, nor is there adequate evidence of the extent of the defendant's profits from these performances.

[43] Therefore a broad approach is required.

[44] The song 'Malolo Ita' is one of 10 songs on the Vol III album. The title track 'Fetu E Tasi' is the most popular song. The evidence is that 'Malolo Ita' is relatively popular. However I see nothing which really sets this song apart in contributing to the success or sales of the Vol III album.

Accordingly I assess the extent of the profits on the Vol III CD attributable to the second plaintiff's song at 10%.

[45] I also find that the proviso to s.26(1) cannot assist the defendant in relation to 'Malolo Ita'. The band had a somewhat cavalier attitude towards using the work of other composers. No real steps were taken to ascertain who had composed 'Malolo Ita'. The defendant simply used the song. There are still persons within the broadcasting industry in Samoa who are aware of the song. A simple inquiry of the broadcasting industry would have revealed the second plaintiffs authorship of the song. This was a reasonable step to expect of the defendant. Obviously the song was written by someone other than the defendant, but the defendant took no steps to find out who that was.

[46] Applying the principles already discussed in relation to s.26 Copyright Act 1988, I fix damages to the second plaintiff for the prejudice suffered as a consequence of the act of infringement in relation to 'Malolo Ita' in the sum of T$15,000 including profits.

[47] The second plaintiff is entitled to costs which I fix in the sum of T$5,000.

SECOND PLAINTIFFS CLAIM - JUDGMENT

[48] In summary there will be judgment in favour of the second plaintiff against the defendant as follows:

a) The sum of T$15,000 -damages for prejudice suffered as a consequence of the infringement.

b) The sum of T$5,000 for legal costs.

c) The defendant is ordered to acknowledge the second plaintiffs copyright in the song 'Malolo Ita' on all covers of the album 'Fetu E Tasi'. This is to be done by placing a sticker to that effect on all CD or cassette covers still in the possession or control of the defendant, and on any covers to be printed in future, printed on the cover itself.

JUDGE