Premises Manager Beware: Manage Also the Copyright Licences

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Introduction

Copyright is infringed when a person authorises or procures another to do any act restricted by the copyright without the copyright owner’s licence. While it is well established that someone directly involved in playing a recorded music without the copyright owners’ licence infringes their copyright, to what extent would the person authorising or procuring such act be liable?  In Phonographic Performance Limited v CGK Trading Limited & Others [2016] EWHC 2642 (Ch), the English Chancery Division held that a de facto manager of a nightclub was liable for authorising and procuring the nightclub’s unlicensed playing of recorded music.

Background

The 3rd Defendant in that case (“D3”) was the Designated Premises Supervisor (the “DPS”) of a nightclub in Essex (the “Club”) and was, according to the claimants’ case, the Club’s manager.  D3 denied liability on the ground that she was not a manager of the Club, and had no knowledge, responsibility or control in relation to any copyright works performed at the Club.  D3 further denied that she was a person-in-charge of the day-to-day running of the premises beyond her limited scope of duties.  Since Counsel for D3 conceded that the act of playing of recorded music was unlicensed (the “Infringing Acts”) and therefore amounted to infringement, the major issues before the Court were:

  1. whether D3 had authority to authorise the Infringing Acts; and
  2. if so, whether D3 in fact exercised that authority.

Court’s findings

Master Clark of the Chancery Division made, among others, the following findings of fact:

  1. neither being a DPS nor carrying out the functions of a DPS is of itself sufficient to give rise to a liability for authorising or procuring infringement;
  2. but it would be an unusual position if a DPS is not a manager of the premises, since the DPS would need to fulfil a management role to meet the objectives under which the premises are licensed;
  3. D3 had on at least one occasion referred herself as the manager of the Club, and was referred to as the manager and running the venue by a promoter;
  4. D3 has some sort of management role at the Club;
  5. D3’s role at the Club included booking disc jockeys to appear at the Club, and passing lists of music to be played to them; and
  6. D3 was the principal user of the Club’s mobile telephone, and she used it in relation to the day-to-day running of the Club.

Based on the evidence submitted, the Master held that D3 acted as the manager of the Club, and her responsibilities included authorising and procuring the performance of music at the Club, and the booking of disc jockeys and promoters to appear there. Therefore, D3 had authority to authorise the Infringing Acts.

With regard to whether D3 in fact exercised that authority, the Master also found against her. It was found that she was working at the Club at the night when the recorded music concerned was played there without licence. Furthermore, the Master held that the relevant infringing act was the engagement of the performers.  The engagement involved an authorisation by D3 to the performers to perform at the Club whatever music the performers selected.  The authorisation thus included one of playing the music concerned notwithstanding the absence of the claimants’ licence.

Lessons to learn

Two points should be noted from the case discussed above. First, whether an employment contract provides for managerial responsibility is not conclusive on the issue of authority in deciding whether an employee authorised or procured an infringing act.  The court would look at the circumstances and totality of evidence to determine whether that employee had the relevant authority.  The claimants in the case discussed above accepted that if the employment contract between the Club and D3 had accurately reflected D3’s duties, she would not have been liable for authorising infringement.  Nonetheless, the Master still held D3 liable for authorising and procuring the infringement.

Secondly, a manager allowing a performer to play any music the performer selects can be regarded as giving a blanket authorisation. If any playing of music by the performer turns out to be unlicensed, the manager may be liable for authorising and procuring such unlicensed playing.

Owners and managers (designated as such or de facto) of premises on which there is performance of copyright works should be cautious about potential infringement of copyrights on those premises.  They should verify that the premises and/or the performers have obtained all necessary copyright licences for performing or playing of the performers’ repertoires.  Managers are particularly reminded to assume an active role in this regard: otherwise they may be at risk of getting themselves personally liable for the infringing acts which take place on the premises.

 

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Important: The law and procedure on this subject are very specialised and complicated. This article is just a very general outline for reference and cannot be relied upon as legal advice in any individual case. If any advice or assistance is needed, please contact our solicitors.
Published by ONC Lawyers © 2017