Stevens v. Sony

HIGH COURT OF AUSTRALIA

GLEESON CJ, McHUGH, GUMMOW, KIRBY, HAYNE AND HEYDON JJ

EDDY STEVENS APPELLANT

AND

KABUSHIKI KAISHA SONY COMPUTER

ENTERTAINMENT & ORS RESPONDENTS

Stevens v Kabushiki Kaisha Sony Computer Entertainment [2005] HCA 58 6 October 2005 S319/2004

ORDER

1. Appeal allowed with costs.

2. Set aside the orders of the Full Court of the Federal Court of Australia made on 30 July 2003 and, in their place, order that the appeal to that Court be dismissed with costs.

On appeal from the Federal Court of Australia

Representation:

J V Nicholas SC with C Dimitriadis for the appellant (instructed by Gadens Lawyers)

D K Catterns QC and R Cobden for the respondents (instructed by Blake Dawson Waldron)

J Basten QC with G C McGowan SC and L G de Ferrari appearing as amici curiae on behalf of the Australian Digital Alliance Limited and the Australian Libraries Copyright Committee (instructed by Sarah Waladan)

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

Stevens v Kabushiki Kaisha Sony Computer Entertainment

Intellectual property - Copyright - Circumvention devices - Circumvention of a technological protection measure - Definition of "technological protection measure" in s 10(1) of the Copyright Act 1968 (Cth) ("the Act") - Respondents produced and sold computer games on CD-ROMs for use with PlayStation consoles - Access codes on the CD-ROMs could not be reproduced by conventional CD recording or copying devices - Games could only be played if access codes were read by the boot ROM device within a PlayStation console - Appellant sold and installed "mod chips" into PlayStation consoles which allowed unauthorised copies of games to be played - Whether appellant had knowingly sold or distributed a circumvention device which was capable of circumventing, or facilitating the circumvention of, a technological protection measure - Whether access codes and boot ROM were technological protection measures - Whether access codes and boot ROM prevented or inhibited the infringement of copyright by preventing access to unauthorised copies of games.

Intellectual property - Copyright - Circumvention devices - Literary works - Computer programs - Reproduction in a material form - Definition of "material form" in s 10(1) of the Act - Parts of program code reproduced in the random access memory ("RAM") of a PlayStation console as game is being played - Whether access codes and boot ROM prevented or inhibited the infringement of copyright in a literary work by preventing a substantial part of a computer program from being reproduced in RAM - Whether RAM a "material form" for the purposes of the Act.

Intellectual property - Copyright - Circumvention devices - Subject-matter - Cinematograph films - Part of the aggregate of visual images contained in program code copied in the RAM of a PlayStation console as game is being played - Whether access codes and boot ROM prevented or inhibited the infringement of copyright in a cinematograph film by preventing a copy of the film being made in RAM - Whether a substantial part of a cinematograph film is embodied in RAM as game is being played.

Statutes - Statutory construction - Approach where provision is ambiguous - Approach where provision is the product of legislative debate over evolving technology and compromise - Use of extrinsic materials - Relevance of legislative history - Relevance of policy considerations - Preference for interpretation which upholds fundamental rights.

Words and phrases - "circumvention device", "technological protection measure", "prevent or inhibit", "material form", "cinematograph film", "substantial part".

Copyright Act 1968 (Cth), ss 10(1), 116A.

GLEESON CJ, GUMMOW, HAYNE AND HEYDON JJ. With effect from 4 March 2001, the Copyright Amendment (Digital Agenda) Act 2000 (Cth) ("the Amendment Act") made significant amendments to the Copyright Act 1968 (Cth) ("the Act"). This appeal concerns a dispute as to the construction of the "circumvention device" provisions introduced by the Amendment Act.
The scope of copyright law
Over a long period amendments to copyright law have comprised legislative solutions to problems created by competing economic and social pressures associated with the development of new technologies. The issues in the present appeal indicate that this is very much the case today.
The well-established categories of original works of authorship have been supplemented by various types of "subject-matter other than works" (including, significantly for this case, cinematograph films), certain "moral rights" have been conferred on individuals, and computer programs have been protected as literary works. This last step has been taken notwithstanding any incongruity in treating computer programs as literary works given "their objective of making hardware function rather than of conveying anything immediately perceivable to humans"[1].
Copyright in both works and other subject-matter remains defined in the Act primarily in terms of the doing (or the authorising of the doing) of any of various acts listed as those comprised in the relevant copyright[2]. Other infringement provisions include those dealing with importation for sale and hire (ss 37, 102) and sale and other dealings (ss 38, 103). It follows from this specificity that not all activities involving the use of copyright material require a licence to escape infringement[3]. (Patent law has operated more broadly, with the traditional terms of the grant of monopoly being to "make, use, exercise and vend" the invention; however, no patent rights were claimed in this litigation.) Merely to read a copy of a book is not to infringe the literary work of which the book is a material reproduction. Further, the making available of means of reproduction which may or may not amount to infringement has been held not necessarily to amount to authorisation of infringement[4].
This litigation turns upon the construction of provisions in the Amendment Act which expand neither the existing categories of copyright works and other subject-matter protected by the Act nor the categories of infringement. Rather, the legislation in question deals with "anti-spoiler devices" which would allow the side-stepping of technical barriers to copying.
Anti-spoiler devices
There is considerable controversy in Australia and elsewhere concerning the proper scope of such legislation[5]. However, the task of the Court on this appeal is to construe the particular compromises reflected in the terms of the Amendment Act.
The development of technical barriers to copying and the escalation of a struggle between those who design such barriers and those who devise means of surmounting them is not new. Professor Cornish writes[6]:
"Back in the 1970s and 1980s, the answer to analogue copying on photocopiers, cassette decks, and video recorders was pronounced to lie in the machines themselves: but the eternally springing hopes were often enough dashed. Every locked door seemed to produce a hacker with a jemmy. With the Internet, technical control remains the core objective, because it seems the only hope for preserving the copyright industries in something resembling their present form." (original emphasis)
A legislative response to problems identified in the pre-Internet age had been made in the United Kingdom in s 296 of the Copyright, Designs and Patents Act 1988 (UK) ("the 1988 UK Act")[7]. Section 296(2) used the broadly stated expression "any device or means specifically designed or adapted to circumvent the form of copy-protection employed". Section 296(4) defined the phrase "copy-protection" as including "any device or means intended to prevent or restrict copying of a work or to impair the quality of copies made". The distinction between preventing or restricting copying of a work and the impairment of the quality of copies made remains important in considering the construction of the current Australian legislation.
The Amendment Act
Section 3 of the Amendment Act sets out what are stated to be the objects of that statute. These objects are expressed largely by reference to the Internet and online access to copyright material. According to the Revised Explanatory Memorandum to the Senate on the Bill for theAmendment Act ("the Explanatory Memorandum")[8], "the keystone" to the reforms http://www.austlii.edu.au/au/legis/cth/consol_act/caaa2000294/ provided by the Bill was the introduction[9] of a "new technology-neutral right to communicate literary, dramatic and musical works to the public". This would "provide copyright owners with greater protection for their material in the new digital environment". However, the substantive provisions of the Amendment Act with which this appeal is concerned deal with a different matter, technical control of "access".
The Amendment Act inserted Div 2A (ss 116A-116D) in Pt V of the Act. Part V is headed "Remedies and offences". Division 2A is headed "Actions in relation to circumvention devices and electronic rights management information". The Amendment Act also introduced additions to the offence provisions contained in Div 5 (ss 132-133A) so as to create new offences for contravention of the new Div 2A. The Amendment Act further introduced new definitions into s 10 of the Act. The Act has been further amended on five occasions, the last set of changes being those made with effect from 1 January 2005 by the US Free Trade Ageement Implementation Act 2004 (Cth) ("the 2004 Act"). This litigation is concerned with the statute in what is to be taken as its form at the date of commencement of the Amendment Act, 4 March 2001.
In the Explanatory Memorandum[10] it was said that the provisions of Div 2A were intended to provide "appropriate measures for the enforcement of copyright in the digital environment" and to provide "effective civil remedies against the abuse of technological copyright protection measures". In particular, Div 2A provided copyright owners "with new civil remedies against persons who make, commercially deal in, import, advertise, market or make available online devices, or provide services, used to circumvent technological copyright protection measures".
The Explanatory Memorandum[11] also stated that the changes made were intended to ensure that Australia provided adequate legal protection and effective legal remedies to comply with "the technological measures obligations" in two treaties negotiated in 1996 in the World Intellectual Property Organization ("WIPO"). One of these was the WIPO Copyright Treaty , which became effective on 6 March 2002.
Article 11 of the WIPO Copyright Treaty stated:
"Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention and that restrict acts, in respect of their works, which are not authorized by the authors concerned or permitted by law."

It will be apparent that the provision is expressed in broad terms, leaving considerable scope to individual States in deciding on the manner of implementation[12].
The Explanatory Memorandum further said of the new Div 2A[13]:
"These provisions will operate to provide copyright owners and their licensees with an effective means of enforcing their rights in the online environment whilst simultaneously allowing for the operation of some exceptions to the exclusive rights of copyright owners. In this way, the provisions are intended to strike a fair balance between the rights of copyright owners and the rights of copyright users."
The contrast between legislation such as Div 2A and the protection of copyright in works and other subject-matter was drawn by the Committee on Commerce of the House of Representatives of the United States Congress when considering legislation proposed to amend the copyright law and to implement in the United States Art 11 of the WIPO Copyright Treaty. The United States legislation that resulted, the Digital Millennium Copyright Act 1998 , amended Title 17 of the United States Code, introducing inter alia 17 USC §1201, to which more detailed reference will be made below. With respect to the previous copyright provisions, that Committee said in Pt 2 of its report[14]:
"In general, all of these provisions are technology neutral. They do not regulate commerce in information technology, ie, products and devices for transmitting, storing, and using information. Instead, they prohibit certain actions and create exceptions to permit certain conduct deemed to be in the greater public interest, all in a way that balances the interests of copyright owners and users of copyrighted works."
The Committee went on to refer to the use of the term "paracopyright" to identify anti-circumvention provisions, liability under which could result from conduct independent of any act of infringement or of any intent to promote infringement[15].
Before turning to consider the submissions respecting the construction of the definition of "technological protection measure" in the Act, it should be observed that the broad terms of Art 11 of the WIPO Copyright Treaty have supported legislation of various countries which is in differing forms. For example, in the United States, 17 USC §1201, which is headed "Circumvention of copyright protection systems", deals with the matter in different terms from those of Div 2A in the Australian legislation. Section 1201(a)(1)(A) states that "[n]o person shall circumvent a technological measure that effectively controls access to a work protected under this title". Then, §1201(a)(3) provides:
"As used in this subsection-
(A) to 'circumvent a technological measure' means to descramble a scrambled work, to decrypt an encrypted work, or otherwise to avoid, bypass, remove, deactivate, or impair a technological measure, without the authority of the copyright owner; and

(B) a technological measure 'effectively controls access to a work' if the measure, in the ordinary course of its operation, requires the application of information, or a process or a treatment, with the authority of the copyright owner, to gain access to the work."
The Australian legislative materials identified in the written submissions to the Court indicate that proposals were made by the International Intellectual Property Alliance to the House of Representatives Standing Committee on Legal and Constitutional Affairs in favour of the adoption of legislation in terms such as those of the United States, with emphasis upon protection for all devices controlling access to a work. However, as will be apparent, the legislation as enacted takes a different form, with an emphasis upon measures designed to prevent or inhibit infringement.
The facts
The present respondents (collectively described as "Sony") produced and sold computer games on CD-ROMs for use with PlayStation consoles. Sony as owner or exclusive licensee controls the copyright in the computer programs (as literary works under the Act) and in the cinematograph films (as subject-matter other than works) embodied in the CD-ROMs for the games.
On two occasions after the commencement of the Amendment Act, the appellant, Mr Stevens, sold unauthorised copies of PlayStation games. The games were titled "Croc 2", "Medi Evil", "Motor Races World Tour" and "Porsche 2000". Mr Stevens was not sued for any acts on his part that might have constituted infringements of Sony copyright in any computer program or cinematograph film. Nor were the makers of the unauthorised copies, whether Mr Stevens or others.
However, the PlayStation software contained access restrictions described as follows by Sackville J in his judgment at first instance[16]:
"The PlayStation software incorporates an access code, or a number of encrypted sectors of data that cannot be reproduced by conventional CD recording or copying devices (usually referred to as 'burning' mechanisms). The access code is stored on an encrypted portion of the CD-ROM and essentially consists of a string of characters. This string must be read by the boot ROM located within the PlayStation console if the particular game is to be played. The boot ROM recognises whether there is an access code and specifically what kind of access code it is. The access code is inaccessible to standard CD-ROM 'burners' or standard CD replication manufacturing parts."

Sony contended that, in this state of affairs, a "technological protection measure" could be said to exist in the boot ROM, or the access code in the PlayStation software, or the two in their combined operation.
In addition to supplying the unauthorised copies, Mr Stevens on three occasions sold and installed "mod chips" into PlayStation consoles. The unauthorised copies could not be played upon an "unchipped" or unmodified PlayStation console because they did not have the requisite access code. However, these copies could be played upon the "chipped" PlayStation consoles which Mr Stevens had modified.
By proceedings instituted in the Federal Court, Sony alleged that contrary to s 116A (inserted in the Act by the Amendment Act) Mr Stevens without permission had knowingly sold or distributed a "circumvention device" which was capable of circumventing or facilitating the circumvention of a "technological protection measure" which protected Sony's copyright in literary works (computer programs) and cinematograph films.
The litigation
By its application in the Federal Court, Sony sought against Mr Stevens a declaration, damages, an injunction and civil relief under the civil remedies provision in s 116D. Sackville J held that the claims by Sony under Div 2A failed[17]. In the Full Court, Sony succeeded on the first of three issues, but not on the second or third[18]. However, Sony's success was sufficient to entitle it to substantial relief against Mr Stevens. The Full Court made a declaration as follows:
"On 8 April 2001, 28 September 2001 and 16 November 2001 [Mr Stevens] sold circumvention devices, as defined in [the Act, s 10(1)], for use in association with 'PlayStation' computer consoles and the CD-ROMs for 'PlayStation' computer games, in contravention of s 116A of [the] Act."
The Full Court enjoined Mr Stevens from selling circumvention devices for use in association with those computer consoles and CD-ROMs in contravention of s 116A of the Act. It remitted the matter to the primary judge for determination of the claims for damages pursuant to s 116D of the Act.
Against those orders, Mr Stevens appeals by special leave to this Court. By Notice of Contention, Sony seeks to reagitate the issues on which it did not succeed in the Full Court. At first instance, Sackville J had permitted the Australian Competition and Consumer Commission ("the ACCC") to appear as amicus curiae and to press for a construction of the relevant provisions of the Act at odds with that favoured by Sony[19]. An application to this Court by the ACCC was withdrawn. However, the Court granted leave to appear as amici curiae to the Australian Digital Alliance Ltd and the Australian Libraries Copyright Committee.
Section 116A
Section 116A(1), so far as immediately material, states that the section applies if "a work or other subject-matter is protected by a technological protection measure" and a person without the permission of the owner or exclusive licensee thereof makes, sells or offers for sale or hire or otherwise promotes or advertises "a circumvention device" which is capable of circumventing, or facilitating the circumvention of, that "technological protection measure". Making and importing are also proscribed by s 116A(1), but the mere use of a circumvention device is not proscribed. Supplying, making and importing are excused if "for use" for a "permitted purpose".
The terms "circumvention device" and "technological protection measure" are defined in s 10(1)[20]. Save as to what follows, it was not disputed that Mr Stevens had sold "circumvention devices". The definition is as follows:
"circumvention device means a device (including a computer program) having only a limited commercially significant purpose or use, or no such purpose or use, other than the circumvention, or facilitating the circumvention, of an [sic] technological protection measure."
What was in issue was the existence of the "technological protection measure" identified in the concluding words of the definition of "circumvention device". It is upon the following definition of "technological protection measure" that the appeal by Mr Stevens turns. The definition states:
"technological protection measure means a device or product, or a component incorporated into a process, that is designed, in the ordinary course of its operation, to prevent or inhibit the infringement of copyright in a work or other subject-matter by either or both of the following means:
(a) by ensuring that access to the work or other subject matter is available solely by use of an access code or process (including decryption, unscrambling or other transformation of the work or other subject-matter) with the authority of the owner or exclusive licensee of the copyright;

(b) through a copy control mechanism."

Statutory construction
The critical task for the outcome of this appeal is one of statutory interpretation, particularly of the defined expression "technological protection measure" as it appears in the setting of Div 2A. No particular theory or "rule" of statutory interpretation, including that of "purposive" construction, can obviate the need for close attention to the text and structure of Div 2A.
Lord Renton QC[21] writes of the position in the United Kingdom[22]:
"I do not know to what extent judicial interpretation influences drafting but drafting greatly influences judicial interpretation of statutes. From earliest times judges have found it difficult to interpret them, and most of the time of appellate judges is now taken up in doing so. Parliament has never required the judges to do so in any particular way. The Interpretation Act [1978 (UK)] merely provides some definitions and minor assumptions. So the judges have made their own well-known rules of interpretation."

Of these rules of interpretation Lord Renton continues[23]:

"The first was the Mischief Rule in 1584: to find out the intention of Parliament it was necessary to discover the mischief for which the common law did not provide and what was the remedy Parliament chose to cure it. That rule still applies where relevant. Later came the Golden Rule, which said that, if the whole statute leads to inconsistency, absurdity or inconvenience, the court should give it another meaning that makes more sense. This caused problems and led to the Literal Rule: if the words of the statute which apply to the case being tried are clear, they must be followed, however unjust the result. Then came 'the Diplock principle', that the court must give effect to what the words would mean to those whose conduct the statute regulates."

He then indicates that in England in the past 50 years the judges have gradually adopted the "purposive rule"; under this the judges try to discover what Parliament intended. In Australia, s 15AA of the Acts Interpretation Act 1901 (Cth) states:

"In the interpretation of a provision of an Act, a construction that would promote the purpose or object underlying the Act (whether that purpose or object is expressly stated in the Act or not) shall be preferred to a construction that would not promote that purpose or object."

Section 15AB provides for the use of a wide range of extrinsic materials in pursuing the construction indicated in s 15AA.
In the case of the Amendment Act, there is a statement of objects in s 3. However, as indicated earlier in these reasons, that statement of objects, which fixes upon the "online" environment of the Internet, does not encompass the broader operation of Div 2A, as demonstrated by the facts in this litigation. Nor do the extrinsic materials give any clear indication of how it came to be that the Bill for the Amendment Act took the final form that it did. Indeed, the very range of the extrinsic materials, with shifting and contradictory positions taken by a range of interest holders in the legislative outcome, suggests that the legislative purpose was to express an inarticulate (or at least not publicly disclosed) compromise.
There is force in the statement by one commentator[24]:
"The definition of 'technological protection measure' is a compromise, which was neither as restrictive as some copyright users had hoped, nor as broad as copyright owners sought - and parts of the legislative history are opaque."
The result is that in the present case to fix upon one "purpose" and then bend the terms of the definition to that end risks "picking a winner" where the legislature has stayed its hand from doing so. In the selection of a sole or dominant "purpose", there is a risk of unintended consequences, particularly where, as here, the substratum of the legislation is constantly changing technologies.
"Technological protection measure"
These considerations indicate the approach to construction evident in the reasoning of Sackville J, with its close attention to text and structure. Of the expression "technological protection measure", his Honour said[25]:
"The definition has a number of elements, as follows:
. a device or product, or a component incorporated into a process

. that is designed

. in the ordinary course of its operation

. to prevent or inhibit the infringement of copyright in a work [or other subject-matter]

. by either or both of two particular means.

The two particular means of preventing or inhibiting the infringement of copyright are these:

. ensuring that access to the work is available solely by use of an access code or process with the authority of the owner or licensee; or

. a copy control mechanism."
Sackville J did not accept the construction advanced by Sony which was to be accepted in the Full Court and which is urged again on this appeal. His Honour rejected the proposition that[26]:
"the definition is concerned with devices or products that do not, by their operations, prevent or curtail specific acts infringing or facilitating the infringement of copyright in a work [or other subject-matter], but merely have a general deterrent or discouraging effect on those who might be contemplating infringing copyright in a class of works, for example by making unlawful copies of a CD-ROM".

Rather, Sackville J said[27]:

"It can be seen that the focus of the definition, as the expression 'technological protection measure' itself implies, is on a technological device or product that is designed to bring about a specified result (preventing or inhibiting the infringement of copyright in a work) by particular means. Each of the specified means involves a technological process or mechanism. The means identified in par (a) is an access code or process that must be used to gain access to the work. The means identified in par (b) is a 'copy control mechanism'."
That latter expression is not defined in the legislation. However, the distinction between devices or means designed to prevent any copying at all and those designed to impair the quality of copies that are made has a provenance in s 296 of the 1988 UK Act, to which reference has been made at par [8] of these reasons. Consistently with this and with reference to the Australian legislative history, Sackville J concluded that the phrase "copy control mechanism" encompassed a mechanism restricting the extent (and, one might add, the effectiveness) of copying of a work that otherwise could be undertaken by someone with "access" to the copyright material[28].
Sackville J concluded that[29]:
"a 'technological protection measure', as defined, must be a device or product which utilises technological means to deny a person access to a copyright work [or other subject-matter], or which limits a person's capacity to make copies of a work [or other subject-matter] to which access has been gained, and thereby 'physically' prevents or inhibits the person from undertaking acts which, if carried out, would or might infringe copyright in the work [or other subject-matter]".

That construction should be accepted.
It is important to understand that the reference to the undertaking of acts which, if carried out, would or might infringe, is consistent with the fundamental notion that copyright comprises the exclusive right to do any one or more of "acts" primarily identified in ss 31 and 85-88 of the Act. The definition of "technological protection measure" proceeds on the footing that, but for the operation of the device or product or component incorporated into a process, there would be no technological or mechanical barrier to "access" the copyright material or to make copies of the work after "access" has been gained. The term "access" as used in the definition is not further explained in the legislation. It may be taken to identify placement of the addressee in a position where, but for the "technological protection measure", the addressee would be in a position to infringe.
This construction of the definition is assisted by a consideration of the "permitted purpose" qualifications to the prohibitions imposed by s 116A(1). First, s 116A(3) provides that, in certain circumstances, the section does not apply in relation to the supply of a circumvention device "to a person for use for a permitted purpose". The term "supply" means selling the circumvention device, letting it for hire, distributing it or making it available online (s 116A(8)). Secondly, s 116A(4) states that the section in certain circumstances does not apply in relation to the making or importing of a circumvention device "for use only for a permitted purpose".
The expression "permitted purpose" in sub-ss (3) and (4) has the content given it by sub-s (7). This states that for the purposes of s 116A, a circumvention device is taken to be used for a permitted purpose only if two criteria are met. The first criterion is that the device be "used for the purpose of doing an act comprised in the copyright in a work or other subject-matter" (emphasis added). The second criterion is that the doing of that act otherwise comprised in the copyright is rendered not an infringement by reason of the operation of one or more of the exculpatory provisions then set out[30]. (The listed provisions do not include the general fair-dealing exculpations in ss 40, 41 and 42 of the Act.)
The first criterion in s 116A(7) for reliance upon the permitted purpose provisions which are an answer to what would otherwise be a claim under s 116A thus in terms links the use of a circumvention device to the doing of one or more of the acts enumerated in s 31 of the Act (where these are done in relation to a work) and in ss 85-88 (where these are done in relation to subject-matter other than a work).
If the construction of the definition for which Sony contends were accepted despite the linkage specified in s 116A(7) between the use of a circumvention device and the central provisions of ss 31 and 85-88 of the Act, the permitted purpose provisions would risk stultification. The facts of the present case are in point. The use of Mr Stevens' mod chip in order to circumvent the protections provided by (a) the access code on a CD-ROM in which a PlayStation game is stored and (b) the boot ROM device contained within the PlayStation console cannot be said to be for the "purpose" of reproducing a computer game within the sense of s 31 of the Act. Any such reproduction will already have been made through the ordinary process of "burning" the CD-ROM. The mod chip is utilised for a different purpose, namely to access the reproduced computer program and thereafter visually to apprehend the result of the exercise of the functions of the program.
There are three other considerations which support Sackville J's construction of the definition.
The first is that, in choosing between a relatively broad and a relatively narrow construction of legislation, it is desirable to take into account its penal character. The present litigation does not arise from the institution of criminal proceedings under the offence provisions now contained particularly in s 132 of the Act. However, a person who makes or sells a circumvention device (s 132(5B)) is liable to imprisonment for not more than five years (s 132(6A)). An appreciation of the heavy hand that may be brought down by the criminal law suggests the need for caution in accepting any loose, albeit "practical", construction of Div 2A itself.
The second consideration is that the true construction of the definition of "technological protection measure" must be one which catches devices which prevent infringement. The Sony device does not prevent infringement. Nor do many of the devices falling within the definition advanced by Sony. The Sony device and devices like it prevent access only after any infringement has taken place.
The third consideration is that in construing a definition which focuses on a device designed to prevent or inhibit the infringement of copyright, it is important to avoid an overbroad construction which would extend the copyright monopoly rather than match it. A defect in the construction rejected by Sackville J is that its effect is to extend the copyright monopoly by including within the definition not only technological protection measures which stop the infringement of copyright, but also devices which prevent the carrying out of conduct which does not infringe copyright and is not otherwise unlawful. One example of that conduct is playing in Australia a program lawfully acquired in the United States. It was common ground in the courts below and in argument in this Court that this act would not of itself have been an infringement[31].
The Full Court's reasoning
However, on appeal, the Full Court accepted the construction advanced by Sony. In doing so, the Full Court did not refer to the significance, for construction of the definition of "technological protection measure", of the permitted purpose provisions. The reasoning of the judges in the Full Court varied. Lindgren J, with whom Finkelstein J agreed on this issue[32], found nothing in the statutory text to persuade him strongly to one construction or the other[33]. His Honour was persuaded by a detailed review of the extrinsic materials that a "broader approach" was intended by the Parliament so that the definition of "technological protection measure" embraced an "inhibition" which was indirect and operated before an attempted operation of the circumvention device[34].
However, if one thing appears from a consideration of the Australian and international materials it is that in Australia there was a reluctance to give to copyright owners a form of broad "access control". Indeed, this reluctance is manifest in the inclusion in the definition of "technological protection measure" of the concept of prevention or inhibition of infringement.
This outcome dissatisfied copyright owners. Yet other "stakeholders" with their own interests did not achieve all they may have desired. To those, such as the ACCC, concerned with the operation of restrictive trade practices law, it was significant that the access code for Sony products differed in various markets, so that a PlayStation game purchased in the United States could not be played on an unmodified PlayStation console purchased in Australia[35]. Users of copyright material such as those represented in the amici curiae in this Court were dissatisfied by the exclusion from the permitted purpose provisions of the general provisions protecting fair dealing. Other users were dissatisfied by the failure to include in the permitted purpose provisions the specific protection given by s 47C for back-up copies of computer programs. All of these considerations suggest no particular support for the "broad" approach to the definition of "technological protection measure".
French J, the other member of the Full Court, emphasised that s 116A operates with respect to the range of acts which may constitute infringement, a range going beyond reproduction. His Honour said of that range of acts[36]:
"It extends to knowingly selling or offering for sale articles, the making of which constituted an infringement of copyright (s 38). ... If a device such as an access code on a CD-ROM in conjunction with a Boot ROM in the PlayStation console renders the infringing copies of computer games useless, then it would prevent infringement by rendering the sale of the copy 'impracticable or impossible by anticipatory action'."
However, the provision in s 38 which, subject to the fair dealing and related provisions, renders it an infringement of copyright in a work to sell an article "if the person knew, or ought reasonably to have known, that the making of the article constituted an infringement" may be accommodated within the operation of s 116A without going so far as did French J in construing the definition of "technological protection measure". Taking the example discussed by French J, s 38 itself indicates that what might be called the act of secondary infringement by sale must necessarily follow in a temporal and practical sense from the primary infringement of making the article. The "technological protection measure", consistently with the construction accepted by Sackville J, prevents the act of primary infringement in an immediate sense. It also thereby "inhibits" the act of secondary infringement. One meaning of "inhibit" is to hinder, to check or to place an obstacle or impediment to a path of conduct[37].
French J went on to conclude[38] that the construction proffered by Sony flowed from a consideration of the ordinary and grammatical meaning of the language of s 116A and the definition of "technological protection measure". To accept the contrary construction would be "to cage the ordinary meaning of the words which have been adopted"[39].
Copyright legislation, both in Australia and elsewhere, gives rise to difficult questions of construction. Given the complexity of the characteristics of this form of intangible property, that, perhaps, is inevitable. It may be going too far to say of the definition of "technological protection measure" and of s 116A, as Benjamin Kaplan wrote of the American law even as it stood in 1967[40], that the provisions have a "maddeningly casual prolixity and imprecision". However, in this Court no party advanced the proposition that its task on this appeal was satisfied merely by a consideration of the ordinary meaning of the words in the definition of "technological protection measure".
Rather, Sony contended that, unless the term "inhibit" had the meaning given by the Full Court, it was otiose, adding nothing to "prevent". One meaning of "inhibit" indeed is "prevent". However, it may be taken that "inhibit" is used in the definition of "technological protection measure" in one of its weaker senses, while still necessarily attached to an act of infringement. One such sense has been given above with respect to acts of secondary infringement by dealing in an article created by an act of primary infringement. Further, the operation of a copy control mechanism to impair the quality or limit the quantity of a reproduction may be said to hinder the act of infringement. In that regard, there is a legislative antecedent in s 296 of the 1988 UK Act. This, it will be recalled, spoke of devices or means intended "to impair" the quality of copies made. In the present case, the Sony device does not interfere with the making of a perfect copy of Sony's copyright in its computer program or cinematograph film.
Conclusion on construction of definition of "technological protection measure"
The conclusion reached by Sackville J was correct and should not have been disturbed by the Full Court.
There remain for consideration the two grounds advanced by Sony in its Notice of Contention. To these we now turn.
Sony's Notice of Contention
By its Notice of Contention, Sony contends that the decision of the Full Court should be affirmed on grounds in addition to those upon which it succeeded there. Sony has submitted that its device (comprising either or both the boot ROM in the PlayStation console and the access code on PlayStation CD-ROMs) was a "technological protection measure" on three essentially distinct bases. The first which has been dealt with in these reasons was the construction argument concerning "inhibit" and "practical effect".
The second ground was that the device fell within the terms of the definition of "technological protection measure" because it prevented PlayStation users from reproducing in the RAM of an unmodified PlayStation console a substantial part of the particular program embodied in an unauthorised copy of a PlayStation CD-ROM by playing the CD-ROM in that console. This may be called "the reproduction in RAM contention".
The remaining contention was that the device answered the description of the definition because it prevented PlayStation users from making in the RAM of an unmodified PlayStation console a copy of a substantial part of a cinematograph film embodied in an unauthorised copy of a PlayStation CD-ROM by playing the CD-ROM in that console. This may be called "the cinematograph film contention".
Sackville J had rejected all these submissions. In the Full Court, French J and Lindgren J accepted Sony's argument on the first point but rejected the other grounds. Finkelstein J accepted Sony's arguments on all three grounds. Hence the Notice of Contention respecting the reproduction in RAM contention and the cinematograph film contention. To these we now turn.
The reproduction in RAM contention
As Lindgren J noted in the Full Court[41], Sony's contention here must be that the protection device prevents or inhibits reproduction of the literary work constituted by the computer program (being the set of statements or instructions embodied in the CD-ROM for a PlayStation game) in a material form in RAM, within the meaning of par (a)(i) of s 31(1) of the Act [42]. Section 21 provides that, for the purposes of the Act, reproduction is to be taken to have occurred in various circumstances. One of those is set out in s 21(1A). This states:
"For the purposes of this Act, a work is taken to have been reproduced if it is converted into or from a digital or other electronic machine-readable form, and any article embodying the work in such a form is taken to be a reproduction of the work."
The PlayStation console is equipped with random access memory ("RAM") which it utilises in order to accelerate its own operation. This it does by copying into its RAM a portion of the computer program stored in the CD-ROM being played. Sackville J noted at least two key features of this process. First, "[t]he RAM's capacity is limited to 2 megabytes", and "[s]ince the game code may consist of up to 580 megabytes ... only a small section of the game code is downloaded and copied"[43]. Secondly, the "storage [of the copy] in RAM is temporary, in the sense that the data is only stored there until the PlayStation console is shut down"[44].
If any conversion of the program from a CD-ROM to RAM answers s 21(1A), there remains, as Lindgren J noted[45], the question whether the reproduction in RAM is "in a material form" within the meaning of par (a)(i) of s 31(1) of the Act.
Sackville J held that a substantial part of the computer program embodied in a PlayStation CD-ROM was temporarily stored in the RAM of a PlayStation console while the game is played: the storage is temporary because the contents of the RAM will be lost if power to the console is disconnected and are displaced as new instructions are downloaded to the RAM[46]. That conclusion was not challenged in this appeal. But his Honour held that temporary storage of a substantial part of the computer program did not entail reproduction of it in a "material form"[47].
A definition of "material form" was introduced by the Copyright Amendment Act 1984 (Cth) ("the 1984 Amendment Act")[48]. The definition states:
"material form, in relation to a work or an adaptation of a work, includes any form (whether visible or not) of storage from which the work or adaptation, or a substantial part of the work or adaptation, can be reproduced." (emphasis added)

The definition was introduced to qualify what had been the general understanding that in copyright law a material form was one which could be perceived by the senses[49].
Whilst the 1984 Amendment Act indicates that RAM may constitute a "material form" for the purposes of the Act, in certain circumstances, this is not determinative of this ground in the Notice of Contention. This is because if the "material form" upon which Sony relies is a form of invisible storage, then this storage must be one from which the work or a substantial part of it "can be reproduced". In effect, as Mr Stevens contends, the legislature amplified the rights of copyright owners with respect to reproduction in invisible forms of storage but did so subject to essential limitations.
Sony submitted that the words of the definition of "material form" after "includes" were not crucial to its success, because as a matter of ordinary language the data stored in the RAM could be said to reproduce the computer program stored in a PlayStation game in a material form. The answer is that given by Sackville J[50]: the data were not in a material or corporeal form, but in a non-material, incorporeal form, comprising essentially electronic impulses.
Sony also relied on par 28 of the Explanatory Memorandum to the Bill for the 1984 Amendment Act introducing the definition of "material form":
"The definition of 'material form' is new and makes it clear that material form includes such methods of fixation as storage or reproduction on magnetic tape, read only or random access computer memory, magnetic or laser disks, bubble memories and other forms of storage which will doubtless be developed."

As Lindgren J pointed out, that assumes that in some circumstances the electronic impulses stored in RAM are in material form; it does not state a test for distinguishing between the circumstances in which they are and those in which they are not, and it does not say that they are in material form in all circumstances[51].
The closing words of the definition of "material form", namely "can be reproduced", were interpreted by Finkelstein J in his dissenting judgment in the Full Court[52] as meaning "may be able to be reproduced". This takes the inquiry concerning materiality of form from the realm of present capability into that of abstract or conjectural possibility. Lindgren J said it was[53]:
"an unrealistic and strained construction to treat the words 'can be reproduced' at the end of the definition of 'material form' so widely as to encompass 'could be reproduced if an additional device, not supplied with the console and not yet available, were to be manufactured and attached to it' or 'could be produced if the RAM under consideration formed part of a future modified console'".
Earlier, in Australian Video Retailers Association v Warner Home Video Pty Ltd ("AVRA")[54], Emmett J had appeared to interpret "can be reproduced" as "ordinarily is able to be reproduced". His Honour said[55] that "ordinarily it will not be possible to reproduce the contents of RAM in a DVD player". He continued[56]:
"If a DVD player has been modified, such that it is possible to study or use the RAM for the purpose of reproducing its contents, there could be a reproduction of the computer program in a material form within the meaning of s 31(1)(a)(i) of the Act. However, in the ordinary course, temporary storage of a substantial part of the computer program in the RAM of a DVD player will not involve a reproduction of the computer program in a material form.
Where a DVD disc is being played by means of a personal computer, it will be possible, where an appropriate additional program is installed in the personal computer, to reproduce the contents of RAM. However, where a computer does not have such a program installed, the use of the computer for the purpose of playing a DVD disc will not involve the reproduction of the computer programs in question in a material form within the meaning of s 31(1)(a)(i) of the Act." (original emphasis)
The references by Emmett J to what "ordinarily" will not be possible and to what happens "in the ordinary course" explain what is intended in the statutory phrase "can be reproduced". It is not sufficient to consider what might or would result from additional steps such as the use of additional hardware.
With that in mind, it is apparent from the account of the evidence given by Sackville J that Sony's device cannot answer the requirement of the definition of "material form".
Sackville J accepted the evidence of Mr Nabarro, Vice-President, Technical Services, of Sony Computer Entertainment Europe Limited, as is apparent from the following passage in his Honour's judgment[57]:
"Once a portion of the game code has been copied into the RAM, it is stored there. The storage in RAM is temporary, in the sense that the data is only stored there until the PlayStation console is shut down. Moreover, as Mr Nabarro explained, the data stored in the RAM will be 'flushed' as new instructions are transferred from the PlayStation game's code. Mr Nabarro was also asked whether the portion of the game code stored in the RAM could be extracted and reproduced. His answer was that this could not be done without developing hardware which would enable the process to be reversed." (emphasis added)
What is said in the last quoted sentence is sufficient answer to Sony's case. It is unnecessary to determine whether the temporary storage which is "flushed" is sufficient to answer the definition of "material form". However, it should be noted that in the formulation of Art 11 of the WIPO Copyright Treaty, to which reference has been made, a proposal was made but not accepted to give explicitly to copyright owners the exclusive right to authorise "direct and indirect reproduction of their works, whether permanent or temporary, in any manner or form"[58].
Sackville J observed[59]:
"On the face of things, it might seem surprising that the reproduction in electronic or digital form of a computer program is not necessarily an infringement of copyright in the computer program. The scheme of the legislation, however, seems to be that reproducing a work in electronic or digital form infringes copyright, pursuant to ss 31(1)(a)(i) and 36(1) of [the Act], only if the form in which the work is reproduced is itself capable of further reproduction."

His Honour added that this approach is consistent with s 21(1A) of the Act and added[60]:

"It is plausible that the legislation is structured in this way as a means of balancing the interests of copyright owners and users. If a work such as a computer program is reproduced in electronic or digital form, but is not amenable to further reproduction, it might well be thought too restrictive to regard the first reproduction in electronic or digital form as necessarily an infringement of copyright."
Finkelstein J referred to certain United States authorities holding that the downloading of computer software into the RAM is the making of a "copy" for the purposes of the Copyright Act 1976 , as amended, 17 USC §101. That provision defines "copies" as:
"material objects ... in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device".

The word "fixed" was defined as follows:

"A work is 'fixed' in a tangible medium of expression when its embodiment in a copy ... is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration."
Finkelstein J acknowledged that the legislative scheme in the United States is different and the authorities have attracted a great deal of criticism[61]. In particular, the utility of the authorities is diluted by the words "with the aid of a machine or device" in the definition of "copies". Lindgren J made the point that the words permit use of a machine or device not already present in the PlayStation console and software of which the RAM is part[62].
The first ground of the Notice of Contention, the reproduction in RAM contention, should be rejected.
The cinematograph film contention
The term "cinematograph film" is defined in s 10(1) of the Act as follows:
"cinematograph film means the aggregate of the visual images embodied in an article or thing so as to be capable by the use of that article or thing:
(a) of being shown as a moving picture; or

(b) of being embodied in another article or thing by the use of which it can be so shown;

and includes the aggregate of the sounds embodied in a sound-track associated with such visual images."
The set of statements or instructions to be used directly or indirectly in a computer to bring about a certain result answers the definition of "computer program" which, in turn, is brought within the definition of "literary work" within Pt III of the Act. Cinematograph films are differently treated. Cinematograph films are one of those subject-matters other than works in which copyright is conferred by Pt IV of the Act. Section 86(a) provides that, for the purposes of the Act, copyright in relation to a cinematograph film includes the exclusive right "to make a copy of the film".
Section 21(6) states:
"For the purposes of this Act, a sound recording or cinematograph film is taken to have been copied if it is converted into or from a digital or other electronic machine-readable form, and any article embodying the recording or film in such a form is taken to be a copy of the recording or film."

Further, s 24 deals with this concept of embodiment in an article as follows:

"For the purposes of this Act, sounds or visual images shall be taken to have been embodied in an article or thing if the article or thing has been so treated in relation to those sounds or visual images that those sounds or visual images are capable, with or without the aid of some other device, of being reproduced from the article or thing."
Finally, it follows from s 14(1) that it is sufficient for infringement that there has been the copying of "a substantial part" of a cinematograph film.
Galaxy Electronics Pty Ltd v Sega Enterprises Ltd[63] concerned two video games constituting a series of images such that the events represented on the screen varied according to the actions of the player of the game. The Federal Court held that the aggregate of the visual images generated by the playing of each of the games constituted a "cinematograph film". It did not matter that the images were embodied in the computer program or integrated circuits in a different form from that in which they might appear on the screen. Nor did it matter that the images seen by players were created by computer calculations only immediately before their appearance on the screen. The present litigation also concerns games with this general character.
In his evidence at the trial in this case, Mr Nabarro referred to the importance of the interactive elements in the codes for computer games and to the "level" at which particular choices are made to play a game. Earlier, in Galaxy[64], the Full Court adopted what had been said at trial by Burchett J[65]:
"[E]xcept for the opening and closing sequences, the events represented on the screen will show differences from screening to screening, except where the player's responses are all correct.
... the apparatus is designed to screen the simple story only when the correct responses to a series of cues are fed into it by the player; and when incorrect responses are given, a number of variations will result."
Neither side sought in this Court to challenge Galaxy, although the amici curiae rightly pointed to difficulties to which that case gives rise. However, what now follows in these reasons proceeds on the footing that the aggregate of the images and sounds stored on a PlayStation CD-ROM answers the statutory description of "cinematograph film".
By its Notice of Contention, Sony would have this Court decide that the RAM of a PlayStation console is an article or thing in which at least a substantial part of a cinematograph film is embodied. It is then submitted that the Sony device was a "technological protection measure". It prevented the making of a copy of a film embodied in the RAM.
This argument was raised at trial by an amendment of pleadings pursuant to leave granted on the first day. The preparation of the affidavit evidence thus had preceded the pleading.
Sackville J's conclusion on this branch of the case was expressed as follows[66]:
"In the absence of clearer and more detailed evidence as to the nature and quality of the images embodied in the instructions stored in the RAM, assessed in relation to the totality of 'the aggregate of visual images' constituting the cinematograph film, I cannot conclude (to adopt the language of Emmett J [in AVRA]) that 'the ephemeral embodiment' of a small proportion of images in the RAM constitutes the act of making a copy of the cinematograph film for the purposes of s 86(a) of [the Act]."
In the result, his Honour decided that, on the evidence before him, the argument founded on s 86(a) of the Act had to be rejected.
The question whether the evidence presented at trial was sufficient to establish the copying of what amounted to a "substantial part" of a cinematograph film which had been copied into the RAM was essentially a matter for Sackville J at trial. Mr Stevens correctly stresses in this Court that there was no attempt in the Full Court to assess the "substantiality" of any part of any particular cinematograph film by reference to the whole of it. The determination of questions of what amounts to the taking of a substantial part of a work or other subject-matter is notoriously difficult. This is nonetheless so in the present case where, on the evidence of Mr Nabarro, the purpose of the temporary storage of a small part of the instructions on the RAM of the PlayStation console is purely to enable the display of visual images and sounds by the console in real time.
In his dissenting judgment in the Full Court, Finkelstein J said[67]:
"[T]he question whether a substantial part of the copyright had been reproduced did not require detailed evidence. In particular, it did not require oral evidence from a witness to describe the relevant technology and, perhaps, express an opinion on the issue of substantiality. In many instances, of which this case is a good example, the judge can make an assessment whether a substantial part of the copyright has been taken by making a simple visual comparison between the copyright work and the allegedly infringing work. Second, I do not accept that the judge was confined in his consideration of the issue to what he observed during the demonstration. He had available to him the disks and a PlayStation console and, if necessary, he could have personally played the games in order to assess the nature and the quality of the images stored in the RAM when compared to the totality of the visual images comprising the film."
However, this case did not involve the viewing of a motion picture in the ordinary understanding of that term. The visual images which, consistently with Galaxy, are to be taken to constitute a cinematograph film do not have a set course or sequence of motion. The whole copyright subject-matter cannot be determined merely by a visual appraisal as with a motion picture. The Sony cinematograph films did not comprise visual images and sounds conventionally arranged in a linear sequence. Rather, they were interactive in nature, so that the ability to appreciate directly their content was dependent upon particular activity varying between one player and another.
In this setting, difficult questions for the assessment of substantiality are presented. It is not sufficient here to attempt to assimilate an artificial and contrived demonstration of the playing of the games to the viewing of a segment of a motion picture.
Sony correctly emphasises that the case law concerned with Pt III "works" such as books, where the subject-matter may be appreciated directly, shows that the courts readily enter upon the question of substantiality and that the emphasis has been upon quality, not merely quantity. However, the judgment of Starke J in Blackie & Sons Ltd v Lothian Book Publishing Co Proprietary Ltd[68] is an early illustration in this Court of the general proposition that substantiality is a question of degree which depends upon the circumstances of each particular case.
Where the issue of substantiality arises with respect to a computer program, the importance of evidence is apparent from Data Access Corporation v Powerflex Services Pty Ltd[69]. In the present case, whether what remained in the RAM, as "accessible by the console", had "an appreciable, playable, coherent, viewable and enjoyable part" of what must be taken to be a cinematograph film was, Sony submits, sufficiently established by the demonstration of two games during the hearing of the Full Court appeal and the reaction thereto of Finkelstein J.
It is unnecessary in this appeal to consider what may be the scope in dealing with computer games for evidence bearing upon the alleged "quality" of that which has been taken. Reference has been made above to the interactive nature of the computer games, and to the limited (and technical) purpose of the temporary storage on the RAM of the PlayStation console. Whatever the scope here for consideration of "quality", there was an unsatisfactory carriage by Sony of its evidential burden. There remains then the question of quantity.
What here is critical is Sackville J's acceptance that the evidence suggested that only a very small proportion of the images and sounds comprising the cinematograph film were "embodied" in the PlayStation console's RAM at any given time[70]. In the circumstances as they arose at trial, Sony failed to lay the necessary evidentiary basis for a finding in its favour on substantiality.
That being so, it is unnecessary to consider other submissions put in this Court in answer to Sony's case.
The second ground in the Notice of Contention also fails.

Disposition of the appeal

The appeal should be allowed with costs. The orders of the Full Court of the Federal Court should be set aside. In place of those orders, the appeal to the Full Court should be dismissed with costs.
McHUGH J. The issue in this case is whether the protective device that is installed in Sony "PlayStation" consoles is a "technological protection measure" within the meaning of s 116A(1) of the Copyright Act 1968 Cth ("the Act"). If it is, then the "mod chips" that the appellant supplied and installed in the PlayStation consoles are "circumvention device[s]" as defined by s 10(1) of the Act. If he installed "circumvention devices", he contravened s 116A of the Act and is liable to Sony for damages or an account of profits and other remedies conferred on a copyright owner by s 116D of the Act.
Statement of the case
Three Sony companies ("Sony") sued Mr Eddy Stevens in the Federal Court of Australia, alleging that he had contravened s 116A of the Act by supplying and installing circumvention devices that were intended to facilitate the use of pirated copies of Sony's PlayStation computer games. In the proceedings, Sony asked the Federal Court for damages, for an injunction and for relief under the civil remedies provisions in s 116D as well as a declaration of contravention.
The trial judge, Sackville J, rejected Sony's claim. His Honour held that Sony's protection device did not constitute a "technological protection measure" for three reasons:
(1) the device, which merely discourages users from copying games, but does not affect the ability of users to copy games, was not "designed ... to prevent or inhibit" copyright infringement;
(2) the device was not designed to prevent the reproduction of the computer game in a "material form", because the storage of the portion of the PlayStation game in the console's RAM during the playing of the game was not a form of storage from which the PlayStation game, or a substantial part of it, can be reproduced without modifying the console; and

(3) the device was not designed to prevent the copying of the computer game as a "cinematograph film", because the portion of the PlayStation game that was stored in the console's RAM during the playing of the game was not a "substantial part" of the "aggregate of the visual images" that constitute a cinematograph film.
The Full Court of the Federal Court allowed Sony's appeal against the first holding of Sackville J. The Full Court found that the Sony companies' method of "ensuring that access to the program is not available except by use of the Boot ROM, or the access code embedded in the PlayStation games, or both in combination"[71] fell within the definition of "technological protection measure". The Full Court held that the measure was designed to "prevent or inhibit" the copying or selling of infringing copies of authorised CD-ROMs. However, a majority of the Full Court upheld the other two holdings of Sackville J. Because the Full Court found that the Boot ROM and access code were a "technological protection measure", it declared:
"On 8 April 2001, 28 September 2001 and 16 November 2001 [Mr Stevens] sold circumvention devices, as defined in [the Act], for use in association with 'PlayStation' computer consoles and the CD-ROMs for 'PlayStation' computer games, in contravention of s 116A of [the] Act."
This Court granted Mr Stevens special leave to appeal against the decision and orders of the Full Court. In addition to supporting the decision of the Full Court of the Federal Court on the first holding, Sony has filed a Notice of Contention challenging the two holdings of Sackville J that were upheld by a majority of the Full Court.
In my opinion, Mr Stevens' appeal must be allowed and Sony's Notice of Contention dismissed. That is because Sackville J was correct in holding that the Sony protection device was not a "technological protection measure" for the purposes of the Act. It was not "designed ... to prevent or inhibit" copyright infringement within the meaning of s 10(1) of the Act. It was not designed to prevent the reproduction of the computer game in a "material form". It was not designed to prevent the copying of the computer game as a "cinematograph film".
The material facts

The PlayStation console
The Sony PlayStation is an appliance for playing computer games[72]. It consists of a console, two game controllers and software that enables the playing of CD-ROMs. The computer games are stored on CD-ROMs. The data on the CD-ROM is transmitted, interpreted and eventually displayed on a television or computer monitor through the operation of the console. The console is composed of the following parts:
. a read-only memory ("ROM") based internal operating system;

. a CD drive, in which a CD-ROM is inserted, and from which the "game code" of the game's software is downloaded into the random access memory ("RAM");

. RAM, which delivers data to the central processing unit ("CPU"). Unlike a CD-ROM, which can store up to 650 megabytes of data but has only one continuous track, the PlayStation RAM is limited to two megabytes, but it delivers data through 32 highways at one time. The storage of data in RAM is temporary, as it will be "flushed" when new instructions are transferred from the PlayStation game's code and when the power to the console is shut down. Sackville J accepted the evidence of Mr Nabarro, a witness who gave evidence for Sony, that the portion of the game code that is stored in the RAM could only be reproduced if hardware was developed to reverse the process;

. the CPU, which feeds data from RAM to the custom graphics processing unit ("GPU");

. the GPU, which manipulates the data to create the images that appear on the television screen and then moves the data to the video RAM "so that the GPU is free to work on the next section", according to Mr Nabarro; and

. the video RAM, which transmits the data to a digital terminal video converter, which changes digital electronic signals into analogue signals that may be interpreted and displayed by a television.
The components of the console communicate through a main "bus" and a "sub-bus" while the CPU of the console and the game controllers communicate through a serial communication protocol.
Access codes
The CD-ROMs that contain a computer game also contain an "access code", which is a string of encrypted sectors of data. Unlike the computer game, the access code cannot be accessed or reproduced by conventional CD-ROM copying devices (ie "CD burners"). After a CD-ROM is inserted in the console, and before the computer game may be played, a Boot ROM chip in the console must read the string of encrypted data. If an infringing copy of a computer game is inserted into the console, the access code is not found on the CD-ROM and so the game's software does not load. Instead, the user is prompted to insert an authorised CD-ROM. If an authorised copy of a computer game is inserted into the console, the CD sub-bus controller prevents a user from then replacing the authorised copy with an infringing copy and using the access code of the authorised copy to verify an infringing copy.
While PlayStations are sold in many parts of the world, the format of the consoles and the CD-ROMs on which games are played varies. The format depends on the television system standard that is operative in the market in which the consoles are manufactured for distribution. PlayStation consoles and games that are manufactured for distribution in Japan, South East Asia and North America are formatted in accord with the National Television Systems Committee ("NTSC") standard of colour television systems. But the consoles and games distributed in Europe and Australia are formatted in accord with the Phase Alternating Line ("PAL") standard. The Sony companies may distribute the same computer game to different parts of the world, but the access codes of the game's CD-ROMs vary as between countries and regions. The result is that the PlayStation game software that is stored on a CD-ROM that is purchased in Japan or the United States will not be loaded by a PlayStation console that was purchased in Australia unless the reading of the access code is circumvented.
Circumventing the Boot ROM's reading of the access code
A console that was purchased in Australia may nonetheless load software that is contained on a CD-ROM that was either purchased in a country with NTSC formatting or illegally copied from an authorised game if the console's programming is overridden with a "mod chip". The trial judge accepted the evidence of Mr Nabarro as to the functionality of a mod chip. It is a programmed computer chip. It instructs the console that the territorial codes are acceptable and permits the software's loading. It does so even though the CD-ROM that had been inserted in the CD drive does not carry the access code - which the internal operating system of consoles distributed in Australia is programmed to read.
The activities of Mr Stevens
Justice Sackville found that Mr Stevens supplied and installed mod chips in PlayStation consoles on three occasions after the Copyright Amendment (Digital Agenda) Act 2000 (Cth) ("the Digital Agenda Act") came into force. On two occasions, he received $45 for his services and $70 on the third occasion. His Honour also made two findings concerning Mr Stevens' state of mind. First, Mr Stevens knew that the mod chips were installed for the purpose of enabling the console to play copies of the PlayStation games that lacked the access code that Australian consoles recognise. Second, he knew that many copies played "would be copies made without the authority or licence of [Sony]."
The Copyright Act 1968
If the provisions of s 116A(1) apply to these acts of installation by Mr Stevens, he is liable to pay damages or an account of profits in accordance with s 116D(1). The relevant parts of s 116A declare:
"(1) Subject to subsections (2), (3) and (4), this section applies if:
(a) a work or other subject-matter is protected by a technological protection measure; and

(b) a person does any of the following acts without the permission of the owner or exclusive licensee of the copyright in the work or other subject-matter:

...

(ii) sells, lets for hire, or by way of trade offers or exposes for sale or hire or otherwise promotes, advertises or markets, such a circumvention device;

(iii) distributes such a circumvention device for the purpose of trade, or for any other purpose that will affect prejudicially the owner of the copyright;

...

(vii) provides, or by way of trade promotes, advertises or markets, a circumvention service capable of circumventing, or facilitating the circumvention of, the technological protection measure; and

(c) the person knew, or ought reasonably to have known, that the device or service would be used to circumvent, or facilitate the circumvention of, the technological protection measure.

...

(3) This section does not apply in relation to the supply of a circumvention device or a circumvention service to a person for use for a permitted purpose if:

(a) the person is a qualified person; and

(b) the person gives the supplier before, or at the time of, the supply a declaration signed by the person ...

...

(5) If this section applies, the owner or exclusive licensee of the copyright may bring an action against the person.

...

(7) For the purposes of this section, a circumvention device or a circumvention service is taken to be used for a permitted purpose only if:

(a) the device or service is used for the purpose of doing an act comprised in the copyright in a work or other subject-matter; and

(b) the doing of the act is not an infringement of the copyright in the work or other subject-matter under section 47D, 47E, 47F, 48A, 49, 50, 51A or 183 or Part VB.

(8) In this section:

...

supply means:

(a) in relation to a circumvention device - sell the device, let it for hire, distribute it or make it available online; and

(b) in relation to a circumvention service - provide the service.

(9) The defendant bears the burden of establishing the matters referred to in subsections (3), (4) and (4A)."
Section 10(1) of the Act defines the following terms:
"circumvention device means a device (including a computer program) having only a limited commercially significant purpose or use, or no such purpose or use, other than the circumvention, or facilitating the circumvention, of an [sic] technological protection measure.
...

technological protection measure means a device or product, or a component incorporated into a process, that is designed, in the ordinary course of its operation, to prevent or inhibit the infringement of copyright in a work or other subject-matter by either or both of the following means:

(a) by ensuring that access to the work or other subject matter is available solely by use of an access code or process (including decryption, unscrambling or other transformation of the work or other subject-matter) with the authority of the owner or exclusive licensee of the copyright;

(b) through a copy control mechanism."
As a result of these provisions, Mr Stevens is liable for his supply and installation of mod chips if the Boot ROM chip, the access code or a combination of the two falls within the definition of "technological protection measure".
The decision of Sackville J

The construction argument
Justice Sackville accepted the undisputed proposition of Sony that a PlayStation game which is stored on a CD-ROM falls within the definition of "computer program", and so, within the definition of "literary work", which are both defined in s 10(1) of the Act. Justice Sackville held, however, that the Boot ROM and/or the access code were not "designed ... to prevent or inhibit the infringement of copyright" in the computer game. His Honour held that they were intended, inter alia, only to "deter or otherwise discourage copyright infringement by the unlawful making, importation and distribution of copies of PlayStation games."[73] Deterrence or discouragement was insufficient to "inhibit the infringement of copyright" because "[t]he definition ... contemplates that but for the operation of the device or product, there would be no technological or perhaps mechanical barrier to a person gaining access to the copyright work, or making copies of the work after access has been gained, thereby putting himself or herself in a position to infringe copyright in the work."[74] His Honour said that the definition was not[75]:
"concerned with devices or products that do not, by their operations, prevent or curtail specific acts infringing or facilitating the infringement of copyright in a work, but merely have a general deterrent or discouraging effect on those who might be contemplating infringing copyright in a class of works, for example by making unlawful copies of a CD-ROM."

Reproduction in RAM
Justice Sackville found that Sony's device was not "designed ... to prevent or inhibit" the reproduction of the computer game in material form by preventing a user from downloading a portion of the game's code into the RAM. This was because the game code cannot be reproduced from its temporary storage in RAM, and thus is not reproduced in a "material form".
Copying of a cinematograph film
Justice Sackville also rejected Sony's argument that the device was designed to prevent the copying of a "substantial part" of a "cinematograph film" embodied in the computer game, which is an infringement of copyright pursuant to ss 86(a) and 14(1) of the Act. His Honour held that "the evidence to support [this argument] was very sketchy"[76], and he assumed "that the reasoning in Galaxy Electronics v Sega Enterprises applies to the PlayStation games"[77]. The argument was rejected on the ground that the data that is reproduced in the RAM upon the downloading of the game code is not a "substantial part" of the cinematograph film and so s 86(a) of the Act, when read with s 14(1) of the Act, was not infringed.
The decision of the Full Court

The construction argument
The Full Court held that, for the purpose of the definition of "technological protection measure", it is of no relevance that "the inhibition is indirect and operates prior to the hypothetical attempt at access and the hypothetical operation of the circumvention device."[78] Justice Lindgren, with whose judgment on this point Finkelstein J agreed, held that[79]:
"the extrinsic materials ... show an intention that the opening words coupled with para (a) of the definition of 'technological protection measure' were intended to embrace that inhibition, in the sense of deterrence or discouragement of infringement, which results from a denial of access to, and therefore prevention of use of, a program copied in infringement of copyright."
French J agreed with the conclusion of Lindgren and Finkelstein JJ on this point but French J thought that "the proper construction of s 116A and the definition of 'technological protection measure' flows from a consideration of the ordinary and grammatical meaning of its language."[80]
Reproduction in RAM
A majority of the Full Court (Finkelstein J dissenting) affirmed the decision of Sackville J that the downloading of the game code into the RAM did not constitute a reproduction of the code in "material form". Justice Lindgren noted that the code could be reproduced from the RAM if hardware was engineered to reverse the process. But his Honour concluded that it was "an unrealistic and strained construction to treat the words 'can be reproduced' at the end of the definition of 'material form'" to cover the present case. He said that they cannot be construed "so widely as to encompass 'could be reproduced if an additional device, not supplied with the console and not yet available, were to be manufactured and attached to it'"[81].
Copying of a cinematograph film
The Full Court majority, like Sackville J, noted the insufficiency of evidence to support this ground. Justice Lindgren said that "the evidence addressed only the question whether the images were embodied in a larger article or thing of which the RAM formed only one element."[82] Accordingly, he could not conclude that the computer game's "images are capable, when the RAM ... is used in the console, of being reproduced from the RAM."[83]
Construing the legislation
In determining issues of statutory construction, the text of the relevant statutory provision must be evaluated not only by reference to its literal meaning but also by reference to the purpose and context of the provision. And context is not limited to the text of the rest of the statute. For purposes of statutory construction, context includes the state of the law when the statute was enacted, its known or supposed defects at that time and the history of the relevant branch of the law, including the legislative history of the statute itself. It also includes in appropriate cases "extrinsic materials" such as reports of statutory bodies or commissions and parliamentary speeches - indeed any material that may throw light on the meaning that the enacting legislature intended to give to the provision. This is the process required by the modern approach of the common law to statutory construction[84]. In many jurisdictions, the common law principles have been incorporated, extended or modified by statute. Section 15AA of the Acts Interpretation Act 1901 (Cth) requires a court construing federal legislation to have regard to its purpose. Section 15AB of that Act authorises the use of various forms of extrinsic material to determine the meaning of that legislation. Section 15AB(3), however, has probably modified the common law position. It requires the court, when considering extrinsic material or its weight, to take into account "the desirability of persons being able to rely on the ordinary meaning conveyed by the text of the provision" and "the need to avoid prolonging legal or other proceedings without compensating advantage."
But sometimes - opponents of the purposive construction would say most of the time - the purpose of the statute in general, and the purpose of its individual sections in particular, are elusive. Similarly, sometimes context gives little - even no - guidance. In the present case, I think that it is impossible to discern the purpose of the relevant provisions, except by reference to the text. And I think that the historical background, the parliamentary history of the legislation and the extrinsic materials - the context - lead to no conclusion other than that the Federal Parliament resolved an important conflict between copyright owners and copyright users by an autochthonous solution.
Much modern legislation regulating an industry reflects a compromise reached between, or forced upon, powerful and competing groups in the industry whose interests are likely to be enhanced or impaired by the legislation. In such cases, what emerges from the legislative process is frequently not a law motivated solely by the public interest. It reflects wholly or partly a compromise that is the product of intensive lobbying, directly or indirectly, of Ministers and parliamentarians by groups in the industry seeking to achieve the maximum protection or advancement of their respective interests. The only purpose of the legislation or its particular provisions is to give effect to the compromise. To attempt to construe the meaning of particular provisions of such legislation not solely by reference to its text but by reference to some supposed purpose of the legislation invites error.
There is a good deal of evidence that supports the view that the legislative provisions with which this litigation is concerned are the product of a compromise agreed to, or forced upon, interest groups in the industry affected by the legislation. As the judgments of Sackville J and Lindgren J show, for many years Australian and overseas copyright owners and copyright users had been active in seeking to expand or limit the scope of legislation permitting copyright owners to use a "technological protection measure". A Parliamentary Committee set up to investigate that issue received about 100 submissions[85]. The Parliament did not adopt the Committee's recommendation concerning the form that the legislation might take. And the extrinsic materials to which we were referred did not disclose why the legislation took the precise form that it did. Moreover, the legislation that Parliament enacted did not give either the copyright owners or copyright users exactly what they wanted. As one writer has said[86]:
"The definition of 'technological protection measure' is a compromise, which was neither as restrictive as some copyright users had hoped, nor as broad as copyright owners sought - and parts of the legislative history are opaque."
Furthermore, there is nothing in the objects section of the Digital Agenda Act nor in the Explanatory Memoranda that shows a legislative purpose that assists in determining the meaning of the expression "technological protection measure". The legislative provisions that are the subject of this litigation were inserted into the Act by the Digital Agenda Act. Section 3 of that Act sets out its objects. But the objects, as so set out, concentrate on the Internet and online access to copyright material. They do not show what was the object of permitting and protecting the use of technological protection measures.
Against this background, the best - and certainly the preferable - guide to the meaning of the relevant provisions is the text of those provisions.
The first issue - the construction of "technological protection measure"
The resolution of the first issue turns on the meaning of "inhibit" and, in particular, the way in which its meaning differs from the meaning of "prevent". It is not controversial that a device is "designed ... to prevent ... the infringement of copyright in a work" when the device utilises one of the two means identified by the s 10(1) definition in order to cause a user of the work to be unable to do an act of infringement. An example[87] is the activation code on Microsoft's Windows XP program, which "ensur[es] that access to the work ... is available solely by use of an access code"[88], and thereby causes (and is designed to cause) a user who does not have the access code to be unable to copy the program onto his or her hard drive.
However, as the facts of the present case demonstrate, the unavailability to the user of an access code or the inability to copy the work does not always prevent the doing of an act that infringes copyright. Sony's device ensures that the PlayStation console cannot load the game software unless the software is accompanied by an access code that is read by the Boot ROM. In this way, the device makes it impossible for a user to access, that is, to apprehend the contents of, the work[89], by making it impossible to load the reproduced software onto the PlayStation console. But the device does not render the user unable to "reproduce the work in a material form", sell or import the reproduction.
To the extent that protective devices like the PlayStation Boot ROM and access code are not designed to make it impossible for users to do acts that infringe rights comprised in the copyright, none of the devices are "designed ... to prevent ... the infringement of copyright". Instead, the extent to which these protective devices are protected by s 116A of the Act depends on the scope of the definition of "inhibit".
"[D]esigned, in the ordinary course of its operation, to ... inhibit the infringement of copyright"
Mr Stevens contends that Sackville J correctly defined the term "inhibit" in the definition of "technological protection measure". That interpretation classifies a device as "designed ... to prevent or inhibit" copyright infringement if "but for the operation of the device or product, there would be no technological or perhaps mechanical barrier to a person ... putting himself or herself in a position to infringe copyright in the work."[90] In contrast, Sony contends that "inhibit" ought to be given the meaning ascribed to it by the Full Court of the Federal Court. On that meaning, a device is "designed ... to ... inhibit the infringement of copyright" if the device is designed to "deter" or "discourage" the infringement of copyright. On the Full Court's reading, a technological protection measure is a device that, in the ordinary course of its operation, is designed to make copyright infringement futile. That is, a device "inhibits" the infringement of copyright if the prospect of restricted access to the work or a controlled capacity to copy the work dissolves every reason to do an act that infringes copyright in the work. If the Boot ROM fails to locate an access code, the copy of the work (ie the game software) is unable to be loaded onto the console, and so the game is "unplayable". Sony points out that an "unplayable" copy of a PlayStation game has no market value. Consequently, the operation of the Boot ROM and access code causes PlayStation users to have no reason to do any act of copyright infringement - eg copying, selling or importing an infringing copy of a game - that a user might otherwise have reason to do.
The difference between the interpretations of "inhibit" in the judgments of Sackville J and the Full Court of the Federal Court inheres in the disparate descriptive tasks that each interpretation requires the term "designed" to perform. Sackville J used the term "designed" to describe the action that the device was intended to execute in the course of its operation. To identify this action, it was necessary to ask: "what is the device meant to do?" His Honour answered this question in terms of the device's construction of a "technological or perhaps mechanical barrier" that operated "physically" to prevent or inhibit acts of dealing with the work[91].
The Full Court of the Federal Court saw the content of the term "designed" differently. It thought that it refers to the effect that the device's action is intended to cause. This effect is discerned from the question: "why is the device meant to do that?" On this view, as Lindgren J noted, this "purpose" may be "indirect[ly]" achieved by the device's operation and, consequently, fall within the s10(1) definition[92].
However, the Full Court's interpretation of "inhibit" and description of the device's "design" gives rise to three problems. First, the interpretation is not consistent with the language of the s 10(1) definition of "technological protection measure". That the device must be "designed, in the ordinary course of its operation, to ... inhibit" indicates that the definition is concerned with the actions that the device is intended to execute in the course of its operation. The chain of causation, by which the device utilises one of the two processes specified in pars (a) and (b) of the definition to "inhibit" acts of copyright infringement, must be fixed by the completion of the device's operation. The effects that the device's action, in enacting one of the two processes, is intended to have on a user subsequent to the completion of the course of its operation are external to this chain of causation, and thus not attributable to the device.
Second, the grammatical structure of the phrase "designed ... to prevent or inhibit" - where the term "designed" operates in the same way in respect of both "prevent" and "inhibit" - indicates that the term "designed" must perform the same descriptive task when attached to "inhibit" as it does when attached to "prevent". A device is "designed ... to prevent" copyright infringement when it is the operation of the device (which must incorporate one of the two processes specified in the definition) that makes it impossible to do an act of copyright infringement. In this context, the term "designed" is used to describe the device's function, and not the purpose that the execution of the function was intended to fulfil. Thus, for grammatical consistency, the phrase "designed ... to ... inhibit" must also refer to the device's intended operation. It cannot extend to the intended effect of the device's operation (ie the user's understanding and contemplation of the device's operation that causes there to be no reason to do an act of copyright infringement).
Third, Sony's interpretation is not consistent with the language of the s 10(1) definition of "circumvention device". A "circumvention device" is defined by reference to the device's "purpose or use". If the legislature intended the s 10(1) definition of "technological protection measure" to extend to a device whose ultimate purpose, even if not its immediate effect, is to "inhibit" copyright infringement, then the plainer language of the "circumvention device" definition would have been used, so as to include devices having a "purpose or use to prevent or inhibit" copyright infringement.
In my opinion, for the purpose of s 10(1), a device is a device that is "designed ... to ... inhibit" copyright if the device functions, "in the ordinary course of its operation", so as to make the doing of an act of copyright infringement - not impossible - but more difficult than it would be if the device did not operate.
This interpretation does not render the term "inhibit" redundant because it applies to at least two categories of devices that do not have an absolute preventative effect on copyright infringement. Thus, there are protective devices that regulate a user's access, not to the work itself, but to the appliance through which works are accessed. For example, "device binding" is a measure through which the decryption key of a work is linked to the "unique identifier" of the computer of a person who is licensed to download and copy a work[93]. The work may only be downloaded and saved (and thus, copied) onto a computer with this identifier. The fact that access to the work is available solely by use of a decryption key that is linked to the computer's identifier does not make it impossible for another user of the same computer - who has not been licensed to reproduce the material - to download and save the work. Nonetheless, in disenabling the access of all other computers to the work, "device binding" mechanisms function to make it more difficult for users - who are not licensed to download the work - to have access to an appliance that will enable the copying and infringement of copyright in the work. In this way, "device binding" inhibits, but does not prevent, copyright infringement.
Other devices are designed to make it impossible to do an act of copyright infringement by a particular method or methods, but are ineffective to prevent the doing of the same infringing act by other, more complex, methods. Online access controls are an example. They are measures that decrypt a work that is delivered to the computer through the Internet - "streamed" - when it is delivered to the computer. The work is then immediately re-encrypted, so as to enable only a small portion of the work to be decrypted at any given time. The result is that the work cannot be digitally copied onto the computer to which it is being delivered[94]. However, the re-encryption of the work, after it has been delivered and played, does not restrain the user from reproducing the work on other recording devices while the work is being played. In making it impossible to do an act of copyright infringement (ie reproduction) using one method, but not making it impossible to do the same act of copyright infringement using a more tedious method, online access controls make it more difficult to reproduce the work.
Acts of copyright infringement include not only acts that are comprised in the copyright but also acts of dealing with infringing copies of copyrighted works (eg by selling or importing). As French J observed[95], it may be that the function of a protective device will rarely make it impossible, or even more difficult, to engage in the latter category of acts. But this is not an illogical result that ought to compel an alternate reading of the statutory definition. The Parliament did not contemplate that technological protection measures would "prevent or inhibit" acts of dealing with infringing copies. This is evident from the limited scope of s 116A(7) of the Act. Section 116A(7) defines "a permitted purpose", for which a circumvention device may be used in accordance with s 116A(3), as "the purpose of doing an act comprised in the copyright in a work". The "permitted purposes" for using a circumvention device do not extend to acts of dealing - however fairly - with copies of works. Thus, a circumvention device may be needed to circumvent a technological protection measure in order to sell, trade or import the protected work for one of the purposes listed in Pt III, Div 3 of the Act. On this hypothesis, the fair dealer who installs the device does not infringe copyright by selling, trading or importing the work, but nonetheless would contravene s 116A of the Act by making a circumvention device for a purpose that is not permitted. This would be an anomaly. It confirms the view that the s 10(1) definition of "technological protection measure" ought to be read according to its ordinary meaning and not artificially stretched to include within its scope acts of copyright infringement that are not comprised in the copyright.
On the interpretation of the