HKSAR v. TSE MUI CHUN

CACC 557/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 557 OF 2001

(ON APPEAL FROM DCCC 556 of 2001)

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J U D G M E N T

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Hon Stock JA (giving the judgment of the Court):

Background

1 In August 1998, the applicant was granted a licence for the manufacture of optical discs. She was the company secretary, as well as a director and shareholder, of Starry Technology Limited whose manufacturing premises were in the Mai Wah Industrial Building in Kwai Chung.

2 On 12 May 2000, goods were collected from that building on the company's behalf and delivered in 155 cartons to the public cargo loading area in Yaumatei. There was then a raid by Customs Officers who seized the cartons in which they found 155,000 optical discs. 28,003 are said to have been copies which infringed copyright in films named "Mulan" and "Aladdin and the King of Thieves". It is said that the copyright owners of these films were Disney Enterprises Inc., USA.

3 Later that afternoon, Customs Officers went to the company's premises and there they seized another quantity of discs amongst which were 12,515 video compact discs and 5,532 CD-ROMs. These were said to be infringing copies of films (the VCDs), and a literary work entitled "My Heart Will Go On" as sung by Celine Dion (the CD-ROMs).

4 There were installed in the premises five production lines, and these included a number of stampers. The officers took away a sample number of the VCDs and of the CD-ROM as well as mould heads from the production line; and, further, there were found four stampers in a drawer, two of which were designed or adapted for making copies of the "Aladdin" films. These were all sent to the Government Chemist for analysis.

5 On 13 May 2000, the applicant was interviewed and she admitted that the discs seized at the cargo loading area had been manufactured by her company. She asserted that she had received letters of commission for processing the optical discs from a company called Yunnan Video Publication Corporation, and that she had approved the orders but that, since she trusted that company, she had not made any inquiries. She also said that the optical discs found at her company premises belonged to Fujian Province Chang Long Video Corporation. She did not say why they were kept at her company's premises.

6 It was established and agreed that the six mould heads which were seized had been used in the manufacture of some of the discs which had been seized.

The charges

7 The applicant faced four charges in the District Court:

(1) The discs seized at the loading area in Yaumatei were the subject of the first charge, namely, possession without the licence of the copyright owner of 28,003 video compact discs being infringing copies for the purpose of trade or business with a view to committing an infringing act, contrary to section 118(1)(d) of the Copyright Ordinance, Cap 528.

(2) The second charge alleged the making for sale or hire of three lots of discs, all infringing copies it was said, without the licence of the copyright owner, that is, the 28,003 video compact discs seized in Yaumatei; the 12,515 video compact discs seized at the factory; and also the 5,532 CD-ROMs: all contrary to section 118(1)(a) of the Ordinance.

(3) The third charge alleged possession of two stampers specifically designed for making copies of a copyright work namely, films, and used or intended to be used to make infringing copies of copyright works for trade or business, contrary to section 118(4)(d) of the Ordinance.

(4) Charge 4 was a charge of possession along the lines of Charge 1, save that the subject matter of this charge were the 12,515 VCDs and 5,532 CD-ROMs seized at the loading area.

Charge 2 was alternative to Charges 1 and 4.

8 The applicant pleaded not guilty before Deputy Judge Livesey, but on 29 November 2001 was convicted on Charges 2 and 3, and sentenced to a total of 28 months' imprisonment. This is her application for leave to appeal against those convictions. There was before us an application for leave to appeal against sentence but she does not pursue that, and that application has, accordingly, been dismissed.

Section 121

9 The first ground of appeal revolves around the testimony of two witnesses for the prosecution, a Mr Lam (PW2) and a Ms Tsang (PW4). Evidence from these witnesses was submitted in the form of affirmations (P26 and P27). These were produced pursuant to the provisions of section 121 of the Ordinance. That section in so far as is relevant in this appeal provides as follows:

"(1) An affidavit which purports to have been made by or on behalf of the owner of a copyright work and which states-

(a) the date and place that the work was made or first published;

(b) the name, domicile, residence or right of abode of the author of the work;

(c) the name of the owner of the work;

(d) that copyright subsists in the work; and

(e) that a copy of the work exhibited to the affidavit is a true copy of the work,
shall, subject to the conditions contained in subsection (4), be admitted without further proof in any proceedings under this Ordinance.

(3) The court before whom an affidavit which complies with the conditions in subsection (4) is produced under subsection (1) or (2) shall presume, in the absence of evidence to the contrary-

(a) that the statements made in the affidavit are true; and

(b) that it was made and authenticated in accordance with subsection (4).

(4) An affidavit may be tendered in evidence under subsection (1) or (2) if-
(a) it is made on oath-

(i) before a solicitor or a commissioner as defined in the Oaths and Declarations Ordinance (Cap. 11), if it is made in Hong Kong; or

(ii) before a notary public, if it is made outside Hong Kong;

(b) it is authenticated, so far as relates to the making thereof, by the signature of the solicitor, commissioner or notary public before whom it is made;

(c) it contains a declaration by the deponent to the effect that it is true to the best of his knowledge and belief; and

(d) subject to subsection (6), not less than 10 days before the commencement of the hearing at which the affidavit is tendered in evidence, a copy of the affidavit is served, by or on behalf of the prosecution or plaintiff, on each of the defendants.

(5) Notwithstanding that an affidavit is admissible as evidence by virtue of this section, a defendant or his solicitor may, within 3 days from the service of the copy of the affidavit, serve a notice requiring the attendance of the deponent to the affidavit in court.

...

(8) Without prejudice to subsection (5)-

(a) the party by whom or on whose behalf the affidavit was served may call the deponent to give evidence; and

(b) the court may of its own motion or, if the defendant who has served a notice under subsection (5) satisfies the court that the subsistence or ownership of the copyright is genuinely in issue, either before or during the hearing, require the deponent to attend before the court and give evidence.

(9) Without prejudice to subsection (8)(a), a deponent of an affidavit which is admissible under this section shall attend before the court and give evidence if, and only if, the court so requires under subsection (8)(b).

...."

10 It transpired that both these witnesses provided oral testimony at the trial, and it is the impact of that fact that gives rise to the suggestion that their evidence as to the ownership of copyright was inadmissible as being hearsay, despite the provisions of sub-sections 121(1) and (3) which clearly contemplates evidence on behalf of the copyright owner.

11 It is as well to summarise what they said.

The copyright evidence

12 PW2 was a gentleman named Lam Man Kit, who is a supervisor with the Hong Kong Film and Video Security Limited, a subsidiary of the US Motion Picture Association of America. His affirmation, in its material parts, stated that he was copyright enforcement officer, and was duly authorised to make his affirmation, on behalf of Disney Enterprises Inc. He annexed a schedule which set down a number of film titles and then, importantly, specified in the second column of the schedule the identity of the owners of the copyright in each film; plus some further information with which we are not in this appeal concerned. It is not now suggested, nor was it suggested at trial, that the affirmation does not comply with the formal requirements of the Ordinance. This affirmation was produced and became exhibit P26 in the case.

13 Mr Lam was called to give oral testimony. He was called by the prosecution. There was no direction from the court that he attend to give evidence, either of its own motion or at the behest of the defence. The significance of this fact will shortly emerge.

14 His oral testimony commenced with the production of his affirmation, and his affirming the accuracy of its contents. Counsel for the prosecution then attempted to adduce evidence from him as to the genuineness of the VCDs seized from the loading area. The witness was to do this by describing the genuine article, and then saying how the seized objects differed. Counsel for the applicant objected. He said that the defence were taken by surprise that this was to be the intended ambit of his oral evidence. In the course of mounting his objection counsel, having first asserted that the witness was not an expert, said this, which we think is of some relevance:

"... with all due respect, this witness has sworn an affirmation and if we go through the affirmation all he's done in the affirmation is established pursuant to section 121 who the copyright owners are of the relevant films, the subject of this trial." (Tr. pp.79-80)

15 Counsel for the prosecution stated quite clearly that he had called the witness to speak as to the genuineness of the articles seized but "not on the copyright aspect." The judge nonetheless allowed the evidence of comparisons to be made. When counsel for the applicant cross-examined, he sought to establish that the information provided by the affirmation was provided to the witness by his own company; that Disney had provided that information in turn to the company; so, as counsel put it, the information in the affirmation was 'second hand'. Then counsel sought to attack the evidence of copyright by showing that whereas it was suggested that the owner of the copyright was Disney Enterprises Inc. USA, ownership was attributed to "Disney" in the authorisation issued to the company, and to the "Walt Disney Company" in a copyright reference on the packages of genuine VCDs. All of this was intended to undermine the assertion that copyright rested in Disney Enterprises Inc., USA.

16 PW4 was a Ms Tsang Pak Lin, a director of International Recording Copyright Limited, a company acting for Sony Music Entertainment Canada Inc. This witness was called by the prosecution albeit, we understand, at the request of the defence. That is a common enough practice with which we are all familiar. In other words, the defence wanted to cross-examine the witness. Nonetheless, it is clear beyond peradventure that she was called by the party on whose behalf the affirmation of that witness was served; that is, the prosecuting party. She was asked a number of questions in the course of which she was referred to her affirmation, which had already been produced as an exhibit. Then she was cross-examined.

17 Her affirmation stated that she was authorised to make it on behalf of Sony Music Entertainment Canada Inc. Again, as in the case of PW2, she attached to her affirmation a schedule which, in conjunction with the contents of the affirmation itself, showed the owner of the copyright in the recording "My Heart Will Go On" sung by Celine Dion, to lie with Sony Music Entertainment Canada Inc. Counsel for the applicant's concern was to establish that the information was obtained by her from a computer data base; and was therefore hearsay.

The first complaint

18 To paraphrase the first ground of appeal, it is that the judge failed to appreciate the standing of the affirmations once oral testimony of the deponents had been admitted, and that in consequence the judge failed then to understand the standing of the oral testimony. The point is pleaded as follows:

"The ... judge erred in that she misdirected herself upon or wrongly failed to direct herself properly or understand or appreciate or apply section 121 of the Copyright Ordinance properly and/or wrongly relied upon hearsay evidence. In particular:

(1) wrongly failed to direct herself or understand or appreciate that once the deponent of an affirmation tendered in evidence under section 121 had been called by the prosecution to give evidence, then all those matters set out in the affirmation could be challenged as of right in the cross-examination."

Analysis

19 The judge made no such error. She noted that the defence was putting the prosecution to strict proof of all elements of the charge, including that of ownership of copyright and that, save for statutory defences which were raised - if any were to be raised - the burden of proof remained on the prosecution. The judge concluded that the affirmations filed complied with the conditions laid down by section 121(4), and said that by reason of section 121(3) of the Ordinance "in the absence of any evidence to the contrary, the court shall presume ... the statements in the affidavits are true". She rehearsed the provisions of section 121(5), noting that a section 121(5) notice had been served, and she then correctly summarized the provisions of section 121(8)(a) and (b) as well as section 121(9). She then noted that PW2 was in a position to give evidence about the standing of the suspected infringing copies of Disney products and she then said this - and given the nature of the grounds of appeal as a whole, what she said should be stated in full:

"14. ... Both PW2 and PW4 were clearly called under section 121(8)(a) as, although I had been informed at the commencement of the trial that copyright was in issue, prior to their being called there was no specific application made to me under section 121(8)(b). The mere service of a section 121(5) notice does not thereby automatically put the matter of copyright in issue. The defence have first to satisfy the court that the subsistence or ownership of the copyright is genuinely in issue before the court will require the deponent to give evidence under section 121(9).

15. In order to do this, it is clearly insufficient, in my judgment, for the defence to rely solely upon the fact that the information in the affidavit is based on hearsay as section 121 clearly permits and envisages such evidence being put in the affidavit and of being sufficient to activate the presumption. There must, in my judgment, be something more. Either the hearsay can be found to be inherently unreliable or defective in some other way not envisaged by the Copyright Ordinance or there must be evidence to suggest, for instance, that others in fact do or may own the copyright.

16. The ownership of the copyright of the discs and CD-Roms was challenged on behalf of the defence on two grounds. Firstly, that the information upon which the affidavits were produced was based on hearsay and is therefore inadmissible on the basis that once the section 121(5) notice is served, the matter of copyright has to be proved from admissible evidence from first instance and not from hearsay evidence. Secondly, that there are uncertainties as to whom the copyright belongs because, by way of example only, there is evidence that the ownership of the copyright is in dispute or unclear or may have lapsed.

17. Firstly, there was no evidence put before the court by the defence with respect to either claimed copyright owner, that is Disney or Sony, which caused me to doubt that the hearsay evidence relied upon by PW2 and PW4 was other than that normally envisaged by section 121. Both witnesses worked for companies that had relatively long-standing relationships with either Disney Production Inc. or Sony Music Entertainment Inc. and had extensive experience of handling and examining those companies' goods. I found no basis to this first challenge." (tr. pp 26-27)

20 There is in our judgment nothing in those passages which demonstrates a denial of a right of challenge by cross-examination of the facts asserted by the deponent of an affirmation which has been served in accordance with the provisions of section 121 of the Ordinance. The fact of the matter is that cross-examination was permitted. No-one was prevented from suggesting that the contents of the affirmations were untrue. Mr Callaghan for the Defence was permitted, and it was never suggested that he should not be permitted, to cross-examine. And the core of that cross-examination is referred to in the Reasons for Verdict, in the second part of para 16 of the Reasons for Verdict which we have reproduced; and the same issue raised in cross-examination is referred to later in the Reasons for Verdict which forms the second ground of appeal, to which of course we later turn.

"Genuinely in issue"

21 The next aspect of the first ground is put thus, that:

"(2) Since the Defence challenged the question of copyright ownership in their cross-examination of PW2 and PW4, the Learned Deputy Judge wrongly held that the said challenge had been unsuccessful because:

(a) she wrongly ruled that it was necessary for her to be satisfied that there was an issue under section 121(8)(b) and (9)."

22 This is a suggestion that the judge ruled that there was no genuine issue under section 121(8)(b), and that therefore the defence could not succeed. This, with respect, is to misread what the judge was saying. It was entirely unnecessary in this case for the judge to make a determination under section 121(8)(b), and whilst the judge was engaged in a discourse in the nature, it seems to us, of an aside upon the effect of the mere service of a notice under section 121(5), she expressly said that the oral testimony had been adduced in evidence under section 121(8)(a), which has nothing to do with genuine issue or not. Her asides were, it seems to us, quite correct, namely, that the mere service of a notice under subsection (5) does not of itself mean that there is a genuine issue; and so, too, the mere assertion that the evidence in an affidavit or affirmation is hearsay does not of itself mean that there is a genuine issue. If - and this is a matter to which we must shortly come - the section envisages that hearsay evidence is permissible in an affidavit, then to say that once a notice is served under section 121(5) affidavit evidence is no longer permissible is to make an assertion which, if correct, would drive a coach and horses through the intent of section 121; because it would mean that each time an affidavit was served all the defence would have to do would be to serve a notice as a purely tactical move, knowing full well, perhaps, that the question of copyright is watertight and beyond a genuine dispute, so that the copyright owner from overseas, more often than not, would have to be called, to have put to him the sort of questions, of no true substance, which one sees in this case. In so far as the judge was saying that the mere fact that the evidence was hearsay could not of itself make the issue of copyright ownership a genuine issue, she was quite correct. There is nothing in this limb of the appeal.

The effect of oral testimony

23 The next complaint is that:

"(b) in determining [that the challenge to the question of copyright ownership had been unsuccessful], she wrongly relied on the hearsay testimony of PW2 and PW4."

This complaint is allied to the next which runs thus:

"Since the prosecution had called PW2 and PW4 to give evidence, they were not entitled or could no longer rely upon hearsay testimony to prove copyright ownership".

In so far as the admission of hearsay evidence is attacked on this ground, namely, that once the witnesses give evidence orally that element of hearsay evidence as to copyright which is permitted by section 121(1) and to be treated, in the absence of evidence to the contrary, as proved, is no longer to be accepted because once they give evidence orally, the normal rules of hearsay apply - this is a contention which is, with respect, fallacious.

24 Section 121(1) and (3) and its effect is not swept aside just because the deponent also gives oral evidence. If the affidavit is in proper form and is tendered, as it was in this case, then those sections which deal with its effect become operative. The affidavit or affirmation remains testimony tendered under that section. The oral testimony does not replace the affidavit. It may supplement it, or it may deal with an aspect of the case quite apart from the ground covered by the affirmation. That indeed is what happened in the case of PW2 who was called by the prosecution to deal with a matter not dealt with by his affirmation; that is, to deal with the question of the genuineness of the articles seized in the customs raid. The proposition contended for pays no regard to the fact that oral testimony may, and frequently does, in a variety of litigious settings, stand side by side with affidavit evidence from the same witness; and it also ignores the nonsense that would be made of the statutory provision which is section 121, which has behind it sound common-sense and practical policy considerations too obvious, and too often stated, to have to repeat, were a defendant able to undermine its intent merely by serving a section 121(8)(b) notice or to point to the fact that the deponent has given oral evidence, to render its effect nugatory. Once a witness who has already deposed is called, his affidavit stands. It raises a presumption as to ownership of copyright. Of course that is not the end of the matter. It is open to the defence to cross-examine and seek to show that the affidavit evidence is not correct or reliable. It is open to the defence to call evidence of its own to the same end. It is open to the defence to cross-examine to show, if it can, that there has been granted a licence; or that the copies seized are not in fact infringing copies. And the tribunal of fact will no doubt then make a determination, and will decide whether the presumption in the affidavit is or is not rebutted. That is the rather simple scheme of the matter, and the very extensive written arguments which were deployed by both sides on this issue became a complex exercise into a straightforward point.

Hearsay

25 Finally, on the hearsay aspect of copyright ownership, Mr Grounds argues that section 121 does not in any event permit the affirmation to contain hearsay evidence; that it envisages that where a deponent is not himself the copyright owner, the deponent must himself have direct knowledge of the copyright. He cannot, it is argued, rely on what he has been told by, say, the copyright owner and then pass it on to the court in an affirmation. We do not agree. The answer lies, as is so often the case, in the section itself. The section permits the giving of evidence by an individual on behalf of the copyright owner. Ownership is presumed proved if such a person makes certain statements, the nature of which is specified in the section. The fact is that both PW2 and PW4 tendered their testimony on behalf of the copyright owners and said that they had been authorised to do so. The statutory conditions were fulfilled. It was never suggested otherwise. The statutory conditions having been fulfilled, that is the end of the matter.

Ground 2

26 This ground reads thus:

"The Learned Deputy Judge erred in law in that she wrongly relied upon the authority of HKSAR v Mega Laser Products (HK) Ltd [1999] 3 HKC 161 and/or wrongly determined that in effect there was no difference between Disney, Disney Home Video, Walt Disney, Walt Disney Home Video, Disney Enterprises Inc, Walt Disney Enterprises Inc., and Walt Disney Company."

27 The genesis of this complaint lies in counsel's attempts at trial to undermine the affidavit evidence of copyright ownership by pointing to various articles which, though no doubt legitimate and not infringing copies, bore names other than that said in the affirmation to be that of the copyright owner, namely, Disney Enterprises Inc. USA. So, for example, Mr Callaghan showed PW2 a film, a sample of "Lion King", and on the strip of the discs or perhaps of the packaging, it matters not too much, there was the letter 'C' encircled as one commonly sees to denote copyright and, next to it, the words "The Walt Disney Company". Another disc bore the name "Disney". Yet, goes the argument, these did not say "Disney Enterprises Inc. USA", so that it must follow that the assertion of the affirmation as to copyright ownership is put in doubt. Mr Grounds says that the judge got it all wrong. She said, according to this argument, that there was no difference between all these names or organizations; and it is contended that she relied wrongly on the judgment in Mega Laser.

28 Well, let us see what the judge actually said:

"19. The defence put before the court two other matters which they suggest casts doubt on the ownership of the copyright. Firstly, the various phrases used on the claimed Disney Enterprise Inc. discs. These were, for example, Disney, Disney Home Video, Walt Disney or Walt Disney Home Video, and in oral evidence the witnesses variously referred to Disney Enterprises Inc., Walt Disney Enterprises Inc., Disney and Walt Disney Company. In HKSAR v Mega Laser Products HK Ltd. & others, Mr Justice Mayo in delivering his judgment on the copyright matter appeared to use the words 'Walt Disney' and 'Disney' interchangeably. Further he said in referring to copyright, 'Walt Disney is a world famous name and it is absurd to suggest that the works may not have been protected by copyright.' In my judgment, the reference variously to Walt Disney, Disney, Walt Disney Enterprises and Disney Enterprises Inc. on the discs and in evidence in no way casts doubt upon the copyright owner being Disney Enterprises Inc. precisely because Disney is such a world famous name and the relevant films have had almost world-wide coverage and been advertised as Disney productions." (Tr. pp. 27-28)

29 The answer to the second ground of appeal is this. The judge did not rely on Mega Laser Products for some ratio or other. The judge was referring to a fact of life, which was echoed in that earlier case, that very well known brand names are used interchangeably and that, sometimes, a mark on a product might for its own protection make some intimation that copyright is owned in the product, in circumstances in which it may be unnecessary, or untidy, or over-fussy, to spell out the full name of the corporation in which copyright resides, and that companies are simply known by different titles. That is all this section of the Reasons amounted to. We have looked at the evidence, and we quite agree with the judge that the answers which emerged in cross-examination, and that paraphrased names on samples, did not for a moment undermine the central evidence in the affirmations themselves as to the proper name of the copyright owners. We do not think that this ground merits further discussion.

Licensing

30 The third and last ground concerns the question of proof whether the applicant was or was not licensed by the copyright owners to manufacture and sell these films, and the literary work. It is said that the prosecution failed to prove lack of a licence and relied on hearsay evidence which, for that reason, was inadmissible.

31 The judge took the view after hearing argument that it was for the prosecution to prove that the manufacture of the discs by the applicant was without the copyright holder's licence, rather than for the applicant to show that she held a licence. Whether as a matter of law this is correct in the case of those who manufacture products we cannot, in the absence of argument, say. See, for example, the discussion of this issue in Copinger & Skone James on Copyright 14th ed. para 23-40; and Phipson on Evidence 15th ed. para 4-11. Mr Turnbull tells us that there is authority which suggests, certainly in the case of retailers, that the burden is on the prosecution and that that thinking extends to the section (or a similar section) as a whole, since it would be difficult to apply different principles to subsections within the one section. Be that as it may, we will proceed, for the purpose of this appeal only, on the basis that the burden in this case was indeed on the prosecution to show that no licences had been granted to the applicant.

32 In this regard, the judge heard the testimony of two witnesses - one to show that no licence had been granted to the applicant in respect of the Disney products; and the other to show that Sony had granted no licence for the manufacture of the CD-Rom with the Celine Dion song.

33 PW1 was Ms Wang Siu Wen. She is the Vice-President and General Manager of a company called Buena Vista Home Entertainment Limited (BVHE). It distributed Disney CDs. BVHE is a wholly-owned subsidiary of Disney. She is also Vice-President of Disney Enterprises Inc., the owner of the copyright. Mr Grounds contends that her evidence was confused and confusing, and that she was not in a position to speak for the copyright owner. We do not agree. She was a Vice-President of the copyright owner. She had been a Vice-President for six years. Her evidence was that anyone wishing to be an authorized licensee to deal in Disney videos and VCDs is required to sign an agreement with BVHE. BVHE has the exclusive licence to manufacture and distribute the films which were the subject of the prosecution in this case. They also have the exclusive right to grant licences for the six films. Her testimony was that only one body had a licence in Hong Kong from BVHE, and that is, or was, a company called International Video Limited. No sub-licence may be granted without the prior written approval of BVHE. BVHE (of which she is the Vice-President, let us remember, and General Manager) has to be party to any written agreement for a sub-licence. She, this witness, was the person responsible in this Region for licensing in Hong Kong and China. It was her job to negotiate licences. Only two requests for sub-licences have been made by IVL, namely, to a company called Jackim and another company called Sono Press. A licence, she said, had also been granted by BVHE to a Mainland company called CAV Thakral Home Entertainment Company. One sub-licence from that company had been approved. Sub-licensees are not permitted themselves to grant further licences. Disney Enterprises does not itself grant licences. All home entertainment product rights, she said, are conferred by BVHE. No licence, she said, was granted by BVHE to the applicant or to Starry Technology Co. In cross-examination she asserted that her responsibility was to go out and find licensees and to negotiate terms with them.

34 The judge has summarised her evidence thus:

"30. Buena Vista Home Entertainments Limited is responsible for home entertainment products in Hong Kong, Taiwan and China. The world-wide exclusive rights for home entertainment products are granted by Disney Enterprises Inc. to Buena Vista Home Entertainments Inc. who in turn have granted the exclusive rights to Buena Vista Home Entertainments Limited exclusively for Hong Kong, Taiwan and China. As the Vice President or general Manger of the above companies, she has access to the business records of Disney. She described the manner in which a company who wishes to become an authorised licence holder is granted such a licence. PW1 set up Buena Vista Home Entertainments Limited and clearly has day-to-day knowledge and hands-on experience of the business. She also clearly has access to the business records, in particular the licensing information which is kept on computer in California. If her information came solely from the computer records of head office, such evidence would not be admissible as no preparatory evidence was given in relation to section 22A of the Evidence Ordinance. However, it is clear from her evidence that she was actively involved in the granting of all of the licences and sub-licences in relation to the home entertainment products of Walt Disney Enterprises Inc. in Hong Kong, Taiwan and China and that she had full knowledge and working experience of the system of work and procedure of granting of licences and the existence in the various agreements of exclusivity terms in relation to the rights of Buena Vista Home Entertainments Limited.

31. No licences can be granted to the initial licence holder nor to sub-licensees save with the consent of Buena Vista Home Entertainments Inc. If licences were granted by any of the companies in breach of the contract with Buena Vista Home Entertainments Limited, then they would lose their contracts. I was satisfied that the only irresistible inference which could be drawn on the basis of this evidence was that a sole licence had been granted to International Video Link for Walt Disney products in Hong Kong and Macau. The only two named sub-licences being granted to replicate are Sonar (sic) Press and Jackim Optical Marketing. The situation was similar in China where CAV Thakral Home Entertainment was granted the licence with one sub-licence to a replicator named Wen Lu in Beijing. I was also satisfied that the only irresistible inference which could be drawn was that no licence had been lawfully granted to Starry Productions Limited, T & Y Technology Limited, Yunnan Video Publication Corporation, nor to the defendant personally to copy the Disney discs." (Tr. pp 30-31)

35 We pause to say that the applicant adduced no evidence at trial. She did not herself assert that she had a licence from Disney or from any of the licensees named by Ms Wang. She told the Customs Officers that she had manufactured the discs at the request of a company on the Mainland and trusted that company and made no inquiries.

36 The arguments by Mr Grounds with respect to the evidence of this lady, Ms Wang, are misplaced. He seems to complain that the witness was not in a position to give evidence on behalf of Disney. There was no evidence, he says, that Disney had not granted the applicant a licence directly. We think that the judge's reasoning speaks for itself, and is not impeachable. Ms Wang was perfectly able to speak for Disney. She was one of its Vice-Presidents, and a Vice-President of BVHE. She was directly involved in the granting of such licensees in Hong Kong as have been granted. Who better than she to say that BVHE was the sole authorized licensee for the product in question? Who better than she to say that licences had been granted but to one company only in Hong Kong, and that it was not the applicant; and that only two sub-licences had been granted in Hong Kong, and that neither was the applicant? The judge did not rely on computer records in California but on Ms Wang's direct knowledge and experience of the business in Hong Kong. She, the judge found, was herself involved in the granting of all material licences. That is good enough. We do not intend to deal with each aspect of the complaint in relation to this witness' evidence. We are satisfied that there was no error.

37 And so, finally, we turn to the evidence of PW7. PW7 is a lady named Maggie Cheng who is the business affairs officer and a director of Sony Music Entertainment Canada Inc., the owner of the copyright in the recording of the song "My Heart Will Go On" sung by Ms Celine Dion. Her duty is to handle all contractual matters. She is also a director of Sony Music Entertainment Hong Kong. Mr Grounds has advanced arguments on the admissibility of her evidence, and in particular as to her reliance upon computer records which, he said, were not produced; and he argued further that the requirements of section 22A of the Evidence Ordinance, Cap 8, had not been satisfied. We have had extensive material from Mr Turnbull about the admissibility of her evidence, and he says that on the authority of R v Shone, 76 Cr App R 72, the evidence was admissible as proving a negative.

38 It is, however, unnecessary to go into all of this. The fact of the matter is that the absence of a licence was proved by another route, namely, the evidence of PW5 and PW6 who examined seized CD-ROMs which are the subject of the relevant part of Charge 3. That there was no licence was proved by the evidence of these witnesses who showed that the discs seized, the supposed Sony discs, were in MP3 format. The evidence showed that Sony does not issue work in that format. One of the witnesses who showed that these discs were not genuine was PW6, a Mr Leung who has worked for Sony for 21 years; and his unchallenged evidence was that Sony has never manufactured any products in the MP3 format. Yet the seized products were in that format. The judge referred to the evidence to that effect of these two witnesses, and said that on the basis of their evidence she was satisfied that the CD-ROMs seized were infringing copies. An infringing copy is necessarily one for the manufacture of which no licence has been granted. For this reason alone, this ground fails.

Result

39 It follows from the conclusions which this Court has articulated that the application for leave to appeal against conviction is dismissed.