rio2016

Fairfax and Sky TV battle over fair use of Olympic footage

The NZ High Court declined on Friday to grant Sky TV an interim injunction to stop Fairfax from using video clips of the Olympic Games in news reports on www.stuff.co.nz. The battle has been brewing since Fairfax and NZME (which publishes the NZ Heraldfailed to reach agreement with Sky TV on terms of access to footage of the Olympic Games.

The legal background to this battle is the NZ Copyright Act 1994. Video footage of the Olympic Games is a copyright work. Under the Copyright Act and an international treaty, known as the Bern Convention, the owner of a copyright work has the exclusive right to perform certain acts in relation to that work, including communicating the work to the public. The Copyright Act also gives the owner the right to authorise others to perform those restricted acts.

The International Olympic Committee (IOC) governs the Olympic movement and owns the rights to the Olympic Games, including the right to broadcast the Olympic Games. The IOC is the sole source of footage of the Olympic Games and grants rights to broadcast that footage to media organisations in each country, typically on an exclusive basis and in return for the payment of substantial licence fees. Sky TV is the exclusive licensee in NZ. It declined in court to disclose the exact licence fee paid, but its counsel described the sum as “many millions of dollars”.

In addition, the IOC grants other organisations rights of access for news reporting under its News Access Rules. Sky TV had varied those rules to grant rights to broadcast footage online under a set of Supplementary News Access Rules. Agreement to these access rules is a condition of obtaining media accreditation for journalists to access the Olympic stadia. Fairfax and NZME chose not to send journalists to cover the Olympics rather than agree to be bound by rules that they considered “unduly restrictive”. Sky TV maintains that these rules are more generous than previous rules and more favourable than what is offered in other countries.

Under the Copyright Act, Fairfax’s use of footage of the Olympic Games will infringe copyright unless it has Sky TV’s permission or the use falls within the scope of an exception in the Copyright Act. When it chose not to sign the access rules offered by the IOC and Sky TV, Fairfax opted instead to rely on an exception in the Copyright Act which provides that:

Fair dealing with a work for the purpose of reporting current events does not infringe copyright in the work.

 

Last week’s court hearing saw Sky TV allege that Fairfax is infringing copyright because its use of Olympic footage goes beyond what is allowed under the fair dealing exception.

Fairfax has been quick to claim the decision of Fogarty J on Friday as a victory, stating to the NBR that the decision is a vindication of its position and a good decision for press freedom. That may overstate the position. The court recognised that the fair dealing defence may be available and that:

There is an increasing public expectation that online reporting of news events is typically accompanied by a short streaming video or photographs.

 

Fogarty J also declined to apply an earlier decision of the NZ courts in this area on the basis that it was decided in 2007 and stated that:

Nine years…is a long time in the digital world.

 

Ultimately, though, the court held that it could not decide the matter in the time available for this hearing. Last week’s hearing was only an interim application to determine whether there was a serious question to be tried was and whether the balance of convenience justified a court order to stop Fairfax from using Sky TV’s footage until there can be a full hearing of the case. The court ruled that it did not. Fairfax can therefore continue its coverage of the Olympic Games, but Sky TV will be able to seek damages for Fairfax’s use of Olympic footage if Sky TV ultimately succeeds in the full hearing.

The NBR reports that Sky TV has declined immediate comment, but indicated that it will take the issue to full trial to seek a clarification of this issue. Sky TV will be disappointed not to have obtained the interim injunction, but it seems that the court action has caused Fairfax to make changes to the way that it uses Olympic footage.

Both parties agreed that Fairfax’s use went beyond the scope of the access rules. A key focus of the argument in any substantive hearing will be the extent to which those access rules are consistent with the fair dealing exception. The court stated that:

The very concept of fair dealing is a standard whose application can be, and usually is, a question of degree. There is always going to be an argument as to the bounds of the fair dealing obligation and correspondingly the legality of the limits contained in the [News Access Rules].

 

For this reason, it will be interesting if this matter proceeds to a full hearing so that we see some substantive guidance from the court on the scope of the fair dealing exception.

A copy of the High Court decision can be downloaded.



Greg France
 is a Principal at Lowndes, a leading New Zealand full-service corporate & commercial law firm.

 

Lowndes is an award winning corporate and commercial law firm with offices in the heart of Auckland and Wellington.  The firm serves local and international companies and investors doing business in New Zealand.

We are recognised for our technical expertise and exceptional client service including high levels of responsiveness and reliability, accessibility of our lawyers, and an unwavering focus on what matters – our clients’ commercial outcomes.