Federal Court: No Copyright in Phone Directories

In the third big copyright decision in two weeks, database owners suffered a setback last week when the Federal Court found that Telstra did not hold copyright in the Yellow Pages or White Pages[1]. Telstra was apparently unable to overcome difficulties establishing who authored the directories, or that they were original literary works that attracted copyright at all. The decision is a troubling one for companies that have relied on copyright to protect valuable database information.

Telstra had accused Phone Directories Company of reproducing entries from the White and Yellow Pages. In the past, simple factual compilations such as these were often characterised as literary works and given copyright protection. Telstra won such a copyright case about its phone directories in 2001[2]. But the ground appeared to shift last year when the High Court suggested in the IceTV case[3] that it is the exercise of skill and labour in expressing the literary work that is crucial when examining copyright in compilations, and not the labour and expense which goes into creating the compilation generally.

Unlike IceTV (where IceTVs electronic program guide did not infringe Nine’s TV schedule because it did not substantially reproduce it), Telstra lost because, according to the Federal Court, copyright simply did not subsist in the phone directories.

Justice Gordon found that the directories were not original literary works, because the creation of each work did not involve “independent intellectual effort”, or the exercise of a “sufficient effort of a literary nature”. Essentially, although the creation of the compilations involved labour and expense, it did not require skill and labour of a literary nature.

Telstra also failed because it could not identify the persons that contributed to the work. Even if it could, Justice Gordon held, those contributors were not “authors” for the purposes of the Copyright Act because their contributions lacked sufficient effort of a literary nature.

The case is an important reminder that copyright does not protect the commercial value of the information in question, nor does it protect facts, ideas or information. Rather, copyright law protects the particular expression of that fact, idea or information.

The judgment will raise concerns for those who create, compile, sell, or rely on factual compilations and databases, and there are some important lessons that emerge from it.

Firstly, it is still the case that an author who uses skill and judgment in expressing information is more likely to attract enforceable copyright protection for that work than a person who merely lists facts.

Secondly, database owners must be able to prove who contributed to the database, what they were responsible for, and how their work involved “effort of a literary nature”. Records and documentation may need to do more than establish the identity of the creators of a database; they may be needed to explain how those creators exercised skill, judgment and discretion in expressing it. As is said in the judgment:

“Start with the work. Find its authors. They must have done something, howsoever defined, that can be considered original.”

For those who compile, exploit and sell database information, it highlights the importance of having appropriate contracts (terms and conditions) with users or customers to prevent misuse of that information.

For those who rely on private databases, it highlights the importance of keeping those databases secure and confidential.

It must be remembered, however, that whereas copyright would allow you to take action against any infringer, contractual obligations, or obligations of confidence owed by employees, contractors or the like, are only enforceable against the person that owes the obligation. They cannot be used to stop third parties reproducing the database once it is out of the vault.

Telstra is, no doubt, considering an appeal. In the meantime, the judgment will encourage further debate as to whether a European-style database right is a better method of protecting the substantial investment that is made in databases and factual compilations than proceeding under the Copyright Act as it presently stands.