Sweet Sound of Victory: Looking at the Calcutta HC’s Decisive Decision on Rights of Authors

On the recent Calcutta High Court’s decision (Vodafone v. Saregama) concerning rights of the authors, we are pleased to bring to you this post by SpicyIP Intern Surabhi Katare, highlighting the key issues in the dispute and sharing her take on the notable findings of the Court. Surabhi is a recent graduate from Hidayatullah National Law University, Raipur. She is interested in IPR, media, and tech laws and wants to pursue a career in IP and allied areas. Her previous posts can be found here.

Sweet Sound of Victory: Looking at the Calcutta HC’s Decisive Decision on Rights of Authors

By Surabhi Katare

In a major development, Calcutta High Court’s passed a landmark judgement on May 17, 2024, in safeguarding the copyrights of authors of music and literary work used in sound recordings. This landmark decision recognizes the rights of the authors, which were long overdue and often neglected, despite being enshrined under the Copyright Act via the 2012 amendment. It is now absolutely clear that authors are now entitled to royalties for the commercial use of sound recordings, except when screened in cinema halls. In my view, the present judgement is an embodiment of inspiring judicial penmanship and gravitas. In this post, I have discussed the present judgment in the backdrop of previous developments and its potential impact on authors in the future.

The Vodafone Dispute

The present dispute arose after Vodafone introduced a value-added service (VAS) allowing customers to use a Caller Ring Back Tone for personal listening or caller tunes. The present judgement was jointly passed in three suits:

Filed by	Filed Against	Claim
IPRS	Vodafone	Vodafone liable to pay royalties to authors of literary and musical works used in sound recordings, in addition to payment made to the owners of sound recording.
Vodafone	IPRS	Declaration of not entitlement of payment.
Saregama	Vodafone	Injunction against exploitation of copyright in sound recording and allied copyright work via VAS.

The Court narrowed down the point of dispute to one issue- whether Vodafone is liable to pay royalty and operate separate license from IPRS in order to commercially exploit the underlying musical and literary work of authors, who are member of IPRS.

Upholding the rights of authors of underlying works, the Court restrained Vodafone from using the IPRS’s repertoire and directed Vodafone to disclose the use of sound recordings under VAS and accordingly, pay to IPRS all outstanding royalties.

Brief Background on Rights of the Authors of Underlying Works

The Supreme Court, in 1977, in IPRS v. Eastern Indian Motion Pictures, ruled that under Section 17(b) and 17(c), Copyrights Act, 1957, once an original work becomes a part of a cinematograph film, the rights of the authors of underlying original work no longer subsist. The judgement, despite its fanciful articulation was conceptually loose and was criticized for its interpretation so much so that the report of the Parliamentary Standing Committee remarked that rights of such authors are being wrongfully exploited in the name of the judgement.

However, J Krishna Iyer’s otiose, as he referred to it, footnote to the judgement highlighted the need for legislative exploration to protect the rights of musicians. He, rightfully, opined that ‘twin lights can co-exist” for “composer alone has copyright on a musical work.”

Cut to almost 4 decades later, in 2012, the copyright laws in India were amended. One of the key features was recognition of the rights of authors of original literary, dramatic, artistic and musical work, used in derivative works. Nonetheless, the courts overlooked the essence of the amendment, leading to such rights still not being recognized by the Supreme Court. The Bombay High Court, in 2022 finally acknowledged the legislative changes brought by 2012 Amendment in IPRS v. Rajasthan Patrika, and ruled that authors of underlying works are entitled to receive royalties when the work is communicated to public, including when played on a radio. The judgement was analyzed by Praharsh, here.

Vodafone-Saregama-IPRS Arrangement

In the opinion of the Court, IPRS’ claim was a mixed question of fact and law. On questions of fact, Vodafone did not produce any agreement with IPRS that permitted commercial exploitation of copyright in literary and musical work. Furthermore, the Court analyzed agreements between Vodafone and Saregama and concluded that neither did Saregama grant any license or authority to play such sound recordings nor does Saregama have the authority to grant rights in respect of underlying musical or literary works incorporated in sound recordings.

Moreover, a) on a combined reading of Sections 19 (stating the mode of assignments), 30 (provision to license existing and future works), 30A (stating the mode of licensing) meaning that no license can be granted in contravention to rights granted to Copyright Societies, like IPRS, along with Section 17, 18 of Copyrights Act, 1957 (meaning that the rights of authors to receive royalties of underlying work cannot be waived), b) agreement between IPRS and Saregama assigning right to collect royalties to IPRS c) combined reading of Section 33 and 34 (the authority of copyright societies to administer rights of its members) and d) reliance on Bombay High Court’s IPRS v. Rajasthan Patrika Pvt. Ltd., the Court concluded that there could not have been any agreement between Vodafone and Saregama licensing any right in the underlying musical and literary work, without obtaining a license from the IPRS.  

Do All Rights Subsist with the First Owner?

Vodafone contended a triad: firstly, that Saregama is the first owner of the literary and musical works incorporated in the sound recordings, thus no license from IPRS is required. Secondly,  in a contract of service, under Section 17(c), the authors surrender their rights to the employer for valuable consideration, including the right to collect royalty. Thirdly, 2012 Amendment does not change the law with regard to independent copyright in sound recordings.

On a reading of third proviso of Section 18, clarifying  that the author cannot part ways with his right to receive royalty, the Court ruled that Saregama is the first owner of the copyright. However the rights of authors of literary and musical work have overriding effect over Saregama’s claim, post the 2012 amendment and thus, rights of authors cannot be circumvented or bypassed in any case whatsoever. Thus, even though Saregama assigned the right to commercially exploit sound recordings, post 2012 amendment Vodafone is liable to pay royalty to authors, via the copyright society which is IPRS here.

Right to Claim Royalty

Vodafone, while arguing that the authors of literary and musical work do not have the right to receive royalties, relied on IPRS v. Aditya Pandey wherein the Court ruled that right to royalty would accrue in favor of authors of literary and musical work only when the works are used independent of such sound. The Court however held that authors shall be entitled to claim royalty even when their underlying work is used as a part of sound recording and that Vodafone is liable to pay the royalty to IPRS.

Copyright an Extension of Author’s Personality?

Notably, the Court has cited Mr. Prashant Reddy’s paper to quote “copyright is not seen merely as an economic tool, a property right but as something like an extension of the personality of the author – something for his benefit and that of his heirs.” Prashant argues, in the paper that copyright law in India and the European system of droit d’ auteur have the same impact on the market despite their distinct jurisprudential developments. The European system views every creative work inalienably as an extension of author’s personality. He argued that the Copyright Amendment seemed to be inspired by this system. The Court’s present ruling seems to be an extension of the system in present times. This reference by the Court will hopefully open more nuanced discussion on the perception of copyright as an extension of the personality of the author.

What’s Next?

The judgement, in my opinion, marks the end of unsympathetic treatment and ignorance of contributions of authors of original literary and musical work. The right to mandatorily claim royalties will not only encourage more creations but will also provide for an equitable consideration for their contributions.

The decisions of both the Bombay HC and Calcutta HC can potentially impact the decision in another brewing copyright dispute concerning composer Ilaiyaraaja. In M/s Echo Recording Company v. Ilaiyaraja- OSA 51 of 2024 (see here for the Livelaw post on this), an appeal against the 2019 single-bench order of Madras HC, is pending to be heard in June (I was unable to find a copy of the Single Judge order and would be grateful if any reader can share that with us.) The Division Bench has to decide on the Single-bench ruling that Ilaiyaraja has special and moral rights over his musical work but is not the owner (see here for Arun Mohan’s post on this). Similar controversies concerning the famed composer have popped up recently where he has sent legal notices to makers of Tamil film “Coolie” and Malayalam film “Manjummel Boys” alleging unauthorized use of his song. In the pending appeal and these other cases (if they are not settled out of the court) the present Calcutta HC ruling can be referred, for the Court has discussed how if any author contractually gives up his rights, the same cannot be held against his claim in the future. Indeed, an interesting and important series of decisions are awaited.