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2022 Supreme(Online)(MAD) 16132
IN THE HIGH COURT OF JUDICATURE AT MADRAS Judgment reserved on 22.07.2022 Judgment pronounced on 18.08.2022 CORAM The Hon'ble Mr. Justice SENTHILKUMAR RAMAMOORTHY C.S. (Comm.Div.) No.423 of 2019
1.M/s.Mavis Satcom Limited, Rep. by its Managing Director Mr.M.Palanivelu, No.48, NP, Jawaharlal Nehru Road, Ekkattuthangal, Chennai – 600 097.
2.M/s.Jazz Cinemas Private Limited, Rep. by its Director, Mr.K.Karthikeyan Flat 12, 4th Floor, ''Gyan Apartments'', New No.38, Old Nos.19 & 20, Venkatraman Street, T. Nagar, Chennai – 600 017. ... Plaintiffs vs.
1.Netflix Inc.
Rep. by its Manager Mr.Shaseen Sayani, Manager, Content Acquisition, NETFLIX INC.335, N. Maple Drive Suit 353, Beverly Hills, CA 90210 U.S.A.
(Amended As per order dated 21.11.2019 in Appl.No.8808 of 2019)
2.Arka Media Works Private Limited Rep. by its Director Mr.Devineni Shrinivas Sai Prasad, Having its Office at, Plot No.89/90, 4th Floor, Ashoka Vishnu Capital, Annapurna Studios Lane, Road No.2, Banjara Hills, Hyderabad – 500 034. (2nd defendant impleaded as per order dated 23.11.2020 in A.No.1900/2020) ... Defendants The suit is filed under Order IV Rule 1 of the Madras High Court Original Side Rules R/W Section 51, 55 & 62(2) of the Copy Right Act,1957 read with Order VII Rule 1 C.P.C. R/W Section 7 of the Commercial Court, Commercial Division and Commercial Appellate Division of High Courts Act, 2015(Act 4 of 2016), praying to direct the Defendants herein to pay a sum of Rs.2,00,00,000/- (Rupees two crores only) as liquidated damages for the infringement upon the copyright of the plaintiff;(b) For a permanent injunction restraining the Defendants, their men, agents, servants or anyone acting on their behalf, or anyone claiming through, by or under it, from, in any manner hosting, streaming, reproducing, distributing, making available to the public and/or communicating to the public, or facilitating the same, on their websites, through the internet in any manner whatsoever, any cinematograph work/
content/programme/show in and in any other manner, directly or indirectly, infringing upon the Copyright of the plaintiff over the movie ''BAAHUBALI'' and for the costs of the suit.
For Plaintiff : Mr.K.V.Babu For Defendants : Mr.P.S.Raman, Senior Advocate for Mr.R.Parthasarathy Mr.Rahul Balaji and Ms.Tanvi Sinha for first defendant Mr.Sashidhar Sivakumar Ms.V. Pavitra for second defendant
JUDGMENT
The suit was filed to recover a sum of Rs.2,00,00,000/- as damages for infringement of the plaintiffs' copyright in the movie ''BAAHUBALI'' and for a permanent injunction to restrain the defendants from directly or indirectly infringing the said copyright.
2. According to the plaintiffs, Mr. K.E.Gnanavelraja, the sole proprietor of M/s.Aadnah Arts, who is a well established producer in the Tamil film industry, had approached the second plaintiff in relation to the assignment of an exclusive copyright in respect of satellite TV rights, direct to home (DTH), Internet rights, Pay TV, etc. in respect of the movies enumerated in the table at paragraph 5 of the plaint. Pursuant thereto, the plaintiffs stated that a World Satellite Rights Agreement was executed on 31.10.2015 by and between the second plaintiff and M/s.Aadnah Arts. The assignment was for a period of 99 years for a consideration of Rs.10,00,00,000/-(Rupees Ten Crores only). After deducting 10% TDS thereon, the remainder of Rs.9,50,00,000/- was paid through bank channels. Thereafter, it is stated that the second plaintiff entered into an agreement with the first plaintiff on 01.11.2015 in respect of the movies ''BAAHUBALI'' and ''PASANGA-2'' for world satellite television rights, DTH, Internet rights, Pay TV, pay per view, IPTV, etc. The agreement was for a perpetual period of 99 years, which would run from three months after the theatrical release date.
3. Although the first plaintiff acquired the copyright, including Internet rights, in the manner set out above, according to the plaintiffs, the first defendant streamed the movie ''BAAHUBALI'' without any authority, right, title or interest over the movie. Therefore, it is alleged that the first defendant committed infringement of the plaintiff's copyright over the movie. In these circumstances, it is stated that a lawyer's notice dated 02.03.2019 was issued to the first defendant. Although the notice was received by the first defendant, no reply was received by the plaintiffs. The plaintiffs state that the action of the first defendant caused huge losses to the plaintiffs. By restricting the claim for damages to a sum of Rs.2,00,00,000/, the present suit was instituted.
4. Originally, the suit was instituted against Netflix India.
Subsequently, by order dated 21.11.2019 in Application No.8808 of 2019, the plaintiffs were permitted to substitute Netflix India with Netflix Inc., California, USA (Netflix). Thereafter, the plaintiffs filed Application No.1900 of 2020 to implead Arka Media Works Private Limited (Arka Media) as the second defendant. The said application was allowed by order dated 23.11.2020 after recording that Arka Media originally held the copyright over the movie ''BAAHUBALI'' and that it had assigned rights in the movie to M/s.Aadnah Arts from whom the plaintiffs claimed title.
5. The first defendant denied the averments and allegations of the plaintiffs in its written statement. The first defendant stated that it acquired exclusive subscription video-on-demand rights (SVOD rights) for the movie ''BAAHUBALI'' from Film Karavan LLC (Film Karavan) on 30.07.2017. Therefore, the first defendant stated that it is a bona fide purchaser of SVOD rights in the movie ''BAAHUBALI'' and is entitled to exploit such rights. The first defendant also contended that Film Karavan is a necessary party for the adjudication of the dispute and that the suit is liable to be rejected for non-joinder of Film Karavan. The first defendant further stated that M/s.Aadnah Arts is also a necessary party because the second defendant assigned rights to M/s.Aadnah Arts and the plaintiffs' claim rights over the movie through M/s.Aadnah Arts. The first defendant denied that the plaintiffs suffered losses of Rs.2,00,00,000/- and stated that the claim is baseless.
6. The second defendant also denied the contentions of the plaintiffs by filing a written statement. In the said written statement, the second defendant stated the following.
