19 June, 2016
Copyright – reporting current events – fair dealing
— England and Wales Cricket Board Ltd and another v Tixdaq Ltd and another [2016] EWHC 575 (Ch), 18 March 2016
Facts
England and Wales Cricket Board Ltd (“First Claimant”) is the governing body of cricket in England and Wales. It is responsible, among other things, for the organisation and commercial exploitation of certain cricket matches played by the England men’s and women’s cricket teams in England and Wales.
Sky UK Limited (“Second Claimant”) is a well-known United Kingdom pay- television operator which operates, among others, the Sky Sports satellite broadcast television channels and related digital services.
(collectively, the “Claimants”)
Tixdaq Limited and Fanatix Limited (“Defendants”) operate a website located at www.fanatix.com (the “Website”) and various mobile applications, in particular the “fanatix” app for use on Apple iPhones and iPads (the “App”). Prior to the giving of interim undertakings on 27 July 2015, the Defendants” employees, contractors and users uploaded a considerable number of clips of broadcasts of cricket matches lasting up to 8 seconds to the App where they could be viewed by users. Users could also view such clips on the Website and on the Defendants’ Facebook page and Twitter feed.
The present dispute relates to version 8 of the App, which launched in January 2015 with the sports clip facility. This facility was not present in earlier versions of the App. This was described in contemporaneous documents as a beta version of the App (a version released for public testing), with William Muirhead (“Mr Muirhead”), the common director and shareholder of the Defendants, describing it as “more of an alpha version” (a private test version). In either case, a beta version was released in February 2015, in addition to a number of subsequent versions.
Subsequently, the First Claimant first became aware of the Defendant” activities on 24 June 2015, and contacted the Second Claimant regarding the matter. The Claimants’ solicitors wrote to the Defendants on 25 June 2015, requiring them to remove certain identified infringing clips and asking for various undertakings. Mr Muirhead responded on 29 June 2015, and
following further correspondence, the Defendants only took down a limited number of clips and indicated that they would allow users to upload further clips in the future.
The Claimants then started the present proceedings on 17 July 2015, and applied for an interim injunction at the same time as the claim. This injunction was granted on 27 July 2015, which led to the Defendants giving undertakings pending trial.
The Claimants contend that the Defendants have infringed the following copyrights:
1. Television broadcasts of cricket matches staged under the First Claimant; and
2. Films made during the course of the production of the broadcasts, in particular by recording broadcast footage for the purposes of action replays. (collectively, the “Clips”) There is no dispute as to the subsistence and ownership of copyright in the Clips.
Conversely, the Defendants deny infringement, relying upon the following defences, among other things, fair dealing for the purposes of reporting current events under Sections 30(2) and (3) pursuant to Section 178 of the Copyright, Designs and Patents Act 1988 (“CDPA”).
A defence of fair dealing for the purposes of criticism, review or quotation was not pursued.
Decision
The Court first established that “for the purpose of” under Section 30 CDPA was to be interpreted objectively. As such, the intention or motive behind the use of another’s copyright material was not highly relevant in the context of Sections 30(1) and (2) of the CDPA.
The Court’s reasoning is set out below.
“Reporting current events”
It is established law that the expression “reporting current events” was to be interpreted liberally, with “current events” not confined to very recent events, especially where such events continue to be a matter of public debate or concern.
“Reporting”, on the other hand, was not limited to general news programmes, and could include news reports of a sporting or specialist character.
The Court accepted that “citizen journalism” could qualify as reporting current events, even if the images, videos or sounds uploaded for such reports was accompanied by relatively little in the way of commentary, and that such a definition was not restricted to traditional media outlets. Despite this, it was held that the use of copyright works in versions 8.2 and 8.3 of the App was not for the purpose of reporting current events, even though most of the Clips uploaded were of contemporaneous sporting events. This was due to the following factors:
- The presentations made by the Defendants to their investors, which suggested that the Clips were reproduced and communicated to the public for the purposes of sharing clips with other users;
- The fact that users added comments to the Clips, as opposed to adding the Clips to a report; and
- The fact that the Clips were presented to the viewers accompanied by the comments, rather than reports being presented to viewers illustrated by the Clips.
Taking the above into account, the Court held that the primary purpose of sharing the Clips was to share the Clips with other users for a purely commercial rather than a genuinely informatory objective. Hence, the use of the Clips in relation to versions 8.2 and 8.3 did not fall under the fair dealing exception in Section 30(2) of the CDPA.
The Court also held in relation to versions 8.3.2 and 8.4 of the App that the requirement for users to add at least 70 characters of commentary did not alter the basic purpose for which the Clips had been reproduced and communicated to the public. Similarly, the requirement in version 8.4 that users associate the Clips with particular sports events or an algorithm restricting the extent of use in versions 8.5 to 8.5.4 did not detract from the nature of the aforementioned use, which was to enable users to share footage of sporting events. Hence, in each of the versions above, the Court found that the use of the Clips did not amount to the reporting of current events under Section 30(2) of the CDPA.
“Fair dealing”
However, on the assumption that the above use was for the purpose of reporting current events, the main questions then, at least in relation to fair dealing, was whether (i) the Defendants’ use of the Clips conflicted with normal exploitation, and (ii) the amount and importance of the works taken was justified by the informatory purpose. Sufficient acknowledgement was also needed for a complete defence in law, but the Court did not express any conclusion on this point in relation to all versions of the App.
In relation to the first question, the Court found that versions 8.2 and 8.3 of the App did conflict with the normal exploitation of the Clips and was thus commercially damaging to the Claimants. This was because both versions of the App provided users with potentially extensive highlights on a near-live basis. Furthermore, there was no restriction on the number of clips a user could upload or the amount a user could view. In such circumstances, the Court accepted that this would have reduced the
attractiveness of the Second Claimant’s cricket offering.
The Court also found that such a use would also reduce the attractiveness of the First Claimant’s rights to the clips as a licensor, and affect the rate at which subscriptions were taken out or renewed among the current licensee’s younger subscribers. Thus, taken as a whole, the Defendants’ use of the Clips did conflict with their normal exploitation by the Claimants.
In relation to the second question, the fact that users were only allowed to upload 8 second clips in versions 8.2 and 8.3 of the App did not, by itself, demonstrate that the extent of use was fairly limited. The Court noted that such Clips were mostly highlights of the matches, and that users were not prevented from uploading an unlimited number of clips from each match or clips as a whole. In addition, the relatively small scale of the use in the above versions did not affect the principle that such versions were meant to be used by very large numbers of users and that the Defendants were seeking to attract as many users as possible. Hence, even if the use of the Clips was for the purpose of reporting current events, the extent of their use would not have been justified by the informatory purpose.
In relation to the modifications made in the later versions of the App, the Court held that the further restrictions on the ability of users to upload and view the Clips did not justify the conclusion that such use was fair dealing in relation to Section 30(2) of the CDPA. This was because the use in this case was not the same as linear television broadcasting, where sports highlights are limited to scheduled news programmes. Rather, the use is on-demand and near-live. This meant that the Defendants’ use of the Clips through the App did conflict with the normal exploitation of the Clips, notwithstanding the limits placed on a user’s ability to view the Clips, and that the extent of the use (i.e., on-demand and near-live clips) was not justified by the informatory purpose.
Comments
Sections 37 and 111 of the Copyright Act (Cap. 63, Rev. Ed. 2006) (the “Act”) are substantially similar to Section 30 of the CDPA, notwithstanding that Section 111 is worded as “[f]air dealing for the purpose of reporting news”.
Assessments of fair use defences require a consideration of all the circumstances, and it is interesting to note how the Court here could infer the commercial objectives from the way the content was presented, the potential for the content provided through the App to compete with the Claimants’ service offering, among other points.
It should also be noted that the “mere conduit” defence under European Parliament and Council Directive 2000/31/EC of 8 June 2000 (the “E- Commerce Directive”) was raised in this case. A similar defence can be found under Section 193B of the Act for “[t]ransmission, routing and provision of connections”, but this is only applicable to organisations that provide bandwidth or network access as opposed to those that provide software applications.
A copy of the decision may be accessed at: http://www.bailii.org/ew/cases/EWHC/Ch/2016/575.html
For further information, please contact:
Jeffrey Lim, Partner, WongPartnership
jeffrey.lim@wongpartnership.com
