Queen tribute case highlights use of company law remedies in IP disputes
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The decision of the New South Wales Supreme Court in Showtime Management Australia Pty Ltd v Showtime Presents Pty Ltd ( NSWSC 594, June 13 2008) has highlighted the use of Corporations Act remedies in an IP dispute.
The case involved a failed joint venture between John Van Grinsven and Peter Anderson. The joint venture was formed to conduct and promote two Queen tribute concerts, marketed under the name "Queen - It’s a Kinda Magic" and "Champions of the World", in Australia and overseas.
After previously entering into limited joint venture arrangements, in April 2005 Van Grinsven, Anderson and their companies (Showtime Management Australia Pty Ltd and RockCity Event Marketing Pty Ltd) agreed to establish a corporate and trust structure under the name Showtime Presents Pty Ltd for the future staging of the concerts. The joint venture was terminated in late 2007, but the parties disputed the distribution of its property.
Van Grinsven and Showtime Management sought orders for the winding up of Showtime Presents, while Anderson and RockCity brought a cross-claim seeking relief on various grounds including:
- claims of ownership of intellectual property (trademark and copyright) in respect of the shows "Queen - It’s a Kinda Magic" and "Champions of the World";
- oppression under the Corporations Act;
- breach of fiduciary duties of joint venturers and company directors (common law and statutory); and
- accessory liability for breach of fiduciary duty.
Prior to the termination of the joint venture, Showtime Presents had made plans for a South African tour, scheduled for May and June 2008. Van Grinsven decided to go his own way and the concerts went ahead under the auspices of a new South African company associated with Van Grinsven, rather than Showtime Presents.
Anderson and RockCity sought interlocutory relief that would:
- bring the profits of the South African concerts into Australia, to be held securely pending the outcome of the wider proceedings; and
- establish some monitoring mechanisms regarding performances and profits.
The New South Wales Supreme Court identified three claims that would entitle the cross-claimants or Showtime Presents to access profits made by Van Grinsven and his company through performances of "Queen - It’s a Kinda Magic" or "Champions of the World" - namely, that:
- Showtime Presents had IP rights in respect of the shows;
- by causing or procuring the staging of "Queen - It’s a Kinda Magic" or "Champions of the World" for his own benefit or for the benefit of Showtime Management or some other entity, Van Grinsven diverted from Showtime Presents (as trustee) a corporate opportunity that belonged to it; and
- by diverting from Showtime Presents the corporate opportunity that belonged to it as the joint venture vehicle, Van Grinsven and Showtime Management breached their fiduciary duties as joint venturers.
The court held that there was a serious question to be tried in relation to all three claims and that the balance of convenience favoured granting the interlocutory relief sought.
The order granted was very unusual in that it was not a Mareva injunction freezing Van Grinsven’s assets, but rather compelled the repatriation to Australia of funds held overseas. This order could be made as Van Grinsven was an Australian citizen and was subject to the court’s jurisdiction. The decision is an example of the courts fashioning orders to meet new circumstances.
Stephen Stern and Vanessa Purcell, Corrs, Melbourne
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