Australian artist receives damages award for unjustifiable threats of copyright infringement
By John Swinson and Rebecca Slater
On 16 March 2012, Justice Collier of the Federal Court handed down her decision in Bell v Steele (No 3). Her Honour awarded Aboriginal activist artist, Richard Bell, damages of $147,000 for unjustifiable threats in relation to copyright.
The decision sets an important precedent. As far as we are aware, this is the first time damages have been awarded where a third party had content removed from the Internet without legal justification. In light of this decision, if a person falsely tells a file-sharing or social media website that they own copyright in an image or movie to have it taken down, and in fact that is not the case, it could be actionable as an unjustifiable threat.
The decision also provides clear guidance as to the principles the courts will apply in assessing the quantum of damages recoverable for unjustifiable threats.
King & Wood Mallesons represented Richard Bell in this litigation.
Richard Bell is a well-known Australian artist, who has painting in the collections of most major galleries in Australia. He has also made a number of art films, including “Scratch an Aussie” and “Uz vs THEM.”
Between June 2009 and September 2011, while on a fellowship in New York, Mr Bell produced and directed approximately 18 hours of raw footage for a film “The Blackfella’s Guide to New York”. He engaged Ms Steele to help him make the film, and paid her for these services. Ms Steele is a resident of Brooklyn.
Mr Bell made a trailer from the raw footage, which his agent posted on the Vimeo website. Ms Steele, through her American lawyers, sent letters to Mr Bell and his agent claiming that she owned the copyright in the footage and demanding that the trailer be removed from the Internet. She also caused the Vimeo website to remove the trailer.
In response to Ms Steele’s threats, Mr Bell’s agent did not display the footage on the Internet, postponed a showing of Mr Bell’s artworks, and delayed the sale of a catalogue of Mr Bell’s artworks that included a still from the trailer.
Mr Bell began proceedings in the Federal Court. On 7 February 2012, orders were made declaring him the owner of the copyright in the footage and declaring Ms Steele’s threats unjustifiable pursuant to section 202(1) of the Copyright Act. Bell v Steele (No 2).
Mr Bell then asked the Court to make an award of damages to the loss he suffered due to Ms Steele’s unjustified threats.
Submissions on damages
Justice Collier heard the following submissions from Mr Bell in relation to his claim for damages:
· he is one of Australia’s most significant and well-known artists;
· as a result of Ms Steele’s threats, he had lost the opportunity to promote and sell his artworks at an opportune time;
· his artistic credibility and integrity were very important in maintaining his reputation and the marketability of his artworks;
· the facts of the case were egregious as the threats were made in a calculated fashion, were made to both Mr Bell and his agent, and took no account of Australian legal principles; and
· notwithstanding the threats, Ms Steele had not commenced legal action in Australia, nor entered any appearance in Australia.
Mr Bell also suffered additional losses in the United States due to these threats. In this case, Mr Bell was only seeking damages for the losses in Australia due to the threats made in Australia by Ms Steele.
Assessment of damages
Justice Collier found that the principle to be applied in assessing damages in respect of unjustifiable threats is that “such damage must flow from the making of the threats”. Her Honour gave the following examples of this:
· where the threats impact on the willingness of third parties to do business with the applicant;
· where losses arise from threats to the applicant’s customers;
· where the applicant suffers lost sales or lost potential sales; and
· where the applicant accrues costs as a result of seeking relief (eg. seeking a declaration of ownership following a threat).
Mr Bell was awarded $147,000 in damages for the lost sales of paintings and catalogues that he suffered as a result of Ms Steele’s threats. He was also awarded lump sum costs totaling $22,224 against Ms Steele.
Mr Bell is now seeking to enforce his damages award in New York.
Ms Steele has commenced legal proceedings against Mr Bell and Milani Galleries in New York seeking a declaration that she owns the copyright in the film, seeking to have Mr Bell’s U.S. Copyright registrations revoked, and also seeking damages. Ms Steele has asked for a jury trial.
This is a similar situation to that in TS Production LLC v Drew Pictures Pty Ltd  FCA 1110 (30 July 2008), TS Production LLC v Drew Pictures Pty Ltd  FCAFC 194 (19 December 2008), a dispute involving claims of copyright ownership between a producer and a director. In that case, the director commenced proceedings in Chicago and the producer commenced proceedings in Melbourne. Both parties agreed that only one case should go ahead, but both courts decided that it should be their case that went ahead. The U.S. Federal Court reached a decision first, a jury decision in favour of the producer.
The Australian decision Bell v. Steele No. 3 is available here
The trailer for Mr Bell’s video is now on YouTube:
John Swinson is a partner at King & Wood Mallesons (Brisbane). Rebecca Slater is a lawyer at King & Wood Mallesons (Brisbane)
 FCA 246.
 FCA 62.