Typically, a composer or lyricist who becomes a member of a performing right society (well, at least a performing right society in the British tradition) assigns the copyright insofar as it relates to “performing rights” to the collecting society including all rights to Works they might make in the future.
Messrs Salim and Suleiman Merchant are apparently renowned composers of music for the soundtracks of Bollywood movies. In 1996 and 1998, respectively, they became members of the Performing Right Society, the PRS, the collecting society in the UK. As part of the terms of becoming members, they each agreed to assign to the PRS:
“absolutely for all parts of the world the rights which belong to you on the date of this Agreement or which you may acquire or own whilst you remain our member”.
However, in 2008, they signed up to compose the music for a film called Kurbaan. One of the terms of their contract with the producers, Dharma Productions Private Limited, was that all copyright in any music they wrote vested in Dharma Productions on creation.
Kurbaan was subsequently broadcast on B4U, apparently a broadcaster that specialises in all things Bollywood, including the Merchants’ music composed for the film. B4U refused to pay licence fees to the PRS.
B4U’s argued that the terms of the agreement with Dharma Productions meant that s 11 of the CDPA 1988 operated so that the Merchants never became the owner of any copyright in the Kurbaan music since it vested eo instanti on creation in Dharma Productions. Therefore, the Merchants never had any copyright in the music which could be assigned to the PRS.
The Court of Appeal said that the assignment to the PRS, being the first in time, took priority so s 91 of the CDPA operated to assign the copyright to the PRS, on creation, and the Merchants had nothing to assign to Dharma.
Formally, the Court of Appeal focused on the wording in the PRS agreement that assigned any copyright that the composer may acquire while a member. Moses LJ treated this as sufficient to cover situations where, but for the agreement with Dharma Productions, the Merchants would have acquired copyright.
B4U Network (Europe) Limited v Performing Right Society Limited  EWCA Civ 1236
Lid dip: Peter Clarke