Haupt t/a Softcopy v Brewers Marketing Intelligence (Pty) Ltd. and Others (118/05) [2006] ZASCA 40; 2006 (4) SA 458 (SCA) (29 March 2006)

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Haupt t/a Softcopy v Brewers Marketing Intelligence (Pty) Ltd. and Others (118/05) [2006] ZASCA 40; 2006 (4) SA 458 (SCA); 2006 BIP 317 (SCA) (29 March 2006)

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THE
SUPREME COURT OF APPEAL
OF
SOUTH AFRICA
Reportable
CASE NO
: 118/05
In the matter between :
HAUPT, ANTON CHARL t/a
SOFTCOPY
Appellant
and
BREWERS MARKETING
INTELLIGENCE (PTY)
LIMITED
First Respondent
BREWER, CHRISTOPHER
JOHN
Second Respondent
COETZEE, BYRON
Third
Respondent
________________________________________________________________________
Before: HARMS, STREICHER,
MTHIYANE, CLOETE & LEWIS JJA
Heard: 15 FEBRUARY 2006
Delivered:
29 MARCH
2006
Summary: Copyright –
‘computer generated’ need not produce correct results –
improved work eligible for copyright if original
– databases and
database structures not computer programs – computer generated work
only if no human author – creativity not
a requirement of
originality – control over the making of a computer program.
Neutral citation: This
judgment may be referred to as Haupt v Brewers Marketing Intelligence
(Pty) Ltd [2006] SCA 39 (RSA)
________________________________________________________________________
J
U D G M E N T
______________________________________________________________________________
STREICHER JA
STREICHER JA:
[1] Anton Haupt, the appellant,
applied to the Cape High Court for an order interdicting the
respondents in terms of the
Copyright Act 98 of 1978
from infringing
his alleged copyright in a computer program known as Data Explorer
and also in certain tables (or database structures)
and databases.
The High Court held that Haupt’s claim could not be sustained and
dismissed the application. With the leave of this
court Haupt now
appeals against the High Court’s judgment.
[2] Haupt and the second respondent,
Christopher Brewer, are brothers-in-law. Brewer used to be the
managing director and Haupt the
marketing director of Brewer’s
Almanac (Pty) Ltd (‘Brewer’s Almanac’). Brewer’s Almanac did
business as an advertising
agency and also disseminated information
of use to the advertising industry.
[3] During 1998 the third respondent,
Coetzee, was requested by Brewer’s Almanac to write a computer
program which could interrogate
and manipulate what is known as AMPS
(All Media Products Survey) data. AMPS data are research results
produced by a media research
company on behalf of the South African
Advertising Research Foundation. AMPS data are based on market
surveys done on a six-monthly
basis by way of questionnaires and are
available in binary column electronic format stored in a UFL file and
captured on a compact
disc. They enable one to determine, inter
alia, who the readers, listeners or viewers of particular newspapers,
magazines, radio
stations or television programs are and who the
users of various products are. The information is useful especially
to advertising
agencies in the planning of marketing strategies.
[4] Coetzee was requested to write a
program that would give the user the ability to select certain
questions, extract the answers
from the UFL file and display those
answers in a meaningful way. He used a computer program called Delphi
to write the program which
he called Project AMPS. To enable the
selection of a question, the questions upon which the AMPS data were
based had to be stored
in a database. For this purpose Coetzee
created a table. This was done by simply asking the Delphi program to
create a new table.
The program allows one to determine the number of
fields required and the extent of the fields. Haupt then undertook
the task of
filling the table with the questions contained in the
questionnaire in respect of the AMPS97b data. Coetzee, in the
meantime, wrote
a program that could read the data in the binary
format supplied. The next step was to create the user interface or
front end of
the program, that is, that part of the program that
determines what a user will see. Coetzee decided that the questions
should be
displayed in a ‘tree’ format and used the tree
component of the Delphi program for this purpose. He then proceeded
to write a
program that could read the questions in the table (the
questions database), populate the tree when the program was
activated, allow
the user to select a question and extract, calculate
and display the data requested. By 21 June 1998 the program had
developed to
the extent that a tree could be populated from a
questions database, a user could select one of the questions, and an
answer, sometimes
correct sometimes wrong, could be extracted from
the UFL file and be displayed on a monitor.
[5] On 31 July 1998 Haupt and Brewer
parted ways and from that date onwards Haupt was no longer in the
employ of Brewer’s Almanac.
Thereafter, Coetzee, in terms of a
prior arrangement with Haupt, continued to develop the program for
Haupt exclusively. In terms
of the arrangement Coetzee was to receive
20 per cent of the gross sales of the program.
[6] The next major development of the
program after 21 June 1998 was the incorporation of a ‘tree
preparer’ program. Every time
the program was loaded it took time
to populate the tree from the questions database. To overcome this
problem Coetzee wrote a program
called the tree preparer program
which could, from the questions database, prepare a tree populated in
the format required and then
save it in a tree.txt file. He took out
the link to the questions database and thereafter the tree.txt file,
instead of the questions
database, was used to populate the tree.
Haupt testified that this development took place after 31 July 1998.
His evidence in this
regard was not disputed. However, when Coetzee
testified he suggested that the development might have taken place
before 31 July
1998. According to him he established that he started
working on a tree preparer program on 5 or 6 July 1998. He could not
say when
he completed the writing of the program but could say that
it would have taken him about six hours to do so. In my view
Coetzee’s
belated and half-hearted suggestion that the program
might have been written before 31 July 1998 is not sufficient to cast
doubt
on Haupt’s evidence in this regard. Coetzee also wrote a
program which could search the tree view of the questions. It was not
suggested that this was done before 31 July 1998.
[7] The data in the UFL file was not
sorted and every time a question was selected a search had to be done
through the whole of the
file. Quick access could, therefore, not be
gained to a particular sector of the data. To overcome this problem
Coetzee created an
answers database and changed the existing program
so as to pre-sort the answers contained in the UFL file and to order
and index
them in a table or database structure created as in the
case of the questions database structure. Once this had been done the
program
had to be changed again so as to look for an answer to a
selected question in the answers database instead of the UFL file.
This
procedure had to be followed in respect of each set of AMPS data
as it became available. The development took place at the beginning
of 1999. At that time Coetzee also created a weightings database.
This was necessary because respondents to the questionnaires have
a
weighting which is used to determine their actual representation in
the relevant population. Subsequently various other database
structures were added to the Data Explorer program.
[8] Every six months when new data
was received the Data Explorer program had to be changed from reading
the answers file to reading
the UFL file and once this had been done
it had to be changed back again. To obviate these changes Coetzee, in
June 2000, created
a new program (the converter program), separate
from the Data Explorer program, to do the conversion from the UFL
file to the answers
file. Coetzee described the effect of the
development as follows:
‘
So that meant that I could leave the Project
AMPS program pristine, every time a conversion came I could just do
my conversion with
a separate program and finished, I didn’t have
to remember what I’d changed and all that kind of stuff.’
He referred to the program as the
Project AMPS program although, by that time, the name of the program
had been changed to Data Explorer.
[9] Coetzee left for the USA in
October 2000. Before he did so he worked full time for a period of
two months on the further development
of the program. During this
period Haupt paid him R20 000 per month. It was at this time
that a new graphing tool was added
to the program. This was done by
purchasing a graphic server which was commercially available and by
incorporating it into the Data
Explorer program.
[10] The AMPS data referred to as
Teen98, Child99, AMPS99a, AMPS99b and AMPS2000a were all processed by
Haupt and Coetzee and marketed
by Haupt together with the Data
Explorer program. In respect of each set of data a tree.txt file was
compiled by the tree preparer
program from the questions table filled
by Haupt and the data contained in a UFL file was converted to an
answers database and a
weightings database.
[11] On 26 March 2001 Coetzee, who,
at that time, was still in the USA, made contact with Brewer by
e-mail stating inter alia that
he had heard little or nothing from
Haupt. This led to the following letter from Brewer to Coetzee on 4
May 2001:
‘Dear Byron,
. . .
There’s something I’d like to discuss with you – but it MUST be
kept strictly confidential and just between you and me –
for
obvious reasons.
I have been asked by several agencies to get busy
on other database products, some of which would be impractical, but
more recently
SAARF asked me if I would be able to produce a “Brewers
AMPS Data Program”.
Let me say straight off that I have absolutely NO intention of
developing a program for this – but I WOULD be interested in coming
to an arrangement with you where we would use the program you wrote
to convert the SAARF data (we would then develop the front-end
to
make it look nice as well as looking like our other products).
I . . . also believe there is room for another player in the market
(Anton is obviously doing exceptionally well – in fact he seems
positively RICH) and you, yourself, would not be compromised. I’ll
make that a little clearer if I can:
I need to use the program you wrote in order to import SAARF (AMPS)
data into a Brewer’s database (which Hank will write). For
this you
will earn a “royalty” or “commission” on sales.
. . .
So here’s my question to you:
Are you interested in allowing me to use your program for
converting SAARF (AMPS) data into a database (which we will write) in
return
for a royalty?
. . .
Whichever is the answer, please DO NOT discuss this with Anton. There
is nothing devious in my saying that – it’s just that I
don’t
want to create any family stress or tension (especially if your
answer is “no”).
There is no other reason for me not wanting Anton to know.
If we do go ahead then (if necessary) I’ll explain it all directly
to him. There is absolutely nothing underhand about you and
I
discussing this.
. . .’
[12] Negotiations between Coetzee and
Brewer ensued culminating in a written agreement on 2 July 2001. In
terms of the agreement they
agreed that Brewer’s Marketing
Intelligence (Pty) Ltd, the first respondent, would develop the
program, that Coetzee would provide
compiled (converted) data to the
first respondent to enable the first respondent to develop the
program, and that Coetzee would co-operate
and advise the first
respondent during the development stage.
[13] The first respondent employed
one Hank Bento to write the program which became known as the
Brewer’s AMPS program. While doing
so Bento was in frequent contact
with Coetzee for assistance. Coetzee regularly gave advice to Bento
and from time to time sent him
portions of the source code of the
Data Explorer program. The source code for the search function and
also the source code required
to incorporate the graphics server were
so sent to Bento. In both instances this was done because Bento
struggled to do the programming.
Referring to an e-mail in terms of
which he sent the code in respect of the graphics server to Bento,
Coetzee testified:
‘
[W]hat has happened here is Mr Bento has
installed the graphing package, he’s never seen it before, and he’s
tinkered with it
a bit and he’s realised that there’s a lot more
to this than just simply installing it, he now has to write code
around it in
order to use it, so he has contacted me, I’m not sure
how, either with MSN or by e-mail, and said, listen, Byron, how did
you use
this, what, can you shortcut me on this, please, and so I
said, I sent him an e-mail with the exact code that is in Project
AMPS
that I wrote around using the graphic server previously, and
it’s about just over two pages long, the code.’
Bento conceded that he made use of
these source codes.
[14] At that time, the latest AMPS
data, namely AMPS2000b, had not been converted by Coetzee for Haupt.
The first respondent acquired
this data, Brewer filled a questions
table with the questions in respect of the AMPS2000a data, sent the
data (contained in a UFL
file stored on a compact disc) together with
the questions database so created to Coetzee, and Coetzee converted
the data from the
UFL file to an answers and weightings database.
Coetzee, by using the tree preparer program, also created a tree.txt
file and returned
the conversions and the tree.txt file to the first
respondent. In addition Coetzee supplied the Teen98, Child99,
AMPS99a, AMPS99b
and AMPS2000a databases which had previously been
created for the Data Explorer program, as well as the relevant
tree.txt files,
to the first respondent.
[15] The first respondent marketed
the Brewer’s AMPS program together with all the aforesaid converted
data and the tree.txt files.
The existence of the program was
discovered by Haupt when he investigated why his Data Explorer
program, which was being used by
Nasionale Pers, was not functioning
properly. He established that the malfunctioning was caused by the
presence of a similar program,
namely the Brewer’s AMPS program.
[16] Haupt thereupon applied for an
Anton Piller order and for an order interdicting the respondents from
infringing his copyright
in the Data Explorer program and various
files and folders including the aforesaid databases. By this time
Coetzee had returned to
South Africa. The Anton Piller order was
granted and the respondents were called upon to show cause why an
interdict should not be
granted against them.
[17] On 29 May 2002 the interim
interdict against the respondents was discharged and, by consent, the
following order was made in
respect of the application for an
interdict:
‘3 The final interdict prayed for by the Applicant is to be dealt
with as follows:
Determination of the final interdict is referred to trial on 4
November 2002;
The Applicant is ordered to deliver his supplementary replying
affidavits if any by no later than Thursday 20 June 2002;
It is ordered that the affidavits, filed and to be filed, in the
present matter are to stand as pleadings;
The Uniform Rules of Court pertaining to trial actions are to apply
to the present matter.
Costs are to stand over for later determination.’
[18] This order should never have
been made. The affidavits together with the annexures comprised 330
pages in which the issues were
not properly defined. The problem
could have been alleviated had the parties held a pre-trial
conference as required by para 3.4
of the order but that was not done
either. As a result the parties plunged into a trial without a proper
appreciation of what the
issues were. The trial commenced on 26
February 2003 and the respondents closed their case on 24 February
2004 after a number of
postponements. No less than 33 court days were
taken up. A lot of time and energy were spent at the trial on the
question as to the
shareholding in Brewer’s Almanac and on the
question as to whether the relationship between Haupt and Brewer,
while they were employees
of the company, was similar to the
relationship between partners. It has now been conceded by all the
parties concerned that those
disputes were irrelevant. An inordinate
amount of time was also spent on the question whether it was Brewer
or Haupt who first had
the idea to write the program, and as to the
relative contributions of Brewer and Haupt to the writing of the
Project AMPS program.
Again these issues were irrelevant as it is
common cause that Haupt and Brewer were acting in their capacities as
employees of Brewer’s
Almanac. The parties got so entangled in
irrelevant issues that the real issues, such as the nature of the
works in respect of which
copyright was being claimed, whether the
works were original and who the author for purposes of the Act was,
received scant attention.
[19] In terms of Uniform rule 6(5)(g)
a court may, where an application cannot properly be decided on
affidavit, refer the matter
to trial with appropriate directions as
to pleadings or definition of issues, or otherwise. In this case, as
would be the case in
most applications that are referred to trial, it
was essential that the issues be defined.
1
Had it been done, a lot of time, energy and costs could have been
saved. The order referring the matter to trial was not made by
the
trial judge. However, when the matter was allocated to him, he should
have insisted on a proper definition of the issues.
[20] The evidence adduced at the
trial established that nine out of ten database structures used in
the Brewer’s Amps application
were identical with database
structures used in the Data Explorer application; that the answers
and weightings databases used in
the Data Explorer application were
supplied to clients who used the Brewer’s AMPS program; that the
tree.txt files in respect of
the Teen98, Child99, AMPS99a, AMPS99b
and AMPS2000a data used in the Brewer’s AMPS application
corresponded 99%, 100%, 57%, 96%
and 96% respectively with the
corresponding tree.txt files used in the Data Explorer application;
that the source code of the tree
preparer and converter programs used
by Coetzee for the Brewer’s AMPS program corresponded 93 per cent
and 84 per cent respectively
with the tree preparer and converter
programs used by him in respect of the Data Explorer program; and
that the source code in respect
of the search and graphing functions
in the Brewer’s AMPS program corresponded 83 per cent and 26 per
cent respectively with the
source codes in relation to these
functions in the Data Explorer program.
[21] The High Court did not
distinguish between the computer programs and the databases. It held
that Brewer’s Almanac was the author
of the Project AMPS program in
that the company in general had overriding control of the creation of
the program. In regard to the
developments of the program post 31
July 1998 the High Court said that it was apparent that they were
improvements and refinements
of the existing Project AMPS program. It
held that by expending time and effort on the improvement of the
program, Haupt did not,
in some way, become the holder of the
copyright. According to the High Court it was not Haupt’s case that
one (or more) of the
developments that occurred after 31 July 1998,
of which he was the author, satisfied the originality requirement of
the Act and attracted
copyright in its own right. In respect of the
converter program the High Court held that, at best for Haupt, he
could claim to be
the co-author with Coetzee in respect of the
changes that were made after July 1998. For these reasons the High
Court dismissed Haupt’s
application.
[22] Haupt contends that the High
Court erred and that he was entitled to an order interdicting the
respondents from infringing his
copyright in
–
The Data Explorer program including the search
instructions, the graph instructions, the converter program and the
tree preparer
program;
Various structures of databases such
as the questions.db, the answers.db and the weightings.db; and
The questions, answers, weightings
and tree.txt compilations in respect of the Teen98, Child99,
Amps99a, Amps99b and Amps2000a data.
[23] Haupt submitted that the High
Court erred in finding that the Project AMPS program, as it existed
on 31 July 1998, constituted
a computer program eligible for
copyright in terms of the Act. He submitted that this was the case
because it produced incorrect
results and because ‘sections of the
raw data’ could not be read at all. I do not agree. A computer
program is defined in s
1 of the Act as ‘a set of instructions
fixed or stored in any manner and which, when used directly or
indirectly in a computer,
directs its operation to bring about a
result’. It does not require the result to be correct. As at 31
July 1998 the Project AMPS
program did bring about a result,
sometimes correct, sometimes wrong. It did, therefore, qualify as a
computer program eligible for
copyright.
[24] The High Court was apparently of
the view that Haupt could not acquire copyright in the Data Explorer
program inasmuch as the
program was an improvement and refinement of
the Project AMPS program. It erred in this regard. If a work is
eligible for copyright
an improvement or refinement of that work
would similarly be eligible for copyright, even if the improved work
involved an infringement
of copyright in the original work, if it
satisfies the requirement of originality.
2
That will only be the case if the improvement or refinement is not
superficial. The alteration to the original work must be
substantial.
3
See in this regard
Interlego A G v Tyco Industries Inc
[1988] UKPC 3
;
[1989]
AC 217
(PC) at 263 where the Privy Council said in respect of an
alteration to an artistic work:
‘
There must in addition be some element of
material alteration or embellishment which suffices to make the
totality of the work an
original work. Of course, even a relatively
small alteration or addition quantitatively may, if material, suffice
to convert that
which is substantially copied from an earlier work
into an original work. Whether it does so or not is a question of
degree having
regard to the quality rather than the quantity of the
addition. But copying, per se, however much skill or labour may be
devoted
to the process, cannot make an original work.’
[25] The High Court also erred in
holding that it was not Haupt’s case that one or more of the
developments after 31 July 1998 satisfied
the originality requirement
of the Act and attracted copyright in its own right. Haupt
specifically claimed copyright in respect
of the various databases.
He may have approached the case on the basis that the converter and
tree preparer program were part and
parcel of the Data Explorer
program but the question as to whether he was entitled to copyright
in respect of these programs was
canvassed to no lesser extent than
in respect of the other components of the relevant software.
[26] In terms of s 2(1) of the Act
literary works and computer programs are works that are eligible for
copyright if they are original.
Other works that are eligible
for copyright are not presently relevant.
[27] Subject to certain qualifications copyright is, in
terms of s 3 of the Act, conferred on the author of a work eligible
for copyright.
In s 1 of the Act ‘author’ is differently defined
in respect of literary works, computer programs, and literary works
or computer
programs which are computer-generated. It follows that,
in order to determine in whom the copyright in respect of the various
works
vested, it is necessary to first determine whether the works we
are concerned with are literary works, computer programs,
computer-generated
literary works or computer-generated computer
programs and to then determine whether they are original and who the
author of the
relevant work is.
The nature of the works
[28] As stated above a ‘computer program’ means a
set of instructions fixed or stored in any manner and which, when
used directly
or indirectly in a computer, directs its operation to
bring about a result (s 1 of the Act). It is common cause that the
Data Explorer
program (including the search instructions and the
graph instructions) and also the converter program and the tree
preparer program
are computer programs. All of them consist of a code
containing a set of instructions which, when used in a computer,
directs its
operation to bring about a result.
[29] A literary work includes, irrespective of literary
quality and in whatever mode or form expressed, tables and
compilations, including
tables and compilations of data stored or
embodied in a computer or a medium used in conjunction with a
computer, but not a computer
program (s 1 of the Act).
[30] In respect of the database structures Haupt
contended that they were computer programs while the respondents
contended that they
were literary works. According to the evidence
adduced at the trial a database structure does not consist of a set
of instructions.
It consists of a table with a certain number of
columns which may vary in width. The database structures are
therefore literary
works for purposes of the Act.
[31] The Act does not contain a definition of
‘computer-generated’. In my view a work only qualifies as having
been computer-generated
if it was created by a computer in
circumstances where there is no human author of the work. If there is
a human author the work
is computer assisted and not
computer-generated. That is the meaning ascribed to
‘computer-generated’ in s 178 of the Copyright,
Designs and
Patents Act, 1988 of the United Kingdom. It also accords with the
recommendation of the Australian Copyright Law Review
Committee in
respect of computer software protection.
4
That is also the meaning ascribed to ‘computer-generated’ in
Payen Components SA Ltd v Bovic CC and Others
[1995] ZASCA 57
;
1995 (4) SA 441
(A) at 450D-G although the court was not dealing with the meaning of
‘computer-generated’ in the context of the Act.
[32] The structures for the various databases were
created by Coetzee. Although he made use of the computer program
Delphi to do so
they were not generated by a computer: the computer
merely assisted him in creating them. It is he who decided on the
number of columns,
their width and the field names. The creation of
such a table is no different from the creation of a document by
utilising a word
processor. In such a case the computer is used as a
tool.
5
The bare databases so created, therefore, did not qualify as
computer-generated literary works.
[33] In the case of the answers, weightings and tree.txt
databases it does not make sense to separate the structures of the
databases
from the compilations.
6
The databases were created by Coetzee as a composite unit and their
structures were significant parts of such units. They determined
how
the data was to be ordered in order to be utilized by the Data
Explorer program. In the circumstances the answers, weightings
and
tree.txt databases were created by Coetzee with the assistance of the
converter and tree preparer programs i.e. they were not
computer-generated.
[34] The position is different in the case of the
questions database. The structure of the database was created by
Coetzee and the
compilation of the questions within that structure
was done by Haupt. They were literary works by definition and were
not computer-generated.
Originality
[35] There is no definition of ‘original’ in the
Act. That the work must originate from the author and not be copied
from an existing
source is clear but that is not to say that every
work which is not copied would qualify for protection in terms of the
Act. In this
regard the High Court would seem to have accepted and
the respondents submitted that a ‘minimal degree of creativity’
was required
to satisfy the originality requirement. They relied on
the judgment of the Supreme Court of the USA in
Feist Publications
Inc v Rural Telephone Service Co Inc
449 US 340
(1991) at 345 and
348. However, the originality requirement in the Act was also a
requirement in the Copyright Act 63 of 1965, which
was repealed by
it, and there is no reason to believe that it was intended to have a
meaning different from the meaning it had in
the repealed Act. The
repealed Act was based on the Copyright Act of 1956 of the United
Kingdom which had a similar originality requirement.
For this reason
‘original’ in the repealed Act was probably intended to have the
meaning it had been held to have in the United
Kingdom. There,
creativity is not required to make a work original. Save where
specifically provided otherwise, a work is considered
to be original
if it has not been copied from an existing source and if its
production required a substantial (or not trivial) degree
of skill,
judgment or labour.
7
In Canada ‘original’ has likewise been interpreted so as not to
require creativity. In
CCH Canadian Ltd v Law Society of Upper
Canada
8
it was held:
‘[A]n original work must be the product of an author’s exercise
of skill and judgment. The exercise of skill and judgment required
to
produce the work must not be so trivial that it could be
characterized as a purely mechanical exercise. While creative works
will
by definition be “original” and covered by copyright,
creativity is not required to make a work “original”.’
9
[36] There can be no question that the converter program
and the tree preparer program were the products of substantial skill,
judgment
and labour. It took Coetzee about six months to get the
converter program right while the writing of the source code of the
tree
preparer program would have taken him about six hours. The fact
that Bento could not himself create a similar tree preparer program
but had to rely on Coetzee’s assistance is in itself an indication
that the writing of the program required substantial skill,
judgment
and labour. There can also be no doubt that the writing of the source
code for the search and the graph instructions required
substantial
skill, judgment and labour. They were made available to the first
respondent because Bento was struggling to write the
code. That the
incorporation of these functions into the Data Explorer program
brought about a significant improvement is evidenced
by the fact that
both Haupt and the respondents considered it necessary that these
functions be incorporated into programs such as
the Data Explorer and
Brewer’s AMPS programs.
[37] It is, in the light of what follows, not necessary
to decide whether the databases, database structure and questions
compilations
were ‘original’. I shall, therefore, merely assume
that they were original.
Author
[38] As stated above ‘author’ is differently defined
depending on the work that is eligible for copyright. In the case of
a literary
work ‘author’ means the person who first makes or
creates the work; in the case of a computer program ‘author’
means the
person who exercises control over the making of the
computer program; and in the case of any of these works having been
computer-generated
‘author’ means the person by whom the
arrangements necessary for the creation of the work were undertaken.
[39] The databases and database structures are literary
works which were not made or created by Haupt. Haupt, therefore, does
not
own the copyright in these works. He was entitled to use them
because of a tacit licence from Coetzee. The questions compilations
on the other hand were created by Haupt and on the assumption that
they were original he acquired the copyright in them.
[40] The High Court held that Brewer’s Almanac
exercised control over the making of the Project AMPS program but did
not consider
the question of control in respect of the developments
to that program after 31 July 1998. Had it done so its reasoning
would have
led it to conclude that Haupt controlled the making of the
program after 31 July 1998. That is so because, on the evidence, the
relationship
between Haupt and Coetzee was the same as the
relationship between Brewer’s Almanac and Coetzee in respect of the
making of the
program.
[41] In s 21 of the Act specific provision is made
in respect of works made in the course of an author’s employment by
another
person. A distinction is thus drawn in the Act between
‘control’, in the definition of ‘author’ in respect of a
computer
program, and ‘control’ by virtue of a contract of
employment. ‘Control’, in the definition, must therefore have
been intended
to have a wider meaning than ‘control’ in the
employment situation, that is, a person may because of his control
over the making
of a computer program be the author of that program
even if the creator of the program is an independent contractor.
10
According to the Shorter Oxford Dictionary ‘to control’ means ‘to
exercise restraint or direction upon the free action of’
and
‘control’ means ‘the fact of controlling, or of checking and
directing action’. In this case Haupt instructed Coetzee
as to the
end result that was to be achieved, Coetzee then did the technical
work required to achieve that end result and from time
to time
effected improvements. However, Coetzee was all along in constant
contact with Haupt and he accepted and executed detailed
instructions
from Haupt. As he progressed he submitted his work to Haupt for it to
be checked and approved by him. In the properties
section of the Data
Explorer program Coetzee indicated that the copyright was owned by
Softcopy, the name under which Haupt was trading.
The allegation by
Haupt in his founding affidavit that it was always agreed between the
parties that Haupt was the owner of the program
was not disputed.
This being the understanding between the parties, Haupt could at any
time direct in which direction the development
of the program should
proceed or could terminate further development if he wished to do so.
Haupt was, therefore, in a position of
authority over Coetzee insofar
as the development of the program was concerned. He was in command
and Coetzee subjected himself to
such command. It is true that Haupt
was in no position to instruct Coetzee as to how, technically, to
achieve his requirements but
I agree with the High Court that one
does not need to be a computer programmer to be able to control the
writing of a computer program.
For these reasons I am of the view
that Haupt controlled the writing of the computer programs written
after 31 July 1998.
[42] It follows that the copyright in the Data Explorer
program, which included the search instructions and the graph
instructions
and also the copyright in the converter and the tree
preparer program, vested in Haupt.
Infringement
[43] The respondents contended that, in the event of it
being held that the copyright vested in Haupt, they did not infringe
such
copyright. Section 23(1) provides as follows:
‘Copyright shall be infringed by any person, not being the owner of
the copyright, who, without the licence of such owner, does
or causes
any other person to do, in the Republic, any act which the owner has
the exclusive right to do or to authorize.’
[44] Section 11B provides that copyright in a computer
program vests the exclusive right to reproduce or to authorize the
reproduction
of the computer program and to do certain other acts not
presently relevant in respect of the computer program in the
Republic. It
is, however, not only the reproduction of the entire
work that would constitute an infringement. In terms of s 1(2A) the
reproduction
of a work is, unless the context otherwise indicates, to
be construed as a reference to the reproduction of a substantial part
of
the work.
[45] The first respondent reproduced part of the Data
Explorer program in its Brewer’s AMPS program and Brewer caused it
to do so.
The respondents submitted that such reproduction was not
substantial. However, where a part of a work is reproduced the
question
whether a substantial part had been reproduced depends much
more on the quality than the quantity of what had been taken.
11
It is true that in this case only 26 per cent of the graphic
component and 83 per cent of the search component, consisting of 63
lines of several thousand lines of source code, had been copied but
then those lines were copied because Bento found it too difficult
to
write them himself. These components were clearly considered to be a
valuable ingredient of the program by both Haupt and the
respondents.
For these reasons, the copying referred to, in my view, constituted
the reproduction of a substantial part of the Data
Explorer program.
It follows that the first and the second respondents infringed
Haupt’s copyright in the Data Explorer program.
[46]
The respondents agreed that the
Brewer’s AMPS program would be marketed in South Africa and that
Coetzee would receive a royalty
of 15 per cent of the full sales
price of each sale. Coetzee assisted the first and second respondents
in infringing the appellant’s
copyright in the Data Explorer
program by providing the source code in respect of the search
function and also the source code required
to incorporate the
graphics server. In the premises Coetzee made common cause with the
first and second respondents and co-operated
with them in so far as
the infringement by them of the appellant’s copyright in the Data
Explorer program in South Africa is concerned.
By doing so Coetzee
himself infringed the appellant’s copyright in the Data Explorer
program in South Africa.
12
[47]
The tree preparer program
and the converter program do not form part of the Brewers AMPS
program. They were in possession of Coetzee
and were used by him to
create tree.txt, answers and weightings databases in respect of the
AMPS2000b data. In doing so neither he
nor any of the other
respondents did, or caused any other person to do, any act as
contemplated in s 11B which Haupt as owner of
the copyright had the
exclusive right to do. Haupt was unable to advance any basis for his
contention that his copyright in respect
of these programs had been
infringed.
[48] Haupt’s case is that his copyright in the
questions compilations done by him was infringed in that each one of
them ‘was
reproduced in first respondent’s program in the exact
same manner and form and thereafter sold by first respondent to its
clients’.
The case is not borne out by the evidence. As I
understand the evidence the compilations were no longer required
after the tree.txt
files had been created.
[49] The order in terms of which the matter was referred
to trial was made by consent. All the parties are, therefore, to
blame for
the fact that the trial lasted 33 court days as a result of
various irrelevant issues having been canvassed. In the circumstances
I consider it just and equitable that Haupt, who should have
succeeded in the High Court, should have been deprived of 50 per cent
of his costs.
[50] Haupt also appealed against the costs order made by
the High Court in respect of two interlocutory applications, one on
11 September
2002 and the other on 11 November 2002, relating to
discovery. In respect of the first of these applications the High
Court ordered
that the costs would be costs in the cause. In respect
of the latter application the High Court considered it reasonable
that the
parties bear their own costs. Haupt could not point to any
irregularity or misdirection and could not submit that a court,
acting
reasonably, could not have made these costs orders. In the
circumstances this court cannot interfere with them.
13
[51] In the result the following order is made:
The appeal is upheld with costs, including the costs of
two counsel.
The order by the High Court is set aside and replaced
with the following order:
‘
1 The respondents are interdicted from infringing the
applicant’s copyright in its computer program known as “Data
Explorer”.
The respondents are ordered to deliver up within 7
days all infringing copies of the work to the applicant.
The respondents are ordered, jointly and severally, to
pay 50 per cent of the costs of suit, including :
The qualifying fees of Mr Marius Bosman;
The costs of the Anton Piller application, including
the costs of the supervising attorney and experts used therein.
The costs of the application on 11 September 2002.
__________________
P E STREICHER
JUDGE OF APPEAL
CONCUR
:
HARMS JA)
MTHIYANE JA)
CLOETE JA)
LEWIS JA)
1
The appropriate order in this case would have
been one directing that the notice of motion should stand as a
simple summons, that
a declaration be filed within a fixed time and
that the Uniform Rules dealing with pleadings and the conduct of
trials would thereafter
apply.
2
See s
2(3) of the Act which provides:
‘A work
shall not be ineligible for copyright by reason only that the making
of the work, or the doing of any act in relation
to the work,
involved an infringement of copyright in some other work.’
3
Biotech Laboratories (Pty) Ltd v Beecham Group
PLC and Another
2002 (4) SA 249
(SCA) at 257 H-I.
4
See Ricketson
The Law of Intellectual
Property: Copyright, Designs and Confidential Information
para
14.30. See also Dean
Handbook of South African Copyright Law
para 4.8.
5
Laddie, Prescott and Vitoria
The Modern Law of
Copyright and Designs
2 ed para 20.60.
6
Cf
Ladbroke (Football) Ltd v William Hill
(Football) Ltd
[1964] 1 WLR 273
(HL) at 276-277.
7
Ladbroke (Football) Ltd v William Hill
(Football) Ltd
[1964] 1 WLR 273
(HL) at 277 to 278; 281 to 282;
287; and 292;
Autospin (Oil Seals) Ltd v Beehive Spinning
[1995] RPC 683
(Ch) at 694 (30-45). Laddie, Prescott and Vitoria
The
Modern Law of Copyright and Designs
2 ed para 2.56 p47; and
Garnett, Davies and Harbottle
Copinger and Skone James on
Copyright
, 15 ed para 3.128 p119. See also
Klep Valves (Pty)
Ltd v Saunders Valve Co Ltd
1987 (2) SA 1
(A) at 22H- 22B in
which it was held that ‘originality’ in terms of the 1911
British Act required original skill or labour..
8
2004 SCC 13
;
[2004] 1 S.C.R. 339
para 25;
2004 SCC 13
(Canlii).
9
It should be noted that no mention is made of
labour. In para 24 it is said: ‘The “sweat of the brow”
approach to originality
is too low a standard’. In this regard the
Canadian law differs from our law and the law of the United Kingdom
as also the Australian
law. See
Waylite Diary CC v First National
Bank Ltd
1995 (SA) 645 (A) at 652G-653C and in respect of the
Australian law Ricketson
The Law of Intellectual Property:
Copyright, Designs & Confidential Information
para 7.35 and
7.60 where it is said: ‘[I]f the expression in question represents
the independent application of knowledge, judgment,
skill or labour
on the part of the author, this will be sufficient for the statutory
requirement (of originality).’ Whether we
should in due course
follow the Canadian approach need not be decided now.
10
Ricketson
The Law of Intellectual Property :
Copyright, Designs & Confidential Information
para 14.180.
11
See
Ladbroke (Football) Ltd v William Hill
(Football) Ltd
[1964] 1 WLR 273
(HL) at 276 quoted with approval
in
Biotech Laboratories (Pty) Ltd v Beecham Group PLC and Another
2002 (4) SA 249
(SCA) para 9. See also
Jacana Education (Pty) Ltd
v Frandsen Publishers (Pty) Ltd
[1997] ZASCA 109
;
1998 (2) SA 965
at 972G-J.
12
Cf
Morton-Norwich Products Inc and Others v
Intercen Ltd
[1978] RPC 501
at 514(40) – 516(40).
13
Attorney-General, Eastern Cape v Blom
1988
(4) SA 645
(A) at 670D-F.