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A2B Telecommunications Pty Ltd v Hinkley

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Supreme Court of Victoria


A2B Telecommunications Pty Ltd v Hinkley & Anor [1999] VSC 76 (24 March 1999)

Last Updated: 15 April 1999 

	Do not Send for Reporting 

Not Restricted 
No. 7673 of 1998 
ACN 057 359 958 


	Warren J 


	24 February 1999 

	24 March 1999 

	A2B Telecommunications Pty Ltd v. Hinkley & Anor 

	[1999] VSC 76 
Rule 32.05 - Specific discovery - Breach of copyright 

For the Plaintiff 
	Mr M. Colbran, QC with 
Mr J. Carney 
	White S.W. 
Computer Law 

For the Defendant 
	Mr A.K. Panna 

For the Second Defendant 
	Mr W. Alstergren 

1.	In this matter the plaintiff seeks an order pursuant to Rule 32.05 that the defendants make discovery of specific documents. The documents sought and the surrounding circumstances have some relevance to the matters considered by me in proceeding No.Ê7673 of 1998 between Hotline Communications Ltd & Ors and Adam Hinkley & Ors, ("the other proceeding"). The relevant facts of the other proceeding are described in my judgment delivered in that proceeding on 24 March 1999. 

2.	In the other proceeding Hotline Communications Ltd and others allege that Adam Hinkley developed intellectual property for computers called the Hotline Library and the AW Library exclusively for Hotline Communications. It is alleged Hotline Communications owned all of the related intellectual property including the copyright in the libraries. It is alleged that MrÊHinkley worked with Hotline Communications and those associated with it from about mid 1997 until March 1998 when he absconded without warning taking a key element of the Hotline and AW libraries known as the source code with him. As a result, the other proceedings were commenced on 10 September 1998 in this court and orders were obtained requiring Adam Hinkley, his father Paul Hinkley and his father's company Meta Pty Ltd ("Meta") to produce the source code for the Hotline and AW libraries and other related material. After execution of those orders Hotline Communications and its co-plaintiffs ascertained that Adam Hinkley had the relevant source code within his possession and obtained it from him. They subsequently inspected documents and computer material and ascertained that Adam Hinkley was developing or had developed a library called Paradox. Hotline Communications and its co-plaintiffs, as a result of the inspection, also formed the opinion that the Paradox library was substantially similar to the Hotline and AW libraries and alleged that Adam Hinkley had, among other matters breached the exclusive copyright held by Hotline Communications in those libraries. Adam Hinkley denies the substantial allegations made against him in the other proceeding.

3.	In the present proceeding the plaintiff alleges that the first defendant, Adam Hinkley became an employee of the plaintiff ("A2B") on 3 November 1995 specifically to develop a Macintosh version of a "Windows" computer product called MobileNet Mail. A2B allege that the first defendant, MrÊHinkley developed a software tool called "ImagEdit". It is said that the tool relied on a class library which is a set of computer programmes pre-built in order to be incorporated into a larger computer application programme. The plaintiff asserts that it is rare for a commercial computer programme to be built from "scratch". It is said that a class library exists in the form of a source code which can be modified and an object code which is virtually impossible to modify. Further, A2B asserts that a source code is by far the more valuable item because of its capacity for modification and enhancement of software.

4.	On affidavit, Mr Hamilton on behalf of the plaintiff deposed that MrÊHinkley took a period of about five weeks to produce the first version of the "MobileNet Mail for Macintosh" product. After another period of about four months MrÊHinkley provided the plaintiff with a new version of the "MobileNet Mail for Macintosh" product. A large part of this period was taken up by MrÊHinkley developing an alternative set of tools and a new class library that subsequently was called the AppWarrior library.

5.	Mr Hamilton for the plaintiff has deposed that in October 1996 MrÊHinkley used the AppWarrior library to produce an Optus system that was later abandoned. In January 1997 MrÊHinkley used the AppWarrior library to produce another product for Optus and which was delivered to Optus in about February 1997. Between May and June 1997 MrÊHinkley used various techniques and methods previously implemented in the AppWarrior library to produce a class library suitable for use with Microsoft Windows based computers as opposed to Apple Macintosh computers.

6.	The plaintiff asserts that MrÊHinkley continued to be employed by A2B performing various tasks in relation to software and related development until early September 1997 when he went on leave for three weeks. On 23 September 1997 whilst on leave the plaintiff received an e-mail from MrÊHinkley giving notice of his resignation.

7.	As a result of the departure of MrÊHinkley from its employment, A2B employed another person to take his place. When the new employee set about the task of locating various software he was unable to do so as part of the source code was missing. Despite extensive searches of the plaintiff's computers copies of the missing source code could not be found.

8.	The plaintiff subsequently ascertained that during 1996 and 1997 MrÊHinkley was marketing software known as "Hotline" over the Internet. The plaintiff believes that the icons for the Hotline product were running on the Macintosh computer being used by MrÊHinkley during the period of his employment with the plaintiff. The plaintiff believes that the Hotline product was being developed and tested within the plaintiff's office and, further, was developed using the AppWarrior library. As a result of examination of the Hotline product on the Internet the plaintiff believes that the Hotline product appears very similar to the products that MrÊHinkley developed for the plaintiff during his period of employment with it.

9.	Mr Hamilton for the plaintiff has deposed that on 24 October 1997 he spoke to MrÊHinkley by telephone and informed him that he could not find the source code and was having difficulties as a result. Mr Hamilton requested MrÊHinkley to e-mail the entire source code library files, he agreed but failed to do so. Thereafter MrÊHamilton on behalf of the plaintiff made a number of efforts to contact both MrÊHinkley and the Hotline telephone number taken from the Internet. MrÊHamilton spoke to a number of persons including MrÊT. Gregory and MrÊJ. Roks (who are plaintiffs together with Hotline Communications Ltd in proceeding No. 7673 of 1998). MrÊHamilton had no success until he was able to speak to MrÊHinkley on 2 November 1998. In the conversation, MrÊHamilton alleges that MrÊHinkley stated that he believed he was the owner of the source code. MrÊHinkley allegedly told MrÊHamilton that he had signed a contract with a company called "Meta" and that he could not reveal the source code as he would be sued. It transpires that Meta is a company associated with MrÊPaul Hinkley, the father of Adam Hinkley. MrÊPaul Hinkley and Meta are defendants in the other proceeding. After a number of efforts by MrÊHamilton, MrÊHinkley blatantly refused to release the source code. He is alleged to have told MrÊHamilton that he, MrÊHinkley, had destroyed all copies of the source code other than the one he had in his possession. MrÊAdam Hinkley is alleged to have told MrÊHamilton that the source code was protected by encryption that no-one could break.

10.	MrÊHamilton has deposed on behalf of the plaintiff that he has read some of the affidavits filed in the other proceeding but has been unable to gain access to the exhibits to the relevant affidavits. However, as a result of reading the affidavits and the reference to a product called AW Class Libraries, the plaintiff believes that the AppWarrior libraries developed by MrÊHinkley for the plaintiff could include those libraries that are the subject of the other proceeding. Mr White has sworn an affidavit on behalf of the plaintiff to which is exhibited a proposed statement of claim. The statement of claim alleges that as a result of the conduct of Adam Hinkley he has wrongfully communicated confidential information to the Hotline Communications, acted in breach of trust and breach of copyright. A2B seeks in the proposed statement of claim declaratory and injunctive relief, the taking of accounts and other orders.

11.	In essence, the application of A2B in this matter is that without the opportunity to consider the documents for which specific discovery is sought it does not know whether the AW library product in the possession of the plaintiffs and the Paradox product developed by Adam Hinkley are in the other proceeding the same or substantially the same as the product developed by MrÊHinkley during his period of employment with A2B. Logically, if the AW library product in the possession of the plaintiffs (as a result of orders made by Beach, J on 10ÊSeptember 1998) is not the same or substantially similar to the AppWarrior libraries A2B will not have a cause of action against Adam Hinkley or any of the other defendants in the proposed statement of claim.

12.	The application is opposed by the defendants. They assert that the documents and information sought by A2B are confidential and, in any event, A2B has sufficient knowledge as matters stand to determine whether to issue proceedings in accordance with the proposed statement of claim. I am satisfied that the evidence as set out in the affidavits of Michael John Hamilton sworn 3ÊNovember and 16 February 1999 reveals that there is a reasonable cause to believe that A2B may have a right to relief against a number of persons including Adam Hinkley, Paul Hinkley and the defendants to the present proceeding. I am satisfied that without access to the source code and other documents it is not possible for the plaintiff to be satisfied that the class libraries presently used by Hotline Communications Limited and by Adam Hinkley are the same as or substantially based upon those libraries written by Adam Hinkley during his period of employment with A2B. The fact remains that notwithstanding what could best be described as a highly, even reasonably, held suspicion because of matters alleged in the other proceeding, A2B cannot in fact know of any actual similarity between the Hotline and AW libraries and AppWarrior and/or the Paradox library until it has the benefit of inspection of the documents sought to be discovered.

13.	I am satisfied that the requirements of Rule 32.05 have been made out by the plaintiff and accordingly I will order that the defendants discover to the plaintiff each of the documents described in paragraphs 2(a)-(e) of the originating motion dated 4ÊNovember 1998. However, as there may be commercial sensitivity and confidentiality aspects attached to the documents to be discovered I will hear the parties as to the form of orders to be made including any appropriate order or undertaking to the court with respect to confidentiality.