Friday, 21 May 2010

Cannonballs and footballs – a judicial comparison

What place is there for common-law tort in the context of statutory IP rights? Future Investments SA v FIFA, decided in the High Court last week, takes a look at the interplay between copyright and the common-law tort of causing loss by unlawful means.

Under a licence from FIFA, IMG Media produced FIFA FEVER, a DVD celebrating FIFA’s 2004 centennial. Future Investments protested, saying home video rights in the ’98 World Cup were theirs. Future, however, didn’t sue FIFA for authorizing copyright infringement, for reasons the judgment does not explore. Instead the action is for causing loss by unlawful means. This tort, clarified by Lord Hoffman in Douglas v Hello!, consists of ‘(a) a wrongful interference with the actions of a third party in which the claimant has an economic interest and (b) an intention thereby to cause loss to the claimant’. The claimants argued that IMG’s freedom to enter into contractual relations with Future was unlawfully interfered with when FIFA warranted to IMG that they held the rights. Floyd J said:

I think the most that can be said, on the basis of Future’s pleaded case, is that IMG was somehow discouraged from approaching Future for a licence. At one level this might be thought to be analogous to the cases of causing loss by unlawful means based on intimidation of customers, of which Tarleton v McGawley (1794) Peake 270 provides a colourful example. In that case the master of a ship used cannons to prevent a potential customer from approaching a rival ship. IMG was a potential customer of Future for a licence to WC98 footage, but was turned away by FIFA’s authoritative and (so say Future) wrongful assertion of the right to grant a licence itself. It seems to me, however, that there is a fundamental and decisive difference between keeping your rivals away from your competitor’s goods and keeping them away from your competitor’s intellectual property rights. In the former case the customer has, and should have a free choice as to where to purchase goods, and that choice is being interfered with by the activity of the tortfeasor in scaring them away. But in the case of an intellectual property right, there is no question of any choice. One either needs a licence or one does not.’
The tort’s 400-year case law does offer closer matches, however. Unlawful interference does not have to take the form of a threat. It can be deception. There might only be one person that can own an exclusive IP right but there is no limit to the number of people who can say they own it.

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