A takedown notice that resulted in the discovery of massive copyright fraud in the Tamil movie industry

A recent lawsuit before the Madras High Court, filed through Advocate Swaroop Mamidipudi, regarding the copyright infringement of 5 Tamil movies on YouTube has led to the discovery of an unprecedented scam in the assignment of copyright (internet rights), for possibly 166 Tamil movies.

The origins of the lawsuit can be traced to a routine takedown notice sent to YouTube by Mr. R. Ayubkhan, the plaintiff in the aforementioned lawsuit. He is the proprietor of Khafa Exports and had purchased the digital and internet rights for several Tamil movies. On discovering that 5 such movies were being made available on the internet, by dedicated movie channels run by several different companies, he sent takedown notices to YouTube. These 5 movies include: Arinthum Ariyamalum, Ghajini, Pattiyal, Ramcharan and Azhagai Irukkirai Bayamai Irukkirathu. Some of these movies like Ghajini have been box office hits.

When YouTube receives takedown notices, in a prescribed format, it removes the content from its website and notifies the person who has made loaded the content on YouTube that their account has received a ‘copyright strike’ – 3 such strikes can result in termination of the account. However if the person receiving a ‘copyright strike’ wishes to contest the takedown notice, they can issue a ‘counter-notification’ to YouTube. A counter-notification can be issued for reasons ranging from a ‘fair use’ defense to ownership claims. (At this stage, YouTube’s explainer is silent on the future of the disputed content and how exactly it resolves the dispute that is generated by the counter-notification, without itself incurring any liability – unless of course I have missed it.)

In this case, a few of the channels which had loaded the content on YouTube filed a counter-notification with YouTube and had their videos reinstated, while several other videos were removed. For some other videos, Ayubkhan has reported that some of the takedown notices did not translate into takedowns of the content. At this stage, Ayubkhan decided to sue those parties which had filed counter-notification along with those which were still hosting the copyrighted content on YouTube. On filing the lawsuit against 12 defendants, only a few of the defendants appeared before the Court.

One of these parties was the Mumbai based company called Peppermint Pvt. Ltd. Apparently the company produced copyright assignments from the producers to establish that the company did indeed have ownership over the internet rights for the five movies in question. The counsel for Peppermint Pvt. Ltd. apparently claimed that his client had purchased a total of 166 movies from a person called R. Subramani and even produced the assignment deeds before the Court. Apparently the internet rights for each movie were purchased at a paltry sum of Rs. 10,000 in a deal worth approximately Rs. 16 lakhs. So far nobody has been able to trace this R. Subramani and it also appears that the addresses given on the agreement were fictional. Further one of the producers of the movies in question, Sri Saravana Creations, who was made party to the lawsuit, informed the court that it had assigned the internet rights for the movies in question to the plaintiff-Ayubkhan and not Peppermint Pvt. Ltd.

On hearing arguments, Justice M.M. Sundresh issued an interim injunction on June 27, 2016 against all the Defendants from making available the copyrighted content on internet platforms. As per the order, counsel for Defendant No. 7 i.e. Peppermint Pvt. Ltd. gave an undertaking, through counsel, that they would remove the videos in question from the internet. Justice Sundresh also records that prima facie the copyright in the movies in question appear to belong to the Plaintiff – Ayubkhan. The judge also issued a John Doe order, which is rather ambiguous in my opinion. The order records that the plaintiff’s counsel has requested for a John Doe order against future invisible unknown Defendants but doesn’t specifically state the nature and extent of the John Doe order. Instead the order merely states “these applications are ordered as prayed for”. Given the nature of injunctive relief and scope of copyrights, judges need to be more careful with how they word the orders in question. (The order can be read here)

The lack of copyright registration

The issues thrown up by this case aren’t new to the Indian entertainment industry. The music industry has seen several cases where ownership rights have been disputed because of the lack of transparency and confusion over principles of first ownership of copyrights. In some cases, like the one filed by Javed Akhtar about a decade ago, it turned out that Akhtar had actually assigned away his rights to a particular producer, forgot about it and subsequently sued the producer for copyright infringement. When the producer produced a signed letter from Akhtar, the Delhi High Court imposed costs of Rs. 1 lakh on him for indulging in frivolous litigation.  

One of the reasons for this confusion regarding copyright ownership is that there is no requirement for registration of copyright under the Copyright Act, 1957. The reason for not having such a requirement is that the Berne Convention forbids formalities like registration as a perquisite for protection of copyright and the registration requirement. This requirement is one of the holy sacraments of the Berne Convention on the Protection of Literary and Artistic Works, 1886 and is one of the many reasons that the Americans refused to join the Berne Convention till 1987. From an author’s viewpoint, the ‘no registration’ mandate of the Berne Convention is a boon because it saves the author from the bureaucratic hassles of dealing with the Copyright Office. However, in practice, the absence of a registration mechanism makes it rather difficult to verify ownership details. Due to the lack of compulsory registration there is no simple, credible mechanism to conduct a due diligence to verify ownership of copyrights. Having said that, it should be noted, there are significant downsides to making registration compulsory – it will involve bureaucratic hassles and may require a judgment call on similarity and originality, all of which will raise the cost of enforcing copyrights.

The two other ways to handle the information deficit are firstly, copyright societies and secondly, guilds or associations where scriptwriters or producers create an informal system of registration. On the first count, India has completely failed to create functional copyright societies – till date, even the copyright societies which have been operating for the last twenty years, have failed to make public a credible Register of Owners. On the second count, I do remember reading that scriptwriters in Bollywood have informal registration mechanisms for their members.