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Ultimately, on a basis that is not presently relevant, some accommodation was reached between PPCA’s solicitors and the Network Broadcasters’ solicitors, who as I said, are Free TV’s solicitors, as to the documents that would be produced in answer to the summonses. I have no doubt that that involved an element of give and take or compromise and reflects the pragmatic approach that is often very sensible in relation to these sorts of disputes. It may well be that the documents were produced without conceding that they were relevant. On the other hand, the question of relevance would be a sterile inquiry at this stage of the proceeding. 32 If it be the fact that a significant part of the costs for performing the work to which I have referred were incurred in connection with the production of documents that ultimately are shown to have had no relevance to the proceeding, that is a matter that could be taken into account at the end of the day when the reference has been determined. I do not consider that it is appropriate at this stage to make any order for the payment of the costs of complying with the summonses. I consider that at present, the costs of complying with the summonses should prima facie be treated as Free TV’s costs of the proceeding, having regard to the connection between Free TV, on the one hand, and the Network Broadcasters. 33 I consider that the appropriate course is to defer to the occasion when consideration is given to costs generally, either at or after the final hearing, the question of whether, and, if so to what extent, the costs of complying with the summonses should be treated as something other than the costs of Free TV’s participation in the proceeding. On the other hand, as I have already said, the FremantleMedia bodies have no connection with Free TV and should properly be treated as third parties to the proceeding, such that their costs should be ordered on the basis that I have already indicated.

Phonographic Performance Company of Australia Limited

© is the copyright symbol in a copyright notice

© is the copyright symbol in a copyright notice (Photo credit: Wikipedia)

under section 154(1) of the Copyright Act 1968 (Cth) [2009] ACopyT 1 (29 October 2009)

Last Updated: 2 February 2010

COPYRIGHT TRIBUNAL OF AUSTRALIA

Phonographic Performance Company of Australia Limited

under section 154(1) of the Copyright Act 1968 (Cth) [2009] ACopyT 1 

Copyright Act 1968 (Cth) ss 154163164166167
Copyright Tribunal (Procedure) Regulations 1969 (Cth) rr 47, 48 

Bank of New South Wales v Withers [1981] FCA 51(1981) 35 ALR 21
Re John Dee (Export) Pty Limited (1990) ATPR 41-006
Charlick Trading Pty Ltd v Australian National Railways Commission & Anor [1997] FCA 674(1997) 149 ALR 647
Fuelxpress Ltd v LM Ericsson Pty Ltd (1987) 75 ALR 284
Re Application by Seven Dimensions Pty Ltd (1996) 35 IPR 1

REFERENCE BY: PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED (ACN 000 680 704) UNDER SECTION 154(1) OF THE COPYRIGHT ACT 1968 (CTH)

CT 2 of 2007

EMMETT J (PRESIDENT)
29 OCTOBER 2009
SYDNEY

COMMONWEALTH OF AUSTRALIA
Copyright Act 1968

 

IN THE COPYRIGHT TRIBUNAL CT 2 OF 2007

REFERENCE BY:

PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED (ACN 000 680 704) UNDER SECTION 154(1) OF THE COPYRIGHT ACT 1968 (CTH)

 

 

PRESIDENT: EMMETT J (PRESIDENT)
DATE OF ORDER: 29 OCTOBER 2009
WHERE MADE: SYDNEY

THE TRIBUNAL ORDERS THAT:

1. The Applicant pay to Fremantlemedia Australia Pty Ltd and Fremantlemedia Australia Holdings Pty Ltd (together, the Addressees) issued by the Tribunal on 18 November 2008 at the request of the Applicant (Summonses) their reasonable costs reasonably incurred (which may be more than party/party costs but less than solicitor/client costs) in complying with the Summonses, including (without limitation) costs in relation to the following categories of work:

(a) narrowing the categories of documents required by the Summonses;

(b) obtaining advice regarding the Addressees’ obligations under the Summonses;

(c) reviewing documents potentially captured by the Summonses for relevance, privilege and confidentiality;

(d) preparing documents for production (including masking privileged documents and marking confidential documents).

2. Failing agreement between the Applicant and any Addressee regarding the amount of costs payable pursuant to order 1 above, the Registrar of the Tribunal or a person specified by the Registrar may settle the amount of the costs to be so paid. In settling the amount of the costs, the Registrar or the person shall allow so much only of the amount as in their opinion is recoverable pursuant to order 1 above.

3. The question of whether, and if so, to what extent, Seven Network Limited, Ten Network Holdings Limited, Nine Network Australia Holdings Pty Limited, WIN Corporation Pty Ltd, Southern Cross Broadcasting (Australia) Pty Limited and Prime Media Group Limited, (the “Summonsed FTA Broadcasters”), should be awarded costs in relation to the Summonses issued to them on 18 and 24 November 2008 be stood over to the occasion when consideration is given to costs of the proceeding generally, whether at or after the final hearing.

4. Pursuant to the Copyright Tribunal (Procedure) Regulations reg. 48, PPCA be exempted from compliance with any requirement of reg. 47 of those regulations to make payment of fees or expenses to the Addressees or the Summonsed FTA Broadcasters in respect of the Summonses.

5. Until further order, access to Confidential Exhibit JIF-1 be limited to external solicitors, counsel and external experts for:

1. the parties to the reference; and

2. the addressees of the summonses issued on 18 and 24 November 2008.

COMMONWEALTH OF AUSTRALIA
Copyright Act 1968

 

IN THE COPYRIGHT TRIBUNAL CT 2 OF 2007

REFERENCE BY:

PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED (ACN 000 680 704) UNDER SECTION 154(1) OF THE COPYRIGHT ACT 1968 (CTH)

 

PRESIDENT: EMMETT J (PRESIDENT)
DATE: 29 OCTOBER 2009
WHERE MADE: SYDNEY

 

REASONS FOR JUDGMENT

1 Phonographic Performance Company of Australia Limited (PPCA) has applied to the Tribunal under s 154 of the Copyright Act 1968 (Cth) (the Act) for approval of a scheme. The scheme generally relates to the broadcast by free-to-air television broadcasters of recorded music. PPCA is a collecting society in relation to the recorded music.

2 On 18 November 2008 and 24 November 2008, the Tribunal, at the request of PPCA, issued summonses to the following parties:

• Seven Network Limited (Seven);• Nine Network Australia Pty Ltd (Nine);

• Ten Network Holdings Limited (Ten);

• Southern Cross Broadcasting (Aust) Pty Limited (Southern Cross);

• Prime Media Group Limited (Prime);

• WIN Corporation Pty Ltd (WIN);

• FremantleMedia Australia Pty Ltd; and

• FremantleMedia Australia Holdings Pty Limited.

On the same days, the Tribunal, at the request of PPCA, issued a second set of summonses to the same parties.

3 Each of Seven, Nine, Ten, Southern Cross, Prime and WIN (together the Network Broadcasters) is a member of, or is related to, a member of Free TV Australia Ltd (Free TV), a company limited by guarantee. Free TV is a respondent to this proceeding.

4 The recipients of the summonses incurred legal costs in connection with the summonses. The costs related to performance of the following categories of work:

• Narrowing the categories of documents referred to in the summonses;

• Obtaining advice regarding the recipients’ obligations under the summonses;

• Reviewing documents potentially covered by the summonses for relevance, privilege and confidentiality; and

• Preparing documents for production in accordance with the summonses, including masking privileged material in documents and identifying confidential documents.

The work was undertaken in order to avoid incurring unnecessary costs and to ensure that privilege was not waived and that confidential documents were appropriately dealt with. Having regard to the complexity of privilege issues and the sensitivity of the information dealt with in the documents, significant costs were incurred.

5 The recipients of the summonses have now applied to the Tribunal for an order that PPCA pay to them the amount of costs and expenses incurred by them in relation to those categories of work. PPCA resists the making of such orders on two bases. The first is that the Tribunal has no power to make the orders claimed. The second is that, if the Tribunal has such a power, it ought, in the exercise of its discretion, to decline to make orders in favour of the Network Broadcasters. PPCA says, in effect, that the Tribunal should do no more than allow the costs and expenses incurred by the Network Broadcasters in performing the work in relation to the summonses to be treated as the costs of Free TV in the reference before the Tribunal.

POWER TO MAKE ORDERS

6 Part VI of the Act provides for the establishment of the Tribunal. Division 4 of Part VI deals with Procedure and Evidence and consists of ss 163 to 169 inclusive. Under s 166(1), regulations may make provision for, or in relation to, the procedure in connection with the making of references and applications to the Tribunal and the regulation of proceedings before the Tribunal. Pursuant to that power, the Copyright Tribunal (Procedure) Regulations 1969 (Cth) (the Regulations) were enacted. Part VI of the Regulations, consisting of regs 44 to 48 inclusive, deals with Miscellaneous Matters.

7 Under s 164 of the Act, the procedure of the Tribunal in proceedings before it is, subject to the Act and the Regulations, within the discretion of the Tribunal. Under s 167(3), a person may be summoned to produce specified documents or articles to the Tribunal. Regulation 47(c) relevantly provides that, where a witness attends to produce documents or articles in a proceeding, in accordance with a summons, or at the request of a party to the proceeding or of the Tribunal, payment of fees and expenses to the witness shall be made by the person on whose behalf the witness is summoned or at whose request the witness attends or, if the witness is summoned or requested to attend on behalf of the Tribunal, by the Commonwealth. Under reg 48(1), the Tribunal may, in relation to any proceeding, in special circumstances, and either absolutely or subject to conditions, exempt a person from compliance with any procedural requirements of the Regulations.

8 The Tribunal’s power under s 164, in matters of procedure, is broad and unfettered, save as to the Act and the Regulations. That power is complemented by s 167(3), which expressly enables the Tribunal to summon a person to produce specified documents or articles. Regulation 47 then creates an obligation or liability, on the part of a person on whose behalf a witness is summoned, or at whose request a witness attends, to pay the fees and expenses of that witness. Thus, reg 47 operates independently of any action on the part of the Tribunal. In particular, it creates a liability or obligation independently of any order that might be made by the Tribunal in the exercise of the power conferred by s 164. On the other hand, it refers only to the attendance of a witness to produce documents or articles.

9 Under the general law, a person who has been served with a subpoena to produce documents is not entitled to expenses incurred in searching out, collating and copying those documents. It was an established principle of the general law that there could be no recovery of witness expenses in the absence of an express provision in the rules of the relevant court (see Bank of New South Wales v Withers [1981] FCA 51(1981) 35 ALR 21).

10 The Tribunal’s powers to issue summonses and to order persons who procure their issue to bear the costs and expenses incurred by persons in complying with them are within the scope of the Tribunal’s power to determine its procedure under s 164. While there is an express power under s 167 to issue summonses, the power to make orders in relation to the issue of such summonses, including orders for the payment of expenses resulting from compliance with the summons, are implied from or are incidental to, the power of the Tribunal to summon persons to appear before it and to produce documents (Re John Dee (Export) Pty Ltd (1990) ATPR 41-006). I do not consider that reg 47 detracts from that general power. Regulation 47 is directed to a different question, namely, the creation of a liability or obligation to pay certain fees and expenses. That does not derogate from the broad and unfettered discretion conferred by s 164.

11 I consider that, in the exercise of the discretion conferred by s 164, it would be appropriate to order in a proceeding such as the present, that a person who is the recipient of a summons be paid by the party at whose instigation the summons is issued, being PPCA in this case, all reasonable costs reasonably incurred in complying with the summons. That is to say, the costs recoverable would include costs in a reasonable amount for the work performed on the basis that the work performed was reasonably required in the circumstances.

12 Where a summons issued by the Tribunal is served on a person, that person would ordinarily be entitled to the reimbursement of reasonable costs and expenses incurred in:

• obtaining advice as to the validity of the summons;

• correspondence with, and attendances on, the party at whose instigation the summons was issued, as to the terms of the summons, with a view to narrowing or clearly identifying the scope of documents to be produced;

• identifying and extracting documents for production in accordance with the summons;

• obtaining advice as to whether documents covered by the summons are confidential or properly subject to claims for privilege;

• preparing documents for production, including masking privileged material;

• correspondence and negotiations with and attendances on the person at whose instigation the summons was issued, as to the terms upon which access to confidential documents should be permitted by the Tribunal; and

• attendances before the Tribunal when the summons is dealt with in order to assert and make out any claim of confidentiality and to seek orders restricting access and to ensure that confidentiality undertakings proposed are given.

Such expenses would ordinarily be expenses reasonably incurred by the recipient of the summons (see Charlick Trading Pty Ltd v Australian National Railways Commission and Anor [1997] FCA 674(1997) 149 ALR 647 at 649).

13 The purpose of the exercise of the discretion to order reimbursement of reasonable costs reasonably incurred is to compensate a recipient of a summons for expense or loss incurred in complying with the summons. That purpose is to be contrasted with the case of a successful party to litigation who seeks recovery of costs. In such a case, a distinction is ordinarily drawn between solicitor and client costs, on the one hand, and party-party costs, on the other. A person who is not a party to litigation would ordinarily be compensated for the costs and expense actually incurred, so long as that cost or expense is a reasonable one and that cost or expense was reasonably incurred (see Fuelxpress Ltd v LM Ericsson Pty Ltd (1987) 75 ALR 284 at 286).

14 Accordingly, I consider that it is appropriate to order that PPCA pay all reasonable costs reasonably incurred by the FremantleMedia companies in complying with the summonses issued to them, including costs and expenses incurred in performing the work described above. Of course, payment in compliance with such an order would satisfy and discharge any liability or obligation under reg 47.

EXERCISE OF DISCRETION IN RELATION TO TELEVISION NETWORKS

15 Additional considerations arise in relation to the Network Broadcasters. PPCA invites the Tribunal to have regard, when considering the exercise of the discretionary power conferred by s 164, to the special relationship that exists between the Network Broadcasters, on the one hand, and Free TV on the other.

16 Each of the Network Broadcasters is a member of a group of companies. Each member of a group is related to the other members of the group. The board of directors of Free TV is made up of the following:

• six directors and their respective alternates, who represent each of the six Network Broadcasters;

• one director and alternate, who represents Imparja Television Pty Limited; and

• an independent chairman who has no connection with any of the Network Broadcasters or Imparja.

17 Free TV was incorporated in September 2002. Prior to that time, commercial free-to-air television broadcasters were represented by an unincorporated association called the Federation of Australian Commercial Television Stations (usually referred to as FACTS). Free TV or FACTS have negotiated blanket licence schemes with both PPCA and Australasian Performing Right Association (APRA). Under those schemes, the parties have agreed a total licence fee to be paid by the entire industry. Each broadcaster must enter into a separate licence agreement with APRA or PPCA, as the case may be, under which the broadcaster agrees to pay a proportion of the relevant industry-wide fee as allocated to it by FACTS or by Free TV.

18 Under the blanket licence agreement with PPCA, the amount to be paid by each broadcaster to PPCA was left to be determined by FACTS. The apportionment was determined internally by FACTS. The apportionment of the industry-wide fee payable under the blanket licence agreement with APRA was left to be determined by Free TV. The methodology for apportionment was determined by Free TV, which requires ongoing calculations to be made involving the use of highly confidential information provided by the broadcasters. What is significant about those arrangements, however, is that the fee that is paid to APRA and the fee that is presently paid to PPCA (and one might assume the fee that would be paid to PPCA under any new scheme that might be approved) is apportioned among the licensees by somebody other than the licensors, PPCA and APRA.

19 Free TV applied to be made a party to the proceeding on 11 December 2007. In its application to be joined, Free TV stated that it is the industry body representing Australia’s commercial free-to-air television broadcasting licensees. The application stated that Free TV’s constitution commits it to promoting, defending and conserving the rights and interests of its members in commercial free-to-air television broadcasting in Australia and that it provides a forum for discussion of industry matters and is the public voice of the industry on a wide range of issues. The application stated also that the members of Free TV are currently licensed by PPCA to broadcast copyright sound recordings to the public and that the proposed licence scheme that is the subject of the current reference will be directly applicable to the members of Free TV. In an affidavit filed on behalf of Free TV, Ms Sandra Slade confirmed that Free TV is the industry body that represents all of the commercial free-to-air television broadcasters in Australia.

20 In its points in answer to PPCA’s points of claim, filed in relation to this reference, Free TV confirmed that it represents every free to air commercial television broadcaster licensed to broadcast in Australia. At one stage, in the course of the reference, it was contemplated that a case would be stated for the Federal Court in relation to certain questions. A draft stated case was prepared on behalf of Free TV in which, again, it stated that Free TV is the industry body representing Australia’s free-to-air commercial television broadcasting licensees, and that Free TVs constitution commits it to promoting, defending and conserving the rights and interests of its members in commercial free-to-air television broadcasting in Australia. The draft stated case identified the current members of Free TV, which include all licensees that are licensed to broadcast television in Australia. All but Imparja Television Pty Ltd are related to one or other of the Network Broadcasters.

21 In the light of those facts, it would be artificial to regard the Network Broadcasters as being summonsed independently of their connection with Free TV. The Network Broadcasters were treated as being the holder or likely repository of documents for the relevant network. It is clear that Free TV is the member body for all of the commercial free to air broadcasters and that there is no other body that represents them. Each of the Network Broadcasters that received a summons is involved with Free TV in the way that I have described and the only exception to the proposition that all members of Free TV were, in effect, the recipient of summonses was Imparja Television Pty Ltd.

22 The proposed licence scheme and the arrangements that presently exist are not simply schemes pursuant to which licences may or may not be taken up by individual industry participants. Rather, the current arrangements and the proposed scheme constitute an industry-wide agreement between PPCA and Free TV pursuant to which individual licences would be granted to each participant. The fee for the licence is a single industry-wide fee agreed between PPCA, on the one hand, and Free TV on behalf of its members, on the other. The apportionment of the fee amongst the members of Free TV is undertaken by Free TV on a basis that is not disclosed to PPCA or to the other members.

23 The position of Free TV in relation to the Network Broadcasters may be unique as an industry body. Accordingly, any observations that I make in relation to this application should not be understood as extending to any other industry body in respect of which circumstances may be quite different. PPCA has promulgated a number of public performance schemes. Those schemes can be contrasted from the proposal in relation to television broadcasters. No single industry-wide fee is agreed between PPCA and any other industry body in relation to those schemes. Apart from its members’ direct interest in the proposed licence scheme, Free TV would have no standing to be joined as a respondent to this reference. An inference is capable of being drawn that the steps taken by Free TV in relation to the reference are taken in accordance with decisions made by its board of directors which, as I have said, for the most part, represent the Network Broadcasters.

24 Under s 174(1) of the Act, the Tribunal may order that the costs of any proceedings before it incurred by any party, or a part of those costs, are to be paid by any other party. The Tribunal may tax or settle the amount of the costs to be so paid or specify the manner in which they are to be taxed. In taxing or settling pursuant to that provision, so much only of the amount is to be allowed as would be allowed if the proceedings were proceedings before the Federal Court of Australia and the costs were taxed under the Federal Court Rules. However, it has not been the practice of the Tribunal to award costs to successful parties as a matter of course. The parties who appear before the Tribunal ordinarily bear their own costs themselves. As a general rule, orders for costs will only be made in cases where there are circumstances that justify the making of the order.

25 The justification for that practice is that cases before the Tribunal often involve matters of doubt and difficulty between substantial parties who are owners, or substantial users, of copyright material. Such cases often involve parties who are in an ongoing relationship, who are in genuine dispute about the amount or amounts to be paid for the use of copyright material. In those circumstances, it will often be appropriate, particularly if parties have acted in good faith, that there be no order for the payment by one party to another party of costs incurred in a proceeding before the Tribunal (see Re Application by Seven Dimensions Pty Ltd (1996) 35 IPR 1 at 21).

26 I do not consider that the Network Broadcasters, being the recipients of the summonses, are in substance third parties to the reference. They are, in essence, parties to the reference represented by Free TV. There is a considerable merit, therefore, in the proposition that they should be treated in the same way as parties, who would not, in the ordinary course, be awarded costs separately from any overall consideration of costs involved in the proceeding. That is to say it is appropriate to deal with the relevant costs incurred by the Network Broadcasters as being Free TV’s costs of the reference.

27 However, the matter is complicated by the course of communications that led up to the issue of the summonses in question. Prior to that time, PPCA and Free TV had entered into discussions for the informal production, by way of simulated discovery, of documents that might be relevant to the reference. PPCA’s solicitors propounded a list of categories of documents for production by Free TV. Five of those categories related to financial material concerning the network Broadcasters. On 28 August 2008, Free TV’s solicitors wrote to PPCA’s solicitors in relation to those categories, saying that the relevance of those particular categories was not clear. On 17 September 2008, PPCA’s solicitors responded that, if Free TV did not intend to submit that the Network Broadcasters did not have the capacity to pay an increased licence fee to PPCA, then PPCA would not press for those categories. Otherwise, the categories were pressed and Free TV’s objection on the ground of lack of relevance was disputed.

28 On 3 October 2008, Free TV’s solicitors responded that the objection to the relevant categories was pressed. Following that response, the summonses in question were issued at the instigation of PPCA. That then led to a further exchange of correspondence between the solicitors for PPCA and for Free TV. In a letter of 2 December 2008, PPCA’s solicitors said that, given that the discovery process was not fruitful, having regard to the objections to production taken by Free TV, PPCA had decided to approach document production through the more orthodox method of the issue of summonses. They said that the objections that may properly be taken to such summonses were an entirely separate matter from the grounds of objection to discovery raised by Free TV.

29 They also said that, in that regard, it was not useful to refer to the summonsed parties as non-parties, as if they were somehow strangers to the proceeding, when in fact they and not Free TV will be the licensees under the licence scheme the subject of the reference. They said that the fact that Free TV is the actual respondent to the reference is a somewhat artificial state of affairs, as is amply demonstrated by the fact that the firm of solicitors acting for all of the broadcasters with respect to the summonses, is the firm on the record acting on behalf of Free TV. Free TV’s solicitors responded on 17 December 2008, rejecting the assertion that the objections that may properly be taken to the summonses are an entirely separate matter from the grounds of objection to discovery raised by Free TV.

30 Free TV’s solicitors said that objections to discovery by Free TV based on relevance are pertinent to equivalent objections to production by non-parties. They said that a failure by PPCA to articulate the relevance of documents sought from Free TV had obvious significance to the issue of whether non-parties should be required to produce those very documents. The fact that one objection arises in the context of production agreed between the parties and the other arises in the context of summonses issued by the Tribunal was, the solicitors said, a procedural distinction with no substantive significance. Indeed, they said, given related bodies corporate of the summonsed entities will be licensees under the licence scheme, they could not see any basis for the distinction that PPCA’s solicitors sought to draw between the objections.

31 Ultimately, on a basis that is not presently relevant, some accommodation was reached between PPCA’s solicitors and the Network Broadcasters’ solicitors, who as I said, are Free TV’s solicitors, as to the documents that would be produced in answer to the summonses. I have no doubt that that involved an element of give and take or compromise and reflects the pragmatic approach that is often very sensible in relation to these sorts of disputes. It may well be that the documents were produced without conceding that they were relevant. On the other hand, the question of relevance would be a sterile inquiry at this stage of the proceeding.

32 If it be the fact that a significant part of the costs for performing the work to which I have referred were incurred in connection with the production of documents that ultimately are shown to have had no relevance to the proceeding, that is a matter that could be taken into account at the end of the day when the reference has been determined. I do not consider that it is appropriate at this stage to make any order for the payment of the costs of complying with the summonses. I consider that at present, the costs of complying with the summonses should prima facie be treated as Free TV’s costs of the proceeding, having regard to the connection between Free TV, on the one hand, and the Network Broadcasters.

33 I consider that the appropriate course is to defer to the occasion when consideration is given to costs generally, either at or after the final hearing, the question of whether, and, if so to what extent, the costs of complying with the summonses should be treated as something other than the costs of Free TV’s participation in the proceeding. On the other hand, as I have already said, the FremantleMedia bodies have no connection with Free TV and should properly be treated as third parties to the proceeding, such that their costs should be ordered on the basis that I have already indicated.

I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Tribunal.

Associate:

Dated:

Counsel for PPCA: Mr R Cobden, Mr C Dimitriadis
Solicitor for PPCA: Gilbert + Tobin
Counsel for Free TV: Mr JM Hennessy
Solicitor for Free TV Clayton Utz

 

Date of Hearing: 21 and 29 October 2009
Date of Judgment: 29 October 2009

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