Friday 17 May 2019


(Common Law v. EU Law?)

For the first time there will be no live television broadcasts of Rugby World Cup games in New Zealand this year.  Telecommunications provider, Spark, has acquired the rights to ‘show’ the games (hosted in Japan) and they will be live streamed on its Spark Sport service.  Putting aside the problems of those who still do not and will not have adequate broadband connections by September, there will undoubtedly be many who will seek out pirate streams to avoid Spark’s subscriptions.  Because rugby is New Zealand’s most popular sport, streaming copyright issues are likely to multiply from current levels.

As in other countries New Zealand satellite broadcasters who have acquired licences to show content have been encountering a form of piracy by the parallel delivery of this content streamed over the internet from other jurisdictions free of charge.  Various technologies have been used, although Kodi programmed set top boxes are popular for viewing on a television screen.  There has been litigation. 

Current Case Law

In 2010 there was Munhwa Broadcasting Corporation v Young International which concerned Korean broadcasts being digitised and streamed online to NZ viewers to watch on their screens. The defendant argued that the transient copying that occurred in the buffers of the set top box and then by each picture frame momentarily appearing on a viewer’s screen were within the section 43A exception for transient reproduction.  Section 43A is equivalent to the Directive Article 5.1/UK section 28A exception for transient copying.  Potter J rejected this defence on the basis that these incidents of copying were not authorised by the rights owner. 

Then in 2018 two courts held in separate suits brought by Sky Network TV that (i) the sale of set top boxes with ‘add-ons’ providing access to pirated streams constitutes an infringing communication, (ii) the transient storage in the set top box memory of internet packets making up each video frame was copying, and (iii) the transient display of each frame on the viewer’s screen was also copying.  In each case Sky referred to the streaming of cricket matches live for which it had the sole rights to communicate within NZ.  The streams were generated from reception of a broadcast from Sky UK.  In one case, a District Court did not consider the section 43A exception to infringement for transient copying, while in the other case the High Court which did, rejected this defence on the basis that only the owner of copyright in the original broadcast could authorise the streaming in NZ and without such authorisation the use made by viewers could not be ‘a lawful use’

In the High Court decision it was accepted that the streaming of a live cricket match was a communication of a copyright work.  Since live sport cannot constitute a copyright work then it must have been the broadcast which was at issue.  That of course was not Sky NZ’s broadcast and the evidence did not show how and by whom Sky UK received its feed.

Comments on Current Case Law   

It is suggested the reasoning in all three decisions is at the least questionable, despite the fact that the primary cause of action in the two 2018 actions was breach of the Fair Trading Act based on allegations that the defendants in the advertising of their set top boxes had suggested purchasers would not be infringing copyright.  One issue of concern arises because CJEU statutory interpretation under the InfoSoc Directive seems to have been used rather than classic common law interpretation.  Further, the WIPO Copyright Treaty which gave rise to the right to communicate was totally forgotten about.  The ‘internet provisions’ in the NZ Copyright Act derive from the WCT, including the Article 8 right to communicate to the public’.  But, the NZ courts, like the CJEU, ignored or misinterpreted the Agreed Statement on Article 8, namely: ‘It is understood that the mere provision of physical facilities for enabling or making a communication does not itself amount to communication within the meaning of the Treaty …’. 

As to case law precedents, the CJEU decision in Strichting Brein v Jack Frederick Wullems was used in the two 2018 judgments to interpret breaches of the exclusive right to communicate a work to the public to include the sale of ‘tweaked’ set top boxes.  But for the s.43A defence the most applicable and persuasive authority for NZ, the UK Supreme Court judgment in Public Relations Consultants Association v The Newspaper Licensing Agency [2013] UKSC 18, (the Meltwater case) was not considered.

Statutory interpretation issues

Following the common law rules of interpretation, the right to communicate would have been given its literal meaning as there is no ambiguity in the way it is expressed in the restricted acts listed in s.16 of the NZ Act.  It would not be broadened beyond its literal meaning which is to transmit information.  It would not encompass the sale of individual pieces of apparatus for receiving or processing the information.  Under the old broadcast right, common law courts, including NZ, did not interpret that right to include the distribution of radio or television receivers.  In addition, the exception provided by way of the Agreed Statement on Article 8 would be given the same weight as the Article 8 right itself.  It should not be devalued on the argument used by the CJEU that the EU Directive was for the benefit of copyright owners.  The aim of the WCT was to bring copyright into the internet age in a balanced manner.      

In the section 43A transient reproduction exception, limbs (b)(i) and (ii) offer alternative defence components, and if either one is satisfied then section 43A provides a defence to transient copying.  But the Munhwa and Sky judgments seemed to conflate limbs b(i) and b(ii) and concluded that if viewers were receiving a communication which might infringe copyright, then the viewers’ transient reproduction could not be a ‘lawful use’ of the communicated work.  However, as was pointed out by Lord Sumption in the Meltwater case, ‘The use of material is not unlawful by reason only of the fact that it lacks authorisation of the copyright owner.’  ‘Lawful use extends to use which is “not restricted by the applicable legislation”’.  And copyright legislation does not make private viewing of content on a screen an infringing act any more than it makes reading a book an infringing act even if the book is a reprint made by an unlicensed third party.

The defence provided in s.43A for transient reproduction is not even necessary for the actual display of sport on a domestic television screen.  Copyright is not infringed by the private display of content on a screen. It never has been since the days of home film projectors being used to show bought or hired movies.  To suggest otherwise, as the courts did, is in direct conflict with the statutory limitation of the s.16(1)(e) exclusive right ‘to show the work’ to showings which are made in public.


In the litigation that will predictably arise as the Rugby World Cup draws closer it is to be hoped New Zealand’s copyright law will not be misconstrued to ensure licensees can obtain a remedy.  Until the legislation is changed to reflect a more comprehensive understanding of the digital technology used to supply content, instead of trying to use concepts more appropriate to content stored on physical media, licensees will be best served by seeking blocking orders against ISPs to block access to the IP addresses of pirate streamers.  NZ courts have plenty of persuasive precedents to follow in the form of Arnold J’s blocking orders in the UK.

As it happens, NZ has recently started a major (and no doubt lengthy) review of its Copyright Act and it is tempting to advocate introducing the US patent concept of ‘contributory infringement’ to render liable those who supply especially configured hardware to assist pirates.  And the cumbersome concept of infringing copyright by ‘authorising’ needs to be supplemented or totally replaced!     

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