Technology, media and telecommunications law update – May 2016
Key developments during May 2016 in the areas of Technology, Media and Telecommunications (TMT) are summarised as follows.
Penalty for misleading conduct by digital advertising service
The Federal Court of Australia has found that a digital advertising company engaged in unconscionable conduct, within the meaning of section 21 of the Australian Consumer Law, by failing to bring certain terms of the contract to customers’ attention, and by entering into contracts with and accepting payments from customers when it knew that it would be unable to deliver on its promises: Australian Competition and Consumer Commission v Multimedia International Services Pty Ltd  FCA 439. The conduct specifically related to representations by a sales representative that advertising screens would be installed on the premises of host businesses, and failing to draw a customer’s attention to terms in the contract precluding cancellation or any other recourse in the event of a delay by the advertising company in providing its services. The court found the respondent liable not only under section 21 but also under section 29(1)(g) (false or misleading representation about goods or services) and section 36(3) (wrongfully accepting payment). The court imposed a penalty of $230,000 and subsequently, on 9 May 2016, refused an application by the respondent for an extension of time for payment, observing in the process that “an order for payment of a pecuniary penalty by instalments can ameliorate the effect of the penalty”: Australian Competition and Consumer Commission v Multimedia International Services Pty Ltd (No. 2)  FCA 490.
Disclosure of case notes not a privacy breach
On 11 May 2016, the Victorian Civil & Administrative Tribunal held that the inadvertent disclosure by a Department of Health and Human Services employee of the complainant’s case notes to a third party did not constitute a breach of Information Privacy Principle (IPP) 2 (use and disclosure of personal information) or IPP 4 (data security). In relation to IPP 2, the Tribunal took account of Section 118 of the Privacy and Data Protection Act 2014 (Vic) which provides that an act of an employee will not be attributed to an organisation if the organisation took reasonable precautions and exercised due diligence to avoid the act or practice occurring. In this regard, the Tribunal was satisfied that the Department had reasonable measures in place to minimise the likelihood of inadvertent disclosures by employees. In relation to IPP 4, which requires an organisation to take “reasonable steps” to avoid misuse or unauthorised disclosures, the Tribunal was satisfied that the Department had reasonable mechanisms in place to maintain the confidentiality of material and that it was simply not possible to “have prevented the picking up of documents from the printer in error, which is what had occurred in this instance”.
Subpoena of BigPond records does not invade privacy
On 12 May 2016, the Supreme Court of New South Wales upheld the validity of a subpoena by the plaintiff in an action for injurious falsehood to recover BigPond account details from Telstra as a means of establishing a link between the defendant and a blog which contained the offending statements: DHR International Inc v Challis (No 4)  NSWSC 610. The court accepted the plaintiff’s contention that it had a legitimate forensic purpose in knowing whether “anonymous” comments posted on the blog were written and published by the defendant. The court acknowledged that there was a risk that the privacy of persons unconnected with the litigation could be invaded but Justice Adamson further observed that “litigation almost necessarily causes invasions of privacy” and that the interests of third parties should be “sufficiently protected by the constraints that operate on the use of material produced pursuant to the court’s compulsory processes”.
Dismissal of valuer not a repudiation
This case is of relevance to the TMT industry in which it is common for independent experts to be appointed as valuers of technology businesses or of newly developed intellectual property. On 18 May 2016, the Victorian Court of Appeal ruled that the unilateral dismissal by one party of an independent valuer of that party’s interest in a business did not constitute a repudiation by that party of the overall valuation contract: Alphater Consulting Engineers Pty Ltd v Miles Rozman and ors  VSCA 111. The court was of the opinion that whilst the Applicant had no basis for terminating the valuer’s retainer, and that this therefore constituted a breach of the agreement, it did not amount to a repudiation because the Applicant had not evinced an intention to no longer perform the agreement. Rather, the court considered the applicant had misjudged its right to remove the valuer in all the circumstances.
No copyright in ITVR signal
On 26 May 2016, the Full Court of the Federal Court dismissed an appeal by the Commissioner of Taxation against a finding by the trial judge that copyright does not subsist in an international television and radio (ITVR) signal: Commissioner of Taxation v Seven Network Limited  FCAFC 70. The issue, which arose in the context of a dispute arising pursuant to the Australia-Switzerland double taxation agreement, related to a payment made by Seven to the International Olympic Committee, based in Switzerland, for the use of the ITVR signal in its live Australian television broadcasts of the 2004 and 2008 Olympic Games. The trial judge had concluded that Seven had no obligation to withhold tax on the relevant payment because withholding tax was only applicable to “royalties”, defined as meaning, amongst other things, payments in consideration for the use of any “copyright”. The Full Court agreed that copyright only came into existence in Seven’s broadcast, which was made with the benefit of the ITVR signal, and that there was no copyright in the signal itself, there being no embodiment or storage of visual images in the ITVR signal.
Spam penalty for e-marketer
On 31 May 2016, the Australian Communications and Media Authority issued a $21,600.00 infringement notice for breaches of the Spam Act 2003 against J & L Mainwaring Pty Ltd. ACMA found that the company had sent marketing emails on behalf of other businesses but was unable to show that the recipients consented to receive the messages. The company had also failed to include the name and contact details of the business that authorised the sending of the message.
Google issued patent for a system to protect pedestrians involved in collisions with vehicles
The United States Patent Office issued a patent to Google on 17 May 2016 for a system which protects pedestrians involved in collisions with vehicles. The system reduces injuries caused by “secondary impacts” (where a pedestrian involved in a collision with a vehicle is thrown from the vehicle following the initial impact onto the road surface or into contact with another object). An adhesive layer, positioned on the hood, front bumper and/or front side panels of the vehicle, is covered by a protective coating. Upon impact, the protective coating breaks, exposing the adhesive layer, which then attaches the pedestrian to the vehicle, preventing the pedestrian being thrown from the vehicle and experiencing a secondary impact.
Regulatory options for automated vehicles
DETAILS: On 10 May 2016, the National Transport Commission released a discussion paper on regulatory options for automated vehicles.
OUTCOME: In February 2016, the NTC released an issues paper in response to a request by the Transport and Infrastructure Council in November 2015 for the NTC to identify regulatory barriers to the safe introduction of automated vehicles (sometimes referred to as “driverless cars”) in Australia. The issues paper (which we reported on here) foreshadowed the release of a discussion paper later in the year. The discussion paper which has now been released identifies barriers which need to be addressed as soon as possible in order to ensure clarity around the status of automated vehicles on Australia’s roads and to support further trials. The discussion paper confronts issues such as the importance of nationally consistent rules, the implementation of on-road trials, allocation of responsibility and liability in relation to the “control” of automated vehicles and the availability of compulsory third party insurance and state-based accident compensation schemes for people injured in a collision with an automated vehicle.
Study into the potential of blockchain technology
DETAILS: On 4 May 2016, the CSIRO’s Data61 announced that it will be studying into the potential applications and benefits of blockchain technology.
OUTCOME/RECOMMENDATIONS: The study will be conducted over the course of the next nine months in collaboration with government agencies, including the Treasury, and will examine the potential applications and benefits of blockchain technology for both government and industry. Blockchain technology could have wide application across many sectors. Data61 has foreshadowed that a “proof of concept” trial will be developed to demonstrate the impact of the technology. We look forward to reading about the results of this study in or around early 2017.
Inquiry into agricultural innovation
DETAILS: On 4 May 2016, the House of Representatives Agricultural and Industry Committee released its report concerning an inquiry into agricultural innovation.
OUTCOME/RECOMMENDATIONS: The inquiry had regard to a wide range of emerging technologies in the areas of biological sciences, materials science, seasonal forecasting and digital sciences, of relevance to the agricultural industry. The inquiry investigated the barriers to the adoption of emerging technologies in those areas and how they can be addressed. A key area of relevance to agriculture relates to advances in information and communications technology which are expected to underlie and drive developments in automation and infrastructure for storing, accessing, using and marketing a wide range of data. The report made 17 recommendations in total. These included recommendations relating to establishing a national working group on agricultural innovation, raising awareness of innovative applications of telecommunications services across the industry, targeted funding of agricultural education strategies within the current STEM funding program, the use of satellite services as backhaul for local wireless networks, measures to improve mobile services in regional and remote areas (including continuing the Mobile Black Spot Programme beyond the upcoming second round of that program and providing incentives for the provision of roaming services), providing support for the development of national data sets, pursuing reform options to ensure national consistency in gene technology regulation and developing appropriate extension materials promoting the appropriate use of unmanned aerial vehicles.
Privacy in the ACT
DETAILS: On 5 May 2016, the ACT Minister for Justice and Consumer Affairs announced a review of the use and conduct of civil surveillance in the ACT
OUTCOME/RECOMMENDATIONS: The proposed review in the ACT will consider issues such as surveillance in civil litigation claims, surveillance technology, the expansion of the Listening Devices Act 1992 to capture video surveillance and electronic monitoring, the possible need for a tort of breach of privacy and a review of the Information Privacy Act 2014. The commencement of recent amendments to the Workplace Privacy Act 2011 will be deferred pending the outcome of the review.
Western Australia’s Inaugural ICT Strategy
DETAILS: On 25 May 2016, the Western Australian Government released the State’s first whole-of-Government ICT Strategy.
OUTCOME/RECOMMENDATIONS: The Western Australian Government has released a whole-of-government digital strategy with the objective of providing the public with easier access to Government information. Perceived benefits under the scheme, once fully implemented, will include more effective use of technology by government agencies in delivering services through common platforms, and the ability of members of the public to transact securely online with government through a single digital portal using any device – computer, mobile phone or tablet. Privacy will be maintained by permitting individuals to opt out and to maintain a significant degree of control over how much of their personal information can be shared between different government agencies.
ICT Tenders in Queensland
DETAILS: On 26 May 2016, the Queensland Government unveiled a new ICT dashboard to facilitate tendering by small businesses for government work.
OUTCOME/RECOMMENDATIONS: The object of the new initiative is to make it easier for small businesses to find, plan and tender for government ICT business through a revamped ICT dashboard website. The revamped dashboard shows a list of tenders at various points in the tender lifecycle. Powered from the Queensland Government QTenders website, the dashboard will enable ICT suppliers to find out about current and upcoming government work including invitations to offer, requests for interest and expressions of interest.
Draft guidelines on lawful disruption of on-line access
DETAILS: On 27 May 2016, the submission deadline expired in relation to public comment on draft guidelines for government agencies seeking to disrupt access to on-line services.
OUTCOME/RECOMMENDATIONS: In June 2015, the House of Representatives Standing Committee on Infrastructure and Communications recommended that the Australian government adopt whole-of-government guidelines for the use of section 313 of the Telecommunications Act 1997 by government agencies to disrupt access to on-line services. Draft guidelines were subsequently issued by the Department of Communications and the Arts in April 2016, inviting submissions from the public. The guidelines are designed to promote the “transparent, accountable and responsible use of the section while recognising that agencies have different operational needs”. Under the draft guidelines, good practice would dictate that disruptions should be limited to the investigation of serious criminal or civil offences, or threats to national security.
New South Wales eHealth Strategy
On 4 May 2016, the New South Wales Government launched a 10 year eHealth Strategy to deliver “smart, safe, sustainable and digitally-enabled care to patients”. Under the e-Health Strategy for NSW Health 2016 to 2026, initiatives include the integration of patient records into a single electronic record (EMRs), the continued rollout of the electronic medication management system (eMeds), improved communications between hospitals and private health care providers (Health eNet), the use of mobile devices to help remote families (Telehealth) and the rationalisation of diverse health information into a more useable format (Clinical Analytics).