Liability for Authorisation of Copyright Infringements: Metro on George

By Campbell Thompson

Under Australian law, the exclusive rights of the copyright owner extend to the right to authorise people to do any of the acts 'comprised in the copyright'—such as reproducing (copying) the work, communicating it and performing it in public. The 'authorisation right' sometimes permits the copyright owner to go behind the actual copyist and pursue people who, on general principles of tort law, might not otherwise be liable.

In determining whether a person has authorised an infringement of copyright, the court must in particular consider that person's power to prevent the infringement, the actual steps he or she took to avoid the infringement, and his or her relationship with the infringer. The essential test is whether the person 'countenanced, sanctioned or approved' the infringement.

That the concept of authorisation may have a broad reach in certain cases was shown by the recent Federal Court decision of APRA v Metro on George, handed down on 31 August 2004. In Metro on George the respondent, who owned a Sydney nightclub operating under that name, was held to have authorised infringements of copyright which occurred in the course of live performances of songs at its venue. This finding was made despite the following facts not being in dispute:
  • the respondent had rented the venue to promoters of particular bands and did not purport to (or in fact) determine or influence their choice of music and did not see the playlists in advance;

  • each promoter gave a written warranty to the respondent to the effect that it would secure all necessary copyright licences from APRA with respect to all live performances;

  • the contract between the respondent and the promoter expressly provided, in substance, that the respondent did not authorise any infringement of copyright by a band that might occur during a live performance; and

  • the respondent had no advance knowledge of any particular infringing acts.
Had each promoter complied with its contractual warranty, the respondent could not have been liable to APRA as the performances would not themselves be infringements. However, the evidence showed that promoters did not always comply, that infringing performances had taken place and that APRA had given written notice to the respondent to this effect. On the evidence, after being notified by APRA, the respondent took no steps to try to procure compliance with the contract as it believed, genuinely, that it had no legal obligation to do so.

The court, however, found that once it was on notice that some promoters were failing to secure APRA licences, the respondent's failure to take any steps to try to ensure strict compliance with the contract meant that it had impliedly authorised whatever infringements might occur during future performances. The court appeared to consider it decisive that it was within the respondent's power or control to take further positive steps to ensure infringing performances could not take place—for example, by following up to verify that APRA licences had been obtained or, if needs be, by taking legal action. The court considered that in all the circumstances the respondent was at least 'countenancing' infringements of copyright and was therefore authorising them.

Authorisation in the context of the 'peer to peer' cases

There are cases currently before the courts in Australia and overseas in which owners of film and sound recording copyright are pursuing the providers of 'peer to peer' software and/or services. Peer to peer software is technology which facilitates the sharing of digital files, such as music and movies, directly between the hard disk drives of internet users.

The United States Court of Appeals (9th Circuit) held, in a judgment delivered on 19 August 2004, that several providers of file sharing technology including Grokster Ltd and Streamcast Networks Inc were not liable with respect to copyright infringements by users of their technologies. The court considered that their position was analogous to that of the providers of video recording technology, who could not be held responsible for unlawful uses of that technology by their customers. The court distinguished an earlier US case involving the well known 'Napster' system essentially for reasons based on the nature of the technology employed—which meant that Napster Inc had a degree of control over the use of its system which Grokster and Streamcast did not.

Under US copyright law, unlike in Australia, there is no specific concept of authorisation of infringement as such. It remains to be seen whether the US principle of 'contributory' infringement, which was central to the Grokster decision, is relevantly wider or narrower than the Australian principle of authorisation, as recently applied (although in a very different context) in Metro on George.


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