IPRS Hits All Right Notes by Demanding Royalty from Vodafone

By Pranit Biswas and Swayamsiddha Das

Introduction

Music is the universal language that connects people from all over the world despite linguistic and cultural differences, soothes the soul, and rejuvenates the mind. It is one thing to hear it as an individual and an entirely different thing if the same music is used to reach out to masses unauthorizedly and make profit out of it. In the recent case of Vodafone Idea v. Saregama & Anr.[1], the Hon’ble High Court of Calcutta upheld the rights of the author and issued an injunction order against Vodafone, including its officers, employees, agents, and representatives, as well as anyone acting on their behalf, and thereby prohibited them from performing, authorizing, or communicating to the public any part of IPRS’s collection of musical and literary works, or from committing any other act that infringed on IPRS’s copyright in these works, without obtaining a valid license and paying royalties to IPRS.

Concept of Copyright Societies

Keeping track of how their copyrighted work is exploited by the public can be a daunting task for authors and creators. To address this challenge, the concept of copyright society emerged. By joining a national copyright society, authors and owners gain access to the society’s organizational facilities and strength, ensuring better protection for the copyright in their works and enabling them to reap optimum economic benefits from their creations.[2]

Copyright societies under the Copyright Act

In India, the Copyright Societies are registered under the Copyright Act of,1957. A copyright society, as stated above, is formed by authors and other owners and the minimum membership for the registration of a copyright society is seven members. Section 33 of the Copyright Act, 1957, vests a registered Copyright Society with the business of issuing or granting licenses with respect to the literary, dramatic, musical, and artistic works incorporated in cinematograph films or sound recording. There are several copyright collective societies in India such as IPRS, ISRA, PPL, etc. that ensure and safeguard the rights of authors and owners of copyrighted works.[3]

The Hon’ble High Court of Calcutta in the recent case of Vodafone Idea v. Saregama & Anr, in an analogous hearing consisting of three suits filed by Vodafone, Saregama, and IPRS dealt with the issue of Whether Vodafone is required to obtain a separate license from IPRS and pay royalty before commercially exploiting the musical and literary works of its members as part of the sound recording?

Brief facts of case

In the present suit, Vodafone, engaged in the business of providing telecommunication services to its customers and offering of additional services like Value Added Services (VAS) and Caller Ring Back Tunes (CBRT) allows its customers to choose songs for their caller tunes or personal listening. Few of the sound recordings used by Vodafone for its VAS and CBRT services were originally owned and manufactured by Saregama India Pvt Ltd (Saregama) and few were secured by the copyright society- Indian Performing Rights Society (IPRS) by an agreement entered by it with Saregama, whereby the underlying musical and literary works incorporated in sound recordings in favor of IPRS including the right to collect royalties.

Contentions by IPRS

1. The IPRS contended that Vodafone had no lawful authority to commercially exploit the music and literary works of the IPRS members present in the sound recordings without obtaining a proper license.
2. The IPRS further contended that the Memorandum of Settlement entered by Vodafone and Saregama did not grant any authority to Vodafone to license and play such sound recordings, it was also claimed that neither Saregama nor any other music company had the right to permit commercial exploitation or grant license in respect to sound recordings.
3. The IPRS pointed that Clause 3 of the Settlement Agreement read with Clause 5 of the New Agreement entered between Saregama and Vodafone stated that “any license for exploitation of the literary and musical work incorporated in the sound recordings have to be obtained by Vodafone from IPRS upon payment of royalties and at Vodafone’s own cost and responsibility” making Vodafone’s obligation towards Saregama and IPRS independent.

4. Pursuant to the amendment of the Copyright Act, 1957 IPRS entered into fresh agreements with all music companies including Saregama, whereby rights in respect of underlying music and literary work incorporated in sound recordings were assigned in favour of IPRS including the right to collect royalties.

 

Contentions by Vodafone

1. Vodafone defended itself by contending that as per Section 17 (c) of the Copyright Act, 1957, Saregama was the first owner of the literary and musical works incorporated in sound recordings.
2. It was also claimed that the copyright in sound recordings was independent of the musical and literary work, therefore there was no requirement for Vodafone to obtain a separate license or pay royalty to IPRS for exploitation of sound recordings.
3. It was also contended that Saregama had assigned rights of public performance and mechanical rights of musical and literary works to IPRS, as a “collecting agent” of royalties without transferring the actual ownership and in such circumstances Saregama’s licence to Vodafone for commercial exploitation of sound recordings does not infringe the rights assigned to IPRS by Saregama.

Court’s order and observations

After hearing the contentions of both the parties, the Hon’ble High Court of Calcutta was of the view that that Saregama was not in a position to grant any right to Vodafone to exploit the underlying musical and literary works incorporated in the sound recording and that Vodafone was statutorily obliged to procure licences from IPRS. The Court while delivering the judgment in favour of IPRS made the following observations:

1. That although the Copyright Act, 1957 under Sections 13 and 14 conferred no specific rights to the author of literary and musical works, the provisos provided a right of equal sharing of royalty to the authors, which implied that commercial exploiters of such literary and musical works were  liable to pay royalty to authors of such work”.
2. That though Section 17 (c) of the Act makes Saregama the first owner of the literary and musical works incorporated in sound recording, the amendments brought to Section 17 and 18 of the Act in the form of provisos recognized the right of the author in such work and thus has an overriding effect over the claim of the first owner of the copyright, therefore the rights of an author to claim royalties could not be circumvented.
3. That post amendment of the Copyright Act, Vodafone was statutorily obliged to pay IPRS royalty to the authors of the literary and musical works incorporated in sound recordings and issued an injunction order against Vodafone, including its officers, employees, agents, and representatives, as well as anyone acting on their behalf, prohibiting them from performing, authorizing, or communicating to the public any part of IPRS’s collection of musical and literary works, or from committing any other act that infringes on IPRS’s copyright in these works, without obtaining a valid license and paying royalties to IPRS.

Other similar cases on Copyright societies under the Copyright Act

In the case of IPRS v Rajasthan Patrika[4],  the Hon’ble High Court of Bombay “temporarily restrained the Defendants companies engaged in the business of operating FM Radio Broadcast Channels – Radio Tadka and Radio City and its directors, proprietors, partners, principal officers, servants, agents, assigns and representatives and all other acting for and on their behalf from either engaging in themselves or authorizing, the public performance/communication to the public, of the Plaintiff’s repertoire of literary and musical works, in any form or manner whatsoever, including as part of sound recordings, or doing any other act amounting to an infringement of the copyright and/or statutory right in the said works, without making payments of royalties as per the Tariff scheme”..

Similarly in the case of Indian Performing Right Society Ltd v. Debashis Patnaik And Ors[5], the Defendant was infringing the copyright of the Plaintiff by playing music within its hotel premises without obtaining the license from the Plaintiff and without paying royalties, the Hon’ble High Court  of Delhi imposed “a punitive damages on the Defendants for violating the copyright of the Plaintiff and permanent prohibitory injunction restraining the defendants, its agents, employees and all others acting on its behalf from playing of music by live or any other means, or by way of mechanical devices at the hotel operated by the Defendants and /or channeling musical and/or literary works of the plaintiff or those of its sister copyright societies, by way of mechanical devices such as Radio, Cable TV and /or RA systems within the defendants’ premises without obtaining a license from the plaintiff Society and without paying the requisite royalties, thereby amounting to infringement of the plaintiff society’s copyrights in the same”.

Also in the case of IPRS v Hello FM Radio (Malar publications Limited)[6], the Hon’ble High Court of Delhi “restrained the Defendants (Hello FM – Malar Publications Limited), their Servants, Agents, Director, Subsidiaries, and all other acting on their behalf from causing the broadcast or broadcasting/performing or communication to the public, literary and/or musical works of the Plaintiff Society or those of the foreign sister societies of the Plaintiff or broadcasting any works of the Plaintiff by any means without obtaining a license from the Plaintiff thereby amounting to infringement of the Plaintiff Society’s Performing Rights and communication to the public rights in the same”.

Copyright Societies in the USA

Just like the Copyright Societies in India, the Performance Rights Organizations and Societies (PROs) protect the collective interest of composers and publishers in the United States of America. The United States Copyright Act of 1976, 17 U.S. Code § 101, defines Performing Rights Society as “an association, corporation, or other entity that licenses the public performance of nondramatic musical works on behalf of copyright owners of such works.”[7]There are 3 types of Performance Rights Organization and Societies in the USA such as the American Society of Composers, Authors and Publishers (ASCAP), Broadcast Music, Inc. (BMI), and SESAC, Inc.[8]

In the case of WB Music Corp. v. Cedar St Invs[9], the Plaintiffs in this case are the members of the American Society of Composers, Authors and Publishers (ASCAP) and have granted ASCAP a non-exclusive right to license the performing rights in that members copyrighted musical compositions. On behalf of its members, ASCAP licenses public performances of its member’s musical works, collects license fees, and distributes royalties. It was contended by the Plaintiff that ASCAP representatives have communicated with the Defendants multiple times to offer an ASCAP license. However, the Defendants continued to infringe the rights of the Plaintiff’s copyrighted musical compositions for public performances at Draught. Aggrieved by the action of the Defendants, the Plaintiffs filed a copyright infringement suit against the Defendants for using copyrighted works of the artists represented by publishers without permission to obtain proper ASCAP license.

Similarly in the case of Broadcast Music, Inc Et Al v. The Hub at Cobb’s Mill, LLC, Et Al[10], the Plaintiff, Broadcast Music Inc., (BMI) brought a copyright infringement suit against the owners of the La Roue Elayne restaurant (Defendant) at the Hon’ble District of Connecticut for conducting a public performance without obtaining any license or authorization from the Plaintiff. The performance included at least eight musical compositions, the copyrights for which were owned by Plaintiffs. The Hon’ble District Court held the Defendant liable and granted a summary judgment in favor of BMI for copyright infringement.

Conclusion

Musicians, Composers, Lyricist, etc., put their heart and soul into creating music that is loved and enjoyed by everyone everywhere, therefore they need to get remunerated in the form of royalties when their music is being played in public or is being exploited by third parties. The Copyright Societies representing the collective rights of musicians, composers, lyricists, authors, etc., have time and again made sure that any form of art, music in particular gets its dues and the skills painstakingly mastered y the artists will not go in vain.

[1] (CS-COM/93/2024)

[2] https://copyright.gov.in/Documents/Copyright_Societies.pdf

[3] Id At 1

[4] COMMERCIAL IP SUIT NO.193 OF 2022

[5] MIPR2007(1)323

[6] IPRS Limited v. Hello FM Radio (Malar publications Limited)

[7] https://www.copyright.gov/title17/

[8] https://www.copyright.gov/title17/

[9] 3:18-cv-00077-RJC-DCK

[10] 3:13-CV-01237 (VLB)