The First Hall Civil Court, presided over by Mr Justice Mark Chetcuti, on October 8, 2015, in the case ‘The Performing Rights Society Limited of London, England v Tal-Lira 2 Limited’ ordered Tal-Lira 2 to pay PRS €1,100 in damages for not having a licence to play musical works in public, even if these formed part of a film distributed by KRS, as PRS was vested with rights in respect of such music.
The Performing Rights Society Ltd (PRS) of London, represented in Malta by its agents Dingli Co. International Ltd, was duly authorised by the Copyright Board in terms of 2004 Regulations, Legal Notice 425/2003, to act as a collecting society in Malta.
It was stated that Tal-Lira 2 Ltd had been operating a cinema at the Gallerija Complex in Fgura since March 6, 2007.
PRS stated that it had exclusive copyright in respect of musical works which were played in public at the Gallerija Cinema. It said that Tal-Lira 2 Ltd needed a licence from it in order to play music in public.
PRS claimed that Tal-Lira 2 had violated its copyright, and that as a result it had suffered damages by Tal-Lira 2 Ltd not paying royalties due to it, according to its approved tariff. Faced with this situation, PRS instituted legal proceedings against Tal-Lira 2 Ltd.
It requested the court to declare that Tal-Lira 2 had violated its copyright by playing musical works in respect of which PRS had such rights, without obtaining a licence; to liquidate the damages; to condemn Tal-Lira 2 Ltd to pay such damages; and to prohibit Tal-Lira 2 from playing music in public unless it obtained such licence.
In reply, Tal-Lira 2 Ltd contested the action against it. It raised the plea that it was not a legitimate defendant and that PRS’s legal action was time-barred, under articles 2153 and 2156(f) of the Civil Code.
Tal-Lira 2 Ltd submitted in its defence that it operated a cinema complex and did not require any licence from PRS to run a public cinema. It said it was not obliged to pay any royalties, as no licence was required in terms of Chapter 415. If at all, it would have to pay KRS Film Distributors Ltd and not the PRS.
Tal-Lira 2 Ltd maintained that it did not have any legal relations with PRS. Nor was there any need for the parties to have contractual relations.
Tal-Lira 2 Ltd denied any liability to pay damages and that it had violated the copyright of PRS. In addition, it contended that under Maltese law it was not possible to request an injunction in perpetuity.
It said that PRS had to indicate which author’s rights had been infringed.
Kevin Dingli of Dingli International testified that musical works did not lose anything of their original character simply because they were associated with a film as a soundtrack.
Karen Estelle Fishman for the PRS testified in court about the society’s operations. She said that according to Maltese law, “‘musical work’ is a separate and distinctive type of work from an ‘audiovisual work’. The exclusive rights enjoyed by the owner of the copyright in an audiovisual work are entirely separate from those enjoyed by the owner of the exclusive rights in any musical work that may have been copied onto the soundtrack of the audiovisual work.
The court rejected PRS’s request to issue an order to prohibit Tal-Lira 2 Ltd from playing music in public
“The fact that an exhibitor has a licence to display an audiovisual work does not absolve him from the requirement to obtain an equivalent licence from the owners of the relevant rights in any musical works included in the audiovisual works, namely the PRS. Accordingly, Tal-Lira 2 Ltd still needs a licence.
“To lawfully exhibit an audiovisual work defendants therefore require not only the licence from the owners of the copyright in the audiovisual work but also from the owner of the musical work embedded in that work.”
Tal-Lira 2 Ltd on the other hand put forward the argument that once they showed films provided by KRS, the rights in the musical works in any film had already been paid by the producers of the film. Tal-Lira 2 Ltd added that they showed the entire film and not the music separately.
The court dismissed Tal-Lira 2 Ltd’s preliminary plea that it was not a legitimate defendant. It held that PRS could only claim for a period not earlier than two years before the date when its legal action was filed.
The court considered that PRS was not claiming contractual damages, but extra-contractual damages.
In the court’s opinion, it was proven that Tal-Lira 2 Ltd had played musical works in respect of which PRS enjoyed rights.
PRS submitted that “the fact that an exhibitor has a licence to display an audiovisual work does not absolve him from the requirement to obtain an equivalent licence from the owners of the relevant rights in any musical works included in the audiovisual works”.
Article 7(1) Chapter 415 provides that “Copyright in an audiovisual work, a database, a literary, musical or artistic work shall be the exclusive right to authorise or prohibit the performance in Malta in respect of the protected material in its totality or substantial part thereof, either in its original form or in any form recognisably derived from the original of any display or performance to the public”.
Reference was made to Copinger: “Notwithstanding that the soundtrack of a film is to be treated as part of the film, film soundtracks are entitled to copyright separately as sound recordings under the Act. The film producer should therefore ensure that he takes either an assignment of copyright from the soundtrack owner or a licence entitling him to reproduce the work in any material form.
“The right to perform in public any music or lyrics (the ‘performance right’), as opposed to the sound recording of that work will invariably have been assigned by the composer (assuming he is British) to the Performing Rights Society (the PRS). The assignment will also include the right to synchronise specially-commissioned music with the film soundtrack. In an ideal world, the composer will be required in his agreement with the producer to procure the grant of such synchronisation rights by the PRS to the producer.
“Since no royalty is collected for public performance in the US, the PRS in practice refuses to grant a film synchronisation licence unless the producer agrees to provide for payment of fees to the composer via the PRS in respect of the theatrical exhibition of the film in the US.” (Copinger & Skone James on Copyright, para 26-29 page 1700).
The court noted that it was proven that PRS was a collecting society authorised by the Copyright Board since 2007. Its rights emerged expressly from article 52 Chapter 415, and PRS was authorised to administer authors’ rights for Malta.
The court said that PRS had a right to claim damages for the period between October 1, 2011 and November 1, 2012, under the old tariff, as the new tariff had not yet become effective.
The court in fact used its discretion under article 1135 Civil Code and liquid-ated the loss suffered by PRS arbitrio boni vini to amount to €1,100 for the period between October 1, 2011 and November -1, 2012.
The court rejected PRS’s request to issue an order to prohibit Tal-Lira 2 Ltd from playing music in public. Reference was made to Dingli Co. International Ltd vs Smash Communications Ltd dated November 30, 1998.
For these reasons the court gave judgment by declaring that Tal-Lira 2 Ltd had violated the rights of PRS and condemned it to pay PRS €1,100 in damages.
Karl Grech Orr is a partner at Ganado Advocates.