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[2019] ZASCA 153
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Tellytrack v Marshalls World of Sport (Pty) Ltd and Others (971/2018) [2019] ZASCA 153; 2020 (2) SA 435 (SCA); 2019 BIP 238 (SCA) (25 November 2019)
Links to summary
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
CASE
NO: 971/2018
Reportable
In
the matter between:
TELLYTRACK APPELLANT
and
MARSHALLS
WORLD OF SPORT (PTY) LTD FIRST
RESPONDENT
MARSHALLS
WORLD OF SPORT
GAUTENG
(PTY)
LTD SECOND
RESPONDENT
MARSHALLS
WORLD OF SPORT
EASTERN
CAPE (PTY)
LTD THIRD
RESPONDENT
MARSHALLS
WORLD OF SPORT
WESTERN
CAPE (PTY)
LTD FOURTH
RESPONDENT
JEREMY
MARSHALL FIFTH
RESPONDENT
SUSAN
CARLISLE
MARSHALL SIXTH
RESPONDENT
STEVE
MARSHALL SEVENTH
RESPONDENT
BRETT
BOWMAN EIGHTH
RESPONDENT
Neutral Citation:
Tellytrack v Marshalls World of Sport
(Pty) Ltd & others
(971/2018)
[2019]
ZASCA 153
(25 November 2019).
Coram:
Navsa, Saldulker, Van der Merwe and Dlodlo
JJA and Weiner AJA
Heard:
4 November 2019
Delivered:
25 November 2019
Summary:
Copyright – whether enabling the public
to view horse racing events at bookmakers’ business locations
constituted an
infringement of the appellant’s rights in
cinematograph film as provided for in
s 8
of the
Copyright Act 98 of
1978
– discussion of definition of cinematograph films and
eligibility for copyright.
ORDER
On
appeal from
: KwaZulu-Natal Division of the
High Court, Durban (Radebe J sitting as court of first instance):
1 The appeal is upheld
with costs including the costs consequent upon the employment of two
counsel.
2 The order made by the
court a quo is set aside and substituted as follows:
‘
1
The first, second, third, fourth, fifth, seventh and eighth
respondents and Marshalls World of Sport KZN 2 (Pty) Ltd (“the
respondents”) are interdicted and restrained, in terms of
s
8(1)
(b)
of the Copyright Act No. 98 of 1978 (“the
Copyright Act&rdquo
;), from infringing the appellant’s
copyright in the Tellytrack Cinematograph Films and Raw Race Feeds by
causing them to
be seen in public.
2
An enquiry be held for the purposes of determining the amount of
damages, alternatively, a reasonable royalty to be paid by the
respondents to the appellant and that if the parties cannot agree
upon the procedure to be adopted, they may approach the Court
to
prescribe such procedure for conducting such enquiry.
3
The costs are to be paid by the respondents, jointly and severally,
the one paying the others to be absolved, such costs to include
those
consequent upon the employment of two counsel.’
JUDGMENT
Navsa
JA (Saldulker, Van der Merwe and Dlodlo JJA and Weiner AJA
concurring):
[1]
This is an appeal by Tellytrack, a partnership between Phumelela
Gaming and Leisure Limited (Phumelela), Gold Circle (Pty) Ltd
(Gold
Circle) and Kenilworth Racing (Pty) Ltd (Kenilworth),
against
an order of the KwaZulu-Natal Division of the High Court, Durban, in
terms of which an action for an interdict against seven
defendants,
the present respondents, was dismissed with costs, including the
costs of two counsel. Tellytrack had sought an interdict,
inter
alia
, restraining the respondents from
permitting the public to view, at their business locations, horse
racing events shown on the
Tellytrack Television channel 239,
broadcast by DSTV, a national television broadcast entity. The appeal
is before us with the
leave of the court below. Phumelela, Gold
Circle and Kenilworth are racetrack operators. They are the only
entities licenced to
conduct horse race meetings in South Africa.
They also each hold totalisator betting licences.
[2]
The first respondent is Marshalls World of Sport KZN (Pty) Ltd, the
second respondent is Marshalls World of Sport Gauteng (Pty)
Ltd, the
third respondent is Marshalls World of Sport Eastern Cape (Pty) Ltd,
the fourth respondent is Marshalls World of Sport
Western Cape (Pty)
Ltd, the fifth respondent is Jeremy Marshall and is the sole director
of the second and third respondents. He
is one of two directors of
the first respondent. Tellytrack did not proceed against the sixth
respondent in the court below. The
seventh respondent, Steve
Marshall, conducts business at Marshalls World of Sport KZN in
Pinetown, Port Shepstone and at the Taj
Hotel in Marburg. The eighth
respondent, Brett Bowman, is one of the two directors of the first
respondent. The present respondents
all hold bookmakers licences and
conduct business at various provincial locations. It is uncontested
that they permit viewing by
the public of channel 239 at their
business locations for the benefit of,
inter
alia
,
potential and actual punters.
[1]
[3]
The action in the court below was based on alleged contraventions by
the respondents, of provisions of the Copyright Act 98
of 1978 (the
Act). Simply put, this case is about whether the respondents are
guilty of copyright infringement. The detailed background
culminating
in the present appeal is set out hereafter.
[4]
At the outset it is necessary to have regard to the scale of interest
in the horseracing industry in this country, best demonstrated
by the
facts set out hereafter. There are nine domestic race tracks in this
country and some 400 totalisator betting outlets, branded
as TAB, in
South Africa, two tote telephone betting centres and two online tote
betting sites. This is over and above the locations
at which
bookmakers conduct their business. Channel 239 which is made
available for viewing by the public at locations where the
respondents conduct business, runs continuously from 10h00 to 22h30
every day of the year, except for Christmas Day, and a live
horserace
is shown on channel 239 every 10 minutes. As will be explained in
more detail later, most of the material displayed on
channel 239
concerns international horseraces conducted at racetracks in numerous
countries across the world.
[5]
Tellytrack operates a television control room in Rivonia that
receives raw television feeds from domestic horse races, via a
transmission services provider, Telemedia, and receives raw
international horse race feeds via satellite. The raw race feeds
consist
of visual images of events leading up to the race, images of
the live race being run, accompanied by auditory commentary, as well
as pre and post-race celebrity and guest interviews. Tellytrack
through its employees enhances the raw race feeds by editing,
compiling and adding the following graphics:
(a) betting scrolls,
incorporating the totalisator odds offered on each horse or
combination of horses in a given race or races;
(b) horse race previews,
tips and selections;
(c) horse race
totalisator pool information;
(d) horse race
totalisator betting information;
(e) compilations of horse
racing data and information; and
(f) race preview and
post-race interviews with racing personalities.
These
are effected by computer software supplied by an American company,
customised and modified for Tellytrack’s purposes.
Phumelela
holds the licence for the software utilised by Tellytrack.
[6]
Once the enhancements are added, the final product, referred to as a
dirty feed, is then sent by fibre optic cable to Multichoice,
a
national satellite dish broadcaster, to be shown on its DSTV
Tellytrack channel 239 via Intelsat. The international and domestic
races are billed as being broadcast live. It is to be noted that the
enhancements are added within one second of receipt by way
of a
computer program, the details of which are referred to later, and the
final product is then dispatched immediately for broadcast
on channel
239. More than 75 per cent of the races shown on channel 239 are
international horse races from, amongst others, England,
Dubai and
Singapore.
[7]
In respect of domestic races it should be understood there is a
production team consisting of Phumelela employees stationed
at the
race tracks owned by the constituent members of Tellytrack, operating
mostly from outside broadcast vans (OB vans). In respect
of two
racecourses there is a fixed gallery at each instead of an OB van. At
each racetrack there are several cameras strategically
positioned to
film races at that track. The images captured during a race are
converted to a format which enables them to be received
via
fibre-optic cable at the OB van or gallery. For convenience I shall
hereafter refer to both as the OB van. The race-day producer
works
with a video tape operator and with a stipes operator. The images are
accompanied by the audio commentary of on-course presenters
who talk
about the horses and their form to entice potential punters to place
bets. Post-race interviews are also conducted. The
following are the
domestic racetracks in question:
‘
1.1 Turffontein, Vaal,
Arlington, Fairview and Flamingo Park Racecourses (Phumelela).
1.2 Clairwood, Greyville and
Scottsville Racecourses (Gold Circle).
1.3 Durbanville and Kenilworth
Racecourses (Kenilworth).’
The
racetracks that have a fixed gallery are Fairview in Port Elizabeth
and Flamingo Park in Kimberley.
[8]
What is received by the OB van from the cameras at domestic
racetracks via a cable is simultaneously recorded on one digital
server as well as on a separate dedicated server for the stipes
stewards and is kept in archival storage there. The images can
be
replayed for stewards to monitor whether everything was above board
and permits slow motion replays at the instance of the race-day
producer. Before the signal leaves the OB van it has to be compressed
to facilitate transmission to the Tellytrack control room
in Rivonia.
The onward transmission by fibre-optic cable is effected by
Telemedia, a service provider, at the instance of Tellytrack.
The
enhancements are then added and the complete product is recorded in
Tellytrack’s control room on the output digital video
recorder
and simultaneously sent to DSTV by Telemedia in compressed form via
fibre-optic cable. It is kept in archival storage
at Tellytrack’s
control room. After it is received by DSTV it is encrypted for
transmission by satellite to DSTV’s
private subscribers. This
latter process takes six seconds. Separately, Telemedia sends in
encrypted form, via satellite, the dirty
feed from the Tellytrack
control room to the latter’s commercial subscribers, for
viewing by the public at their respective
business locations. To be
accurate, what is viewed on channel 239 is displayed at least seven
seconds later than what is occurring
at the race tracks at that
moment.
[9]
In relation to international races, the capture of the race by
cameras involves production teams employed by rights owners in
respective countries and the raw feed is then transmitted by
Tellytrack’s international supplier via satellite to the
Tellytrack
control room via Telemedia. The same process as in
relation to domestic raw feeds as referred to in the preceding
paragraphs is
then followed.
[10]
It is necessary to record that in terms of a Channel Distribution
Agreement between Multichoice Proprietary Limited, which
conducts
DSTV operations and Tellytrack, Multichoice is given the right to
receive, distribute and market channel 239 and is entitled
to licence
the reception, distribution and marketing of the channel, by means of
Pay TV Systems for reception by subscribers. In
terms of that
agreement Tellytrack reserved to itself the right to grant communal
subscribers such as totalisators and bookmakers
authorisation to
receive, distribute or broadcast the channel.
[11]
I now turn to deal with the history of Tellytrack’s involvement
with the respondents and the genesis and resolution of
the litigation
leading up to the present appeal. During 2000 a meeting took place,
attended by representatives of Phumelela, Gold
Circle, the Western
Cape Bookmakers, Eastern Cape Bookmakers, Gauteng Bookmakers and
KwaZulu-Natal Bookmakers. The respondents
are members of the
respective provincial Bookmakers Associations. At that meeting an
oral agreement was concluded between Phumelela
and Gold Circle on the
one hand and licenced bookmakers on the other, in terms of which
Phumelela and Gold Circle (both being race
course operators in South
Africa) together with other race course operators in South Africa,
would establish and operate a television
channel for the purpose of
broadcasting horseracing events. Totalisator operators would
subscribe to the television channel and
would have the right to
display the television channel’s contents at their outlets.
Phumelela and Gold Circle (which subsequently
established Phumelela
Gold Enterprises (PGE), for this purpose) would bear the cost of
establishing the television channel. The
television channel would be
operated on a ‘break-even’ basis with the costs
associated with bringing the feeds from
the various race courses in
South Africa to the recipients of the broadcast being spread equally
between the licensed bookmakers
in South Africa and totalisator
agents in South Africa on a per outlet or ‘per shop’
basis.
[12]
The envisaged television channel would be known as Tellytrack, which
initially was a partnership comprising Phumelela and Gold
Circle. It
was later extended to include Kenilworth. In terms of each of the
contracts concluded between Tellytrack and KwaZulu-Natal
Bookmakers
Society; the Gauteng Off-Course Bookmakers Association; and the
Western Cape Bookmakers Association, Tellytrack would
provide the
television channel for a monthly subscription fee determined in
accordance with an agreed formula set out in the contracts
which was
on the break-even basis.
[13]
From 2001 to September 2013 the relationship between Tellytrack and
the KwaZulu-Natal Bookmakers Society (the successor in
title of the
Natal Bookmakers’ Society (CO-OP Limited)), the Gauteng
Off-Course Bookmakers Association and the Western Cape
Bookmakers
Association, of which the respondents are members, was regulated by a
series of written agreements. In terms of the
agreements Tellytrack
would provide the television channel for a monthly subscription fee,
determined in accordance with an agreed
formula which was on the
break-even basis referred to earlier.
[14]
From September 2013, after the termination by effluxion of time, so
Tellytrack alleged, of the last written agreements referred
to in the
preceding paragraph, Tellytrack, desirous of extracting more from the
various betting entities, prompted by financial
demands by their
international suppliers, sought to base a future subscription fee on
a percentage of turnover. This was communicated
to those entities,
including the respondents. Negotiations to that end ensued.
Thereafter, Tellytrack wrote to the bookmakers.
The relevant part of
a letter dated 24 January 2014 is set out hereafter:
‘
We have not managed to persuade
our international suppliers to continue to permit exploitation of
their intellectual property by
bookmakers in betting outlets without
being remunerated therefor. Accordingly, the international content
has to be removed from
the Tellytrack channel and broadcast as a
separate channel on separate decoders with effect from February 2014.
Your options therefore are:
a)
You can subscribe for either the Telllytrack channel or the
international content, or both, at 3 % of your over-the-counter
turnover;
b)
You can elect to accept our offer of mediation;
c)
You can still make an alternative proposal to us;
d)
You can pursue the clean feed alternative offered by Phumelela; or
e)
You can elect not to subscribe for any of our services and take bets
without displaying live South African or international racing
in your
retail betting shops.
We have deployed decoders to
bookmakers who have to date opted for alternative a).’
[15]
Neither the respective bookmakers associations nor any of the
respondents were amenable to the proposals and they all stopped
paying for the material received from Tellyrack. The constituent
members of Tellytrack were adamant that they were the proprietors
in
what they described as the cinematograph films and sound recordings
of the horse racing events (the raw feeds) that took place
at the
racetracks operated by them. Phumelela asserted that it was the
proprietor of the copyright in the computer program used
to produce
the betting scrolls, added to the raw feed and that it was the
proprietor of the copyright in the resultant betting
scrolls which
constitute computer generated literary works as contemplated in the
Act and that it ultimately holds copyright to
what was being viewed
on channel 239, namely, the dirty feeds of domestic and international
race events. Insofar as any of the
constituent members of Tellytrack
hold copyright in any part of the works in respect of which copyright
protection was sought,
an exclusive licence therein was granted to
Tellytrack.
[16]
The factual material recorded in paras 5 to 9 above are common cause.
They were largely drawn from a diagrammatic representation
produced
by a witness on behalf of the respondents, namely Mr David Fraser.
The paragraphs that follow describe the essential dispute
between the
parties and the findings of the court below.
[17]
It is on the basis of the reservation of its rights in relation to
communal subscribers in the agreement concluded with Multichoice,
referred to in para 10 above, that Telllytrack in the past provided
to be viewed at the business locations of members of the bookmakers’
associations with which it had reached agreement, the dirty race
feeds of domestic and international races. As stated above, the
relationship between Tellytrack and members of the bookmakers’
associations broke down when the former demanded an increased
fee and
the latter stopped paying any subscriptions. Such members are
presently making available for viewing to the public at its
business
locations what DSTV broadcasts to its private subscribers. It is that
conduct that formed the basis of the action instituted
by Tellytrack.
At the time of the hearing of this appeal a number of bookmakers and
tote operators had signed up to receive access
to the Tellytrack
channel in the terms proposed by it in the letter set out in para 14
above.
[18]
Tellytrack’s complaint in proceeding to litigation and seeking
an interdict against the respondents, was that the respondents,
since
they stopped paying any subscription fees and in the absence of any
new agreement granting them the right to do so, continued
to make
available for viewing by the public the dirty race feeds on channel
239 broadcast by DSTV at their betting shops, thereby
infringing
Tellytrack’s copyright in the works referred to above, in terms
of ss 6, 8, 9, 11B and 23 of the Act. Sections
6 and 9 deal with the
nature of copyright in literary or musical works and in sound
recordings. Section 8 sets out the nature of
copyright in
cinematograph films. Section 8, which is central to this appeal, will
be dealt with in greater detail later. Section
11B sets out the
nature of copyright in computer programs. The relevant part of s 23
reads as follows:
‘
Copyright
shall be infringed by any person, not being the owner of the
copyright, who, without the licence of such owner, does or
causes any
other person to do, in the Republic, any act which the owner has the
exclusive right to do or to authorize.’
[19]
Tellytrack was adamant that the respondents were infringing their
copyright on a daily basis since October 2013. Tellytrack
claimed
that consequently it suffered damages, alternatively, that it was
entitled to be awarded an amount calculated on the basis
of a
reasonable royalty, which would have been paid by a licensee in
respect of the use of the works. It also claimed additional
damages
it insisted it was entitled to in terms of s 24(3) of the Act. I
shall in due course deal with the applicability of that
subsection.
[20]
It is necessary to record that pending the finalisation of the
litigation the respondents have in the interim paid an amount
based
on the break-even formula that applied when the written agreements
were still in force into their attorneys’ trust
account. The
issue before us is whether there was an infringement by the
respondents of Tellytrack’s copyright.
[21]
In adjudicating Tellytrack’s action for an interdict, the court
below (Radebe J) had regard to the principal dispute
between the
parties, namely, the assertion and refutation of copyright in what
the public was being permitted to view on channel
239, at the
respondents’ business locations. She had regard to ss 2(2) and
2(2A) of the Act, which deal with works that are
eligible for
copyright and which read as follows:
‘
2 Works eligible for
copyright
(1) . . .
(2) A work, except a broadcast
or programme-carrying signal, shall not be eligible for copyright
unless the work has been
written down, recorded, represented in
digital data or signals or otherwise reduced to a material form.
(2A) A broadcast or a
programme-carrying signal shall not be eligible for copyright until,
in the case of a broadcast, it has been
broadcast, and, in the case
of a programme-carrying signal, it has been transmitted by a
satellite.’
[22]
Radebe J also considered ss 8(1)
(a)
and
(b)
of the Act
which deals with the nature of copyright in cinematograph films.
Those subsections read as follows:
‘
8 Nature of copyright in
cinematograph films
–
(1) Copyright in a cinematograph film
vests the exclusive right to do or to authorize the doing of any of
the following acts in
the Republic:
(a)
Reproducing the film in any manner or form, including making a
still photograph therefrom;
(b)
Causing the film, in so far as it consists of images, to be seen
in public, or, in so far as it consists of sounds, to be heard in
public.’
These
sections should be read with s 1 of the Act which defines
cinematograph films as follows:
‘
[A]ny fixation or
storage
by any means
whatsoever on film
or any other material
of
data
,
signals
or a sequence of images
capable, when used in conjunction with any other mechanical,
electronic or other device, of being seen as
a moving picture and of
reproduction, and includes the sounds embodied in a sound-track
associated with the film, but shall not
include a computer program.’
(My emphasis.)
The
court below, however, had regard to two previous incarnations of this
definition, drawn from the decision of this court in
Golden
China TV Game Centre & others v Nintendo Co. Ltd
[1996] ZASCA 103
;
1997 (1) SA 405
(A). In that case, this court was considering the
question whether video games qualified for copyright protection as
‘cinematograph
films’. It dealt with the relevant
provisions of the Copyright Act 63 of 1965 and those of the Act, pre
and post amendments
in 1992. The versions of the definition that this
court in
Nintendo
had regard to were those initially contained in the Act upon its
promulgation and subsequently by virtue of the amending Act in
1992.
[2]
The word in square
brackets indicate an omission from the 1978 Act and those underlined
represent insertions. The text that the
court in
Nintendo
had regard to reads as follows:
‘“
Cinematograph film”
means the [first] fixation by any means whatsoever on film or any
other material of a sequence of images
capable, when used in
conjunction with any mechanical, electronic or other device, of being
seen as a moving picture and of reproduction
and includes the sounds
embodied in a sound-track associated with the film,
but
shall not include a computer program
.’
[3]
The
differences can be seen by comparing the historical texts with the
emphasised parts of the present definition.
[23]
The court below, after having regard to the historical rather than
the present day text, referred to 413A-J to 414A of
Nintendo
where
the following appears:
‘“
First Fixation
”
As a rule, a work has to be fixed or
reduced to some or other material from before it can be eligible for
copyright (s 2(2)). Before
its amendment in 1992, this subsection
imposed the requirement on literary, musical and artistic works only,
but it is now applicable
to all works except, obviously, a broadcast
or programme carrying signal. As far as cinematographic films are
concerned, the fixation
requirement has been part of the definition
since 1978. It replaced the requirement of “recording” in
the 1965 Act.
Since the amending Act, the requirement is therefore to
be found not only in the definition, but also in s 2(2) . . .
“
A sequence of images
”
The obvious difference between a
“conventional” cinematograph film and a video game lies
in the fact that, with the
former, the sequence of images is fixed
whereas in the case of the latter the sequence of images is, to an
extent, variable and
under control of the player . . .
“Reproduction”, in the contexts of copyright, refers to
the copying of the work (i.e.
the cinematograph film) in question . .
. and not to ephemeral versions, renditions or application of a work.
This is clear if
regard is had to the definitions of “copy”
and “reproduction” (s 1) and, especially, s 8(1) of the
Act.
What seems to me, to have to be capable of reproduction is the
film itself and not the sequence of images . . . .’
[24]
The court below went on to state the following, at para 23 of its
judgment:
‘
It is clear from the above
exposé that for a work to fall within the definition of
“cinematograph film”, the
data or signals or a sequence
of images, must have been
fixated
or
stored
, in other
words, been recorded on material, and been capable of being seen as a
moving picture and of being reproduced when used
in conjunction with
any other mechanical, electronic or other device. Infringement of the
copyright in a cinematograph film therefore
requires that there is
copying
of that film or a substantial part thereof. The term
“copy”, in relation to cinematograph film, means any
print, negative,
tape or other article on which the film or part of
it is recorded.’
In
Nintendo
this court
held that video games fall within the definition of ‘cinematograph
films’.
[25]
I interpose to record that in dealing with the then definition of
‘cinematograph films’, Harms JA, in
Nintendo
, said
the following at 412E-F:
‘
As with many definitions in the
Act and its antecedents, very wide terms have been employed. The only
reason for this can be an
intention to cover future technical
innovations by using general words. Legislative inertia ought not to
impede human ingenuity
and the reasonable protections thereof.’
[26]
Returning to the judgment of the court below, Radebe J, after
referring to
Nintendo
, progressed to dealing with sound
recordings and had regard to s 9
(e)
of the Act, which
provides:
‘
9 Nature of copyright in
sound recordings. -
Copyright in a sound recording vests
the exclusive right to do or to authorize the doing of any of the
following act in the Republic:
. . .
(e)
Communicating the sound recording to the public.’
[27]
Radebe J thereafter proceeded to evaluate the evidence adduced and
held as follows at para 45:
‘
It cannot be disputed that both
the Raw Race Feed and the Tellytrack Film are cinematograph films, as
is abundantly clear from Plaintiff’s
(Mr Wahlberg’s) and
Defendant’s (Dr Fraser) witnesses. What needs to be still
determined is whether the Plaintiff is
the owner of what vests in the
telecast that is broadcast by Multichoice on DSTV channel 239
(Tellytrack channel) the evidence
of both Mr Wahlberg and Dr Fraser
is that what is being broadcast as the Tellytrack Channel is recorded
“simultaneously”
as the channel is viewed.’
[28]
The court below then, somewhat paradoxically, once again considering
Nintendo
, stated the following, referring to specific parts of
the evidence adduced:
‘
Mr Wahlberg’s evidence
under cross-examination was that: at the time of the broadcast there
did not exist in material form
any work which could be copied because
they were in the process of being recorded (simultaneously) as they
were being broadcast.
He thus conceded that all that which could be
shown was the broadcast by Multichoice.
Similarly, the evidence on affidavit
by Mr Stuart, which Mr Wahlberg agreed, is that what was shown on the
television channel was
a broadcast and not a film. The latter was
still in the process of being made, possibly in the process of being
fixated or stored
or reduced to material form. Mr Wahlberg’s
evidence is that what is shown on the Tellytrack TV channel is a
broadcast by
Multichoice. This is not dependent upon the recordal of
the Tellytrack channel, albeit these two events happen
simultaneously,
or concurrently or at the same time as the channel is
viewed.’
[4]
[29]
The court went on to reach the following conclusions:
‘
In the premises, the
Plaintiff’s claim for copyright must fail for the following
reasons:
In respect of cinematograph film, the
evidence of both Mr Wahlberg and Dr Fraser was that what is broadcast
as Tellytrack television
channel is recorded simultaneously or
concurrently as the channel is viewed. There was therefore no copying
of a work which had
been fixated or stored when, the Defendants
showed the Tellytrack channel on their screens. Fixation for storage
of the data or
signal or sequence of images is required.
The definition of “cinematograph
film is clear and unambiguous s 1(1) and should be interpreted as is
done, for instance in
the decision in NINTENDO (
supra
).
In respect of literary works, Mr
Wahlberg’s evidence is that the Plaintiff relies on the same
thing for literary works and
for the computer-generated works.
Plaintiff fails to identify these works separately and Plaintiff’s
evidence shows that
both are in any event part of the cinematograph
film relied on.
In respect of the sound recordings,
the Plaintiff’s evidence amounts to showing that these cannot
be a work separate from
the cinematograph film. Mr Bowman argued that
even if they were otherwise separately identifiable, they are nothing
other than
part of the cinematograph film the Plaintiff relies on. I
agree with him. The Plaintiff could not identify these works as
separate
from cinematograph film. The literary works, the sound
recording and the computer-generated works do not have existence
other than
part of the cinematograph films.
It is on these bases that I accept
that what the Defendants were showing on their screens was a
broadcast, in respect of which the
Plaintiff has not claimed
copyright. It is Multichoice and not the Plaintiff, that is the owner
of the copyright which might vest
in the Tellytrack TV Channel. The
Plaintiff therefore has no copyright in the “telecast” on
which it relies as being
the cinematograph film.’
[5]
[30]
The court below consequently dismissed the appellant’s claim
with costs, including the costs of two counsel. It is against
that
order and the conclusions upon which it was based that the present
appeal is directed.
[31]
Section 2(1) of the Act lists the categories of works that are
eligible for copyright. One such category includes cinematographic
films. Section 2(2) of the Act provides:
‘
A work, except a broadcast or
programme-carrying signal, shall not be eligible for copyright unless
the work has been written down,
recorded, represented in digital data
or signals or otherwise reduced to material form.’
Section
8, the provisions of which appear in para 24 above, make it clear
that copyright in a cinematograph film vests the exclusive
right to
authorise,
inter alia
,
‘causing the film, in so far as it consists of images, to be
seen in public; or, in so far as it consists of sounds, to
be heard
in public’.
[32]
Although the action instituted by Tellytrack is based on infringement
by the respondents of copyright in relation to a variety
of works,
namely, literary, cinematograph films, sound recordings and computer
programs it soon became clear that the core of its
case was that it
was entitled to copyright protection in relation to cinematograph
films, which comprised the other works. It will
be recalled that the
definition of cinematograph film in s 1 of the Act includes a
soundtrack associated therewith.
[33]
Before us, the crux of the respondents’ case, was that since
what was displayed at their business premises by way of
DSTV’s
channel 239 was a broadcast of a live event, there was no fixation or
storage as required by the definition of cinematograph
film and that
consequently there had been no infringement of appellant’s
copyright in the work. More particularly, that the
broadcast was not
from a recording as required by the definition of cinematographic
film, because the recording was happening concurrently
with the
transmission of the live event. That is the part of the judgment of
the court below that the respondents support and rely
on. The
respondents also support the conclusion by the court below that
Multichoice, as the first broadcaster of the Tellytrack
television
channel owned the copyright in the broadcast and in any event in
terms of clause 12 of the Channel Distribution Agreement
copyright in
the broadcast vested in Multichoice. The respondents also criticised
Tellytrack for initially basing its case on s
8(1)
(a)
in terms of which it accused them of reproducing the film whereas
only latterly, relying on s 8(1)
(b)
,
namely, causing the images of the film to be seen in public.
[34]
It is true that Tellytrack was at times confused about the core of
its case. Too much unfocused effort was expended on the
nature of
what was sent to Multichoice by Telemedia and whether what was seen
on channel 239 was a reproduction rather than on
whether what the
public was ultimately permitted to view at the business locations of
the respondents was a cinematograph film,
within the definition of
that expression in the Act. That notwithstanding, before us, the
principal question is whether Tellytrack
is entitled to claim
copyright in relation to cinematographic films. There can be no doubt
that what the public is allowed to see
at the respondents’
business locations are a sequence of images seen as a moving picture
constituting in the main horse racing
events. Those images and
others, including those of studio interviews and the overlay of all
the items imposed by way of the computer
program, have indisputably
been reduced to material form by way of the recordings on the
aforesaid occasions. First, in relation
to domestic races, two
recordings were made at the OB van, second at the Tellytrack control
room. In respect of international races,
the recording is made of the
complete product, including enhancements, at the Tellytrack control
room. What is seen on channel
239 is what has already been recorded
and stored at the OB van and the Tellytrack control room. At the time
that a race event is
seen on channel 239 is has already been recorded
and stored, as described above. As noted in
Nintendo
,
[6]
the stored images need not be stored in their original form, that is,
as images. It is capable of being reproduced as it was when
examples
were shown to the court below. These facts bring it squarely within
the definition of s 1 of the Act and provides it with
copyright
protection in terms of ss 2, 8 and 23 of the Act.
[35]
This is not a case in terms of which Multichoice is claiming
copyright infringement in relation to the broadcast of the material
on channel 239. This case is about Tellytrack claiming copyright in
cinematograph films which encompass sound recordings and the
graphic
enhancements. There is something to be said for the refrain on behalf
of the appellant, namely, that one cannot broadcast
‘nothing’
and that consequently, what the public was being allowed to view at
the respondents’ business locations,
was a cinematograph film.
There is no dispute in relation to it being produced at source and
later being added to by Tellytrack
employees. In all of the
circumstances set out above, the appellants have discharged the onus
of establishing copyright in cinematograph
films. Tellytrack was
clearly entitled to the interdict sought in the court below. To hold
otherwise would be to frustrate the
purpose of the Act.
[36]
Reverting to the question of additional damages being claimed by the
appellants as contemplated in s 24(3) of the Act, the
concession was
rightly made before us that in terms of that subsection, Tellytrack
was not entitled to such relief if effective
relief was otherwise
available to it. Section 24(3) reads as follows:
‘
(3)Where in an action under
this section an infringement of copyright is proved or admitted, and
the court having regard, in addition
to all other material
considerations, to -
(a)
the flagrancy of the infringement; and
(b)
any benefit shown to have accrued to the defendant by reason of
the infringement,
is satisfied
that effective relief
would not otherwise be available
to the plaintiff, the court
shall in assessing damages for the infringement have power to award
such additional damages as the
court may deem fit.’ (My
emphasis.)
It
was accepted that an enquiry to be held for the purposes of
determining the amount of damages, alternatively, a reasonable
royalty
to be paid, would, in the circumstances, provide Tellytrack
with effective relief.
[37]
One last aspect requires attention, namely Phumelela’s licence
conditions in relation to Gauteng and the Eastern Cape.
These licence
conditions placed certain obligations on Phumelela which explains the
formal tender made by Tellytrack and which
remain extant. The tender
is as follows:
‘
Phumelela tenders to make
available, to the defendants conducting business in Gauteng, the
visual broadcasts of all horse races
staged at Turffontein Race
Course in accordance with its Gauteng Race Meeting licence.
Phumelela tenders to make available,
to the Defendants conducting business in the Eastern Cape, the
television signals of all horse
races staged at Fairview Race Course
in accordance with its Eastern Cape race course licence.’
The
interdict sought by Tellytrack is somewhat impinged upon by the
tender but does not otherwise militate against it. The tender
and is
enforceable by the respondents and we need not concern ourselves any
further in relation thereto. The order that follows
does not
encompass the visual broadcasts in respect of which the tender is
made.
[38]
The following order is made:
1 The appeal is upheld
with costs including the costs consequent upon the employment of two
counsel.
2 The order made by the
court a quo is set aside and substituted as follows:
‘
1
The first, second, third, fourth, fifth, seventh and eighth
respondents and Marshalls World of Sport KZN 2 (Pty) Ltd (“the
respondents”) are interdicted and restrained, in terms of s
8(1)
(b)
of the Copyright Act No. 98 of 1978 (“the
Copyright Act&rdquo
;), from infringing the appellant’s
copyright in the Tellytrack Cinematograph Films and Raw Race Feeds by
causing them to
be seen in public.
2
An enquiry be held for the purposes of determining the amount of
damages, alternatively, a reasonable royalty to be paid by the
respondents to the appellant and that if the parties cannot agree
upon the procedure to be adopted, they may approach the Court
to
prescribe such procedure for conducting such enquiry.
3
The costs are to be paid by the respondents, jointly and severally,
the one paying the others to be absolved, such costs to include
those
consequent upon the employment of two counsel.’
________________________
MS
NAVSA
JUDGE
OF APPEAL
APPEARANCES:
FOR
APPELLANT:
R Michau SC (with him P Cirone)
Instructed by:
Roodt Inc. Attorneys,
Johannesburg
Honey Attorneys Inc,
Bloemfontein
FOR
RESPONDENTS:
L Bowman
SC (with him GR Thatcher SC)
Instructed by:
Livingston Leandy Inc, La
Lucia Ridge
McIntyre van der Post,
Bloemfontein
[1]
As to how totalisator betting as opposed to fixed odds betting –
conducted by bookmakers - operates, see the judgment of
this court in
KwaZulu-Natal
Bookmakers’ Society v Phumelela Gaming and Leisure Ltd
[2019]
ZASCA 116.
[2]
Act 125 of 1992.
[3]
At 412C-E.
[4]
Paras 47 and 48.
[5]
Paras 60-61.
[6]
At 415C-D.