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TMI Blog1997 (8) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... n a 'Zee TV Channel'. This broadcast is made from Hong Kong to the "Asian Footprint" of Asiaset I. This includes India. Zee TV is being telecast since about October, 1992 showing various types of programmes, education, social, entertainment, news-based, etc. which programmes are interspersed with commercial advertisement. The advertisement shown on Zee TV are by way of advertising slots sponsored by business houses, who wish to promote themselves, their products and services in South East Asian countries. Zee TV Channel is a "Free to Air Programme" that is the viewers are not charged for watching the programme. As this is a "Free to Air Programme the expenses arc naturally met through advertisements. The first plaintiffs arc the sole agent, who procure for the third plaintiffs advertisements in India. The third plaintiffs after receiving the programme from the second plaintiffs and the advertisements from the first plaintiffs combine the two and broadcast the programme on the Zee TV Channel. The advertisers choose programmes in which to advertise, according to their popularity and time of showing. Zee TV Channel, which is a free-to-air signal, is se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stituting their advertisements along the lower part of the TV screen simultaneously with the main programme. 3. We have heard Mr. Kapadia for the appellants and Mr. Chagla for the respondents. The principal issue arising in this case is whether the defendants have a right and are entitled to substitute their advertisements during the broadcast of the plaintiffs. According to the plaintiffs, the action of the defendants in substituting advertisements in intercepting the programmes broadcast by the third plaintiffs and substituting the advertisements in the programmes by their own advertisements is per se unlawful. The plaintiffs have based their action upon various causes of action viz.:- (a) Passing off; (b) Inducing a breach of contract; (c) Conversion; (d) Copyright and Broadcast Reproduction Rights. Re (a) Passing off :- 4. The case of the plaintiffs under this head is that by reason of unauthorised intervention or interruption of the Zee TV signal the programmes and original advertisements forming part of the Zee TV broadcast are cut off from the viewers and the "local advertisements" are inserted by cable operators by means of their own video films. Such interc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses their advertising media, that is to say, their copies of the plaintiffs publications together with the defendants insets, as being the plaintiffs original publications and that dam age to the plaintiffs was likely to result from such misrepresentation and accordingly the plaintiffs were in my judgment, entitled at the time of the issue of the writ to an injunction. 6. Mr. Chagla also brought to our notice the case of Associated Newspaper Group v. Insert Media Limited and Ors. 1991) Fleet Street Reports 380. In that case the plaintiffs published two national newspapers, one of which had a colour magazine. They sold the right to advertising space both within the pages of their newspapers and by way of inserts. The defendants were in the business of insert advertising and proposed to arrange with retail newsagents to have their customers material inserted between the pages of various national newspapers without the publishers knowledge or consent. They canvassed customers by pointing out the advantages of having advertisements even for small businesses inserted in national newspapers and used the reputation of those newspaper as a selling point. They were, however, prepared shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertisements in the programme broadcast by the third plaintiffs is. a misrepresentation that they are advertisements broadcast by the plaintiffs. The statement does not have the effect of converting that false representation into a true representation. In fact if such a notice is displayed, it will add to the confusion of the viewers as to who is in fact responsible for the advertisements and may even reinforce the representation to the reader that the advertisement was shown as a result of some arrangement or collaboration with the plaintiffs. Re (b) inducing a breach of contract :- 8. It is a violation of legal right to interfere with contractual relations recognised by law if there be no justification for interference. Thus A commits a tort if, without lawful justification, he intentionally interferes with a contract between B and C, (a) by persuading B to break his contract with C, or (b) if by some unlawful act he directly or indirectly prevents B from performing his contract (see Winfield and Jolowicz on Tort Thirteenth Edition page 497). This tort had its origin in the action for enticing away the servant of another. In Lamley v. Gye (1853) 2 E and B 216 the plaintiff's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be confined but must reach all wrongful acts done intentionally to damage a particular individual. Lord Justice Macneghten said at page 510:- Speaking for myself, I have no hesitation in saying that I think the decision was right, not on the ground of malicious intention - that was not, I think the gist of the action - but on the ground that a violation of legal right committed knowingly is a cause of action, and that it is a violation of legal right to interfere with contractual relations recognised by law if there be no sufficient justification for the interference. Lord Lindley at page 535 of the same case said :- But if the interference is wrongful and is intended to damage a third person and he is damaged intact - in other words, if he is wrongfully and intentionally struck at through others, and is thereby damnified the whole aspect of the case is changed. The wrong done to others reaches him, his rights are infringed although indirectly, and damage to him is not remote or unforeseen, but is the direct consequence of what has been done. Our law, as I understand it, is not so defective as to refuse him a remedy by an action under such circumstances. If the above reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Gye reaches all wrongful acts done intentionally to damage a particular individual and actually damaging him. The law as thus stated was explained by the House of Lords in Quinn v. Loathem and in their Lordships opinion it applies in the case before them. 11. In G.W.K. Limited and Ors. v. Dunlop Rubber Co. (1926) 42. The Times Law Reports 376 the first plaintiffs, who were manufacturers of G.W.K. motorcars, made with the second plaintiffs, who were manufacturers of "Bal-lon-ette" tyres, an agreement which had the effect that all new G.W.K. cars were to be fitted with "Bal-lon-ette" tyres whenever the cars were exhibited. Under the agreement, the tyres were supplied to the first plaintiffs at reduced prices but were to be sold by them only as part of a new car. The first plaintiffs, sent to an Exhibition, two of their cars duly fitted with "Bal-lon-ette" tyres and on the night before the opening the defendants, who were manufacturers of Dunlop tyres, removed the "Bal-lon-ette" tyres and substituted Dunlop tyres, although they were aware of the agreement between the first and the second plaintiffs. In an action brought by the plaintiffs, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the International Transport Workers Federation. Whilst the ship, on a sub-charter, was docked at Liverpool, the International Transport Workers Federation (I.T.W.F.) decided to blackball the ship because of the low wages paid by the ship owners. I.Y.W.F. persuaded the tugmen to refuse to operate tugs assigned to move the ship. The result was that the ship was unable to leave port. The ship owners applied for an injunction against the I.T.W.F. to lift the blackball and for collateral advantages to Esso as mortgagees. Two years before the expiry date of the solus tie agreement and with the purpose of defeating it, Impact Holdings acquired the shares of Kingswood, who repaid the outstanding mortgage debt. Unknown to Esso, Impact Holdings procured the transfer of the legal title of the land on which the garage stood from Kingswood to Impact Motor, a subsidiary of Impact Holdings, and the agreements in relation to operating the garage were broken. Impact Motor charged the garage to L. In an action brought by Esso, it was held that there would be no clearer case than the present of an interference, namely, by Impact Holdings and Impact Motor, as soon as they had controlled and wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fendant knew the precise terms of the contract breached; it is enough if the defendant's knowledge is sufficient to entitle the Court to say that he has knowingly or recklessly procured a breach. Proof of malice in the sense of spite or ill-will is unnecessary. It is no justification for the defendant to say that he had an honest doubt whether he was interfering with the plaintiff's contract, or that he acted without malice or in good faith. It is enough to show that the defendant did an act which must damage the plaintiff; it need not be proved that he intended to do so. It is certain that justification is capable of being a defence to this tort, but what constitutes justification is incapable of exact definition. It has been said that regard must be had to the nature of the contract broken, the position of the parties to the contract, the grounds for the breach, the means employed to procure it, the relation of the person procuring it to the person who breaks the contract, and the object of the person procuring the breach. 17. In applying the well settled principles to the facts of the present case, it is required to be noted at the outset that it is admitted that the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even though it is without the knowledge or consent of both the contracting parties, would be an actionable interference. Mr. Kapadia is also not right in saying that interference by the defendants is not of "direct" nature. In Greig v. Insole (1978) 1 W.L.R. 32 it was observed that the phrase "direct interference" covers the case where the intervenor, either by himself or his agents, speaks, writes or publishes words, or docs other acts which communicate pressure or persuasion to the mind or person of one of the contracting parties themselves, while "indirect interference" refer to the case where, without actually doing any of these things, the intervenor nevertheless procures or attempts to procure a situation which will result or may result in a breach of the contract. Has there been a direct interference in this sense by the defendants with the contracts between the third plaintiffs and the advertisers? In our judgment, beyond doubt, there has. In this case apart from inducing the third plaintiffs to commit a breach by effectually preventing them from showing their advertiser the advertisement, the action of the defendants would directly have the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver at the time of the cause of action approximately about 4000 tons of this stuff was still undisposed and lying on that land. The defendants purchased this farm. He then started removing the hard core. The defendant claimed that as he had bought the land all that was on it belonged to him. The plaintiff, therefore, claimed damage for conversion. Rejecting the argument of the defendant that what was done by him does not amount to conversion. Scrutton L.J. observed :- Mr. Bensley Wells, while admitting that the appellant was mistaken as to his right to the hard core contends that what was done by him was not conversion. Conversion has been very much extended in the last two hundred years. In early times the plaintiff began with a writ for trespass. That was found not to be sufficient, then came a writ on the case framed, on the special circumstances, which extended the writ for trover, and all those remedies have been labelled as action for conversion. I take the modern definition of conversion from the judgment of Atkin, J. in Lancashire and Yorkshire Ry. Co. v. MacNicoll where he said: "It appears to me plain that dealing with goods in a manner inconsistent with the right o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... L.J. in Chickley v. Lyster. Atkin, J. goes on to point out that where the act done is necessarily a denial of the owner's right or an assertion of a right inconsistent therewith, intention does not matter. Another way of reaching the same conclusion would be to say that conversion consists in an act intentionally done inconsistent with the owner's right though the doer may not know of or intend to challenge the property or possession of the owner. 22. Mr. Kapadia however submitted that conversion necessarily has to be of chattel. In this case there is no chattel or goods. The plaintiffs are merely transmitting signals. He submitted that these signals do not constitute goods and in any event the defendants are not interfering with the transmission or the signals in any manner. Plaintiffs signals are not distorted or affected or diminished in any manner. Any person who has a satellite dish can pick up the plaintiffs signals at the same lime that the defendants are showing their advertisements. Plaintiffs broadcast their programme on their entire "Asian Footprint". On the other hand, he submitted that the defendant viewers are restricted to certain cities in India. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a tangible physical sense. In Malerkotla Power Supply Co. v. Excise Taxation Officer, Sangrur (1968) 22 STC 325 (Punj). Tek Chand, J. observed that electric energy has the commonly accepted attributes of movable property. It can be stored and transmitted. It is also capable of theft. It may not be tangible, in the sense that it cannot be touched without considerable danger of destruction or injury but it was perceptible both as an illuminant and a fuel and also in other energy giving forms. Electric energy may not be property in the sense of the term "movable property" as used in producing steam. Similarly, signals transmitted by the third plaintiffs can also be transmited, transferred, delivered, stored and possessed. Infact they are being communicated by the defendants. Many of the programmes are being stored and they can be possessed. In our view, therefore, all the attributes of a movable property are present. It must thus be held that signals are "movable property" within the meaning of Sale of Goods Act. There is also no merit in the argument of Mr. Kapadia that there is no conversion because the plaintiffs signals are not distorted or affected or dimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e claiming the copyright. The plaintiffs allege that even though Zee TV is "Free to Air Programme", yet the plaintiffs have permitted viewing on certain conditions. Those conditions are set out in para 13 A of the plaint. It is submitted by the plaintiffs that the copyright being in the plaintiffs, a party may view or further communicate the programme only on these conditions. All cable operators including the defendants are bound by these conditions and to comply with the same. The defendants, however, are acting in breach thereof. Therefore, the defendants' wrongful acts also constitute rebroadcast of the Zee TV signals in a form different from the signals broadcast by the third plaintiffs. 26. In order to appreciate the plaintiffs' case it is necessary to refer to the relevant provisions of the Copyright Act. Under Section 2(dd) broadcast means communication to the public by any means of wireless diffusion, whether in any one or more of the forms of signs, sounds or visual images; or by wire and includes re-broadcast. Section 2(f) provides that a cinematograph film includes any work of visual recording on any medium produced through a process from which a movi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the copyright. Under Section 54 owner of a copyright also includes an exclusive licensee. 28. It is contended by Mr. Kapadia that the third plaintiffs have no copyright in India. The argument is based on fact that the third plaintiffs are established in British Virgin Island and are broadcasting from Hong Kong. What was relied on was the fact that neither British Virgin Island nor Hong Kong were parties to the Berne Convention and thus do not have any arrangement with India whereby copyrights in their country were recognised in India. Mr. Kapadia's argument is also based on fact that admittedly the copyright in the advertisement belongs to various advertisers who are not before the Court. Mr. Kapadia's submission is that even though the second plaintiffs arc owners of copyright, the defendants arc not interfering with their programme and thus not interfering with the copyright of the second plaintiffs. As regards advertisements component of the programme is concerned, Mr. Kapadia argues that copyright does not vest in any of the plaintiffs. Mr. Kapadia also argues that there was no binding contract between the plaintiffs and the defendants. He submits that the defendants a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 37 is available to all broadcasting organisations, wherever they are situated, so long as the broadcast is available in India for viewing. Sub-section (1) of Section 37 clearly provides that every broadcasting organisation shall have a special right to be known as "broadcasting reproduction right" in respect of its broadcast. Under Sub-section (2) it is provided that the broadcast reproduction right shall subsist until 25 years from the begining of the calender year next following the year in which the broadcast is made. Sub-section (3) provides that any person who, without the licence of the owner of the right rebroadcasts the broadcast or causes the broadcast to be heard or seen by the public on payment of any charge or does any other acts mentioned in the said sub-section, shall be deemed to have infringed the broadcast reproduction right. The language of the section makes it very clear that the right is not confined only to Berne Convention countries. This is also clear from the fact that the International Copyright Order, 1991 exclude the application of Chapter VIII which deals with broadcast reproduction right. Under the broadcast reproduction right nobody can reb ..... X X X X Extracts X X X X X X X X Extracts X X X X
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