New(s) Questions and Fair Use: Using Copyright to Curtail Expression?

We’re pleased to bring you a guest post from Akshat Agrawal on a recent order that raised questions on the extent / limitations of the exemptions and limitations to Indian copyright law. Akshat is a lawyer, interested in IP policy, currently litigating at the Patna and the Delhi High Courts. You can see his previous posts for us here.

New(s) Questions and Fair Use: Using Copyright to Curtail Expression?

Akshat Agrawal

The Bombay High Court through order dated 27^th April 2022 in Shemaroo Entertainment Limited v. News Nation Network Private Limited, restrained News Nation from using, incorporating, recording, distributing, broadcasting, telecasting, disseminating, or publishing any works from the Plaintiff’s catalogue of cinematographic works, on its news channels. This post analyzes this order from the perspective of use of copyrighted work by news channels, and whether the same is exempted from infringement and is a limitation to Copyright under Section 52(1)(a)(ii) and (iii) of the Act of 1957.

Facts

The Plaintiff in the present case claimed to own various cinematographic films, including audio-visual works and clips within. The Defendant operates various news channels including “News Nation”, “News State UP and Uttarakhand” and “News State MP and Chhattisgarh”. It was revealed in Court that the Plaintiff and Defendant had entered into an agreement wherein the Plaintiff had licensed, in a non-exclusive manner, its right to broadcast and exploit the audio-visual song clips, scenes and dialogues/clips to the Defendants’ channels. This agreement was for a period from 1^st July 2019 to 30^th June 2022. It was however terminated at the instance of the Defendant with effect from 1^st August 2020.

According to the Plaintiff, despite this termination, the Defendant had unauthorizedly broadcasted their content. In response the Defendant claimed, “fair use” and “de minimis” use. The Defendant contended that it had only used the content under question while reporting news and other programmes, which comes within the doctrine of fair use. The use by the Defendant was not to exploit, individually or commercially, works of the Plaintiff, but only in a transformed capacity as a part of news reporting. The same, in its submission did not intend to impinge on the market of the Plaintiff. Without prejudice, the Defendant also contended de-minimis use as the use was of a clip lasting less than a minute.

Holding

The Court based its conclusion of prima facie infringement awarding an injunction, on the following:

• The Defendant had entered into a licensing agreement in respect of broadcasting the same content which was now being contended to be an exemption from infringement under Section 52 as well as the doctrine of de minimis. While entering into a licensing agreement in the first place, the Defendant had essentially given up its right to contend such an exemption.
• While terminating the contract, the Plaintiff had informed Defendant of the terms of termination, which inter alia provided that using Plaintiff’s content without a license would now constitute infringement. Defendant had affirmed this.
• A mere quantitative analysis of the duration of content used does not matter. Therefore, mere use for one minute does not exonerate the Defendant from infringement, given it was in respect of the same content that he was paying a valuable consideration during the subsistence of the license agreement.
• Given advertising is the primary source of revenue of the Defendant, the use of the Plaintiff’s works by the Defendant, not for reporting current events and affairs but rather for programmes titled “Bollywood ki Mou Mistri”, “Surili Rakhi”, “Bollywood Mashup”, “Kahani Rakhsabandhan Ki” cannot be fair dealing.
• Moreover, “no material” was shown on record by Defendant in support of its claim that the content was used as a part of its ordinary course of business for news reporting.

Analysis and Commentary

Firstly, the Court has perhaps overemphasized on the fact that there was a licensing agreement between the parties in the past. In my opinion, merely because a license was taken previously, pleading the statutory defense of Section 52(1)(a) at this stage, should not have been denied. Merely because the Defendant had affirmed the communication of the Plaintiff while terminating the contract cannot be a reason for the Defendant to be denied his statutory defense, if applicable. The statutory exemptions to copyright, find their genesis under Article 19 of the Constitution, as held by a Division Bench of the Delhi High Court in Wiley Eastern Ltd. v. IIM ), and their applicability cannot be waived by contract. The Court ought not to have dismissed the applicability of exemptions on this ground.

Secondly, when it comes to applicability of section 52(1)(a)(iii), it is essential to see how Courts have interpreted the said provision in the past. In Super Cassettes Industries Ltd. v. Hamar Television Network, the Delhi High Court held that in ascertaining what would constitute reportage of “current events” or would be “criticism” or “review”- courts ought to adopt a liberal approach. The Court also held that commercial use of copyrighted work cannot simplicitor make it unfair and that “transformative use” may be deemed as fair.

It may also be helpful to see how other jurisdictions have treated the defense of “reporting current events” in Copyright law.

In Ashdown v. Telegraph Group Ltd. , the UK Court of Appeal, following the opinion in Pro Sieben AG v. Carlton UK Television Ltd. , held what constitutes “reporting current events” to be interpreted liberally. The said defense is to ensure that media is able to inform the public of matters of current concern. The event need not be “current” with respect to time, but rather merely needs to be the current interest of the public. The Court recognized that merely because the newspaper was using the content for commercial purposes, it would not be prevented from availing of the defense provided in Section 30(2), as it is a consciously delineated loss to the copyright holder in interests of freedom of expression/ freedom of the press. One of the factors which the court recognized was whether the user was competing with the proprietor in respect of the content. If not, then, moderate taking for the purposes mentioned under Section 30 same would be permitted. The nature and extent of reproduction was required to be reasonable and apt for reporting.

Moving on to Australia, in TCN Channel Nine Pvt Ltd. v. Network Ten Limited , the Federal Court, while recognizing the defense to Copyright, which was worded differently, stating – use for the purpose of or is associated with “reporting of news by way of broadcasting”, held that “news”, despite being qualified by the words “reporting” was not restricted to “current events”. The Court also recognized that “news” may include the use of humor, inspite of the fact that the difference between news and entertainment may be difficult to determine in particular situations.

Coming to Canada, in Allen v. Toronto Star Newspapers Limited, the Ontario Court dealing with the defense to copyright infringement termed as “purpose of news reporting”, held that use had to be related to “current news”. The Court also recognized that use in “a reduced form” would be fair. If the copying/ reproduction was to aid in the presentation of a news story and not to gain unfair competitive advantage over the Plaintiff, it would be exempted. In Wiseau Studio v. Harper et al., the Supreme Court of Justice, Ontario, recognized that use of copyright works, short of infringement, ought to be encouraged. The Court reiterated the “users rights” framings of the law and held that the use need not be trivial to be fair. The Court also held that if the only effect on the market of the Plaintiff was “lost licensing revenue”, and the purpose of use was justifiable as for criticism, review or news reporting, the said effect on the market wouldn’t matter.

In the case at hand, the Bombay High Court, even at a prima facie stage took a rather unbalanced approach towards this exemption, by ignoring the possibility of the use by the Defendant being for reviewing the movies and the catalogue, or reporting on current releases in the entertainment world, where usage of small clips is common. There is no reason to assume that these could not even be considered as being newsworthy or ‘report worth’ content, simply based on the titles Bollywood ki Mou Mistri”, “Surili Rakhi”, “Bollywood Mashup”, “Kahani Rakhsabandhan Ki” etc . Moreover, it is clear that the Plaintiff and the Defendant are not in competition, and the length of clips used was maximum for a minute, out of a movie/show which is way longer. Of course, if the use of the works was only as a background content to other news, and not related to the release or criticism/review of the film/show in question, the use would have been susceptible to infringement.

In Academy of General Education, Manipal v. Malini Mallya, AIR 2009 SC 1982, the Supreme Court has clearly recognized that even at the stage of interim injunctions, Courts ought to reasonably consider application of exemptions to infringement to take a balanced view to ensure that defenses, which have their genesis in the constitutional doctrine of freedom of expression, are not unreasonably constrained by the statutory copyright doctrine. Further, the mere fact that the use is commercial in nature does not de facto hold use to be infringement, and the amount of emphasis laid by the Court on advertising ad revenue was clearly unfair. Commercial actors are as entitled as noncommercial actors to engage in free speech and expression for purposes/ in context of uses mentioned under Section 52(1)(a) of the Act.  Moreover, at the prima facie stage, where evidence ought not to be produced by parties, the reasoning given by the Single Judge requiring Defendant to show “material” in support of its claim of news reporting was uncalled for. The mere possibility of use for legitimate purposes, along with the insubstantial quantity, ought to have occasioned for no injunction to be granted.

In any case, no irreparable harm would have been caused in the present case to Plaintiffs in case an injunction was not granted- given all that was lost are potential licensing revenues. The Court could have easily, as was ordered in the Rameshwari Photocopy case, directed the Defendant to maintain a bank account with the licensing amount that was paid in the past in a fixed deposit account, during the pendency of the suit- and the same would have clearly served the purpose during the interim period without potentially restricting any harm to free speech interests of news reporters and citizens. Injunctions should most definitely be withheld in such close cases, where it is tough to prima facie come to a finding that there is absolutely no chance of the use being an exempted use, or one which is a limitation to the copyright of the Plaintiff.

Hopefully, these are the types of questions the courts consider, going forward.