The applicability of the Hot News doctrine was rejected recently in a landmark ruling delivered by Justice Bhat of the Delhi HC. This post is a summary of the decision. Shamnad discussed the crux of this decision here. The judgment is extremely well written and researched, employing a multitude of cases from several foreign jurisdictions. Read the decision in full here. Long post follows.
Background
In 2012, by an Agreement, BCCI granted exclusive broadcasting rights to Star TV to disseminate the information/content emanating from the cricket matches; other copyrights emanating from recording of the live match too were assigned which included the right to record, reproduce, broadcast , etc. Sometime later, Cricbuzz, Idea Cellular and ONMOBILE started SMS services providing contemporaneous ball-by ball coverage of live cricket matches. Star TV India(plaintiff/Respondents) filed three suits against Piyush Agarwal (Cricbuzz), Idea Cellular and ONMOBILE(Appellants/Defendants). The “mobile distribution” rights were the bone of contention in the proceedings. The BCCI was arrayed as the common defendant in all the three cases. BCCI, however, supported Star, claiming paramount rights over all information emanating from cricketing events as the organizer and promoter of that sport in India. Star alleged that the defendants had violated those rights and consequently filed a suit for permanent injunction and damages. The Single Judge of the Delhi HC rejected the defendants’ contentions and the ad-interim injunction sought was granted:
A. A limited interim injunction restraining the defendants from disseminating contemporaneous match information in the form of ball-by-ball or minute-by-minute score updates/match alerts for a premium, without obtaining a license from the plaintiff
B. There shall be no restriction upon the defendants to report “noteworthy information” or “news” from cricket matches , as and when they arise, because “stale news is no news”.
C. There shall be no requirement for the license if the defendants do it gratuitously or after a time lag of 15 minutes.
A Division Bench of the Delhi HC overturned the decision in the present judgment.
Contentions
The Appellants’ contentions broadly were:
1. The appellants submitted that no statute created a proprietary right in scores. Facts cannot be ‘owned’ under statute or common law. Further, the appellants highlighted unique nature of the right claimed by the respondents- a quasi property right, not enumerated under any statute. The Court cannot deem cricket scores as property of a person owing to the ambiguous nature of such a right. The appellants cited the opinion of Justice Brandeis in International News Service vs. Associated Press (INS case) which raised concerns about the dangers of creating ill-defined rights. Other case-laws were cited to submit that giving ‘relief’ on the basis of ‘created rights’ would amount to ‘judicial legislation.’ Owing to the non-existence of the respondents’ claimed rights, the Appellants argued that Star’s claims were barred by Section 16 of the Copyright Act which precluded it from claiming copyright or other similar un-enumerated, rights.
2. Only certain aspects or features of an event may be capable of ownership. The sporting event as a whole is incapable of ownership. The mere expending of money or effort would not render the underlying facts relating to sporting events property, capable of protection.
3. There was an inherent contradiction in the rights claimed by the respondents. Property rights are in rem, yet those rights were self professedly are not asserted against the world at large, which therefore was contrary to the in rem principle underlying property rights. It was admitted by the respondents that there was no exclusive property right against persons who carry on the same activities gratuitously.
4. They relied on a Delhi HC decision( New Delhi Television Limited v. ICC Development Limited and Anr.) and submitted that the limited protection by way of injunction of a finite duration granted to preserve the sanctity of “hot news” on the basis of the “unfair competition” and “unjust enrichment” doctrine was warranted by the facts and circumstances of the case.
The Respondents’ contentions broadly were:
1. The respondents submitted the definition of the right asserted as: “It is a unique property right, which stems out of a negative obligation of the appellants, who secure match related information contemporaneously, not to use it commercially for a short duration.” Whereas the right of the members of the public – who witness the event, having paid for the tickets or millions of television viewers who subscribe and watch paid channels, which cover the event, to share it on a non-commercial basis cannot be denied, yet there was an obligation on a third party not to commercially exploit SMS updates. The respondents maintained that the right asserted was neither an intellectual property right, nor a copyright. Counsel submitted that the rights claimed and sought to be enforced are not absolute, in that not all factual information is the subject matter of protection, but only a limited property right – the right to generate revenue by monetizing Match Information through the new platform / medium of Mobile services.
2. Match information had commercial value and was time sensitive, thus constituted Hot News. The Court’s authority to injunct its misappropriation was recognized by in Marksman Marketing Services Private Limited v. Bharti Televentures Limited [Mad HC].
3. An organizer is entitled to appropriate newsworthy content from its events. The BCCI claimed that that it owned property rights in the match information, subject only to public interest considerations like gratuitous dissemination by public, Mandatory Sharing of Feed, etc.It was also argued that denial of property rights in respect of match information is inconsistent with grant of the entire structure of rights in sports event, including broadcasting rights, audio rights, internet rights, stadium rights, etc. Further, if ownership is was partially or fully conceded even for one of the rights, then all incidents and insignia of ownership must follow in respect of the entire bundle of rights vesting in the BCCI.
4. The counsel contended that he rights claimed flowed out of broadcasting rights, not copyright. Further, Section 16 stood excluded in respect of broadcasting rights. Relying on the ESPN case, it was submitted that if Parliament had did not intend Section 16 to apply in respect of broadcasting rights since it was not mentioned in Section 39A.
Decision
The reasoning of the judgment was based on the following four questions:
1. Was the Respondents’ claim precluded by Section 16 of the Copyright Act
The Court decided this issue by a twofold approach and held: The respondent’s claims were precluded by Section 16 of the Copyrights Act; they were also precluded because of the provisions of Chapter VIII of the said Act. If Parliament had intended such rights to exist, they would have been enacted, with suitable mechanisms for their enforcement and effectuation.
The respondents’s argument of Section 16 excluding the rights claimed was based on a reading of Section 39A of the Act which stated applicability of certain sections to broadcasting rights. Section 39 A is titled: Other provisions applying to broadcast reproduction right and performer’s right. Since section 16 is not included, the respondents contended that the claimed rights neither constituted copyright nor ‘other similar rights.’
Firstly, the Court held that by Section 16, “copyright or any similar right” (in a work) apart from what is created by the Act is precluded. The expression “work” limits the exclusion. However, equally, while the text of the Copyright Act does not prescribe what the rights referred to in the words “other similar rights” – other than copyright – are, this must necessarily allude to broadcasting rights. This is exemplified from the applicability of Section 63( which creates offences) to broadcasting rights, in spite of not being included in Section 39 A.
Secondly, the Court observed that Chapter VIII (Rights of broadcasting organisation and performers) was introduced due to a felt need to give limited protections to broadcast rights akin to copyright. If the Parliament had intended to give protection to facts, “time sensitive information” or events (such as match information), there would have been conscious protection of those rights by express provision. Therefore, the exhaustive nature of the regime in Chapter VIII precluded, by its very nature, any claim for protection over and above what was expressly granted by its provisions. Such rights providing protection of facts underlying the broadcast had long been held to be barred as they were “similar” to copyright protection (Donaldson v Beckett 1 ER 837 (1774) and UK statutes) .
In other words, though there is no express reference to Section 16 in Section 39A, its underlying premise, i.e. preclusion of rights other than those spelt out in Chapter VIII, by common law, would apply.
2. The “Hot News” doctrine and its application in India
The Court discussed the Hot News doctrine as propounded in the INS case, and traversed through several cases to arrive at the doctrine’s present ‘ghostly’ avatar : The present avatar ( as in The Flyonthewall.com Inc v Barclays Capital Inc) has been narrowed to injunct time sensitive news where both parties are “direct competitors” and not merely where the plaintiff’s primary service or product is not hot news dissemination, but match organisation or broadcasting of those events. This critical aspect of ‘Hot News’ was absent in the present case, as neither Star, nor BCCI engaged themselves primarily in match news dissemination through SMS.
Thus, the respondents failed to to show to the court, how it had proprietary rights over the facts and information it sought to protect – even for a limited duration. For the reasons discussed above, it was held that the plaintiff could not claim any exclusive property or other such rights to injunct the publication of match information, or hot-news, as claimed by it, irrespective of whether the object of such third party was to publish such information for commercial gain or without any such motive.
3. Respondents’ claim for injunction based on unfair competition
The Court held that upholding the ‘hot news’ doctrine or the unfair competition doctrine in the present case would imply grant of protection to match information, which in turn would be in conflict with the Copyright Act. It observed that the present claims in essence requested to injunct unauthorized copying of facts. It highlighted the issue by stating:
“To say, now, that the doctrine of unfair competition prohibits the misappropriation of match information would either mean that misappropriation under common law can supplant the Copyright Act (which cannot be the case, as discussed above), or that copying and misappropriation refer to two distinct acts, which would be a distinction without a difference.”
It was held that unless a qualitatively different element is purported to be included in the doctrine of “unfair competition” as compared to a copyright claim, the pre-emption under Section 16 would apply to such claims.
4. Respondent’s claim for injunction based on unjust enrichment
The Court held that the claim for interim injunction would not survive for three reasons:
Firstly, the claim of unjust enrichment here was similarly pre-empted as the doctrine of “unfair competition”.
Secondly, the Court must see whether the respondent alleged any misconduct incorporating elements other than those subsumed within the claim of copyright infringement. In the present case, the respondents reported no such facts. Also,even if the claim of unjust enrichment is to be seen on merits, (assuming that it is not pre-empted by Section 16), such a claim cannot – by definition (with limited exceptions) –injunct or prohibit the appellants from disseminating match information, but rather, only be the basis for a restitutionary award.
Thirdly, in this case, the appellant’s dissemination resulted purely from resources invested by them , and in no way resulted from Star’s conduct or any expense incurred by it. Thus, as the benefit gained by the appellants could not be said to be at the expense of Star, the claim for unjust enrichment was not tenable. Given this, the Court did not even consider the question of whether there existed an unjust factor in the retention of such benefit by the appellants.
The claims were considered to be pre-empted by Section 16, amounting to (in essence) copyright claims though dressed up under alternate heads of common law.
Furthermore, the Appellants had argued that their right to freedom of speech and expression and their right to freedom of trade under Article 19 (1) (a) and (g) could not be interfered with in the absence of any law. Expressing its wariness about using common law doctrines to encroach functions of the legislature, the Court held:
“Recognizing the doctrine of unfair competition would inevitably restrict the appellants’ ability to disseminate information, undoubtedly a crucial component of Article 19(1)(a). This is not to say that the doctrine of ‘unfair competition‟ is to be rejected in Indian law on account of an Article 19(1)(a) violation, nor to say that the appellant’s freedom of speech cannot be curtailed by the doctrine under any circumstance, but only to make the limited, but crucial, point that Courts must be cautious in creating doctrines and rights that have such clear implications for constitutional rights, better leaving such matters to the lawmaking domain of the legislative branch, that may result in a coherent legislation that creates a framework within which any curtailment of Constitutional rights is to take place.”
The SC has directed that status quo on the date of the judgment of the Single Judge be maintained by the parties subject to each Defendant depositing RS. 10 Lac per match with the High Court.