Calcutta High Court refuses to grant injunction to Zee Entertainment in copyright breach case

Introduction:

The Calcutta High Court took up this case. In this case of RDB and Company (Hindu Undivided Family) And Ors v. Zee Entertainment Enterprises Ltd and Ors, the petitioner claims to the copyright owners in ten cinematographic films on the basis of the father of the second respondent, R.D Bansal who was also the producer of a few of the said films. The petitioners claimed to have the exclusive rights for selling the said films or give them on commercial rental for showing to the public.

Background of the Case:

The petitioners have telecasted ten cinematographic pictures through the OTT platform Zee5 in Bangladesh. According to the petitioners, there were two agreements drawn: –

• In the first agreement dated 4th July 2017, the petitioners had licensed the right to telecast these ten pictures to the third petitioner, i.e., Turtle In-Motion Studios, through television and Indian satellite channels within the territory of India. However, the telecast would exclude Doordarshan and Lok Sabha tv channels.

• In the second agreement dated 21st December 2017, Turtle In-Motion Studios granted a license to the second respondent, i.e., Balarka Projects, to telecast the ten films in television and satellite channels excluding Doordarshan channels.

Through the drawn agreements, Balarka Projects had obtained licenses to telecast the ten cinematographic pictures through the exchange of ownership.

The Petitioner’s Contentions:

• Respondent no.1, ZEE Entertainment, had never obtained a license from the petitioners to telecast the said ten pictures on satellite channels and OTT platform, namely, Zee5 in Bangladesh, and is therefore in breach of the terms of the license.

• The petitioners further claimed that Respondent No. 1 had been notified via. a letter dated 1st July 2021, wherein the licenses were granted to respondent no. 3 had been reduced to null and void with immediate effect.

• The counsel for the petitioners relied on Section 17(c) and Section 55 of The Copyright Act, 1957 and further contested that the petitioners are entitled to civil remedies.

The Respondent’s Contentions:

• The counsel for respondent 1 submitted that they had stopped the telecast of the said ten pictures, and the respondents would be willing to maintain accounts till the case is finally decided.

• The counsel for Respondent 2 submitted that the agreement between Turtle In-Motion Studios and Balarka Motions, could only be treated as null and void if the consideration amount is not paid according to clause 5 of the said agreement. The counsel further stated that the notice could not terminate the agreement sent on 1st July 2021, because Petitioner No. 3 has received rupees 1crore in consideration for the same.

Issues:

•  Whether the petitioners’ complaint of the second respondent, Balarka Projects, having breached Clause 7 of the license agreement dated 21st December 2017, can entitle the petitioners to an injunction on the respondents.

The petitioners have failed to disclose that they were all along aware of ZEE’s intention to telecast the films, which would be a material consideration for the grant of injunction.

• Whether respondent no.2, Balarka Projects breaches Clause 4 of the license agreement dated 21st December 2017, which provides that the rights licensed to Balarka Projects do not include telecast-broadcast for the World Wide Web or internet rights concerning the said films.

To discuss this, issue the case of U.P. State Electricity Board vs. Shiv Mohan Singh; (2004) 8 SCC 402 was relied on wherein the Supreme Court held that ‘breach of the terms and conditions of a contract between the parties would result in the contract becoming voidable at the instance of the either party to the contract.’ The Supreme Court further held that ‘if a contract is valid in law, the breach thereof would not render it invalid but may only enable a party who had suffered by reason of such breach to avoid the contract.’ 

• Whether the petitioners can seek an injunction while being entitled to reasonable compensation or not.

The petitioners have quantified the damages as Rupees 50 lakhs, and in the notice dated 1st June 2021 have asked Balarka Projects to pay the damages, following Section 74 of the Contract Act, 1872.

The Role of Respondent No. 1 (Zee Entertainment)

• Balarka Projects and Zee Entertainment executed the Film Assignment Agreement on 27th December 2017. Zee was assigned a spectrum of rights in the ten films, mainly on an exclusive basis, for the ‘Entire world, including India and the overseas territorie’s, for an assignment fee of Rs. 2 crores 50 lakhs.

• Hence, ZEE is a bonafide assignee who has parted with substantial consideration for the assignment, which provides for overseas territories.

• The mails referred to above show that petitioner no. 2 was fully aware of ZEE’s rights as an assignee to the films in question. Moreover, ZEE’s response to petitioner no.1 to the charge of unauthorized telecast of the movie on Zee5 would significantly impact the injunction which the petitioners now seek action against ZEE.

• The substantial gaps contribute to the petitioners failing to establish a prima facie case for an interim injunction. Since a considerable number of years have passed after the execution of the three agreements in 2017, the balance of convenience also stands against the reliefs being given to the petitioners at this stage.

Judgment:

Since the petitioner could not convince the court that the respondents have indeed terminated the license, the said date cannot alter that the petitioners have waited for four years before approaching the Hon’ble Court.

Further, the name of the first petitioner appears as the applicant before the Censor Board of Films of Satyajit Ray while the name of the second petitioner appears in applications before the Central Board of Film Certification of non-Satyajit Ray films. There are no documents to show how the copyright in the ten films devolved on the second petitioner as the son of R. D. Bansal even if it is accepted that R. D. Bansal is the producer of the Satyajit Ray films. The ten films which form the subject-matter of the licence agreements are a combination of films by Satyajit Ray and other directors. The petitioner nos. 1 and 2 cannot therefore be treated as the producer and hence the copyright owners of the ten films taken together.

The quantification of loss by the petitioner further disentitles it from claiming injunction against the respondents before the facts are clarified on affidavits.

The prayer for interim relief was hence rejected by Justice Moushumi Bhattacharya of the Hon’ble Calcutta High Court.

Reference: https://services.ecourts.gov.in/ecourtindiaHC/cases/display_pdf.php?filename=QnBUxJ6a3gIx%2B5SFrUiAoLP1AbZA04NLlZ9qP%2FyRhCeDvxtoDRYgwpNTINVDqlJ0&caseno=CS/135/2021&cCode=1&appFlag=