FEDERAL COURT OF AUSTRALIA

Connect TV Pty Ltd v All Rounder Investments Pty Ltd (No 3) [2013] FCA 98

THE COURT ORDERS THAT:

1.    The hearing of the contempt motions be adjourned to 10:15 am on 16 April 2013.

2.    On or before 5:00 pm on 22 March 2013 the first and tenth respondents file and serve:

(a)    any affidavits on which they propose to rely at the penalty hearing; and

(b)    an outline of their written submissions.

3.    On or before 5:00 pm on 12 April 2013 the applicants:

(a)    file and serve any answering affidavits on which they propose to rely at the penalty hearing; and

(b)    an outline of their written submissions.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    On the 7 September 2010, Connect TV Pty Ltd (“Connect TV”) commenced an ex parte proceeding in this Court seeking interim, interlocutory and final relief against a number of respondents. The relief was sought against, inter alia, All Rounder Investments Pty Ltd, which traded as Russian TV 4 U, and its controllers, Mr Yuri Grinberg, his wife Ms Leonora Lurie and their son Vladimir Grinberg (“the respondents”). The applicant filed a statement of claim on 7 September 2010 alleging that the respondents had contravened the Copyright Act 1968 (Cth) (“the Act”). Connect TV is a provider of Russian language television services. It has licence arrangements with a number of Russian television broadcasters to broadcast in Australia programs made in Russia. The respondents were alleged to have infringed copyright in those broadcasts.

2    On 7 September 2010, I made interim orders restraining the respondents from engaging in certain conduct. On 14 September 2010 I made interlocutory injunctive orders.

3    Connect TV has alleged that a number of respondents have contravened or failed to comply with some of the interlocutory orders which I made. They have filed statements of charge alleging that these respondents are guilty of contempt of court.

THE ORDERS

4    The orders which are said to have been contravened were orders that:

“2    The first, second, third and fourth respondents and each of them, whether by their servants, agents, or otherwise be restrained until the hearing and determination of this proceeding or further order, in Australia and New Zealand, from:

(a)    in so far as the Copyright Broadcasts or any of them consist of visual images – making a cinematograph film of the broadcast, or copy of such a film;

(b)    in so far as the Copyright Broadcasts or any of them consists of sounds – making a sound recording of the broadcast, or a copy of such a sound recording;

(c)    re-broadcasting the Copyright Broadcasts or any of them; or

(d)    communicating the Copyright Broadcasts or any of them to the public otherwise than by broadcasting them.

3    The first, second, third and fourth respondents and each of them, whether by their servants, agents, or otherwise be retrained until the hearing and determination of this proceeding or further order, in Australia and New Zealand, from:

(a)    assisting, facilitating, or being in any way directly or indirectly involved with any of the activities restrained by Order 2;

(b)    promoting, offering, or agreeing to provide, assist, facilitate or become in any way, directly or indirectly, involved with any of the activities restrained by Order 2.

4    The first respondent immediately take all lawful steps in its power to prevent or inhibit all persons whom that respondent, whether by its servants, agents or otherwise, has assisted or enabled to receive transmission of services involving re-broadcast or other communication to the public of Copyright Broadcasts, from receiving or being able to receive transmissions of such services.

… ”

5    The term “Copyright Broadcast” was defined, for the purposes of the orders, to mean:

“i)    NTV Broadcasting Company broadcasts;

ii)    Channel 1, Vremya, and Dom Kino Channels;

iii)    Russian Television and Radio-Planeta Channels;

iv)    Russian language channel ‘Israel Plus/Channel 9’”

THE ALLEGED CONTEMNORS

6    The allegations of contempt of court have been levelled against the first (“All Rounder”), tenth (“Ms Lurie”) and the eighteenth (“Mr Vladimir Grinberg”) respondents. Ms Lurie is the sole director and sole company secretary of All Rounder. She is the estranged wife of Mr Yuri Grinberg and the mother of Mr Vladimir Grinberg. At relevant times Mr Vladimir Grinberg was an employee of All Rounder and claimed to “have been involved personally in every aspect of starting and running the Russian TV 4 U department of the company.”

THE STATEMENTS OF CHARGE

7    Two statements of charge have been filed. The first was filed on 27 September 2010 by Connect TV. It contained three charges against All Rounder. They alleged, respectively, contraventions of orders 2, 3 and 4 which I had made on 14 September 2010.

8    The second set of charges was filed on 1 March 2011. By this time NTV Hungary Commercial Limited Liability Company had been added as an applicant. Although the charges were said to have been filed on behalf of both applicants, nothing turns on the addition of a second applicant. It will be convenient, in these reasons, simply to refer to Connect TV as the moving party in respect of these charges.

9    The second statement contained four charges against All Rounder. Some of these charges were repetitive of charges appearing in the first statement of charges.

10    The second statement also contained four charges against Ms Lurie and three against Mr Vladimir Grinberg. The charges against Ms Lurie and Mr Grinberg related to the part they allegedly played in some of the contraventions alleged against All Rounder. As a result, it will be convenient, later in these reasons, to deal with some of the charges in groups.

11    When framing the charges Connect TV gave them consecutive numbers in respect of each respondent. There are, for example, four “charge one” (two against All Rounder and one each against Ms Lurie and Mr Grinberg). In order to avoid confusion I have allocated sequential and non-repetitive numbers to each of the charges and I will refer to them using those numbers in these reasons.

12    In some instances the same conduct by an individual respondent is alleged to involve multiple contraventions of the orders.

13    At trial All Rounder did not press those charges which alleged contraventions of order 2 made on 14 September 2010 because, it contended, order 3 necessarily included all the conduct proscribed by order 2. As a result, charge 1 on the first statement of charge was not pressed. For the same reason Charge One against All Rounder, Charge One against Ms Lurie and Charge One against Mr Vladimir Grinberg on the second statement of charges were not pressed. These charges have been renumbered as 1, 4, 8 and 12 respectively.

THE EVIDENCE

14    The evidence relied on by Connect TV was contained in a series of affidavits (together with the exhibits referred to in some of those affidavits). The affidavits were those of:

    Oleg Khalkin sworn on 4 November 2010 and 13 April 2011;

    Dmitry Shtifelman sworn on 1 March 2011 (paragraphs 3-15), 8 April 2011 (paragraphs 3-16) and 14 December 2011 (paragraphs 3-17);

    Edward Volchek sworn on 6 September 2010 (paragraphs 5-9, 11-13);

    Gennady Volchek sworn on 13 September 2010 (paragraphs 2-8), 23 September 2010 (paragraphs 2-4), 27 February 2011 (paragraphs 3-8) and 8 December 2011 (paragraphs 1-12);

    Mila Volchek sworn on 27 February 2011 (paragraphs 1-4);

    Tatanya Volchek sworn on 23 September 2010 (paragraphs 1-12), 27 February 2011 (paragraphs 1-15) and 30 November 2011; and

    Sophia Yuhanov sworn on 27 February 2011 (paragraphs 1-10).

Gennady Volchek, Mila Volchek and Tatanya Volchek were each required for cross-examination.

15    The evidence relied on by the various defendants was contained in the affidavits of:

    Vladimir Grinberg sworn on 11 November 2011 (paragraphs 8, 9, 20-25, 30, 33 and 35);

    Leonora Lurie sworn on 11 November 2011 (paragraphs 12-20 and 30-39);

    Bella Shifferson sworn on 11 November 2011 (paragraphs 3-5); and

    M Carmody sworn on 24 November 2011 (together with attachments).

16    Vladimir Grinberg, Leonora Lurie and Bella Shifferson were cross-examined.

CHARGES FILED ON 27 SEPTEMBER 2010 AGAINST ALL ROUNDER

Charge One (Charge 1)

17    This charge alleges a contravention of order 2 and has not been pressed.

Charge Two (Charge 2)

18    This charge alleges that All Rounder:

“…is guilty of contempt of the Court in that in wilful and/or contumacious disobedience of Order 3 of the orders made by his Honour Justice Tracey on 14 September 2010 (“Order 3”) the respondent assisted, facilitated and/or was directly or indirectly involved in either re-broadcasting the Offending Copyright Broadcasts, or communicating the Offending Copyright Broadcasts or any of them to the public otherwise than by broadcasting them”.

19    The following particulars of the charge were provided:

“The orders made by his Honour Justice Tracey on 14 September 2010 were served on [All Rounder] at 4.59 PM on 15 September 2010 ... [All Rounder] did, on 17 September 2010, in consideration of payment of $39 by Tanya Volchek to [All Rounder], provide by email to Tanya Volchek a signal code and password which purported to enable communication of certain of the Copyright Broadcasts from the website www.russiantv4u.net to Ms Volchek ... [All Rounder] further told Tanya Volchek by email dated 17 September 2010 that despite the fact that the www.russiantv4u.com.au was no longer operational, the signal code and password could be used at the www.russiantv.net website to similar effect. The signal code and password did in fact operate as advised by [All Rounder] as to enable communication of certain of the Copyright Broadcasts from the website www.russiantv4u.net to any member of the public utilising that signal code and password. The Copyright Broadcasts were:

NTV Broadcasting Company broadcasts

Channel 1 broadcasts

Russian Television and Radio-Planeta Channel broadcasts

(collectively, ‘Offending Copyright Broadcasts’)

…

Provision of the signal code and password constituted assistance, facilitation, and direct or indirect involvement in the re-broadcasting of the Offending Copyright Broadcasts, or their communication to the public otherwise than by broadcasting them, by Russian TV 4 U Co., located in California, United States of America through their website www.russiantv4u.net.”

Charge Three (Charge 3)

20    This charge alleged that All Rounder:

“… is guilty of contempt of the Court in that in wilful and/or contumacious disobedience of Order 4 of the orders made by his Honour Justice Tracey on 14 September 2010 (‘Order 4’) [All Rounder] failed to take all lawful steps in its power to prevent or inhibit all persons whom [All Rounder] had enabled to received (sic) transmission of services involving re-broadcasts or other communication to the public of Copyright Broadcasts, from receiving or being able to receive transmissions of such services.”

21    The particulars of this charge were:

“[All Rounder] did on 3 September 2010, prior to the making of Order 4, provide by e-mail to Tanya Volchek a signal code and password which enabled her to receive transmission of services involving the re-broadcast or other communication to the public of Copyright Broadcasts. … [a]t no stage on or after Order 4 was made by his Honour Justice Tracey did [All Rounder] take any lawful steps at all to prevent or inhibit Tanya Volchek, who was a person who had been enabled by [All Rounder] to receive the Offending Copyright Broadcasts, from receiving or being able to receive transmission of those Broadcasts.”

CHARGES FILED ON 1 MArch 2011

Charges Against All Rounder: Charge One (Charge 4)

22    This charge, like Charge 1, alleged a contravention by All Rounder of order 2. It was not pressed.

Charges Against All Rounder: Charge Two (Charge 5)

23    This charge alleged that All Rounder:

“… is guilty of contempt of the Court in that in wilful and/or contumacious disobedience of subparagraph (a) of Order 3 of the orders made by his Honour Justice Tracey on 14 September 2010 (“Order 3”) it assisted, facilitated and/or was directly or indirectly involved in either re-broadcasting the Offending Copyright Broadcasts, or communicating the Offending Copyright Broadcasts or any of them to the public otherwise than by broadcasting them.”

24    Connect TV relied on the following particulars of this charge:

“The orders made by his Honour Justice Tracey on 14 September 2010 were served on [All Rounder] at 4.59PM on 15 September 2010. [All Rounder], through its director [Ms Lurie], admits to being served the said orders on 17 September 2010. [All Rounder] contacted Sophie Yuhanov in early January 2011 in order to arrange for communication of some or all of the Copyright Broadcasts to her home. On or about 12 January 2011 [All Rounder] provided Ms Yuhanov a signal code, password, and necessary equipment to enable communication of certain of the Copyright Broadcasts to any member of the public viewing a television or computer connected to the supplied equipment, and provided the necessary installation services and instructions. [All Rounder] operated the equipment so as to communicate certain of the Copyright Broadcasts to Ms Yuhanov’s home utilising the equipment, signal code and password. The Copyright Broadcasts were … [the Offending Copyright Broadcasts].”

Charges Against All Rounder: Charge Three (Charge 6)

25    This charge alleged that All Rounder:

“… is guilty of contempt of the Court in that in wilful and/or contumacious disobedience of sub-paragraph (b) of Order 3 it promoted, offered, or agreed to provide, assist, facilitate or become in anyway, directly or indirectly involved with any of the activities restrained by Order 2.”

26    In addition to the particulars relied on to support the previous charge Connect TV also relied on, in relation to this charge, All Rounder’s actions in:

“(a)    contacting Gennady Volchek on 3 January [2011] with instructions to make certain telephone calls’

(b)    promoting and offering activities restrained by Order 2 on the website www.russianworld.com.au; and

(c)    promoting and offering activities restrained by Order 2 by advertising Melbourne and Sydney dealers on the website www.kartina.tv.”

Charges Against All Rounder: Charge Four (Charge 7)

27    This charge alleged that All Rounder:

“… is guilty of contempt of the Court in that in wilful and/or contumacious disobedience of Order 4 of the orders made by his Honour Justice Tracey on 14 September 2010 … it failed to take all lawful steps in its power to prevent or inhibit all persons whom it had assisted or enabled to receive transmission of services involving re-broadcast or other communication to the public of the Offending Copyright Broadcasts, from receiving or being able to receive transmissions of such services.”

28    In addition to the particulars relied on in relation to Charge 5, Connect TV relied on the following additional particulars in relation to this Charge:

“At no stage on or after provision of the signal code, password and equipment referred to in those particulars did [All Rounder] take any lawful steps at all to prevent or inhibit Ms Yuhanov, who was a person who had been enabled by [All Rounder] to receive the Offending Copyright Broadcasts, from receiving or being able to receive transmissions of those Broadcasts.

Further, [All Rounder] was obliged under contract to pay Russian TV 4 U Co. $40US per month for service packages from each customer. A lawful step which was in [All Rounder’s] power to take to prevent or inhibit persons it had assisted or enabled to receive transmission of Copyright Broadcasts from continuing to receive such services was the withholding of payments to Russian TV 4 U Co. However, [All Rounder] has not done so. It has stated through its director [Ms Lurie] that it has no power to disconnect or otherwise interfere with the transmission to existing subscribers.

Further, [All Rounder] provided new signal codes each month to some or all of its subscribers. A lawful step which was in its power to take which would have prevented persons it had assisted or enabled to receive transmission of Copyright Broadcasts from continuing to receive such services was the withholding of new signal codes to paying customers. In the case of Sophie Yuhanov, [All Rounder] failed to take this lawful step and instead provided a new signal code.”

Charges Against Ms Lurie: Charge One (Charge 8)

29    This charge alleged a contravention by Ms Lurie of Order 2. It was not pressed.

Charges Against Ms Lurie: Charge Two (Charge 9)

30    This charge alleges that Ms Lurie:

“ … is guilty of contempt of the Court in that she engaged in culpable conduct in her capacity as sole director of [All Rounder] to cause [All Rounder] to act in wilful and/or contumacious disobedience of sub-paragraph (a) of Order 3. [All Rounder] assisted, facilitated and/or was directly or indirectly involved in either re-broadcasting the Offending Copyright Broadcasts, or communicating the Offending Copyright Broadcasts or any of them to the public otherwise than by broadcasting them.”

31    In addition to the particulars relied on in support of Charge 5 against All Rounder, Connect TV also relied on the following particulars in support of this charge:

“(a)    on 3 January 2011, [Ms Lurie] requested Gennady Volchek make contact with [Vladimir Grinberg] in order to arrange for the breaching of Order 2

(b)    on 6 January 2011 [Ms Lurie] requested Sophie Yuhanov make contact with [Yuri Grinberg] in order to arrange for the breaching of Order 2

(c)    [Ms Lurie] is [Mr Grinberg’s] mother and resides with [Mr Grinberg]

(d)    [Ms Lurie] is sole director and sole shareholder of [All Rounder]”

Charges Against Ms Lurie: Charge Three (Charge 10)

32    This charge alleges that Ms Lurie:

“… is guilty of contempt of the Court in that she engaged in culpable conduct in her capacity as sole director of [All Rounder] to cause [All Rounder] to act in wilful and/or contumacious disobedience of sub-paragraph (b) of Order 3, by causing [All Rounder] to promote, offer or agree to provide, assist, facilitate or become in any way directly or indirectly, involved with any of the activities restrained by Order 2.”

33    Connect TV relied on the same particulars which it had relied on in relation to each of the charges it had laid against All Rounder and the second charge against Ms Lurie.

Charges Against Ms Lurie: Charge Four (Charge 11)

34    This charge is cast in wide terms. It alleges that Ms Lurie:

“…engaged in culpable conduct in her capacity as sole director of [All Rounder] to cause [All Rounder] to act in wilful and/or contumacious disobedience of Order 4. She failed, neglected, or refused to cause [All Rounder] to take all lawful steps in its power to prevent or inhibit all persons whom it had assisted or enabled to received [sic] transmission of services involving re-broadcast or other communication to the public of Offending Copyright Broadcasts, from receiving or being able to receive transmissions of such services”.

35    again, Connect TV relied on the earlier particulars of charges against All Rounder and Ms Lurie.

Charges Against Vladimir Grinberg: Charge One (Charge 12)

36    This charge alleges a contravention by Mr Grinberg of order 2. It was not pressed.

Charges Against Vladimir Grinberg: Charge Two (Charge 13)

37    At the time when the second statement of charge was filed on 1 March 2012, Mr Grinberg had not yet been joined as a party to the proceeding. At that time, he was referred to as the “third party”. The first charge against him alleged that he:

“…aided and abetted [All Rounder] to act in wilful and/or contumacious disobedience of Order 2, by knowingly arranging for [All Rounder] to communicate the Offending Copyright Broadcasts or any of them to the public otherwise than by broadcasting them and by physically implementing such communication.”

38    Extensive particulars of this charge were provided. In addition to the particulars relied on in relation to All Rounder and Ms Lurie, Connect TV alleged that:

“(a)    The orders made by his Honour Justice Tracey on 14 September 2010 were made known to [Mr Grinberg] by [Ms Lurie], acting in her capacity as sole director of [All Rounder], on or about 17 September 2010.

(b)    [Mr Grinberg] is the operations manager of [All Rounder].

(c)    [Mr Grinberg] was involved personally in every aspect of starting and running [All Rounder’s] activity relating to the broadcasting and/or communication to the public of Copyright Broadcasts.

(d)    [Mr Grinberg] is [Ms Lurie’s] son and purports to reside with [Ms Lurie].

(e)    [Mr Grinberg] took steps to enable [All Rounder] to surreptitiously breach the Orders of Tracey J made on 14 September 2010, including:

25.    On 20 December 2010, he registered in his personal name, the business name ‘Kartina World TV Australasia’

26.    On 22 December 2010, he opened one or more bank accounts with the Westpac Banking Corporation Ltd, under the trading name ‘Kartina World TV Australasia’

27.    He adopted the alias ‘Dmitriy Shtifleman’, being the misspelled first name and surname of the solicitor having carriage of the current proceedings on behalf of the Applicants, and used that alias rather than his own name (which was referable to [All Rounder] and [Ms Lurie]) in performing the actions the subject of the current charges alleged against him.

(f)    [Mr Grinberg] provided [Ms Lurie] with his mobile phone number to be used in connection with breaching of Orders 2, 3 and 4 by [All Rounder] and/or consented to [Ms Lurie] making such use of it.

(g)    On or about 6 January 2011, having been informed directly or indirectly by [Ms Lurie] that a person was interested in having the Offending Copyright Broadcasts communicated to her premises, he made a telephone call to Sophie Yuhanov from the premises of Yuri Grinberg in the course of which he made arrangement to attend Ms Yuhanov’s premises in order to implement communication to those premises of the Offending Copyright Broadcasts.

(h)    On or about 12 January 2011, [Mr Grinberg] drove [All Rounder’s] vehicle in order to attend Ms Yuhanov’s premises for the purposes indicated above.

(i)    On or about 12 January 2011, [Mr Grinberg] personally

a.    provided Sophie Yuhanov a signal code, password, and necessary equipment to enable communication of certain of the Copyright Broadcasts to any member of the public viewing a television or computer connected to the supplied equipment;

(b)    installed the said equipment;

(c)    caused the said communication to occur.”

Charges Against Vladimir Grinberg: Charge Three (Charge 14)

39    This charge alleged that Mr Grinberg:

“…aided and abetted [All Rounder] to act in wilful and/or contumacious disobedience of subparagraph (b) of Order 3. [Mr Grinberg] aided and abetted [All Rounder’s] promotion, offer, or agreement to provide, assist, facilitate or become in any way, directly or indirectly, involved with any of the activities restrained by Order 2.”

40    Connect TV relied on the same particulars as it had done in respect of the immediately preceding charge.

contempt

41    In Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494 Merkel J summarised the current state of the law in respect of when disobedience of a court order will constitute a contempt of court. His Honour said (at 497-8) that:

“Deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct be casual, accidental or unintentional: see Australasian Meat Industry Employees’ Union v Mudginbeeri Station Pty Ltd (1986) 161 CLR 98 at 106-107 and 112-113. However, the disobedience will amount to a criminal contempt if it involves ‘deliberate defiance or, as it is sometimes said, if it is contumacious’: see Witham v Holloway (1995) 183 CLR 525 at 530 … However, as all proceedings for contempt are now regarded as criminal in nature, all of the charges must be proved beyond reasonable doubt: see Witham at 534.”

See also: Heatons Transport (St Helens) Ltd v Transport and General Workers’ Union [1973] AC 15 at 109.

42    In Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201 Gillard J identified the necessary elements a complainant must establish in order to make good a charge of civil contempt. His Honour there said:

“[31] In order to prove a civil contempt of court involving a breach of an order of the court, the plaintiff has to prove the following:

(i)    that an order was made by the court;

(ii)    that the terms of the order are clear, unambiguous and capable of compliance;

(iii)    that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of the Court;

(iv)    that the alleged contemnor has knowledge of the terms of the order; and

(v)    that the alleged contemnor has breached the terms of the order.

[32]    It is necessary for the plaintiff to prove each element beyond reasonable doubt in accordance with the principles of the criminal law, in proving element (v) it must be proven that the act or omission which constituted the breach of the order was deliberate and voluntary.”

43    There is no dispute that relevant orders were made by me on 14 September 2010, nor that they were served on the respondents. There is, however, an issue, in respect to one charge, as to when the terms of the orders became known to the alleged contemnors. Some of the respondents’ submissions may also be understood to put in issue the clarity and reach of some of the orders. The respondents each deny having breached any of the orders.

THE PROVISION OF SERVICES TO TATYANYA VOLCHEK ON 17 SEPTEMBER 2010 (CHARGE 2)

44    On 1 September 2010, Ms Tatyana Volchek, using the name “Marina Gore”, sent an e-mail to an e-mail address operated by All Rounder. She asked how she could connect to “Russian TV” on a monthly basis and how much she would need to pay for the necessary equipment. On 2 September 2010, “Russian TV 4 U” responded giving her a free call number from which she could obtain information as to the services offered by Russian TV 4 U. On 3 September 2010, she received another e-mail from Russian TV 4 U to which was attached an application form. On the same day she received another e-mail from Russian TV 4 U which contained details of its bank account and signal and password codes which would grant her access to Russian language services. On 8 September 2010, Ms Volchek received another e-mail from Russian TV 4 U which advised that she had received a monthly signal and password and requested her to pay $39 to Russian TV 4 U’s nominated bank account. On 16 September 2010, Ms Volchek deposited $39 into that account and advised Russian TV 4 U by e-mail that she had done so. On 17 September 2010, Ms Volchek received another e-mail from Russian TV 4 U which contained further details of signal and password codes. The e-mail was sent at 11.06 am. Later that day Ms Volchek tried to use the codes to obtain access to the website on which the programmes could be viewed. She was unsuccessful. She sent an e-mail to Russian TV 4 U seeking advice and, at 11.56 am, received a response directing her to another website. Ms Lurie admitted that she was the person who dealt with “Marina Gore” on behalf of All Rounder between 1 and 17 September 2010.

45    These events led to the laying of charge 2 against All Rounder.

46    All Rounder did not seek to dispute Ms Volchek’s account of relevant events or that it exercised control of the relevant websites. It contended, however, that it did not become aware of the 14 September 2010 orders until at least 3.45 pm on 17 September 2010.

47    The registered office of All Rounder was an accountant’s office located at 695 Glenhuntly Road, South Caulfield. The accountant, in whose name the business was conducted, was Tanya Bourke. The orders made on 14 September 2010 were served by Ms Tatyana Volchek at these premises at 4.59 pm on 15 September 2010. The orders and related documents were handed to Ms Elena Grounina, a secretary employed by the accountant. A degree of uncertainty attends that which thereafter occurred.

48    Ms Bella Shiferson is an accountant who worked in the office at which service was effected. She worked at the office under an arrangement with Ms Bourke. The arrangement provided for Ms Shiferson to have and service her own clients. Those clients included All Rounder, Ms Lurie and Mr Vladimir Grinberg. Ms Shiferson swore an affidavit on 3 November 2010 in which she deposed that:

“The mail from the court matter has been received on 17th of September 2010 at 15.45pm. On the same day I’ve contacted the company director Mrs Leonora Lurie and she picked up the mail on the same day – 17th September 2010 at the end of office hours – 5.30pm.”

49    On 11 November 2011, Ms Shiferson swore a second affidavit. In that affidavit she deposed that, between 13 September 2010 (a Monday) and 17 September 2010 (a Friday), she had been suffering from the flu and had not attended her office until some time on the Friday. When she did attend she found letters and correspondence lying on her desk. She found amongst this material a set of Court documents including a copy of the orders made on 14 September 2010. She said that, upon discovering these documents, she immediately telephoned Ms Lurie and advised Ms Lurie that the documents were in the office. She said that this call had been made about 3.45 pm and that Ms Lurie had collected the documents some time before 5.30 pm.

50    Under cross-examination Ms Shiferson confirmed that Ms Grounina was a receptionist and secretary employed in the office. She considered Ms Grounina to be a good and accurate worker. Ms Shiferson had not enquired of Ms Grounina about when the Court documents had come to the office. Ms Shiferson denied that there was inconsistency between her two affidavits and sought to explain the swearing of the second affidavit by saying that “the first was lost therefore the solicitor asked me to file another one.”

51    Ms Grounina was not called to give evidence.

52    On 16 November 2010, Ms Lurie swore an affidavit in which she said that the first time she had knowledge of the 14 September 2010 orders “was on the 17th of September at approximately 3.45 pm.” She did not say how she became aware of the existence of the orders. She said that she had immediately collected the orders “and stopped all operation and followed all orders to the best of my abilities.” She continued:

“I contacted all agents to stop operation and collected all marketing material. No fees or chargers were collected since the 17th of September. I have no power to disconnect or otherwise interfere with the transmission of existing subscribers as the contracts and the broadcast (sic) do not belong to All Rounder Investments.”

53    Ms Lurie swore a more detailed affidavit on 11 November 2011. In that affidavit she deposed that, during the afternoon of 17 September 2010, she had received a telephone call from Ms Shiferson. Ms Shiferson had told her that she (Ms Shiferson) had received some documents relating to All Rounder. Ms Lurie had then gone to Ms Shiferson’s office where Ms Shiferson had given her a copy of the orders made on 14 September 2010. Ms Lurie had taken the orders home and showed them to Mr Vladimir Grinberg. By the time she did this it was early in the evening. Mr Grinberg confirmed that his mother had shown him the orders for the first time at home on the evening of 17 September 2010.

54    Notwithstanding this evidence, Connect TV invited the Court to infer that Ms Lurie and, therefore, All Rounder, knew of the terms of the 14 September 2010 orders prior to 11.06 am on 17 September 2010.

55    Connect TV accepted that the evidence of Ms Shiferson and Ms Lurie supported a conclusion that the orders had not come to Ms Lurie’s attention until late in the afternoon of 17 September 2010. It submitted that the Court should not accept this evidence.

56    Connect TV pointed to a number of inconsistencies in Ms Shiferson’s evidence. Her first affidavit had made no mention of her being absent from work during the week commencing 13 September 2010. She had made no attempt to explain the delay between the service of the orders and her having drawn them to Ms Lurie’s attention. She had wrongly stated that the orders had arrived in the mail.

57    Connect TV pointed to Ms Shiferson’s unconvincing explanation of why she had felt the need to swear a more detailed affidavit some 12 months after she had sworn the first affidavit. That explanation (that the respondents’ solicitor had asked her to do so because the first affidavit had been “lost”) should not, it was submitted, be accepted. By the time she swore her second affidavit it was likely, so it was contended, that she would have been aware, through the respondents’ solicitors, that the orders had not been served by post and that service had been effected at the office on 15 September 2010. This had led her to give evidence about being absent from the office until the Friday afternoon.

58    The attack on Ms Lurie’s evidence was pursued on credit grounds: Connect TV pointed to what it referred to as a series of “fundamental inconsistencies and assertions of fact” in evidence which Ms Lurie had given in relation to other issues.

59    Whilst I harbour a number of reservations about the accuracy of the evidence given by Ms Lurie and Ms Shiferson, Connect TV has failed to satisfy me beyond reasonable doubt that Ms Lurie had knowledge of my 14 September 2010 orders before late in the afternoon on 17 September 2010. More specifically, I am not satisfied beyond reasonable doubt that she was aware of the orders at the time at which Ms Lurie dealt with Ms Volchek’s queries shortly before noon on that day.

60    The state of the evidence leaves open the possibility of inferences being drawn which are favourable to the respondents. Ms Shiferson’s first affidavit was hand written. It was evidently drafted by someone who was not fluent in the English language. She said that she found the Court documents on her desk enclosed in an envelope. There was a practice whereby Ms Grounina placed all incoming mail addressed to clients of Ms Shiferson on Ms Shiferson’s desk. If, as Ms Shiferson deposed, the Court documents were on her desk with other “mail and correspondence”, addressed to her clients, her reference to the Court documents having come to the office by “mail” is, perhaps, understandable. Her statement that this mail had been “received” on 17 September 2010 at 3.45 pm is open to the benign construction that this refers to the time at which Ms Shiferson first saw the documents, that is, the time at which she first received them. It is also possible that Ms Grounina, having received the Court documents from Ms Volchek and identified them as relating to All Rounder, simply followed her usual practice of placing the envelope containing them on Ms Shiferson’s desk to await her attention when next she attended the office. Ms Shiferson’s evidence was that this did not occur until mid to late afternoon on 17 September 2010. Only then was Ms Shiferson able to draw the orders to Ms Lurie’s notice.

61    It is, therefore, possible to infer that Ms Lurie did not have knowledge of the orders made on 14 September 2010 until, at least, 3.45 pm on 17 September 2010 and that she did not receive a hard copy of the orders until later that afternoon when she attended at the accountant’s office.

62    It follows that Charge 2 has not been proven.

PROVISION OF SERVICES TO TATYANYA VOLCHEK AFTER 17 SEPTEMBER 2010 (CHARGES 3, 11)

63    Order 4 required All Rounder to “immediately take all lawful steps in its power to prevent or inhibit all persons whom [it] … has assisted or enabled to receive transmission of services involving re-broadcast … of Copyright Broadcasts, from receiving or being able to receive transmissions of such services.”

64    “Marina Gore” was one of 12 persons who, on the evening of 17 September 2010, were being provided with access to Copyright Broadcasts by All Rounder. Once Ms Lurie had knowledge of this order (as she accepted that she did at this time) she was under an obligation to take all lawful steps necessary to inhibit Ms Volchek’s continued access to the Russian language broadcasts. Connect TV alleges that Ms Lurie failed to do so and that, as a result, both she and All Rounder failed to comply with order 4.

65    In her second affidavit Ms Lurie deposed that she understood the 14 September 2010 orders to require that All Rounder stop operating its Russian internet television business. As a result she ensured that All Rounder’s website was disabled and set about collecting any hard copy advertising materials which had earlier been distributed by All Rounder to various Russian specialty shops. Over the next couple of days she had telephoned each of All Rounder’s internet television customers and told each of them that All Rounder had stopped providing access to such services and that they should not make any further payments to All Rounder for those services.

66    Under cross-examination, Ms Lurie agreed that “Marina Gore” was one of All Rounder’s customers on 17 September 2010. She had not telephoned Ms Gore because she did not have her telephone number. Although she had Ms Gore’s e-mail contact details she had not used this or any other means to contact and provide advice to “Marina Gore”. Ms Lurie explained her failure to do so in these terms:

“As I explained, because [Marina Gore] only ask a signal, one month’s signal, to try, I didn’t see her the serious customer …”

Ms Lurie also accepted that she could have asked “Marina Gore” and all of her other customers forthwith to cease viewing the Russian language programmes which fell within the definition of Copyright Broadcasts. She did not do so.

67    I accept Connect TV’s submission that Ms Lurie’s failure, as a director of All Rounder, to take any steps to contact Ms Volchek in order to seek to persuade Ms Volchek to cease utilising All Rounder’s services, constituted a deliberate and voluntary omission to comply with order 4. These charges are proven.

PROVISION OF SERVICES TO SOPHIE YUHANOV (CHARGES 5, 7, 9, 13, 14)

68    These charges allege contraventions by All Rounder of orders 3(a), 3(b) and 4; and by Ms Lurie and Mr Vladimir Grinberg of orders 3(a) and 3(b).

69    Towards the end of 2010 Mr Vladimir Grinberg decided to establish a new business to provide services similar to those which had previously been offered by All Rounder. He described the steps he took to establish the business in his affidavit. He explained that:

“22.    As a result of this, in mid-December 2010, I decided to take a different course of action. I decided to start a new business using the name “Kartina” through which I would offer the same Russian Internet television products that All Rounder had offered to its customers. I thought that by taking this approach it would cause Connect TV to join Kartina (and possibly me) to the proceeding. If this occurred, I thought it would cause Kartina to cooperate with All Rounder, my parents and me by providing the information and documents to support our position or by taking steps to defend the allegations made against Kartina directly.

23.    To implement this plan, I did the following things.

(a)    I established a new distributorship with Kartina. I used a false name in my dealings with Kartina because I did not want Kartina to decline my application for a new distributorship on the basis of my past association with All Rounder. Further, I did not want my parents to know what I was doing, I decided to use the name Dmitry Shtifelman, the name of the solicitor acting for Connect TV. I thought that if I used that name in the promotion of this new business, my parents would think that the business was associated with Connect TV and would be less inclined to try to find out who was operating it.

(b)    I ordered and received from Kartina:

(i)    500 signal codes and passwords; and

(ii)    a few dozen ‘set top boxes’.

I ordered what I understood to be the minimum quantity that I could order from Kartina as a distributor. These items cost a total of approximately AU$9,900. As I was then living with my mother and I had to keep these things secret from her, I stored the set top boxes mostly in a cupboard in my room with a few kept in the boot of my car where I also stored my paperwork in a satchel.

(c)    On or before 20 December 2010, I registered the business name “Kartina World TV Australasia” (Victoria business number B2337393U) and I registered the Australian Business Number 35 307 199 680.

(d)    On or about 22 December 2010, I opened a bank account with Westpac in the name of “Kartina World TV Australasia”.

(e)    I purchased a pre-paid mobile phone with the phone number 0430 543 856. I also subsequently purchased another pre-paid mobile phone with the phone number 0426 965 065. I used these phones exclusively to promote and operate the Kartina World TV Australasia business. I used one phone (0430 543 856) for sales and the other (0426 965 065) as the technical support line.

(f)    In or about 10 December 2010, I started promoting the Kartina World TV Australasia business. The main means of promotion that I used was to send a group message to users on the “Odnaklasniki” social networking website. This is a social networking website for the Russian community in Australia which operates in a similar manner to the well-known Facebook web site. I also made some businesses (sic) cards and flyers for my new business and distributed them in cafes and business which are popular with the Russian community in Melbourne.”

70    Early in January 2011, Ms Mila Volchek telephoned the number 1800 757 760. This number was advertised as All Rounder’s number on its website. The number was registered to All Rounder and, connected to it, was a diversion to the mobile telephone number of Ms Lurie. Ms Volchek’s call was answered by a lady who introduced herself as Leonora. Ms Volchek asked her how she could go about arranging for her parents to receive Russian TV. Leonora asked her the speed of the internet at her parents’ home. Ms Volchek said that she did not have this information but invited Leonora to call her parents to find out. Ms Volchek gave Leonora her parents’ home telephone number.

71    On or about 4 January 2011, Ms Sophie Yuhanov (Ms Mila Volchek’s mother) received a telephone call at her home from a lady who enquired as to whether Ms Yuhanov was interested in connecting to Russian television. Ms Yuhanov said that she was. The lady who had initiated the call asked Ms Yuhanov some questions about the internet type and the speed of connection at her home. Ms Yuhanov was unable to answer these questions and the caller directed her to a website (www.kartina.tv) where she was told she could find the exact speed of the internet connection. Ms Yuhanov made these enquiries and then telephoned 1800 757 760. Her call was answered by a lady who gave her name as Yulya. Ms Yuhanov told Yulya that she had ascertained the internet speed on the Kartina website and gave details of the monthly internet download allowance. Ms Yuhanov provided various other details and then said that she would need to discuss the matter with her husband.

72    On 6 January 2011, Yulya telephoned Ms Yuhanov and asked her if she had had the opportunity of discussing the matter with her husband. The call was made from landline telephone number 9534 3570. This number was registered to Mr Yuri Grinberg, Mr Vladimir Grinberg’s father. It was connected to a unit at 9/232 Barkly Street, St Kilda. All Rounder’s business office was located at this address. At the time the unit was occupied by Mr Yuri Grinberg and Ms Leonora Lurie. Ms Yuhanov said that she had discussed the matter with her husband and that they were willing to proceed with the installation of a Russian TV connection. Yulya then advised her that a man named Dmitry would come and set up the connection. Yulya said that Dmitry would contact Ms Yuhanov and gave her what she said was Dmitry’s telephone number. The number was 0430 543 856. This was one of the numbers obtained by Mr Vladimir Grinberg when he established his new business. On 7 January 2011, Ms Yuhanov telephoned the number and spoke to a man who identified himself as Dmitry. She did so for the purpose of arranging installation of the service.

73    “Dmitry” attended Ms Yuhanov’s home on 12 January 2011. She described what transpired in her affidavit as follows:

“6.    On or about 12 January 2011 a young man attended my home. He identified himself as Dmitry and said he had come to install my Russian television service. He connected a box to my television and performed some technical work.

7.    He then filled out a form and signed it, and gave it to me together with some other documents. [The “dealers signature” block on the form was signed “Dmitiry Shtiffelman.”]

8.    I then signed a cheque drawn on my account for the installation fee of $254.95 and gave it to Tanya Volchek to hand it on to Dmitry. ….

9.    While he was still at my place, he demonstrated the television service he had installed. He tuned the television into several Russian language channels, including the channels I know as NTV, Channel One and RTR. These are the three most popular Russian language television channels among Russian speaking people I know in Australia. They are also the Russian language channels I have most interest in viewing.

10.    About a month later I received a phone call. The caller said she was from Kartina TV and asked me to make my monthly payment. I was busy and could not talk at that time, I have asked her to call me latter (sic). In a few days I have received a phone call from Dmitry who have asked me to make another monthly payment. I said that I need to get an invoice for the money I have already paid. I have advised him that when I will get an invoice, I will make another payment in order to continue watching Russian channels.

11.    On 14 February 2011 I received an email which appeared to have been sent from the email address Kartina_worldtv@y7mail.com. Attached to that email was an invoice from Kartina worldtv Australasia.” [The invoice was signed with a printed signature “Dmitriy Shtifelman”].

74    Ms Yuhanov’s account of events was confirmed by Ms Tatyana Volchek who was present at Ms Yuhanov’s home on 12 January 2011. In her affidavit Ms Volchek deposed that:

“5.    On 12 January 2011, around 6:30 pm, I was at the home of Mrs Yuhanov. While I was there I saw from the living room window a red car with number plates URN537 pulled up and parked across from Mrs Yuhanov’s house, and I saw a man come out of the car. The man who came out of the car, walked towards Sophie’s house. I heard knocking at the door, when the door was opened, the man standing there was the same man I saw coming out of the red car. He identified himself as Dmitry, and said he had come in order to install Russian language television for Mrs Yuhanov.

6.    When the person entered the house, I immediately identified him as the same man who had attended the Federal Court last year for a hearing in this matter. At that time, he had been sitting at the bar table next to an older woman. I recall that he had identified himself to the court as Vladimir Grinberg and had told the court that he was the son of Leonora Lurie. I was very surprised to see him attending Mrs Yuhanov’s home in order to install Russian language television, particularly as I knew his name was not Dmitry.

7.    While the person was at the premises, I photographed the car he had emerged from that was parked across the road. …

8.    I engaged in a long conversation in Russian with the man, which I recorded on my mobile phone. …

9.    The man installed what I know to be a device called a set top box, which enables television broadcasts communicated via the internet to be viewed on a television. He demonstrated reception of Russian language television channels on Mrs Yuhanov’s television. Among other channels, he demonstrated reception of the channels I know as NTV, Channel One and RTR. These are the three most popular Russian language television channels among Russian speaking people I know in Australia.

10.    I saw the man fill out a form and sign it. He gave it to me for Mrs Yuhanov together with some other documents. I was watching him as he filled in the form and was extremely surprised to see that he signed the form with the name Dmitriy Shtiffelman.

11.    I was surprised because Dimtry Shtifelman is the name of the solicitor who has sole carriage of this matter for the applicants through the firm Lloyd and Barclays solicitors. I am aware that Mr. Shtifelman’s name appears on many affidavits which have been filed with the court in this matter.”

75    In his affidavit Mr Vladimir Grinberg confirmed that what was said by Ms Yuhanov and Ms Volchek in the passages quoted from their respective affidavits “described the steps I took to connect an Internet television service at Ms Yuhanov’s home in January 2011.” He also deposed that, in so far as the paragraphs described things that he had said or done, he agreed that they were accurate.

76    “Yulya” was identified as Mr Vladimir Grinberg’s girlfriend, Ms Yulya Beliavskaya. She did not give evidence. He attributed this failure to her suffering from a bipolar disorder and her being seven months pregnant. No supporting medical evidence was provided.

77    Mr Vladimir Grinberg accepted that the vehicle he drove to Ms Yuhanov’s premises was registered in the name of All Rounder but said that he used it for both business and private purposes. He denied that he was acting as the agent of All Rounder at the time at which he installed the equipment at Ms Yuhanov’s premises: he did so in the course of his newly established business.

78    Ms Lurie denied having any conversation with Ms Mila Volchek or Ms Sophie Yuhanov in January 2011.

79    Mr Grinberg admitted to re-broadcasting or communicating the copyright channels to Ms Yuhanov, but asserted that he engaged in this activity as a means of inciting Connect TV to join Kartina to the proceedings, not to re-establish All Rounder after it was stopped from carrying on its business by the 14 September 2010 Orders.

80    Connect TV alleged that this assertion made by Mr Grinberg was false. It pointed to a discussion between Mr Grinberg and Ms Volchek at the time at which Mr Grinberg came to Ms Yuhanov’s home to install the set-top box. Mr Grinberg told Ms Volchek that his intention was to take advantage of what he saw as being a loop hole in the orders. That loop hole was that the orders did not bind Kartina. He had transferred, so he said, all of All Rounder’s clients to his new business so that they could continue receiving Russian television broadcasts notwithstanding the operation of the orders. He made no mention during this conversation of any desire to have Kartina to be joined to the principal proceeding.

81    It is to be borne in mind that the orders made on 14 September 2010 bound All Rounder and its servants and agents. They did not bind Mr Vladimir Grinberg save to the extent that he was acting as the servant or agent of All Rounder.

82    The links between All Rounder and the events relevant to these charges are tenuous. Ms Mila Volchek chose to initiate the request for the installation of the Russian television services by telephoning All Rounder’s advertised 1800 number. Her mother subsequently used the same telephone number to respond to certain enquiries. On this occasion she appears to have spoken to Mr Vladimir Grinberg’s girlfriend. She subsequently had a further discussion with Mr Grinberg’s girlfriend on a landline connected to the same premises as All Rounder’s business office. Thereafter, however, contact was made using one of the mobile telephone numbers which Mr Vladimir Grinberg had registered to conduct his Kartina business. When he visited Ms Yuhanov’s home to install the equipment he drove a vehicle registered to All Rounder but which he also used for private purposes.

83    Mr Vladimir Grinberg did not explain how he was alerted to Ms Yuhanov’s expression of interest. Even if it be assumed that the referral had come directly or indirectly from Ms Lurie it does not necessarily follow that his subsequent activities were undertaken as the servant or agent of All Rounder. Furthermore, even if, contrary to her denial of having any dealings with either Ms Volchek or Ms Yuhanov, Ms Lurie had told Mr Vladimir Grinberg of having received such a request, that alone would not have constituted a breach of my orders by Ms Lurie or, through her, by All Rounder.

84    The fact that Mr Vladimir Grinberg used a car which was registered to All Rounder when he came to Ms Yuhanov’s home to install the equipment does not compel the conclusion that he was then acting as the agent of All Rounder. The inference is open that, although the car was registered to All Rounder, Mr Grinberg continued to use it after 17 September 2010 to attend to his private business and that he continued his personal use of it after he had established his new business. There was no urgent need to change the registration details for the vehicle.

85    I am, therefore, not satisfied beyond reasonable doubt that All Rounder, Ms Lurie or Mr Vladimir Grinberg have contravened any of the orders which I made on 14 September 2010 by taking steps to respond to Ms Yuhanov’s request for the installation of Russian language services at her home. These charges are not proven.

THE OFFER OF SERVICES TO GENNADY VOLCHEK (CHARGES 6, 9, 10)

86    These charges allege contraventions of order 3(b) by All Rounder and orders 3(a) and (b) by Ms Lurie.

87    Mr Gennady Volchek is the husband of Ms Mila Volchek.

88    In September 2010, Mr Volchek viewed the website www.russiantv4u.com.au. It advertised Russian language television. It referred readers to the telephone number 1800 757 760. On 10 September 2010, Mr Volchek telephoned that number. The call was answered by a lady who identified herself as Leonora. Mr Volchek told her that his name was Alexander Bronis. He said that his father was interested in subscribing to a Russian TV service. He asked for Leonora’s e-mail address. She provided the e-mail address russiantv4u@live.com.

89    On the same day Mr Volchek sent an e-mail to Ms Lurie at that address. He signed it “Sasha Bronis”. He asked some questions about provision of the Russian language television service. Ms Lurie responded shortly afterwards.

90    Ms Lurie gave evidence that shortly afterwards she received a series of telephone calls from “Mr Bronis” in which he pressed her to install a Russian internet television service at his father’s home. She told him that it was “too late” and that All Rounder had stopped business. Ms Lurie eventually told Mr Bronis that he should contact her “in a couple of months” in the expectation that the Court proceeding would have been resolved by then.

91    There matters rested until 3 January 2011 when Mr Volchek received an unsolicited and unsigned e-mail from russiantv4u@live.com. It read: “Call, please, to Dmitiry 0430 543 856 Happy New Year!”. Mr Volchek replied by e-mail asking who Dmitiry was. He received no response.

92    Following receipt of this e-mail Mr Volchek asked his wife to initiate the contact with All Rounder which is described above at [70].

93    Ms Lurie admitted that she had sent the e-mail on 3 January 2011.

94    Order 3(a) restrained All Rounder and its servants and agents from in any way, directly or indirectly, being involved with the re-broadcasting or communication of the Copyright Broadcasts. Order 3(b) restrained them from assisting or facilitating such re-broadcasting or communication.

95    Prior to the making of the orders on 14 September 2010, Ms Lurie, acting on behalf of All Rounder, had dealings with Mr Volchek about subscribing to a Russian TV service provided by All Rounder. After the orders had been made, Ms Lurie recognised that the orders prevented her from pursuing the matter further. On 3 January 2011, however, she sent an e-mail from a website used by All Rounder inviting Mr Volchek to contact Dmitry on a mobile telephone number which Mr Vladimir Grinberg had, a few weeks before, registered for the purpose of conducting his new business. Ms Lurie offered no plausible explanation for having sent the e-mail. Her claim that, at the relevant time, she was not aware that “Dmitry” was her son and that she was merely referring Mr Volchek to somebody she did not know but thought may be able to help him, is, simply, incredible.

96    In the circumstances, I accept Connect TV’s submission that it must be inferred that Ms Lurie, acting on behalf of All Rounder, had determined to assist her son obtain Mr Volchek’s business contrary to orders 3(a) and 3(b). Ms Lurie’s action constituted a deliberate and voluntary contravention of these orders. These charges have been proven.

PROMOTION OF RUSSIAN LANGUAGE SERVICES (CHARGEs 6, 10, 11, 14)

97    These charges allege contraventions by All Rounder of orders 3(a) and 3(b); of 3(b) and 4 by Ms Lurie; and 3(b) by Mr Vladimir Grinberg.

98    This aspect of the charges relates to a posting on a Russian language website (www.russianworld.com.au) on 22 December 2010. The posting continued to appear on 25 February 2011.

99    The posting read:

“114 TV CHANNELS IN RUSSIAN LANGUAGE in 193 countries.

Kartina World TV Australia are one of the most advanced technologies – internet TV KARTINA TV – an interactive digital television you can get it anywhere there is access to the internet, the only condition for admission – quick link digital video stream received from the services of Kartina World Llp your internet equipment and on to a computer or set-top TV.

Today the broadcasting network KARTINA World Llp make up more than 100 television channels in the package include the central Russian TV stations, popular, entertainment and music programs, children’s, documentaries and international channels from countries of the CIS [illegible] package contains popular radio stations around 30tys, daily broadcasts provide a choice for every taste Archive pozvolyaet watch TV [illegible] time for you – all for $ 29 a month.

E-mail: Kartina_worldtv@7mail.com leave your phone

Call: 0430543856.

Dmitriy

http://www.russiantv4u.com.au/indexphp”

100    Mr Vladimir Grinberg denied making the posting.

101    I do not accept his denial. He had adopted the pseudonym “Dmitry” for the purpose of promoting his new business. He had registered the telephone 0430 543 856 to assist in the conduct of the business on the day before the posting appeared. The number could only have been known to Mr Grinberg and anyone he had chosen to advise in a very short period of time. I readily infer that either Mr Grinberg or someone acting on his behalf made the posting.

102    It does not follow that a contravention of order 3(a) or (b) has occurred. The posting promoted Mr Grinberg’s new business. There is nothing in it to suggest that he was acting on behalf of All Rounder. I am not satisfied that Mr Vladimir Grinberg acted as a servant or agent of All Rounder when he made the posting. Nor is there any evidence to suggest that Ms Lurie was involved in the posting of the notice.

103    These charges, to the extent that they relate to the posting put up on 22 December 2010, have not been proven as against All Rounder, Ms Lurie or Mr Vladimir Grinberg.

advertising of dealerships (CHARGES 6, 11, 14)

104    These charges allege contraventions by All Rounder and Mr Vladimir Grinberg of order 3(b) and of order 4 by Ms Lurie.

105    On 25 February 2011, Connect TV’s solicitor examined the website www.kartina.tv. It identified a number of “dealers” in Australia. The Melbourne dealer was identified as Leonora Lurie. The Sydney dealer appeared as Lilila Kvass. Ms Lurie said that Ms Kvass was a relative of hers. The same telephone contact number was given for both Ms Lurie and Ms Kvass. It was 1800 757 760. Also listed amongst the dealers was one “Dmitry”. His contact number was given as 430 543 856.

106    It will be recalled that the telephone 1800 757 760 was registered to All Rounder. When a person called the number the call was redirected to Ms Lurie’s mobile phone. Under cross-examination Ms Lurie admitted that she had received “a lot of calls” on her mobile phone which had been diverted from the publicised 1800 number. She ceased answering the calls in January 2011 following her dealings with “Sasha Bronis”. She denied having provided any services to such callers or referring any of them to Mr Vladimir Grinberg.

107    The contact number given for “Dmitry” was one of those which had been registered by Mr Vladimir Grinberg in December 2010, minus the first “0”.

108    Connect TV contended that All Rounder had contravened order 3(b) by “promoting and offering activities restrained by Order 2 by advertising Melbourne and Sydney dealers on the website www.kartina.tv”. It alleged that Ms Lurie had contravened order 4 by failing to ensure that her name was removed from the list of dealers appearing on the Kartina website. It further alleged that Mr Vladimir Grinberg had contravened order 3(b) because he had chosen to become a Kartina dealer and was aware that his details appeared on the list of dealers appearing on the Kartina website.

109    Mr Vladimir Grinberg’s position can be disposed of quickly. His contact details on the list of dealers contained the mobile telephone number which he had registered in December 2010 when he established his new business enterprise under the false name of “Dmitry”. In arranging to become a listed Kartina dealer he was not acting as a servant or agent of All Rounder. He was promoting his own business. He was not, therefore, bound by any of the orders made on 14 September 2010.

110    Under cross-examination, Ms Lurie admitted that she had continued to advertise both herself and Ms Kvass as agents of All Rounder on the Kartina website. The contact telephone number appearing on the list of dealers was All Rounder’s 1800 number which was diverted to Ms Lurie’s mobile phone. She admitted that she continued to receive calls on the advertised 1800 number after she became aware of the orders. Even if, as she asserted, she did not respond positively on behalf of All Rounder to requests by callers for provision of Russian language television services, maintenance of the advertising of All Rounder’s services on the Kartina website after 17 September 2010 constituted the promotion of All Rounder’s services as a provider of Copyright Broadcasts. In this way, Ms Lurie and, through her, All Rounder, contravened order 3(b). The contravention was conscious and deliberate.

DEFENCES

111    Mr Vladimir Grinberg, who appeared for himself, his mother and, by leave, for All Rounder, raised some defences which applied generally to all charges.

112    Mr Grinberg made a number of submissions regarding the meaning and reach of the terms “re-broadcast” and “communicating … to the public”. He directed attention to the provisions of s 10(1) of the Act in which the word “broadcast” is defined to mean “a communication to the public delivered by a broadcasting service …” and “a broadcasting service” is expressly defined to exclude “… a service that makes programs available on demand on a point-to-point basis, including a dial-up service.” Relying on technical evidence, Mr Grinberg submitted that, the use of the set-top box installed by All Rounder for the purpose of facilitating the receipt, by subscribers, of Russian TV broadcasts, did not involve “broadcasting”. This was because “the set-top box had quite limited technical capacities and capabilities, in many respects operating as no more than a conduit between a server operated by some third party in a remote location and an end user watching a television screen.” The box did not have the capacity to make a cinematographic film or a sound recording of any broadcast or any copies thereof.

113    Mr Grinberg further submitted that the “real issue” was whether or not there had ever been a communication of Russian television broadcasts to the public otherwise than by broadcasting them. He referred to the definition of the word “communicate” in s 10(1) of the Act, namely, to “make available online or electronically transmit (whether over a path, or a combination of paths, provided by a material substance or otherwise) a work or other subject-matter … within the meaning of this Act.” By s 22(6) of the Act it is provided that “a communication other than a broadcast is taken to have been made by the person responsible for determining the content of the communication.” He submitted that it was the end user (that is, the customer) who determined the content of any communications broadcast because they controlled what appeared on their television screens. It followed, he contended, that the respondents could not have communicated the Russian language television programmes to any member of the public.

114    It is trite law that injunctions must be framed with sufficient clarity to ensure that those on whom obligations fall can reasonably be expected to understand those obligations. It does not, however, follow that any ambiguity will render an injunctive order unenforceable in contempt proceedings.

115    In Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483 at 492 Barwick CJ, speaking of undertakings, said that:

“If the order or undertaking is so expressed as to be meaningless, there is of course nothing which can be enforced. But, if it bears a meaning which the Court is satisfied is one which ought fairly to have been in the contemplation of the person to whom the order was directed or who gave the undertaking as a possible meaning, the fact that that meaning results from a process of construction and involves a choice of possible meanings does not, in my opinion, preclude the Court from enforcing the order or undertaking in the sense which the Court assigns to it. If the Court is satisfied that the party said to be in contempt bona fide believed himself bound only by a construction which the Court thinks to be erroneous, it may for that reason, in its discretion, refuse to make an order or, if it makes an order, refuse to make an order for costs against that party. But, even in such a case, the enforcement of the plaintiff’s rights must not be left out of account. A party who has bona fide acted on an erroneous view of an order or undertaking may, according to the circumstances, none the less be justly adjudged guilty of contempt in procedure. In my opinion, this is equally so where, because of its terms or circumstances, the order or undertaking requires construction in order to determine its meaning and remove ambiguities patent or latent.”

116    Windeyer J similarly held (at 503) that:

“This is not a case in which the extent of obligations undertaken is ascertainable simply by construing the undertaking according to ordinary grammatical rules. If that were so, I would agree that a mistake in construction would not excuse disobedience, although it might perhaps mitigate its consequences … If its true meaning, although no immediately plain, can be ascertained according to ordinary rules of construction, then the person giving the undertaking is bound by it in that sense. But the uncertainties that lurk in the words of this undertaking, and which were exposed during the argument, cannot be resolved in that way, for they do not arise from a debatable construction but from an uncertain denotation.”

117    In Universal Music Australia Pty Ltd v Sharman Networks Ltd (2006) 150 FCR 110 Branson J (with whom Lindgren and Finkelstein JJ agreed), having referred to a number of older authorities, including Morgan, concluded (at 119-120) that:

“…the authorities discussed above reveal that an injunction is not rendered invalid, or incapable of founding a charge of contempt, merely because it leaves a respondent with room to wonder whether future conduct falls within it. At least where the true construction of the order is one which ought fairly to have been in the contemplation of the person to whom the order was directed … the Court which entertains the charge of contempt will be required to determine that construction. Of course, it may be highly relevant to the question of punishment that a respondent failed to comply with the order because he, she or it placed a construction on the order that was not its true construction.”

118    The terms “re-broadcasting” and “communicating” appear in paragraphs 2(c) and (d) of the orders made on 14 September 2010. They are words that have both ordinary and statutorily defined meanings. It is notable that both Ms Lurie and Mr Vladimir Grinberg, upon being served with the orders, understood them to mean that they could not continue to facilitate the transmission of the Copyright Broadcasts to their customers using the set-top boxes and other equipment which they had, until that time, been using. Whether or not there might have been scope, at a later time, to seek to confine the reach of the terms by reference to statutory definitions, it cannot be doubted that the construction which was evidently placed by Ms Lurie and Mr Vladimir Grinberg on the orders was one which was fairly and actually within their contemplation. They were either re-broadcasting material emanating from the identified Russian TV channels or they were communicating such material to members of the public who were their customers.

119    The respondents also advanced a related argument that the Court’s orders should never have been made because, on its true construction, the Act did not provide Connect TV with any protection against All Rounder’s activities.

120    The short answer to this submission was provided by the Full Court in Siminton v Australian Prudential Regulation Authority (2006) 152 FCR 129 at 137-8:

“An order made by a superior court of record stands and is bound to be observed even though it may ultimately be determined that the order should not have been made or was made without jurisdiction. Whilst the order stands, and is not set aside, it must be observed and obeyed and any breach or contravention of such an order can give rise to a charge of contempt for failing to comply with it or observe it.”

121    I reject these general defences.

CONCLUSIONS

122    Charges 3 and 6 (insofar as it relates to the provision of services to Mr Volchek and the advertising of dealerships) have been established against All Rounder beyond reasonable doubt.

123    Charges 9 and 10 (insofar as they relate to the provision of services to Mr Volchek), and 11 (insofar as it relates to the provision of services to Ms Volchek after 17 September 2010 and the advertising of dealerships on the www.kartina.tv website) have been proven against Ms Lurie beyond reasonable doubt.

124    No charges have been made good against Mr Vladimir Grinberg.

125    Charges 2, 5, 6 (insofar as it relates to the promotion of Russian language services on the www.russian.com.au website) and 7 (insofar as it relates to provision of services to Mr Yuhanov) have not been proven against All Rounder beyond reasonable doubt.

126    Charges 9 (insofar as it relates to provision of services to Ms Yuhanov) and 11 (insofar as it relates to the promotion of Russian language services on the www.russian.com.au website) have not been proven against Ms Lurie beyond reasonable doubt.

127    I will give directions as to the steps which need to be taken in advance of hearing on penalty.

Associate:

Dated:    19 February 2012