INTRODUCTION
In the year 1865, as inventors were attempting to revolutionize powered road transport and steam coaches were plying on roads, the British Parliament enacted the Locomotives on Highways Act of 1865 ("Act"). The law stipulated that any self-propelled road vehicle had to be manned by three crew, including one person walking at least 60 (sixty) yards ahead, carrying a red flag to warn pedestrians and other vehicles of the approaching vehicle. The Act, which, as per historians was a result of intense lobbying by horse-drawn carriage operators and the railway industry, came to be known as the 'Red Flag Act' and also brought into force, probably the world's first speed limit on roads: 4 (four) miles per hour ("mph") in the countryside, 2 (two) mph in towns, and a £10 (ten pounds) fine for "speeding". By the time the Act was repealed in 1896, it had effectively hindered innovation in powered road transport in Britain for over a quarter of a century.
The history of the interface of law & regulation with new technologies & mediums is full of such instructive case studies. These instances highlight how a reactionary approach to regulation of things which are new and pathbreaking can not only hamper the growth of an entire industry but also disincentivise innovation in other spheres of human activity. Similarly, while it may not always be possible to draft technology-neutral laws, laws can at least be framed and interpreted in an adaptive manner to promote statutory longevity and to avoid laws from becoming roadblocks.
With this food for thought, we present to you Volume XVIII of IndusLaw's The Recap, which covers legal updates for the media & entertainment and gaming industries from the month of October 2023. In line with our discussion in these opening paragraphs, the broad theme of the updates for this month is the interface of legacy laws with new technologies & mediums – whether it be music streaming platforms and statutory licenses or over-the-top ("OTT") platforms under telecom laws or examining the sufficiency of information technology laws to address the menace of "review bombing".
MEDIA AND ENTERTAINMENT
An OTT streaming platform is not a TV channel and is outside the purview of the TRAI Act: TDSAT
The Telecom Disputes Settlement and Appellate Tribunal ("TDSAT") has ruled in an interim order that an OTT streaming platform should not be treated at par with a television ("TV") channel and such a platform shall fall outside the purview of the Telecom Regulatory Authority of India Act, 1997 ("TRAI Act"). The TDSAT made this observation in response to a plea filed by the All-India Digital Cable Federation ("AIDCF") against Star India. The AIDCF had approached TDSAT for a stay on streaming of the ICC Men's Cricket World Cup ("Event") for free on the Disney+ Hotstar OTT platform.
AIDFC argued that Star India was charging them for broadcasting the Star Sports channels whereas the Event was simultaneously being streamed by Star India on its OTT platform Disney+ Hotstar free of cost. The AIDFC argued that this practice violated the principle of providing TV channel signals to distributors on a non-discriminatory basis. However, the TDSAT, in an interim order, refused to hold that an OTT platform is akin to a TV channel and disagreed that broadcasters of an OTT platform should be subject to the same obligations as the broadcasters of a TV channel. The TDSAT held that an OTT streaming platform was not covered within the definition of a "distribution platform" as defined under Section 2 (1)(r) of the Telecommunication (Broadcasting And Cable) Services Interconnection (Addressable Systems) Regulations, 2017. The TDSAT also noted that as opposed to a TV channel, an OTT platform was not regulated under any licensing or registration regime in India. Rejecting the AIDFC's plea for granting an interim stay on the streaming of the Event for free on the OTT app, TDSAT directed AIDCF to compile a list of consumers who had subscribed to the Star Sports channels to demonstrate an irreparable loss to AIDFC before the final hearing which has been scheduled for December 18, 2023 takes place.
You may access the TDSAT order here.
You may also read more about this development as reported by the Economic Times here.
Internet-based platforms cannot avail statutory licensing benefit under S. 31D of the Copyright Act: Bombay HC
The Bombay High Court ("Bombay HC") affirmed that a statutory license under Section 31D of the Copyright Act, 1957 ("Copyright Act") is not available for online platforms and that the same is restricted to traditional non-internet-based broadcasting services.
Section 31D was added to the Copyright Act in 2012 to comply with obligations under the Berne Convention, the TRIPS Agreement and the Rome Convention. Section 31D read with Rules 29 and 30 of the Copyright Rules, 2013 enable broadcasting organisations to broadcast or perform any literary or musical works and sound recordings by issuing a prior notice and paying royalty to the copyright holder.
A dispute had arisen between music label, Tips Industries Limited ("Tips") and online music streaming platform, Wynk Limited ("Wynk") in 2016 when the original license agreement between Tips and Wynk ended in August, 2016. Negotiations between Tips and Wynk continued until March 2017, with Tips claiming that they agreed on a minimum guaranteed payment of INR 4,50,00,000 (four crores and fifty lakhs) for a 2 (two)-year term, while Wynk rejected these claims calling them as 'exorbitant'.
Following these disagreements, Tips had instructed Wynk to deactivate Tips' repertoire of music from the Wynk platform; however, Wynk continued to use the music. In November 2017, Tips demanded a royalty of INR 2,83,00,000 (two crores and eighty-three lakhs) and the deactivation of its repertoire, prompting Wynk to invoke Section 31D of the Copyright Act, agreeing to pay INR 10,00,000 (ten lakhs) as a first tranche of royalty. Tips rejected these contentions and returned the payment. Wynk then reasserted its position, claiming that the royalty calculation was based on market shares and conditions. Tips refuted Wynk's claims and subsequently filed two suits against Wynk in January 2018 praying for an injunction against Wynk's downloading facility and the on-demand streaming service to protect Tips' copyrighted content. A single bench of the Bombay HC decided the suit filed by Tips and granted an injunction against Wynk in April 2019 prohibiting it from streaming copyrighted content of Tips.
Wynk challenged the judgement of the single judge before a division bench of the Bombay HC. The Bombay HC interpreted Section 31D of the Copyright Act (which allows broadcasting of already published literary and musical works and sound recordings subject to certain conditions therein) and held that (a) the statutory license under the said Section 31D cannot be exercised by an online platform offering streaming services; and (b) the said Section is only limited to traditional broadcasting services. Accordingly, the Bombay HC dismissed Wynk's appeal, stating that it cannot exercise a statutory license under Section 31D for protection of its online streaming services. This judgement is vital as it entails that internet-based music streaming platforms will now have to negotiate contracts with record companies to use their music, unlike traditional radio and television networks which can rely on statutory licenses.
You may access the order by the division bench of the Bombay HC here.
You may read more about this development as reported by the Supreme Court Cases Online reporter here.
There cannot be a monopoly in storytelling but a platform can't use another's copyrighted work, rules Delhi HC in 'Humans of Bombay' versus 'People of India' case
The Delhi High Court ("Delhi HC"), on October 11, 2023, disposed of the recent copyright dispute between two prominent storytelling platforms, Humans of Bombay ("HOB") and People of India ("POI") (singly referred to as "Party" and jointly as "Parties") by prohibiting the Parties from using each other's copyrighted material (including commissioned photos & videos, literary works such as interviews and original pieces and their particular presentation styles) and emphasizing the age-old principle that copyright does not extend to ideas, but only to the expression of those ideas.
The present dispute arose when HOB filed a suit against POI for allegedly publishing unlicensed adaptations and appropriating various elements of their content, literary works, unique storytelling formats and presentation styles without authorization.
During the proceedings, POI argued that HOB could not claim a copyright over the concept of a storytelling platform, contending that both platforms drew inspiration from the model established by Humans of New York ("HNY"). However, the Delhi HC emphasized that the central issue was not the origin of the idea of storytelling about the lives of different people but whether either Party had copied the specific content, including images, of the other Party. POI argued that since the subjects of their stories had voluntarily submitted the images, HOB could not assert copyright.
The Delhi HC held that neither Party could monopolise storytelling platforms. Still, at the same time, the Parties must distinguish themselves from other platforms through unique creative expressions in communicating and disseminating their stories. It underscored that while copyright ownership would apply to commissioned photographs and videos, private photos sent by the individuals to either Party will not fall under copyright claims.
This case recently garnered significant attention on social media, with Brandon Stanton, the founder of HNY, expressing dissatisfaction with HOB's legal action against POI. Stanton said that he had previously refrained from commenting on the "appropriation" of his work by HOB, citing the importance of sharing the stories. However, he criticized HOB for suing others for following its own conduct.
You may access the Delhi HC order here.
You may also read more about this development as reported by LiveMint here.
MIB notifies amendments to the Cable Television Network Rules, 1994 to bring in new, decriminalized penalties
The Union Ministry of Information and Broadcasting ("MIB") has notified amendments to the Cable Television Networks Rules 1994 ("Rules") to align the Rules with the recent amendments to the Cable Television Networks (Regulation) Act, 1995 ("CTN Act"). In August 2023, through an amendment of the CTN Act via the Jan Vishwas (Amendment of Provisions) Act, 2023, the Central Government decriminalized the punishment for contravention of the CTN Act by repealing Section 16 thereof. The amended Rules now include a mechanism to enforce the decriminalized penalties in the CTN Act including replacing imprisonment with financial penalties and sanctions such as advisories, warnings, and censures. These provisions will be effected by a 'designated officer' as prescribed in the Rules.
You may access the official notification released by the MIB here.
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