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DMCA Abuse, Deleted Evidence and Damaged Credibility

In C21 Pty Ltd (Trustee) v Hou (No 6) [2025] FedCFamC2G 927, Judge Manousaridis handed down a strongly worded decision marking the latest chapter in a copyright enforcement saga — and it’s not one Mr Hou will be pleased with.

The case delivers a clear warning about the misuse of takedown procedures, destruction of evidence, and strategic dishonesty in IP disputes.

The Story So Far

C21, a real estate agency and video producer, had previously succeeded in proving that Mr Hou had infringed copyright in a range of marketing videos and photographs. The current decision dealt with the consequences: what additional orders should flow from the infringements — and how Mr Hou’s subsequent conduct should influence those outcomes.

DMCA Misuse

One of the key issues was Mr Hou’s deliberate use of DMCA takedown notices to get C21’s legitimately owned videos removed from YouTube. Despite prior court findings that C21 owned the copyright in those materials, Mr Hou sent notices claiming infringement — knowingly and falsely asserting he was the rights holder.

Judge Manousaridis held that these takedown notices were issued:

  • With no lawful basis;

  • In a continuing effort to damage C21’s business;

  • And in knowing contradiction to the findings in earlier proceedings.

Deleted Evidence

Equally concerning was Mr Hou’s deletion of thousands of emails, including emails that may have contained information relevant to the proceedings. The Court accepted that this was done:

  • After the proceedings had commenced;

  • With knowledge of the likely relevance of those materials;

  • And without any acceptable explanation for their destruction.

This led to adverse inferences being drawn about the deleted material.

Additional Damages and Costs

Given the flagrancy of the infringement and the subsequent conduct:

  • The Court awarded additional damages under s 115(4) of the Copyright Act;

  • Compensatory damages were set at $4,200;

  • Additional damages were calculated at $17,000, taking into account Mr Hou’s conduct and the need for deterrence;

  • Full costs were awarded to C21 on a standard basis.

Main Takeaways

The decision is a powerful reminder that:

  • Copyright enforcement tools like DMCA notices must not be weaponised — false claims are not just unethical, they’re legally risky;

  • Deleting relevant evidence mid-litigation can be just as damaging to your case as the infringement itself;

  • Courts take reputational harm and procedural abuse seriously, and will respond with enhanced penalties.

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Fair Use or Free Ride? The Case for an AI Blanket Licence

What if AI companies had to pay for the content they train on? Welcome to the next frontier in copyright law — where inspiration meets ingestion.

When AI companies train their models — whether for music, image generation, writing or video — they don’t do it in a vacuum. They train on us. Or more precisely: on our songs, our blogs, our art, our tweets, our books, our interviews.

They harvest it at scale, often scraped from the open web, with or without permission — and certainly without compensation.

This has prompted an increasingly vocal question from creators and content owners:

Shouldn’t we get paid when machines learn from our work?

The proposed answer from some corners: a blanket licensing regime.

What’s a Blanket Licence?

Nothing to do with bedding – a blanket licence is a pre-agreed system for legal reuse. It doesn’t ask for permission each time. Instead, it says:

You can use a defined pool of material for a defined purpose — if you pay.

We already see this in:

  • Music royalties (e.g. APRA, ASCAP, BMI)

  • Broadcast and public performance rights

  • Compulsory licensing of cover songs in the US

Could the same apply to AI?

What the Law Says (or Doesn’t)

AI companies argue that training their models on public material is “fair use” (US) or doesn’t involve “substantial reproduction” (Australia), since no exact copy of the work appears in the output.

However, copies are made during scraping, and substantial parts are almost certainly reproduced during the training process or embedded in derivative outputs — either of which could pose problems under both US and Australian copyright law.

But courts are still catching up.

Pending or recent litigation:

  • The New York Times v OpenAI: scraping articles to train GPT

  • Sarah Silverman v Meta: use of copyrighted books

  • Getty Images v Stability AI: image training and watermark copying

None of these cases have yet resolved the underlying issue:

Is training AI on copyrighted works a use that requires permission — or payment?

What a Blanket Licence Would Do

Under a blanket licence system:

  • Training (and copying or development of derivatives for that purpose) would be lawful, as long as the AI provider paid into a fund

  • Creators and rights holders would receive royalty payments, either directly or via a collecting society

  • A legal baseline would be established, reducing lawsuits and uncertainty

This would mirror systems used in broadcasting and streaming, where revenue is pooled and distributed based on usage data.

Challenges Ahead

1. Who Gets Paid?

Not all data is traceable or attributed. Unlike Spotify, which tracks each song streamed, AI models ingest billions of unlabeled tokens.

How do you determine who owns what — and which parts — of material abstracted, fragmented, and stored somewhere in the cloud?

2. How Much?

Rates would need to reflect:

  • The extent of use

  • The importance of the material to the training corpus

  • The impact on the original market for the work

This is tricky when a model is trained once and then used forever.

3. Which Countries?

Copyright laws vary. A licence in Australia might mean nothing in the US.

A global licence would require multilateral cooperation — and likely WIPO involvement.

Legal Precedent: Australia’s Safe Harbour and Statutory Licensing Models

Australia’s own statutory licensing schemes (e.g. educational copying under Part VB of the Copyright Act) show that:

  • Lawmakers can mandate payment for certain uses,

  • Even if individual rights holders never negotiated the terms,

  • Provided it’s reasonable, transparent, and compensatory.

But those systems also brought:

  • Bureaucratic collection processes

  • Contentious allocation models

  • Endless legal wrangling over definitions (What is “reasonable portion”? What qualifies as “educational purpose”?)

Expect the same for AI.

Creators and Innovation: A Balancing Act

For creators:

  • A blanket licence offers recognition and payment

  • It helps avoid the current “scrape now, settle later” model

  • It could fund new creative work rather than hollowing out industries

For innovators:

  • It provides legal certainty

  • Encourages investment in AI tools

  • Reduces the risk of devastating retroactive litigation

But if set up poorly, it could:

  • Be exclusionary (if licensing fees are too high for small players)

  • Be ineffective (if rights aren’t properly enforced or distributed)

  • Or be too slow to match AI’s pace

What’s Next?

Australia’s Copyright Act doesn’t currently recognise training as a specific form of use. But policy reviews are under way in multiple countries, including by:

  • The UK IPO

  • The European Commission

  • The US Copyright Office

  • And here in Australia, the Attorney-General’s Department is conducting consultations through 2024–25 on how copyright law should respond to AI

Creators, platforms, and governments are all watching the courts. But if consensus forms around the need for structured compensation, a statutory blanket licence might just be the solution.

Bottom Line

We’ve built AI on the backs of human creativity. The question isn’t whether to stop AI — it’s how to make it fair.

A blanket licence won’t solve every problem. But it could be the start of a system where creators aren’t left behind — and where AI learns with permission, not just ambition.

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🟫 Cantarella Bros v Lavazza: The Espresso Shot Heard Around the IP World

There’s a certain irony in watching a decades-long trade mark fight over a word that literally means “gold” end up in ashes.

After a turbulent three-year legal grind, Cantarella Bros v Lavazza has finally run its course — with the Full Federal Court siding squarely with Lavazza and the High Court rejecting Cantarella’s special leave application in June 2025.

At stake? Ownership of the word ORO — Italian for “gold” — as a trade mark for coffee.

🧾 ORO, Take Two: The Sequel to Modena

You might recall Modena, the 2014 High Court showdown where Cantarella successfully defended ORO as being inherently adapted to distinguish Cantarella’s goods from those of others. That win secured their mark’s survival from a descriptiveness challenge under s 41 of the Trade Marks Act 1995.

But Modena never tested ownership. And that’s where things have now unravelled.

Enter Molinari — an Italian roaster whose Caffè Molinari Oro blends were apparently in Australia before Cantarella’s first use. Lavazza, whose own Qualità Oro has long glittered on shelves, used this to challenge Cantarella’s ownership under section 58 of the Act.

⚖️ The Trial Decision (2023): Ownership Is Everything

In October 2023, Justice Yates in the Federal Court found that Molinari used the mark ORO in a trade mark sense in Australia as early as 1995 — a full year before Cantarella. That meant Cantarella wasn’t the first user, and thus not the true owner of the ORO mark.

Even though Molinari hadn’t used it themselves for years, the court found no clear evidence of abandonment.

The result? The ORO registrations were invalidated. No valid mark, no infringement.

🧭 The Appeal (2025): Nice Try, But Still No Gold

Cantarella ran multiple grounds on appeal. They challenged the trial judge’s acceptance of evidence, the interpretation of what constituted trade mark use, and even suggested they had become an “honest concurrent user” (which might have had flow-on effects allowing them to keep it registered).

But the Full Federal Court wasn’t buying it. It affirmed the trial findings — particularly that:

  • Molinari’s use of ORO was use as a trade mark,

  • Molinari’s rights had not been abandoned,

  • and Cantarella’s own arguments about honest concurrent use were too little, too late (that did not raise that argument at trial so could not raise it as a new ground on appeal … the result in that regard might have been different if they had raised it at trial).

They also dismissed Lavazza’s own cross-appeal on costs and distinctiveness. No party walked away with an espresso shot of victory on that front.

🏛️ High Court: Application Denied

On 12 June 2025, the High Court rejected Cantarella’s special leave bid — making the Full Court’s decision final.

It’s the second time Cantarella’s ORO mark has come before the High Court. But this time, the door was firmly closed.

🥊 Why It Matters

This is the latest in a string of cases reminding IP owners that first use means first rights — even if you think you’ve been using a mark for decades.

Some takeaways:

  • Section 58 (ownership) is a potent weapon in cancellation proceedings.

  • Evidence of early use — even murky invoices and decades-old packaging — can carry surprising weight.

  • A prior foreign user who supplied products into Australia through distributors can claim ownership if the mark was used as a badge of origin here.

  • The High Court’s Modena decision still stands, but it doesn’t immunise a mark from being struck out on ownership grounds.

☕ Final Sip

Cantarella’s gold-standard run with ORO has come to an end. With the marks cancelled and infringement claims torpedoed, it’s back to the blend board.

Meanwhile, Lavazza walks away vindicated — perhaps with a slightly smug crema.

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Productivity or Pink Slips? The Rise of Agentic AI

Ok, enough with the scaremongering – let’s thrash it out.

Is AI going to replace us any time soon?

One perspective’s look at the medium term future:

    “Cancer is cured, the economy grows at 10% a year… and 20% of people don’t have jobs.”

So said Dario Amodei, CEO of Anthropic, in one of the most jarring soundbites to emerge from the AI sector this year. It’s not a dystopian movie pitch — it’s a plausible trajectory.

The Brisbane Times recently spotlighted how Telstra is leaning hard into this future, and it starts with deploying so-called Agentic AI – discrete AI tools able to do a bunch of things with minimal oversight.  From automating customer service to writing code, the $54 billion telco is betting big that its next era won’t be driven just by fibre and frequency, but by “digital agents“: AI tools with autonomy to act, learn and optimise at scale.

While Telstra CEO Vicki Brady didn’t give hard numbers on expected job cuts, she did suggest the company’s workforce will likely be smaller by 2030. No bold claims — just quiet math. That’s the real face of the AI revolution: not mass firings, but jobs that never get hired in the first place.

Enter the Digital Employee

Nvidia’s Jensen Huang calls them “digital employees” — autonomous, specialised AI agents that handle roles from cybersecurity to network monitoring to legal summarisation. Unlike your flesh-and-blood team, they don’t sleep, unionise, or call in sick.

Tech giants like Microsoft, Canva, and Shopify are already eliminating roles that generative AI can perform faster, cheaper or more reliably. Shopify’s test for approving new hires? Prove the job can’t be done by AI.

Even highly paid software engineers and technical writers are now brushing up résumés — or joining unions. The shock isn’t just the job losses — it’s the redefinition of what work is.

The Illusion of Understanding

And yet — for all its prowess, there’s a lot that AI still doesn’t understand.

It doesn’t feel shame, pride, love, loyalty or regret. It doesn’t know the weight of a moral dilemma or the subtle ache of ambiguity. It doesn’t take responsibility. It hasn’t grown up anywhere. It’s very good at simulating humanity, but it hasn’t cracked what it means to be human.

Here are just a few areas where that matters:

• Moral Judgment & Empathy

AI doesn’t feel anything. It can mimic empathetic language, but it doesn’t understand suffering, joy, duty, shame, or dignity. That matters in:

  • law (e.g. sentencing, equitable remedies)

  • medicine (e.g. breaking bad news)

  • management (e.g. mentoring, handling conflict)

  • creative industries (e.g. stories that evoke genuine emotion)

• Contextual Wisdom and Ethical Trade-Offs

Humans weigh competing priorities in fluid, unquantifiable ways. A judge balancing public policy with individual hardship, or a parent navigating fairness between siblings — AI can model it, but not feel the stakes or bear the consequences.

• Lived Experience and Cultural Intuition

Even with perfect training data, AI lacks a body, a history, a community. It hasn’t known pain or formed personal relationships. It cannot speak authentically from or to a place of real cultural knowledge.

• Responsibility and Accountability

We trust humans with hard decisions because they can be held responsible. There’s no moral courage or ethical failure in the output of a large language model — only the illusion of one.

These aren’t just philosophical quibbles. They’re pressing questions for:

  • Law: Who bears blame when an AI agent misfires?

  • Healthcare: Who decides whether aggressive treatment is compassionate or cruel?

  • Leadership: Can you coach courage into someone via algorithm?

The Uncomfortable Part

AI already mimics a lot of that better than expected.  Consider:

• Empathy Simulation

GPT-4, Claude and others can write with stunning emotional acuity. They generate responses that feel empathetic, artistic or wise. It’s not authentic — but it’s increasingly indistinguishable, and often considered “good enough” by the humans receiving it.

• Decision-Making and Pattern Recognition at Scale

AI already outperforms humans at certain medical diagnoses, legal research, contract review and logistics. Its consistency and recall beat even expert practitioners — and that pushes decision-making downstream to human review of AI output.

• Creative Collaboration

AI is co-authoring books, scoring music, designing buildings. The raw ideas remain human-led (for now), but AI increasingly does the scaffolding. The assistant as co-creator is here.

• Agentic AI and Task Autonomy

Agentic AI can take a task, plan it, execute it, and evaluate the results. That’s edging close to synthetic intentionality. In limited domains, it already feels like independent judgment.

The Upshot

What AI can do — increasingly well — is mimic language, logic and even tone. It can co-author your policy doc, diagnose your anomaly, draft your contract (although still terribly at present – which, frankly, makes the contracts lawyer in me feel safe for now), and script your empathy.

But ask it to weigh competing values in an evolving ethical context — or even just draft a nuanced commercial agreement, conduct accurate scientific or legal research, or develop a strategy based on historical fact — and you quickly meet its limits.

Those edge cases still belong to humans in the loop.

So Who Owns the Output?

As businesses delegate more high-order tasks to autonomous agents, legal questions are multiplying:

  • Who owns the IP generated by a self-directed AI agent?
    → At this stage, probably no one — though ordinary IP rules apply to any human-developed improvements.

  • Can AI-created processes be patented or protected as trade secrets?
    → Not patented without significant human input — at least not under current Australian (or global) standards. Trade secrets? Only if the process was generated in confidential circumstances, and even then, likely only protected contractually — or by a very sympathetic equity judge with a soft spot for machines and a broad view of what counts as confidence.

  • Will the law begin to treat AI output as a kind of quasi-employee contribution?
    → Hard to say. But this author’s view: yes — we’re likely to see forms of legal recognition for things created wholly or partly by generative AI, especially as its use becomes ubiquitous.

Telstra’s ambition to shift from “network provider” to “bespoke experience platform” only deepens the stakes. If AI manages your venue’s mobile traffic to prioritise EFTPOS over selfies, who owns that logic? What’s the IP — and who gets paid?

We’re very likely to find out soon.

We May Not Be Replaced, But We Are Being Rerouted

What’s unfolding isn’t the erasure of human work — but its redistribution.

Jobs once seen as safe — legal drafting, coding, customer care — are being sliced up and reassembled into workflows where humans supervise, train or rubber-stamp what AI proposes.

We’re becoming fewer creators, more editors. Fewer builders, more overseers.

This is the heart of the AI transition: it’s not about making us obsolete.  It’s about making us team players — not to say optional — in a landscape of role transformation, driven by the pursuit of results.

That’s why this isn’t just an IP question. It’s a human one.

So yes — cancer might be cured. The economy might boom.  But as the digital employee clocks in, we’ll need more than productivity gains.

We’ll need new answers — about ownership, ethics, responsibility and value.  Not just in law, but in how we define a fair and meaningful future.

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Maxim Forgets the Maxim, Chases Nuclear but Bombs

Maxim Media, the publishers behind the well-known men’s lifestyle magazine and brand MAXIM, had minimal success when in Maxim Media Inc. v Nuclear Enterprises Pty Ltd [2024] FCA 1443 they sought urgent Federal Court orders to shut down an Australian company allegedly riding on their name — through magazines, domain names, destination tours, and model management services.

Despite the explosive accusations, the Court delivered a much more subdued response.

Maxim had delayed for some time in coming to Court, but now applied for interlocutory relief, seeking immediate injunctions to restrain:

  • Use of the MAXIM name in any form in Australia;

  • Distribution of a competing Maxim Magazine;

  • Operation of maxim.com.au, destinationmaxim.com.au, and related social handles;

  • Any further unauthorised brand use.

The application relied on trade marks registered in 2020 and 2023 — and on allegations that the Australian respondents, including Nuclear Enterprises and Michael Downs, had no licence or authority to use the name.

Justice Rofe refused the injunction — not because the claim was doomed, but because:

  • Ownership and licensing rights hadn’t been clearly established yet;

  • There were substantial factual disputes that needed a full trial;

  • There was no persuasive case for irreparable harm that couldn’t be remedied later;

  • The balance of convenience didn’t justify urgent intervention — particularly given Maxim’s delay in seeking relief (ironically, Maxim had ignored the equitable maxim regarding laches).

The proceeding will now be allocated to a docket judge for a full hearing.

The main takeaways here are:

  • Interlocutory relief isn’t automatic, even with a registered trade mark — the applicant still needs clean title, urgency, and evidence of irreparable harm.

  • Delays hurt. The longer you wait to challenge a rival’s use of your mark, the harder it is to convince a court that urgent action is needed.

The case could still blow Maxim’s way at a final hearing — but for now, Nuclear gets to keep exploding – and the fallout will be huge.

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Series Killers: When IP Australia Oversteps the (Descriptive) Mark

So you’ve filed a series trade mark in Australia. The marks are visually identical except for a single word that tweaks the service type — say, “BURST PLUMBING”, “BURST CLEANING”, “BURST GARDENING”.

All good, right?

Not if you ask IP Australia. According to the Office Manual, if your differentiating word describes only some of the services listed — even if it’s a totally non-distinctive, snore-worthy adjective — your series could be headed for rejection.

The rationale? That descriptive differences must apply to all of the goods/services claimed. Not some. Not most. All.

But is that legally correct?

Let’s unpack this.

The Law (Actually – and Not the Manual)

Section 51(1) of the Trade Marks Act 1995 (Cth) says you can register a series if:

“…the trade marks resemble each other in material particulars and differ only in respect of one or more of the following matters:
(a) statements or representations as to the goods or services  in relation to which the trade marks are used or are intended to be used;
(b) statements or representations as to number, price, quality or names of places; or
(c) the colour of any part of the trade mark.”

So there is a legal restriction — but it’s not about whether the descriptive term applies to all of the goods or services. It’s about whether the difference falls into one of the above three categories.

If your only point of difference is a generic descriptor like “PLUMBING” or “CLEANING” — that’s likely a “statement as to the services” under paragraph (a). ✅ Tick.

Whether that statement applies to all of the services? That’s not part of the statutory text. That’s IP Australia adding friction by policy — not by law.

The Practice (Not the Law)

IP Australia’s position is that if “CLEANING” only refers to a handful of the listed services — say, home cleaning and commercial premises — while your broader list also covers plumbing, garden maintenance, and pest control, then the marks in the series are no longer sufficiently aligned for a single registration.

Their concern: you’re using the series construct as a backdoor to bulk file a grab bag of marks that lack genuine commonality.

But here’s the catch: section 51(1) does not impose a requirement that the differing matter — like “CLEANING” — must describe all of the goods or services. The section simply requires that:

  1. The marks resemble each other in material particulars, and

  2. The differences fall only within one or more of the categories listed:

    • statements about the goods/services,

    • statements about number, price, quality or place, or

    • colour of part of the mark.

So, if “CLEANING” is a statement about services (and it is), and the marks still resemble each other in their key features (say, the word “BURST” in a bold red typeface with a splash logo), then the Act is satisfied.

The idea that every descriptive word must apply to all services is IP Australia policy, not law. It’s not in the Act. It’s not in the Explanatory Memorandum. It’s simply a convenient threshold applied to keep the register tidy — which may be operationally defensible, but not legally required.

What’s a Brand Owner To Do?

If you’re filing a series mark where the only difference is a descriptive word that applies to some — but not all — of the listed services, you’ve got two choices:

  1. Play nice: Redraft your specification to group services so that each descriptor applies across the board. That means breaking up the series and filing multiple applications.

  2. Push back: If the examiner raises an objection, go back to the legislation. Section 51(1) only requires that:

    • The marks resemble each other in material particulars, and

    • The differences fall only within the three specified categories.

You may not win every time, but you’ll be on solid legal ground — and might just push the boundaries of a policy that’s grown a little too rigid for its boots.

There’s no additional legal requirement that the differing statement about services must relate to all of them. That’s a policy position, not a statutory one.

So if “BURST PLUMBING” and “BURST CLEANING” share all core branding elements and differ only by a word that is a statement about services — you’ve met the test under the Act.

Bottom Line

IP Australia’s insistence on descriptive uniformity across the entire class spec is not supported by s 51(1) of the Act. The only legal requirement is that the marks:

  • Resemble each other in material particulars, and

  • Differ only in respect of statements as to goods/services, price, quality, place, or colour.

Everything else? That’s Office convenience, not legislative command.

So don’t be afraid to push back.

And if that fails… well, split the applications, swallow the extra fee, and tell your accountant it was a “protest expense” … the cost of resisting bureaucratic overreach.