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2025 MarsdenLR 3373
HIGH COURT MALAYA PENANG
ONNET CONSULTING SDN BHD & ANOR – Appellant
Versus
AM PM PHARMACY SDN BHD & ORS – Respondent
[Civil Suit No: PA-22NCvC-199-12-2023]
Plaintiffs did not prove copyright ownership or infringement due to failure to adduce necessary evidence, including the source code, resulting in dismissal of their claims.
Headnote:(A) Copyright Act 1987 - Sections 26(2) and 42 - Breach of contract - The Plaintiffs claimed copyright over ODOO ERP system and related contractual breaches against the Defendants - The Court found that the Plaintiffs did not own the copyright and thus dismissed the claims - Service relationship between Plaintiffs and Andrew clarified, emphasizing no commissioning agreement existed - The Plaintiffs failed to prove existence of copyright, its ownership, or breach of confidentiality. (Paras 17, 19, 32, 62, and 76)
(B) Burden of Proof - In copyright cases, the burden rests on the Plaintiffs to demonstrate eligibility for copyright protection, ownership, and infringement, which they failed to do - The absence of the original or modified source code undermined the Plaintiffs' claims. (Paras 22, 43, and 59)
Facts of the case:
The Plaintiffs, a consultancy and hosting provider, sued the Defendants for alleged breaches related to copyright and contracts involving the ODOO ERP system following an unauthorized migration to a third party's server. The 2nd Plaintiff sought to continue the service level agreement, which the 1st Plaintiff rejected.
Findings of Court:
The Plaintiffs failed to prove ownership of the copyright in the ODOO ERP system, resulting in dismissal of their action and a costs order against them.
Issues: The key issues included whether the Plaintiffs owned the copyright of the ODOO ERP system and if the Defendants breached any duty of confidentiality or duty of care.
Ratio Decidendi: The Court ruled that the Plaintiffs did not provide sufficient evidence to substantiate ownership or infringement, noting their failure to comply with s 42 of the Copyright Act 1987, and established that Andrew was not formally commissioned by the Plaintiffs, thus no breach occurred.
Result: Claim dismissed; costs awarded against Plaintiffs.
| Table of Content |
|---|
| 1. introduction of the case and parties (Para 1 , 2 , 3) |
| 2. background facts regarding the parties and the odoo erp system (Para 4 , 5 , 6 , 7 , 8 , 9) |
| 3. plaintiffs' case and claims detailed (Para 10 , 11 , 12 , 13 , 14 , 15 , 16) |
| 4. issues to be tried presented (Para 17 , 18) |
| 5. unsuccessful claims of copyright ownership established (Para 19 , 20 , 21 , 22) |
| 6. court's observations on evidence and requirements for copyright (Para 23 , 24 , 25 , 26 , 27) |
| 7. affordable justification and failure to prove existence (Para 28 , 29 , 30) |
| 8. failure to comply with statutory requirements (Para 31 , 32 , 33 , 34) |
| 9. no proof of copyright infringement established (Para 35 , 36 , 37 , 38 , 39) |
| 10. lack of specificity and pleading rules (Para 40 , 41 , 42 , 43) |
| 11. nature of odoo erp system and lack of proprietary rights (Para 44 , 45 , 46 , 47 , 48) |
| 12. standard version defense against copyright claims (Para 49 , 50 , 51) |
| 13. flawed dependence on gnu lgpl for copyright (Para 52 , 53 , 54 , 55 , 56) |
| 14. failure to discharge burden of proof (Para 57 , 58 , 59 , 60) |
| 15. commissioning and ownership of copyright (Para 61 , 62 , 63 , 64) |
| 16. assessment of claims to commission work (Para 65 , 66 , 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74) |
| 17. qualified person status under the copyright act (Para 75 , 76 , 77 , 78) |
| 18. deficiencies in pleading duty of care (Para 79 , 80 , 81 , 82 , 83) |
| 19. migration of the odoo system contextualized (Para 84 , 85 , 86 , 87 , 88 , 89 , 90) |
| 20. court's final conclusion and order (Para 91 , 92) |
Introduction
[1] This action arises from the download, transfer and migration of a certain 'ODOO ERP system' from the 2nd Plaintiff's hosting server to the 3rd Defendant's hosting server. The Plaintiffs sue the Defendants for multiple causes of action based on:- (i) breach of contract (specifically with regard to the duty of confidentiality), (ii) copyright infringement and (iii) breach of a duty of care in respect of the ODOO ERP system.
[2] The 3rd Defendant did not participate in the trial of the instant suit. This is because the 3rd Defendant and the Plaintiffs entered into a consent judgment on 5 August 2024. Accordingly, the reference herein to the Defendants shall mean the 1st Defendant ("D1") and the 2nd Defendant ("Andrew").
[3] After a full trial, I dismissed the Plaintiffs' claim. Here are the grounds of my judgment.
Background Facts
[4] The 1st Plaintiff ("P1") provides advisory and consultancy services, computer software solutions, computer applications and programming. P1 says that it is the ODOO partner in Malaysia. D1 says that P1 is actually a reseller of the ODOO software, which originated from Belgium.
[5] The 2nd Plaintiff is a web hosting provider. Its role in this matter was as the host server provider of the ODOO ERP system.
[6] P1 and D1 entered into a letter of confirmation dated 6 February 2018 ("letter of confirmation"). Whereby P1 would provide system consultation and install the ODOO ERP system, together with the ensuing post-implementation maintenance services, to D1 ("project"). D1 says it was agreed that P1 would implement a standard ERP (enterprise resource planning) software known as ODOO.
[7] P1 says that Andrew is the contractor appointed by it to develop and implement the ODOO ERP system for D1. Andrew is in charge of its installation, implementation and post-implementation maintenance. D1 says that Andrew was held out to be the project director.
[8] In early 2023, the ODOO ERP system supplied to D1 encountered the issue of low capacity. D1 was presented with two sets of solutions.
(a) First, by PW1 (Managing Director of the Plaintiffs), that the problem can be solved by upgrading the database, but a higher price is required to be paid.
(b) Second, by Andrew, that the problem can be solved by migrating the system to another server with a larger capacity. Andrew recommended the 3rd Defendant as the new hosting server.
[9] D1 accepted the second proposed solution of migrating the system to a
