The award of additional damages of $400,000 was far greater than
the actual loss suffered as a result of the copyright
The actual loss suffered from copyright, patent, trade mark or
design infringement is often either small or difficult to quantify.
Being able to claim additional damages - which could be awarded for
flagrant infringement, or the conduct of the infringer after the
infringement - could change the calculation significantly, and make
an otherwise uneconomic claim worthwhile.
In APRA v Dion  FCCA 2330, the Federal Circuit Court has
provided another example of why both rights-holders and alleged
infringers should consider additional damages early on as part of
The infringing conduct
Australasian Performing Right Association Ltd
(APRA) represents Australian and New Zealand
musicians and is responsible for the granting of licences for
performances of its members' musical works. In 2014, APRA
granted John Dion (also known by the alias John Denison) a licence
to hold the Soulfest concerts on the condition that licence fees
were paid in advance.
Shortly before the concerts, Dion sent a fake receipt to APRA
which ostensibly recorded the transfer of the licence fees to APRA.
This transfer never took place, meaning that the licence was not in
effect at the time of the concerts. Consequently, the holding of
the concerts constituted authorisation of infringement of the
copyright in the musical works of APRA's members.
Dion's conduct following the initial copyright
At the time of the judgment, Dion had not paid APRA any money in
respect of the 2014 Soulfest concerts. In addition, he had failed
to comply with the Court orders to pay compensatory damages. Dion
had also failed to provide information to APRA about the 2014
concerts as required by the licence.
In 2015, Dion was granted a subsequent APRA licence in relation
to a Soulfest concert to be held that year. Again, he failed to
make the advance payment as required by the licence. APRA
consequently obtained an injunction preventing Dion from holding
the concert. Dion immediately cancelled the concert, stating
untruthfully that the decision to cancel had been made because of
poor ticket sales.
The Court's assessment of additional damages
The Court assessed compensatory damages at $34,822, but awarded
far more in additional damages.
Judge Street was highly critical of Dion's conduct both at
the time of, and subsequent to, the infringing conduct. He found
that Dion's failure to pay the licence was a
"flagrant" and "deliberate" infringement of the
Copyright Act which had been carried out for the purposes of
obtaining a financial benefit.
Factors that aggravated Dion's conduct included:
Dion's "scandalous" dishonesty in providing the
fake receipt to APRA;
Dion's subsequent failure to pay fees for the 2015 Soulfest
concert, and his decision to mislead the public about the real
reason that these concerts were cancelled;
Dion's lack of compliance with the Court's earlier
order to pay compensatory damages;
the substantial financial benefit that Dion obtained as a
result of holding the concerts.
The Court emphasised its disapproval of the dishonest nature of
Dion's conduct, and the need to deter Dion and others from
engaging in similar conduct in the future. Taking into account all
of these factors, the Court awarded additional damages of
Remember the possibility of additional damages for IP
This judgment serves as a reminder that the Court will impose
tough penalties in circumstances where copyright infringement is
blatant and involves dishonest conduct. If a business acts in a
manner that is morally reprehensible, shameless or deceptive, the
copyright owner could recover a sum far higher than the traditional
award of compensatory damages.
In addition, businesses should be aware that conduct following
acts of infringement will be taken into account when assessing
additional damages. It's therefore important for businesses -
either as rights holders or potential infringers - to seek legal
advice as soon as possible following a potential infringement.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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