SIEMENS INDUSTRY SOFTWARE INC. v INZIGN PTE LTD

Facts

Siemens Industry Software Inc owns the copyright in its NX computer-aided design and manufacturing software, made up of hundreds of separately licensed modules. Inzign Pte Ltd, a Singapore manufacturer of medical disposables, held licences for three NX modules, each usable by one person at a time. Its machinist, Mr Paing Win, whose role expanded in 2020 to include programming, found an unused Lenovo laptop that the toolroom manager had left in a drawer without administrative controls. He installed an unauthorised full version of the NX software on it and used it on at least 15 occasions between December 2020 and April 2021. It was not disputed that he did these acts or that they infringed copyright.

Siemens traced the use through the software's automatic reporting function and raised it with Inzign in April 2021. Inzign uninstalled the software and declined an offer to buy a licence for one module at $79,587. In Suit No 746 of 2021, Siemens claimed Inzign was primarily and vicariously liable, sought $259,511 in damages based on its price book for seven modules it said were representative, $200,000 in additional damages, a declaration and an injunction.

Issues

1. Whether Inzign was primarily liable, by doing or authorising the infringing acts.
2. Whether vicarious liability applies to copyright infringement and, if so, whether Inzign was vicariously liable.
3. What damages were appropriate for the infringement.
4. Whether additional damages, a declaration or an injunction should be granted.

Holding

The High Court allowed the claim in part. It found Inzign vicariously but not primarily liable, assessed damages at $30,574, and granted a permanent injunction restraining further infringement of the NX software copyright. It refused additional damages and declined to grant a declaration. Interest and costs were to be heard separately.

Reasoning

Mr Win's acts could not be attributed to Inzign: he was not acting as its agent, and he had signed acknowledgments of an anti-piracy policy. Applying the factors in RecordTV Pte Ltd v MediaCorp TV Singapore Pte Ltd [2011] 1 SLR 830, Inzign did not authorise the infringement. Although its supervision and handling of the laptop fell short of reasonable steps, it had no practical control over what he did on the laptop and no knowledge of the infringement.

The court held that vicarious liability extends to copyright infringement, a statutory tort. Under the test in Ng Huat Seng v Munib Mohammad Madni [2017] 2 SLR 1074, the employment relationship was a special relationship, and Inzign created or enhanced the risk through lax supervision and its manager's failure to follow procedure on the laptop. Mr Win acted to improve his work skills, which would benefit Inzign. Compensation and deterrence supported liability, and Siemens' four-month investigation period and choice of whom to sue did not weigh against it.

On damages, the court used the hypothetical bargain approach. It found Mr Win had used only two modules, the CAD/CAM 3 Axis Milling Foundation and the Wire EDM Add-on, not seven. The fee was assessed for perpetual node-locked licences without maintenance, by applying a 25 per cent reduction to Siemens' price-book figures for floating licences. Quotations from a distributor obtained through a sub-contractor were excluded as unreliable.

Additional damages were refused because the infringement was not flagrant: Inzign stopped the use at once, had an anti-piracy policy and gained little. An injunction was granted because its management of staff and IT assets might not prevent future infringement.

From the judgment