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Redefining Music Rights and the Landscape of Copyright Licensing Contracts

Two recent decisions, one of the Bombay High Court on July 25, 2011 and the other of the Delhi High Court on July 28, 2011, appear set to completely change the copyright licensing landscape for sound recordings (including recordings of songs) in India.

1. The Prevailing Understanding
As a general rule, playing a recorded song involves the exercise of the so-called “public performance” right, which is treated as one of the exclusive rights granted to the owner of a sound recording. However, sound recordings are rarely entirely original works in the sense that more often than not, they are based on pre-existing musical works and literary works, in the form of musical compositions and lyrics.

No composite copyright for songs exists — the music and lyrics are separately protected by different copyrights. Further, in the case of live performances, once a performer performs a song, a performer's right comes into play, and the recording of a live performance requires the consent of the performer.

The performer's right is defined in Sections 38 and 2(q) of the Copyright Act, 1957, in the following terms: it arises when a performer appears or engages in a live performance, and subsists for fifty years from the year after which the performance is made. Pertiently, the statute does not define what a 'live performance' is, and as such, presumably, it could be enthusiastically interpreted in extremely broad terms.

Like copyright, the performer's right comprises a number of rights, and is also subject to exceptions analogous to the fair dealing exceptions to copyright infringement. In effect, — if it were to be considered in extremely broad terms — the performer's right prevents any person from (1) recording a live performance without the consent of the performer, or (2) reproducing, broadcasting or communicating a recording of a live performance under certain circumstances mentioned in the Copyright Act.

Pertinently, the performer's right is effectively negated by the performer agreeing to the incorporation of his/her performance in a film. This, however, is not stated (in the statute) to be the case where the performer agrees to the incorporation of his/her performance only in a sound recording.

The Permissions Required for the Public Performance of a Sound Recording of a Song

As far as the rights in a sound recording is concerned, once a performance has been recorded, if it has been recorded in the form of a sound recording alone, the producer would own the copyright in the sound recording though not necessarily in the underlying music and lyrics used in the sound recording. Further, in the case of a live performance, the performer's right may not become completely irrelevant merely by virtue of a sound recording of the performance having been made, unless the recording is made with the permission of the performer and it is not reproduced for a purpose which is different from the purpose for which consent to make the recording was granted by the performer.

Due to this, when one plays a sound recording in public, one must obtain permission from not only the owner of the sound recording but also the owner(s) of the underlying musical and literary works. The general understanding that the 'no objection' of the performer is not required.

It may transpire that the owner of the sound recording is also the owner of the rights in the music and lyrics, and should this be the case, there may be no need to approach multiple parties for the grant of licences (assuming that the rights are all administered by the single copyright owner). Nonetheless, the prevailing understanding is that it is necessary to obtain a licence for the public performance of each of the components of a sound recording which qualify as 'works' under the Copyright Act: the recording itself, the music and the lyrics.

The Permissions Required for the Public Performance of a Film Recording of a Song

The necessity of obtaining permission for public performance from all the copyright owners of a recording of a song (i.e. the producer, musician and lyricist) is not seen where a song is recorded / incorporated in a film. As far as the performer's right is concerned, Section 38(4) of the Copyright Act effectively negates the performer's right where the performer agrees to the inclusion of his/her performance in a film.

Further, as far as the copyright of the underlying works (i.e. music and lyrics) is concerned: Indian copyright law has been interpreted such that if a copyrighted work is incorporated in a film, the film producer (i.e. the author and first owner of the rights in the film) would own all the rights in that "underlying" work in addition to owning the rights in the film as a whole, assuming (in practice) of course the rights in the underlying works are assigned to the producer by its author(s).

Based on a decision of the Supreme Court in 1977 [Indian Performing Right Society v. Eastern India Motion Pictures; 1977 SCR (3) 206], the film industry practice has been to work on the understanding that all the rights of the authors of underlying works are assumed by film producers once those underlying works (such as music and lyrics) are incorporated in a film, and the rights subsisting in them are assigned to the film producer. One of the provisions of the Copyright Act, 1957, defining a “cinematograph film” on which this 1977 judgment is based, was subsequently amended in 1994.

At the time the 1977 judgment was pronounced, a 'cinematograph film' was defined to include its soundtrack which would have included all underlying works including the script, sound recordings, lyrics and music. The 1994 amendments, however, inter alia, changed the definition of a 'cinematograph film' to include only one specific work: the sound recording. Presumably, this meant that other underlying works (such as were music and lyrics) were no longer an intergral part of the film.

Due to this, it is possible to conclude that the 1994 amendment, along with others which have been made to the Indian copyright statute since 1977, has meant that the 1977 judgment would no longer be good law. However, this understanding is not reflected either by the practice which is evident in the film industry or by the recent decisions of the Bombay and Delhi High Courts.

In practice, musicians and  lyricists are required to assign the rights in their works to film producers, and these assignments are treated as assignments of the right to exploit those works whether or not in conjunction with the film as a whole. Since the underlying works include the the music and lyrics incorporated in a film, to exhibit a film, or to play in public a song from a film, the law has been interpreted to mean that it would only be necessary to obtain a licence from the film owner-producer, and not separately from the authors of the underlying works.

2. The Recent Decisions Changing the Law Relating to Sound Recordings

In fact, in recent decisions, the Delhi and Bombay courts have applied, to sound recordings, the rationale used with respect to films. These decisions are:
The recent decisions referred to are:
These decisions have concluded that when a literary or musical work is incorporated in a sound recording, the rights in the literary and musical works (i.e. the lyrics and music) are effectively made nugatory / assumed by the owner of the rights in the sound recording. As such, if one were to publicly play a sound recording, one would only need to acquire the permission of the owner of the rights in the sound recording and not the permission of the owners of the rights in the the underlying works. (The issue relating to performer's rights was not dealt with by the courts.)

With reference to copyright societies engaged in licensing copyrighted works on behalf of their members, what this means is that the public performance of sound recordings requires a licence only from the PPL/Phonographic Performance Limited (which deals with sound recordings) and not from the IPRS/ Indian Performing Right Society Limited (which deals with literary and musical works). This is an extraordinary departure from established practice which has the potential to bring down licensing fees significantly, as only one licence would need to be obtained for the public performance of a sound recording. It is also a departure from practice which is being hotly debated.

(This post is by Nandita Saikia and was first published at Indian Copyright.)

Also, via SpicyIP, another case in which a similar conclusion was reached: Mathrubhumi Printing and Publishing v. The Indian Performing Rights Society; Kerela High Court; FAO No. 82 of 2009; February 8, 2011.