Asia IP

Not a good look … is at worst what the New Zealand public will have thought when the media reported that rapper Eminem was suing the National Party for copyright infringement.

After all, the National Party championed the three strikes law against online piracy.

And what is politics about these days, if not appearances?

It may be a case of bad PR for the National Party. However, lawyers will tell you that is almost certainly all there is to it. It is a good illustration of the unavoidable risks sometimes associated with intellectual property rights in the course of business.

This does not appear to be a case of some naïve or reckless National Party campaign staff thinking it was ok to copy or plagiarize a well-known song or use whatever “Eminem-esque” tune they could find online.

The National Party went to Beatbox Music, a reputable Australia-based company, whose business it is to license music to organizations looking for a specific type of tune, such as advertising agencies for a TV or radio ad or political parties for a campaign ad.

The National Party made a routine business decision. It could not know it was being supplied music that would be alleged to infringe someone else’s copyright rights and was not in a position to make that assessment. It was entitled to rely on the reputation of Beatbox Music.

Unfortunately for the National Party, that does not mean it cannot be held liable for infringing copyright.

Copyright is a property right which exists automatically on creation of certain works (such as songs, books or movies). There is no requirement to register copyright in New Zealand.

Copyright gives copyright owners the exclusive right to do certain things with their work. They are called “restricted acts,” and the most common ones are making and selling copies and performing a work in public.

Copyright also gives copyright owners the right to authorize others to do a restricted act and to stop others from doing a restricted act.

Copyright is infringed when a person does a restricted act without the permission of the copyright owner; i.e. uses a work in a way that is exclusively reserved to the copyright owner.

In most cases, the infringing act will be the copying of a copyright work (copying a CD, downloading a movie online) or its communicating to the public (using a song in a video clip) without the copyright owner’s consent.

Knowledge is not a requirement of infringement. The court will give no consideration to the alleged infringer’s state of mind: whether he or she believed there was infringement or not is irrelevant to the court.

Therefore, if the proceeding initiated by Eminem carries on to trial and the music used in the National Party’s campaign ad is found to infringe (i.e. is found to reproduce a substantial part of and be objectively similar to Eminem’s song “Lose Yourself”), the National Party will most likely be found liable for copyright infringement.

This shows that sometimes risks are indeed unavoidable. By implementing good practices and “doing things by the book” however, these risks can be significantly minimized.

For starters, the National Party promptly pulled the track from use to minimise its exposure to damages.

Further, the National Party’s licensing agreement with Beatbox Music most likely contains a “Warranty and Indemnity Clause.” This means Beatbox Music will have made a warranty to the National Party that (1) it owned the rights to the music in question and (2) it did not infringe someone else’s rights.

It also means that, if the National Party is eventually found liable and ordered to pay Eminem damages, it will be able to go back to Beatbox Music and demand that it compensates it for any damages awarded by a court in favour of Eminem.

Whether this dispute goes to trial or settles out-of-court (experience shows the latter is the most probable outcome), the National Party is likely to eventually come out of this relatively financially unscathed.

James & Wells

Level 2, 123 Carlton Gore Road

Newmarket

Auckland 1023

New Zealand

T: +64 9 914 6740

E : sebastiena@jaws.co.nz

W: www.jaws.co.nz

About the Author

Sébastien Aymeric is a solicitor in James and Wells’ Auckland office, where he focuses on general commercial and intellectual property disputes. He was previously a legal and commercial manager at Huawei Technologies in Paris, where he handled matters including drafting and negotiations.