In a previous post, we looked at why Perram J held that Glass Candy’s “Warm in the Winter” and Air France’s “France is in the Air” reproduced a substantial part of the musical work in Love is in the Air, but not the literary work comprising the lyrics.
A further set of issues his Honour had to untangle was which acts involving the streaming and downloading of Warm or France infringed and who owned those rights.
You will recall that Glass Candy are an American electronic duo based in America who, in 2011, released “Warm in the Winter”. Glass Candy wrote and recorded “Warm in the Winter” in the USA. They made it available for streaming and download on, first, the Big Cartel website and then the IDIB website. They or their rights management agent, Kobalt, also made the recording available through iTunes / Apple Music, Google Play, Youtube, Spotify etc.
Subsequently, Glass Candy provided a version of “Warm in the Winter” to Air France for use by the latter in its Air France: France is in the Air promotional campaign. Until this litigation started, Air France used “France is in the Air” in TVCs and radio advertisements in 114 countries (but not Australia), posted the advertisments on its Youtube channel (which could be downloaded from Australia) and, if you rang up its office from Australia and all its customer service operators were tied up, for its “music on hold” service.
Infringement, or not
Having found that Warm and France reproduced a substantial part of Love, Perram J turned to determing which conduct engaged in by Glass Candy, Kobalt and Air France actually infringed any copyright in Australia and who owned those rights.
In summary, Perram J held that:
(2) the streaming and downloading of Warm from the streaming services iTunes/Apple Music, Google, Play, Spotify and Youtube did not infringe copyright as it was licensed; and
(3) the playing of France to Australians via Air France’s music on hold service did infringe, but the streaming and downloading via Youtube did not.
The infringing acts
The streaming of Warm to Australia and its downloading by subscribers in Australia entailed a number of acts:
(1) the making and recording of Warm;
(2) the uploading of a copy of Warm on to the servers of each streaming service;
(3) the making available of that copy to be accessed by end-users in Australia;
(4) the streaming of the recording to someone located in Australia; and
(5) in the case of downloads, the downloading of a copy of Warm on to the end user’s computer (or smart device) in Australia.
Making and recording – the reproduction right
The making and recording of Warm and France did reproduce a substantial part of Love but, having taken place in the USA (or the USA and France), were not infringements of the copyright in Australia.
There does not appear to have been evidence about where the servers of the streaming services such as iTunes / Apple Music, Google Play, Spotify or Youtube were located, but Perram J was not prepared to assume they were in Australia. So loading the copy on to the streaming service’s server was not an infringing activity either.
Making the recording available to be accessed – the communication right
Although storing the copies on the streaming services’ servers was not a reproduction implicating Australian copyright, Perram J considered that Glass Candy’s acts of communicating the copies of Warm to the streaming services (uploading them) could infringe copyright in Australia and the acts of streaming and downloading in Australia would be damage suffered by the copyright owner in Australia. At , his Honour said:
…. That act of infringement seems to me to occur by communicating Warm to iTunes (and if it had been proven the other online music services). That was the infringement. Each time thereafter that the streaming service raised revenue by streaming or downloading Warm that was evidence of the damage suffered by the Applicants or the profits made by Glass Candy. Viewed that way, whether the streaming and downloading of Warm from the online music services is a contravention is irrelevant.
From the context, however, it appears that that act of communicating the copy to the streaming service(s) was not an infringement alleged against Glass Candy. I am not sure how that “infringement” would work, however, given his Honour’s further findings.
The alleged infringements the subject of the proceeding
That left as infringing acts being pursued by the Applicants:
(3) the streaming of Warm to Australians from the streaming services – also an exercise of the communication right;
(4) the making of the copies of Warm by users in Australia from the streaming services – (at ) an exercise of both the communication right (by the streamng service) and the reproduction right (by the end-user); and
(5) in the case of France, the playing of “music on hold” to callers from Australia.
These allegations gave rise two problems: (a) who was the owner of the relevant right and (b) what licences of these copyrights had been granted. The issues that arose are a good illustration of the kind of tracing the chain of title fun the long term of copyright requires you to engage in to make sure you have identified the right person as the copyright owner.
In summary, Perram J found that Boomerang had no standing to sue anyone for infringing the communication right as it was not the owner of the relevant copyright; APRA was. Boomerang was the owner of the copyright in respect of the reproduction right, but its interest was partial or concurrent with AMCOS’ interest as the exclusive licensee of that right.
However, the streaming and downloading from the streaming services, iTunes / Apple Music, Youtube, Google Play and Spotify did not not infringe as those services held licences from APRA and AMCOS for those acts.
The copyright and ownership – a chain of title history
In 1978, they assigned all their copyright in the literary and musical works comprised in Love to Alberts.
Subsequently, in 2016, when Alberts sold its business to BMG, it excluded from the sale the back catalogue of songs written by Vanda, Young and a third member of the Easybeats, Stevie Wright. Alberts instead assigned these rights to Boomerang – a new company owned by members of the Albert family.
However, in 1972 Vanda and Young had become members of the Australasian Performing Right Society (APRA), the collecting society for public performance rights and, as it was before the introduction of the broadly based communication right by the Copyright Amendment (Digital Agenda) Act 2000, the cable diffusion right.
(a) to perform in public; and
(b) to transmit via a diffusion service,
An interesting point to note here is that the assignment to APRA in 1972 was not an assignment of the broad communication right, as there was no such right under Australian law at that time. Further, the repeal of the diffusion right and its replacement with the broad communication right did not affect that earlier assignment. The earlier assignment did not catch, however, the broader rights encompassed in the communication right, apart from the diffusion service, when the broader right came into force as the terms of the assignment were limited just to the diffusion right.
After the assignments from Vanda and Young, Alberts had also entered into agreements which affected the rights of reproduction and communication.
In 1986, Alberts had entered into a licence with AMCOS granting AMCOS the exclusive rights to authorise the making of records from the Alberts catalogue, including Love. Over time this was amended so as to include the making of digital records. The exclusive licence included the right to authorise the making of reproductions for the purposes of broadcasting in Australia. There were, however, three exclusions from these exclusive rights: they did not extend to making reproductions for inclusion in advertisements, or cinematographic films for the purpose of being broadcast in Australia. They also did not extend to licensing a number of named record companies.
In 1992 and again in 2005, Alberts had also entered into assignments with APRA. The 2005 assignment included an assignment of the right of communication to the public (introduced by the Digital Agenda Act in 2001).
Finally in 2016, after the assignment from Alberts of its copyright in Vanda, Young and Wright works, Boomerang also granted an exclusive licence over its copyright to AMCOS and assigned its public performance and communication rights to APRA.
At , Perram J found Boomerang and AMCOS had mutually abandoned the earlier licence granted by Alberts and replaced it with the 2016 licence. The 2016 licence granted AMCOS exclusive rights to authorise reproduction of Love to make records, for digital downloading and communication to the public. AMCOS was not licensed to authorise use of Love in advertisements or synchronisation into a film.
Boomerang was the owner of the reproduction right (at  – , ), but its interest was concurrent with AMCOS as the exclusive licensee under s 119 and s 120. AMCOS of course also had concurrent rights under those sections.
Which acts of streaming / downloading infringed?
The straightforward case on infringement was the streaming and downloading from the Big Cartel and IDIB websites. The position of iTunes / Apple Music, Google Play, Spotify, Youtube was complicated by licences those entities had from APRA and AMCOS.
iTunes / Apple Music, Spotify et al.
The evidence showed that sales of Warm through Apple’s services amount to $85.41 (although some of these were probably to the Applicants’ solicitors).
Perram J held that the streaming and downloading of Warm from these services did not infringe as they held licences from APRA and AMCOS which permitted these acts.
In January 2010, Apple Pty Ltd had entered into a licence agreement with APRA and AMCOS. By cl. 9.1, the licence was a non-exclusive licence to:
(a) reproduce AMCOS Works;
(b) authorise the reproduction of AMCOS Works;
(c) communicate in the Territory the APRA Works (including authorising their electronic transmission from Your Digital Music Service to Your customers);
(d) authorise Your Affiliates to communicate the APRA Works to customers in the Territory as necessary in the course of providing the Digital Music Service,
in the form of Downloads (whether by You, or Your customers in the Territory, onto storage devices) for the purpose of Sale or to complete a Sale, including in the form of Clips provided at no charge for the sole purpose of demonstrating the Clip to customers and potential customers of Your Digital Music Service …
Love was included in the APRA and AMCOS Works.
Perram J held that the rights to reproduce and communicate to the public included the rights, not just to reproduce or communicate the whole of Love, but also a substantial part of it through the operation of Copyright Act 1968 s 14. As Warm and France reproduced a substantial part of Love, they were covered by the licences. At , his Honour explained:
Because Love is in the AMCOS and APRA catalogues it follows that since 2010 Apple has been fully licensed to provide digital streaming and downloading of Love. And because the doing of an act in relation to a work is taken by s 14 of the Copyright Act to include a reference to the doing of that act in relation to a substantial part of the work, it also follows that Apple has at all material times been licensed by APRA and AMCOS to make available for streaming or digital download a substantial part of Love. Of course, the Applicants’ principal contention in this case is that making Warm available for streaming or digital downloading involves the communication or reproduction of a substantial part of Love. However, it would appear that iTunes is lawfully entitled to make Warm available for streaming or downloading even if it does involve a communication or reproduction of a substantial part of Love. Consequently, the Applicants can have no possible case against Apple for making available Warm for streaming or downloading from iTunes.
Similar conclusions followed in respect of the other streaming services which also had licences with APRA and AMCOS.
As Apple did not infringe by streaming or authorising the downloading of Warm, so also Glass Candy could not be liable for authorising the (non-)infringement.
There was an additional wrinkle on this part of the case. Kobalt admitted there had been streaming from Google Play, Spotify and Youtube, but Glass Candy did not. Perram J considered the evidence did not actually establish there had been streaming or downloading from these services so, if the licences did not cover these activities, Kobalt alone would have been liable by reason of its admissions.
The Big Cartel and IDIB websites
The evidence showed that Warm had been downloaded 12 times for $11.50 in revenue from Big Cartel and only once from IDIB. There were also payments to Kobalt Australia of $266.60 from AMCOS and $366.43 from APRA. Warm was still being advertised for sale for $1 from the IDIB website.
The position of downloads from the websites Big Cartel and IDIB was straightforward. The evidence showed Padgett uploaded Warm or caused it to be uploaded and Ida No received payments from time to time from the sites. Therefore, at  they were liable for authorising the communications to the public and downloading from those websites.
The position of streaming was more complicated. Padgett and Ida No had licensed their distribution / streaming rights to BMI in 2010. APRA’s own records recorded BMI as the owner of copyright in Warm for the public performance and communication rights. IDIB had also licensed streaming rights in relation to its website to Kobalt US. At , this meant that the person liable for authorising the streaming from the idib website was either BMI or Kobalt US, neither of which was a party. The receipt of royalties by Kobalt Australia from APRA was not sufficient to find it liable for authorising the streaming.
The case against Air France for streaming promotional videos from Youtube failed because of Youtube’s licence from APRA for the reasons Apple’s licences protected streaming and downloading. There was still liability for the music-on-hold, however, as Air France did not hold a licence from APRA.
Glass Candy contended that any damages would be de minimis and so relief should be withheld.
At  Perram J rejected this argument. First, his Honour found that the copying of Love had been deliberate so the infringements were flagrant. That meant additional damages may well be awarded. In addition, his Honour anticipated that the compensatory damages award might not be so modest:
Further, whilst it is tempting to think that the damages might be limited by the apparently modest infringements I have found, the Respondents (other than Kobalt) will no doubt have to deal with a contention by the Applicants that their damages should be assessed on a foregone licence basis. Without wishing to lend colour to that contention, damages on that basis may not be so modest.
[Boomerang Investments Pty Ltd v Padgett (Liability)] FCA 535
- Italians Do It Better – a record label jointly owned by Padgett (aka Johhny Jewel) and a DJ, Mike Simonetti. ?
- Similar analysis applies to the uses of France by Air France which, additionally involved the transmission of France via a diffusion service to callers on hold. ?
- As noted in my previous post, Perram J may have been interested in exploring whether or not an Australian court could hear and determine questions of infringement under US law. ?
- Copyright Act 1968 s 31(1)(a)(iv): the exclusive right to communicate the work to the public. ?
- Copyright Act 1968 s 31(1)(a)(iv): the exclusive right to communicate the work to the public. ?
- Of course, that would not apply to copyright which had been assigned to someone else before becoming a member of APRA. ?
- As Alberts successor in title, Boomerang was bound by the terms of the 1986 licence granted to AMCOS: Copyright Act 1968 s 196(4). ?
- The applicants’ subsequent attempt to have the Reasons revised or to re-open their case was given short shrift. ?