High Court Settles the Score: Real Estate Tool Box v Campaigntrack and the Authorisation of Copyright Infringement

When does commissioning software that competes with an existing product make you liable for copyright infringement? The High Court of Australia's unanimous decision in Real Estate Tool Box Pty Ltd v Campaigntrack Pty Ltd [2023] HCA 38 is the definitive Australian answer. Delivered in December 2023 by Gageler CJ, Gordon, Edelman, Steward and Jagot JJ, this landmark ruling clarifies the law of authorisation of copyright infringement and resolves uncertainty that had built up through two earlier decisions in the same case.

The Campaigntrack Trilogy: A Roadmap

To understand the High Court's decision, it helps to understand where it sits in a three-year litigation journey:

• 2021 — [FCA 809]: The primary judge found that software developer Mr Semmens had directly infringed copyright in Campaigntrack's DreamDesk platform by copying its code into a competing product called Toolbox. The primary judge dismissed authorisation claims against the corporate respondents — Biggin & Scott Corporate, Real Estate Tool Box, and Dream Desk Pty Ltd — finding they had not sanctioned the copying.

• 2022 — [FCAFC 112]: The Full Federal Court reversed key parts of the primary decision, finding that the Biggin & Scott parties had authorised Mr Semmens's infringement by failing to take adequate steps once they should have known copying was occurring.

• 2023 — [HCA 38]: The High Court set aside the Full Court's orders and substantially restored the primary judge's outcome — while delivering an authoritative restatement of the authorisation test that will govern Australian law going forward.

The Law of Authorisation: The High Court's Restatement

Section 36(1) of the Copyright Act 1968 (Cth) provides that copyright is infringed by a person who, without the licence of the copyright owner, "authorises" another to do any act comprised in the copyright. The word "authorise" has been interpreted to mean to sanction, approve or countenance the infringing act.

Section 36(1A) sets out three specific factors that a court must take into account when assessing authorisation:

1. The extent (if any) of the person's power to prevent the doing of the act concerned;

2. The nature of any relationship existing between the person and the person who did the act concerned; and

3. Whether the person took any other reasonable steps to prevent or avoid the doing of the act.

The High Court confirmed these factors are not a mechanical checklist to be applied in isolation — they are considerations that inform the ultimate question of whether the alleged authoriser sanctioned, approved or countenanced the specific infringing acts.

The Critical Distinction: Knowledge Versus Sanction

The most important principle to emerge from the High Court's analysis is the distinction between knowing that infringement might occur and sanctioning or countenancing infringement.

The Full Federal Court had found that the Biggin & Scott parties had authorised infringement in part because they were aware of the risk of copying and failed to take sufficiently active steps to prevent it. The High Court rejected this reasoning. Mere knowledge of a risk, combined with failure to act as actively as possible, is insufficient to establish authorisation. The defendant must have done something — through positive act or deliberate inaction — that sanctioned, approved, or countenanced the specific infringing acts of the primary infringer.

The General Instruction: Its Legal Weight Restored

A pivotal fact was that Mr Stoner (for the Biggin & Scott parties) had instructed Mr Semmens to build a system that "does not breach other companies' copyright." The Full Court had treated this as inadequate — a general instruction that did not constitute reasonable steps. The High Court restored the significance of this instruction, treating it as a meaningful step that, in the circumstances, meant the parties had not sanctioned the infringement.

This does not mean a general "don't copy" instruction is a complete shield in every case. Context matters enormously. But the High Court has confirmed that a bona fide instruction not to infringe, given by a principal who genuinely believes it has been followed, can negate the sanction or countenancing required for authorisation liability.

What This Means in Practice

The Bar for Authorisation Has Been Clarified — Not Lowered

Some commentators read the High Court's decision as weakening copyright protection against businesses that commission infringing software. This is not quite right. The High Court has not made it harder to establish authorisation — it has clarified what authorisation actually requires. Where a principal actively drives or directs infringing development, turns a blind eye to obvious copying, or benefits from infringement they knew was occurring, the authorisation analysis will look very different.

Active Compliance Steps Still Matter

The High Court's decision does not licence complacency. Businesses commissioning software that competes with existing products should still:

• Give clear and specific instructions against copying third-party code;

• Include IP warranties and indemnities in their developer contracts;

• Conduct code reviews, particularly where development is rapid or the competing product is closely replicated;

• Maintain records of compliance steps taken throughout the development process;

• Investigate promptly if warning signs of copying emerge.

Direct Infringement Was Never in Doubt

Throughout all three stages of the litigation, the finding that Mr Semmens directly infringed Campaigntrack's copyright was never seriously challenged. Source code, database structures, and templates are copyright works — copying them to build a competing product is infringement. That principle is not altered by any of the appellate decisions.

Strategic Takeaways

• The High Court has set the authorisation standard. Real Estate Tool Box v Campaigntrack [2023] HCA 38 is now the leading authority on authorisation of copyright infringement in Australia. Any business involved in commissioning software development should understand this decision.

• A genuine instruction not to copy carries real legal weight. Document compliance instructions given to developers and ensure they are specific, not merely boilerplate.

• Authorisation still applies where principals drive infringement. The High Court's decision protects good-faith principals — it does not protect those who actively direct, encourage, or turn a blind eye to copying.

• Developer liability for direct infringement is clear. If you are a developer, copying a competitor's code into a new product is direct infringement. It does not matter who commissioned the work or what instructions you were given.

Conclusion

The High Court's 2023 decision in Real Estate Tool Box v Campaigntrack is a landmark in Australian intellectual property law. It brings clarity to one of copyright law's most contested areas — when does commissioning infringing work make you liable? — and provides a principled framework that distinguishes genuine good-faith compliance from deliberate or reckless authorisation of copying.

For technology businesses, software developers, and anyone commissioning digital products, this decision is required reading. Stellar IP Law can help you understand its implications for your business. Contact our team today.