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2023 Supreme(Mad) 1868

IN THE HIGH COURT OF JUDICATURE AT MADRAS
S. SOUNTHAR, J.
Ms. Divya M. Jain – Appellant
Versus
M/S. 24 Am Studios Private Limited Rep. by its Managing Director R.D. Raja, Chennai & Other – Respondent
C.S.(Comm.Div). No. 39 of 2021
Decided On : 16-06-2023

Advocates appeared:
For the Plaintiff:P. Shiva, Advocate. For the Respondent:D1, D3 & D4,Dhanaram Ramachandran for M/s. D.R. Law Chambers, Advocates. D2, Jose John M/s. King & Partridge, Advocates.

Headnote:

Copyright Infringement - Finance Agreement - Copyright Act, 1957, Sections 55, 62

Fact of the Case:

The plaintiff sought injunction restraining the defendants from releasing the Tamil Satellite Television Rights of a film without her consent, claiming infringement of copyright based on a Finance Agreement. The defendants contested the plaintiff's ownership of copyright and the validity of the Finance Agreement.

Finding of the Court:

The court found that the plaintiff did not acquire copyright over the film under the Finance Agreement as the copyright had been validly assigned to the 2nd defendant prior to the Finance Agreement. The plaintiff's suit for injunction alleging copyright infringement was deemed not maintainable.

Issues: 1. Copyright ownership under the Finance Agreement 2. Validity of the Finance Agreement in view of prior assignment agreement 3. Maintainability of the suit for infringement of copyright 4. Entitlement to restrain defendants from releasing the film without consent 5. Entitlement to any other relief

Ratio Decidendi: The court concluded that the plaintiff did not acquire copyright over the film and therefore could not maintain the suit for injunction. The Finance Agreement's restriction on theatrical release without the plaintiff's consent was deemed invalid and not binding on the prior assignee of the copyright.

Final Decision: The suit was dismissed, and the plaintiff was directed to pay the costs of the suit to the defendants.

JUDGMENT

(Prayer: Civil Suit is filed under Order VII Rule 1 of C.P.C and Order IV Rule 1 of O.S.Rules read with Sections 55 and 62 of the Copyright Act, 1957,

(a) For an order of perpetual injunction restraining the defendants, their men, agents, servants or any other person or persons claiming through from releasing in any form in respect of Tamil Satellite Television Rights in India of the Film Production No.5 (Colour)-Ayalan without the consent and concurrence of the plaintiff and/or from doing any other act amount to infringement of the plaintiff''s copyright pursuant to the Finance Agreement dated 09.08.2018 between the plaintiff and the 1st  defendant.

(b) For the costs of the suit and

(c) Pass such further or other order as this Honourable Court may deem fit and proper in the circumstances of the case and thus render justice.

1. The plaintiff has come up with this suit seeking injunction restraining the defendants from releasing the Tamil Satellite Television Rights of the film Production No.5 (Colour) - ''Ayalan'' without the consent and concurrence of the plaintiff or from doing any other act which would amount to infringement of plaintiff''s copyright pursuant to the Finance Agreement dated 09.08.2018 entered between the plaintiff and the 1st  defendant.

 Averments found in the plaint:-

2. According to the plaintiff, the 1st defendant, was the Producer of the film ''Ayalan'' and the 3rd defendant, who acted as a Hero in that film approached the plaintiff with a request to finance for the production of the said film. After receiving a sum of Rs.7,00,00,000/-, both of them executed a Promissory Note on 09.08.2018 promising to repay the said amount with interest at the rate of 24%. On the very same date, the 1st defendant entered into a Finance Agreement with the plaintiff by pledging exclusive copyright of the film in respect of the Tamil Satellite Television Rights in India. As per the terms of agreement, it was agreed by the parties that the theatrical exploitation of the film shall be done only after obtaining No Objection Certificate from the financier namely the plaintiff. It was further averred that as per the Finance Agreement, the plaintiff paid a sum of Rs.3,00,00,000/- by way of NEFT on 09.08.2018, another sum of Rs.1,00,00,000/- by way of RTGS on 10.08.2018 and another sum of Rs.3,00,00,000/- by way of RTGS on 10.08.2018. Thus, the plaintiff paid the entire amount of Rs.7,00,00,000/- to the 1st respondent as agreed.

3. It was also averred by the plaintiff that prior to the Finance Agreement, the 1st  defendant entered into an Assignment Agreement dated 02.02.2018 with the 2nd  defendant assigning the satellite rights and other exploitation rights in respect of the film for entire world for a perpetual period for a valuable consideration of Rs.20,00,00,000/- plus GST. The 2nd defendant paid a sum of Rs.10,00,00,000/- plus GST to the 1st defendant as an advance. Thereafter, by letter dated 29.05.2019, 1st defendant requested the 2nd  defendant to pay a sum of Rs.4,35,00,000/- to the plaintiff. Thereafter, there was a Supplement Agreement dated 04.06.2019 entered between the 1st  and 2nd  defendants whereunder it was agreed by them that a sum of Rs.4,35,00,000/- shall be paid to the plaintiff directly after general theatrical release of the said film.

4. It was further agreed that the aforesaid amount shall be payable only after handing over of the certificate from Central Board of Film Certification with an endorsement ''Unrestricted Public Exhibition''. It was also agreed that a sum of Rs.2,65,00,000/- had to be paid by the 2nd defendant to the plaintiff at the request of the 1st defendant after satisfaction of various other condition. It was also agreed that amount paid to the plaintiff shall be treated as amount paid to the assignor.

5. It was also averred by the plaintiff that on the basis of the promise and assurance made by the defendants 1 and 3, the plaint

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