SAREGAMA EXITS PPL TO JOIN NOVEX FOR PUBLIC PERFORMANCE RIGHTS: WHAT THIS MEANS FOR THE PUBLIC PERFORMANCE INDUSTRY

Notice Of Motion (L) No.1451 Of 2014 in Suit (L) No. 603 Of 2014

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The case concerns Novex Communications (Novex), which was granting licenses and collecting fees on behalf of copyright owners, primarily Yash Raj Films (YRF) and Shemaroo Entertainment Ltd. Novex argued it was legally authorized to do so under Section 30 of the Copyright Act, 1957, which allows a copyright owner or their duly authorized agent to grant licenses. However, the opposing parties contended that Novex, neither a registered copyright society nor a duly authorized agent, violated the prohibition under Section 33, which restricts unregistered entities from engaging in issuing or granting licenses.

The Court held that Section 33 prohibits entities from licensing copyrighted works in their name if the copyrights belong to others. However, it clarified that duly authorized agents acting on behalf of copyright owners are exempt under Section 30. The agent must disclose their role as representing the copyright owner in all relevant documents. On the other hand, registered copyright societies can license works and collect fees in their own name. Thus, a third party that is neither a registered copyright society nor a duly authorized agent is barred from issuing licenses.

In this case, the Court examined the documents and concluded that Novex failed to establish itself as a duly authorized agent. Despite affidavits from YRF and Shemaroo claiming Novex as their agent, the Court ruled that the documentation did not satisfy the agency test. Consequently, Novex was deemed to violate Section 33, as it neither qualified as a registered copyright society nor met the requirements for agency under Section 30.

COMMERCIAL IP SUIT NO. 264 OF 2022

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In the landmark case of Novex Communications Pvt. Ltd. v. Trade Wings Hotels Ltd. (2024), the Bombay High Court addressed whether entities like Novex Communications (Novex) and Phonographic Performance Limited (PPL), as copyright assignees, could issue licenses without being registered as copyright societies under Section 33(1) of the Copyright Act, 1957. The case revolved around the rights of assignees to act independently in licensing copyrighted works, contrasting with the regulatory requirements imposed on copyright societies. Novex and PPL argued that their assignments under Section 18(1) and their authority under Section 30 allowed them to issue licenses without registration as copyright societies, emphasizing that they were owners of the rights rather than intermediaries. The defendants challenged this, alleging that the assignment agreements lacked the specificity required under Section 19(2), did not address royalty provisions under Section 19(3), and were designed to evade regulatory oversight.

The Court ruled in favor of Novex and PPL, holding that their assignments were valid and categorized them as “owners” under Section 30. It distinguished copyright societies from assignees, asserting that Section 34(1)(b) permitted authors or owners to issue licenses independently. The Court emphasized that Section 33(1) did not restrict owners’ statutory rights to license their works, and that Parliament intended to empower owners to make their works accessible in the public interest. It also applied the leading provision rule, prioritizing Section 30 over Section 33.

CS(COMM) 770/2024

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In a significant decision on intellectual property rights, the Delhi High Court restrained Hyatt India Consultancy Pvt. Ltd. from using copyrighted sound recordings without proper authorization, in a case filed by Novex Communications Private Limited.

The dispute arose when Hyatt was found using these recordings at multiple events, including a New Year’s Eve celebration at Andaz Delhi on December 31, 2023, without obtaining the necessary licenses. Despite receiving multiple cease-and-desist notices, Hyatt failed to regularize the situation and continued the unauthorized use. Novex argued that Hyatt’s actions infringed its exclusive rights, undermined its business, and set a harmful precedent within the music industry. Hyatt denied the allegations, attributing delays in licensing transactions to technical issues, but the Court found this explanation unconvincing. Justice Saurabh Banerjee noted that Hyatt, being an industry veteran, was fully aware of the licensing requirements and had previously obtained licenses from Novex. Observing that the unauthorized use conferred commercial benefits on Hyatt, the Court held that Novex had established a prima facie case and granted an ex-parte ad interim injunction. The order restrained Hyatt and its associates from using or publicly performing Novex’s sound recordings without a valid license and directed compliance across all Hyatt properties in India.

CWP No. 28758 of 2019 (O&M)

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On 19 May 2022, the Punjab and Haryana High Court quashed a public notice dated 27 August 2019 issued by the Registrar of Copyrights, which interpreted Section 52(1)(za) of the Copyright Act, 1957, to exempt licenses for using sound recordings in marriage-related functions. The petitioner, Novex Communications Private Limited, argued that the Registrar exceeded his jurisdiction by issuing a general interpretation of Section 52(1)(za) and that the notice violated its constitutional right to conduct business under Article 19(1)(g). The Court held that the notice lacked legal authority and could not undermine the statutory rights of copyright owners to enforce their protections. It found that a blanket exemption could lead to misuse for commercial purposes and obstruct law enforcement. The Court also ruled that the notice violated the doctrine of separation of powers and Novex’s fundamental rights. Accordingly, the notice was quashed, reaffirming copyright owners’ rights and restricting administrative overreach.

CS (COMM) 7/2022

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The plaintiff, established in 2002, claims ownership of a repertoire of sound recordings and issues licenses for public performance, including in hotels, restaurants, discotheques, and other venues. It was submitted that in April 2017, Eros International Media Limited assigned the “on-ground performance rights” for sound recordings from its repertoire to the plaintiff. Additionally, other companies have assigned similar rights to the plaintiff. The plaintiff alleges that on 08.09.2021, its representative discovered the defendant infringing copyrights by publicly performing songs from Eros’s label without authorization. Despite serving a legal notice on 20.09.2021, the defendant neither responded nor ceased infringement. The Court found that the plaintiff has a prima facie case, with the balance of convenience in its favor. An ex parte injunction was issued, restraining the defendant and its associates from infringing the plaintiff’s copyrights unless requisite fees are paid and licenses obtained. Summons and notices were issued, returnable before the Joint Registrar on 04.04.2022. The plaintiff was directed to comply with Order 39 Rule 3 CPC within one week.

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In Novex Communication Pvt. Ltd. vs. Lemon Tree Hotels Ltd. & Anr.), the Court held that Novex, as the assignee and owner of sound recording copyrights from Zee, Eros, and Shemaroo, had the legal right to sue for infringement, despite not being a registered copyright society under Section 33 of the Copyright Act, 1957. The Court rejected the trial court’s view that Novex could act only as an agent (as in the case of Yash Raj Films), clarifying that an owner or assignee can license and enforce rights independently. It emphasized that the absence of a copyright society cannot deprive a rightful owner of remedies against infringement.

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In Novex v. Trade Wings, wherein it was held by the Bombay High Court that the right to communicate the sound recordings to the public did not fall within the second proviso of Section 33(1). This second proviso was only confined to underlying works. Therefore, the Court rejected the interpretation taken in Novex v. DXC. It was also observed that no reason was provided for the decision, as to why entities issuing licenses over sound recordings would fall within the net of second proviso to Section 33(1). Therefore, the court clarified that the second proviso would only apply to issuing licenses for underlying works, and not to sound recordings.

[2021] SCC Online MHC 6266.

Read the last order here.

In Novex Communications v. DXC Technology Private Limited, the Madras High Court had ruled that the second proviso to Section 33 (1) applied to sound recordings, and therefore, even owners could not issue licenses for sound recordings except by routing it through copyright societies. The Court reasoned that a mischief was present prior to the Copyright Amendment Act, 2012, where authors and composers were pushed in the background, and had no share in royalties. To remedy this mischief, firstly, S. 18 and 19 were amended and authors / composers were given equal share in royalties, irrespective of any contract to the contrary. And secondly, a proviso to Section 33(1) was introduced, where issuing licenses (over underlying works or sound recordings) was restricted only through copyright societies, to ensure that royalties could be collected and shared equally with authors and composers.

The Madras High Court has quashed the order given by it on 8.12.2021, in its latest order dated 10.03.2025 in the case of Novex Communications Private Limited v. DXC Technologies Private Limited.

The suits filed by the Parties were restored and thereafter allowed to be withdrawn unconditionally after the appellant (Novex Communications) requested for the same.