SM Summit Holdings Ltd and Another v Public Prosecutor and another action

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeYong Pung How CJ
Judgment Date13 October 1997
Neutral Citation[1997] SGHC 255
Citation[1997] SGHC 255
Subject MatterInfringement,Whether High Court judge had power to sit or issue orders as magistrate,Whether documents included under search warrants,Search warrants,Objective test of sufficiency of information,s 58 Criminal Procedure Code (Cap 68),Issue of search warrants,Warrant issued by High Court judge sitting as magistrate,s 62 Criminal Procedure Cod (Cap 68),High court,Whether trade marks existed in masters, stampers and CDROMs,Application before magistrate,Disclosure of documents,Whether search warrant validly issued,Trade marks registered for computer programmes,Replication of masters containing allegedly infringing programs,Whether registered proprietor consented to infringement,Copyright,Criminal Procedure and Sentencing,Civil Procedure,Whether sufficient information in statutory declarations to justify magistrate's issuing of search warrants,s 58 Criminal motion made under Criminal Procedure Code (Cap 68),Whether evidence seized pursuant to warrant to be returned to owners,Ex parte application,Courts and Jurisdiction,Whether petitioners entitled to production of documents,s 2 Trade Marks Act (Cap 332, 1992 Ed),Computer software,Trade Marks and Trade Names,Whether any duty of full and frank disclosure imposed on applicant by statute,Replication of masters containing allegedly infringing programmes,Whether goods legitimately seized under valid warrants pursuant to Copyright Act and Criminal Procedure Code,No enumeration of specific documents required,Whether magistrate entitled to take into account matters not admissible at trial,s 62 Criminal Procedure Code (Cap 68),s 136(9) Copyright Act (Cap 63, 1988 Ed),List of goods seized to be made,Whether copyright owner consented to infringement by private investigator,Whether warrant to be quashed
Plaintiff CounselDavinder Singh SC, Dedar Singh (Drew & Napier) and Manjit Singh (Manjit Samuel & Partners)
Defendant CounselVK Rajah SC, Kenneth Tan SC, Lionel Tan (Rajah & Tann) and Alban Kang (Alban Tay Mahtani & de Silva)
Date13 October 1997
Published date19 September 2003
Docket NumberCriminal Revision No 15 of 1997
Judgment:

1.YONG PUNG HOW CJ

There were two related actions heard together. The first was a criminal revision brought by the petitioners. The petitioners were SM Summit Holdings Ltd and Summit CD Manufacture Pte Ltd. SM Summit Holdings (Summit Holdings) is a holding company listed on the SESDAQ. Summit CD Manufacture (Summit CD) is a wholly owned subsidiary of Summit Holdings. Summit CD carries on the business of manufacturing and replicating Compact Discs (CDs). The CDs include audio CDs, video CDs and CD-ROMs. The second action was a criminal motion where the counsel for Business Software Alliance (BSA) made an application to the High Court for an order that BSA be allowed to make copies of documents seized pursuant to a search warrant granted on 12 August 1997, and for the delivery by Summit Holdings and Summit CD ofcopies of various documents enumerated in the notice of the motion. I shall first address the criminal revision.

2. Criminal Revision No 15 of 1997

The complainants were representatives from Business Software Alliance. Very little information has been made available about BSA other than that it is a company incorporated in the United States of America, and is set up as a watchdog to combat software piracy. Its members comprise the leading software companies, including Microsoft Inc, Adobe Systems Inc and Autodesk Inc. BSA is not registered with the Registry of Companies in Singapore; only its representative office in Singapore is registered with the Trade Development Board. On 8 August 1997, a representative from BSA made a complaint against Summit Holdings and Summit CD of alleged copyright and trade mark infringements before the magistrate Shireen Tan, and applied for two search warrants in respect of the premises of Summit Holdings and Summit CD. Both Summit Holdings and Summit CD have their premises at 45 Ubi Road 1, Singapore. The magistrate granted two search warrants: (1) search warrant no 132/97 pursuant to s 62 Criminal Procedure Code (Cap 68) (CPC) (the trade marks warrant) and (2) search warrant no 236A/97 pursuant to s 136(9) Copyright Act (Cap 63, 1988 Ed) (the copyright warrant).

3.On 12 August 1997, at about 2pm, a raid was conducted at the premises by representatives of BSA, police officers, and solicitors from the law firm of Alban Tay Mahtani and de Silva, numbering about 35. There was no resistance. The staff of Summit Holdings and Summit CD let them in. On the same day at about 11pm, while the raid was still going on, the representatives of BSA and their solicitors decided to apply for a search warrant to search and seize the documents discovered. They appeared before GP Selvam J at his residence and the learned judge granted the search warrant pursuant to s 61 CPC (the third warrant). The raid continued all the way until about 5.10 am on the following morning.

4.The raid yielded only five CD-ROMs alleged to contain copyright infringing programmes, a stamper and two glass masters alleged to be used for the purposes of replicating CD-ROMs. In addition, a large quantity of documents was seized. They included internal memoranda of the staff, minutes and notes of meetings, invoices, sales orders and a log-book. A list recording some of the petitioners` customers which was allegedly downloaded from the computer system of the petitioners and was seized.

5.On 29 August 1997, the Attorney General`s Chambers granted a fiat to counsel for the respondents, Mr VK Rajah SC and Mr Kenneth Tan SC, to defend the proceedings brought in the criminal revision.

6.The petitioners applied to the High Court to quash the three search warrants. After hearing counsel for both sides, I quashed the third warrant and dismissed the application in relation to the first and second warrants. I now set out my grounds.

7.I would make a preliminary point on the manner in which the searches were carried out. All the search warrants executed in this case gave rise to some considerable concern and I would to draw this matter to the attention of theappropriate authorities. The manner in which the search warrants were executed is not relevant to the present proceedings which concern the validity of the search warrants. However, during the course of the hearing, extensive complaints were made as to the manner in which they were executed, and this is something which ought to be addressed. This is an unsatisfactory case and the origin of the case arose from a situation which is regrettably not uncommon. In many such cases, similar complaints are made as to the manner in which the search warrants are executed. It would lead to an intolerable situation if further checks are not put in place in both the issue and execution of search warrants. This case also illustrates the drawbacks of the existing practice of relying on the criminal process as a means to enforce intellectual property rights. If the copyright and trade mark owners had proceeded on their civil remedies only, and applied for an Anton Piller order as a means to obtain incriminating evidence, various safeguards would have been available not only in the Supreme Court Practice Directions, but also in existing case law.

8. The prosecution`s case

BSA became suspicious that the Summit group of companies was involved in software piracy and instructed HS Intellectual Property Services, a firm of private investigators, to conduct investigations into the activities of Summit Holdings and Summit CD. In addition, BSA also received information from two former employees of Summit CD that Summit CD was manufacturing counterfeit CD-ROMs which infringed the copyright and trademarks belonging to the BSA members. The two employees were Pan Wen Hui (Pan), an operator with Summit CD from July 1995 to September 1996, and Shi Jian Chuan (Shi), an operator with Summit CD from April 1996 to April 1997, who was replicating CD-ROMs and was later appointed as a Quality Control Auditor. Both employees were no longer with Summit CD at the time of their complaints.

9.The prosecution alleged that the modus operandi was as follows: Summit CD, under contracts with certain shady customers, notably those who had previous convictions for software piracy, would manufacture masters from the masters provided by the customers. A master is the original computer programme from which copies are made. The master is read by the machines and the computer programmes contained in them are ultimately impressed onto a metal disc known as a stamper. The stamper is like a mould which can be used to replicate CD-ROMs. A master can also be duplicated into another master. All the CD-ROMs manufactured pursuant to legitimate contracts would be impressed with three identification codes: the bar code, the International Federation of Phonographic Industries (IFPI) Code and the Summit code (the SM code) for the purpose of identification of the manufacturer. However, for customers engaged in the counterfeiting of CD-ROMs, on their request, Summit CD would manufacture masters which were specially constructed, such that the CD-ROMs which were replicated from the masters would not bear the SM code. Neither would the infringing copies contain the other codes. This would then make it very difficult to trace the origins of the counterfeit CDs to the petitioners. The period of counterfeiting was alleged to go as far as back as 1995.

10.On the part of BSA, to verify its suspicions, a private investigator from HSIntellectual Property Services called Jimmy Chew Chong Poh met Tan Siang Yong, the assistant general manager of Summit Holdings on 16 April 1997, and asked him to manufacture a master for each of eight various masters of CD-ROMs which Jimmy Chew handed over. Unknown to Tan Siang Yong, four of the CD-ROMs contained programmes which infringed the copyright and trademark of Microsoft, Autodesk and Adobe. The price of the masters to be produced was agreed at $500 per master. On 19 April 1997, the private investigator met Tan Siang Yong to collect the masters at the premises of Summit Holdings and paid $4,000 for all the masters.

11.Pan and Shi in turn handed over to BSA a computer diskette which contained a list of Summit`s customers. They claimed that, in the case of Summit`s legitimate customers, the list showed that their orders would be accompanied by the relevant Summit code, which would be impressed on the CD-ROM when manufactured. However, in the case of the other customers who were known retailers of counterfeit software, their orders would not be accompanied by any Summit code. For this category of customers, their manufactured masters were classified as `C` category.

12.On 8 August 1997, Lee Cross, managing director for the Asia-Pacific of BSA, on behalf of BSA, filed a complaint before a magistrate, alleging that the senior management of Summit CD and Summit Holdings engaged in the large scale manufacture of counterfeit CD-ROMs and hence contravened s 136 Copyright Act and s 62 Trade Marks Act. Supporting the complaint were the statutory declarations of Jimmy Chew, Pan and Shi. The contents of the complaints and the statutory declarations were important and I shall set them out.

13.The statutory declaration of Jimmy Chew set out the details of the transaction between himself and Tan Siang Yong. He deposed that he met Tan Siang Yong at the premises of Summit Holdings on 16 April 1997 and he entered into a contract with Tan Siang Yong for Summit CD to replicate eight different counterfeit masters of CD-ROMs. He did not tell Tan Siang Yong that they were counterfeit masters. The price was agreed at $4,000 for all the eight masters. The masters had serial numbers 0123 to 0127, and 1123 to 1125 and the same serial numbers were to be imprinted on the replicated CDs. Three days later, Tan Siang Yong handed to Jimmy Chew the eight masters which had been manufactured, and also returned the eight masters he had been given. The agreed price was paid by Jimmy Chew. These CDs were handed over to a...

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