Sega Enterprises v Galaxy Electronics [1996] 761 FCA 1

Federal Court of Australia – 28 August 1996 – Burchett J

Classification of video games as 'cinematograph films'; meaning of word 'embodied' in ss 10(1) and 24 Copyright Act.


Tagline for the impatient: In Australia, Computer games can be treated as Cinematograph Films for the purposes of Part IV of the Copyright Act. Who cares? Some of the provisions dealing with infringement of copyright in films are simpler to establish from the copyright holder's point of view than the equivalent provisions for literary works. Having an alternate avenue to argue is beneficial to the copyright holders, but this artificial distinction between categories of electronic data has been criticised widely, and reforms have been proposed (though not acted upon) that would remove those distinctions from the Copyright Act.


Sega brought this action in the Federal Court to stop the paralell importing of games by Galaxy Electronics. Sega sought protection under Part IV of the Copyright Act (which covers, amongst other things, cinematograph films). This was sought because the full Federal Court had held in Avel v Wells (1992) that s 24(2) of the Circuit Layout Act comprised a full defence to parallel importation without permission of integrated circuits comprising literary works under Part III of the Copyright Act (which includes computer programs). So, the question before the court was whether video games (in particular, Sega's Virtua Cop and Daytona USA) fell under the definition of 'cinematograph films' for the purposes of the Copyright Act, ss 10(1), 23, 24.

Section 10(1) Copyright Act 1968 provides that:
"'cinematograph film' means the aggregate of the visual images embodied in an article of thing so as to be capable by the use of the article or thing -

  1. of being shown as a moving picture
  2. of being embodied in another article or thing by the use of which it can be shown,
and includes the aggregate of the sounds embodied in a sound-track associated with such visual images"

Section 24 provides:
"For the purposes of this Act, sounds or visual images shall be taken to have been embodied in an article or thing if the article or thing has been so treated in relation to those sounds or visual images that those sounds or visual images are capable, with or without the aid of some other device, of being reproduced from the article or thing."

Justice Burchett considered that the Virtua Cop is in reality very similar to a traditional movie; two protagonist police officers struggle to investigate criminal activities at various locations, complete with an introduction and triumphant finale. However, Virtua Cop is "designed to screen the simple story only when the correct responses to a series of cues are fed into it by the player". After noting that the screenings will be different most of time, His Honour noted that this would not be relevant, because the "influence of the player's actions is confined within the overall limitations of objects and scenes available to be generated by the controlling program".

The main problem with Virtua Cop being considered a cinematograph film, then, was not its content, but the way in which it was reproduced. Because it is rendered from a 3D representation, and not composed of single frames in any way, whether actual cinematographic or stored on magnetic tape, the respondents argued that Virtua Cop is not represented in any form until it is displayed on the screen, after calculation of input against the 3D reference points (not images) of characters and objects. The respondents also say that since the video is generated dynamically, it is "not correct to say that the 2-dimensional screen images themselves are stored in the computer like some form of 'digital movie' and simply played back during the game".

His Honour was left to consider the meaning of the word 'embedded' in this context. After considering the way in which magnetic videotape is still considered 'cinematograph film' for the purposes of the Act, even though the images are not 'embedded' in the strict sense of the term, and related decisions in England and South Africa, he held that it is not the means by which the video is shown on the screen, but the end result that is important. The important distinction is that the video game is capable of producing the video imagery and the soundtrack, and hence that video and soundtrack was 'embedded' in the game. There was no reason to narrow the definition to require that distinct frames were required to produce a film, as parliamentary discussion had previously shown a reluctance to tie the protection afforded by copyright in this context to a particular technology.