After
eleven years litigation, Waikato inventors of the world’s first asparagus
grading machine got damages of $4.1 million against a Hawkes Bay company which breached
copyright constructing a similar grading machine for rivals who ripped off the
original inventor.
Tirau-based Schwarz family struggled in
the 1980s with the world-wide problem of grading their asparagus crop. Harvested asparagus is difficult to
handle. It does not roll like fruit. It does not behave uniformly when carried in water. It cannot be dumped out of bins or shovelled. Michael Schwarz developed his Oraka Grader
which was able to automatically grade delicate asparagus through use of a tip
cup assembly.
It was so successful that others ripped
off the idea. Paul Daynes, who had
provided software services to the Schwarz, together with Gordon Robertson, who
had been their sales agent in Greece, stole the idea asking Napier Tool and Die
Ltd to make a duplicate machine. The
Court of Appeal ruled this was in breach of copyright. The High Court assessed damages.
When it came to recovering damages,
Daynes and Robertson were penniless, the High Court was told. This left Napier Tool and Die as the last man
standing. Napier Tool said the Court of
Appeal had awarded judgment in favour of the copyright holder: a Schwarz family
company called Oraka Technologies Ltd. But
Oraka did not suffer any losses directly.
Business operations damaged by the breach of copyright were run through
a different company. At best, Oraka
could get nominal damages only, it said.
The Copyright Act allows copyright to be
enforced only by the copyright holder or anyone holding an exclusive written
licence from the holder. The Schwarz’
production company neither held copyright nor a licence to use the copyrighted
machinery.
Justice Hinton ruled Oraka Technologies
by its conduct informally granted an exclusive copyright licence to the
separate production company. A rival operation
using machinery in breach of copyright prevented Oraka Technologies indirectly,
and the Schwarz family production company directly, from earning income.
The court ordered payment of $4.1 million
damages to Oraka Technologies, assessed on lost business income together with
lost salary suffered by Mr Schwarz.
Oraka
Technologies v. Geostel – High Court (2.06.15)
16.091