Harmonious Construction Can Ignore the Term Clause

This post was first published on 25th May, 2012.
The plaintiff Shemaroo Entertainment Ltd. has filed this petition in the Delhi High court against Amit Sharma & others. The case has been decided on 16th May 2012. Shemaroo Entertainment Ltd. contended that it held copyrights over the song “Thodi si jo pee le hai” from the movie “Namak Halal” and prayed towards restraining the Defendants from using the “Thodi si jo pee le hai” in their film “Department”; from releasing or distributing the film without deleting the portion of the song and also from exploiting the audio rights of the film “Department” containing the above portion, by way of DVDs, MP3, CDS etc. The facts of the case are that, the movie “Namak Halal” was produced and released in April, 1982 by M/s Chaudhary Enterprises (defendant no. 5). All rights including broadcasting rights, video rights, performance rights, internet rights etc. in the feature film were assigned to M/s Dimple Video Distributors by an agreement 23rd November 2000. Subsequently, M/s Chaudhary Enterprises assigned all the right in the negatives as also copyright in the film and four other films to M/s Dimple Video Distributors, for a period of 99 years. Mr. Satyandra Pal, Proprietor of M/s Chaudhary Enterprises also issued a Declaration dated 29th September, 2007 confirming that M/s Dimple Video Distributors was the sole and absolute owner of the pictures (negatives and sound) as mentioned therein. Dimple Video Distributors executed an Agreement dated l7th September, 2007 in favour of the plaintiff in respect of all the five films including “Namak Halal” and pursuant thereto all the intellectual property rights including copyright in the film “Namak Halal”, stood transferred to plaintiff. The plaintiff realised that the defendants had adopted some portion of the song “Thodi Si Jo Pee Li Hai” in a song in their film “Department” and thus brought to the notice of the defendants that the plaintiff held copyright and negative rights of the film “Namak Halal” and thus the same cannot be used by the defendants in any manner whatsoever. The Plaintiff claimed that the use of clipping of the aforesaid song by the defendant nos. l to 4 and 7 in their forthcoming film was copyright infringement. The agreement in question that the Court debated on for the purpose of this case was the agreement executed between M/s Chaudhary Enterprises and Defendant no. 6 on 17th November, 1981. The relevant clauses of the agreement, are briefly mentioned below:
“1. This Agreement shall be for an initial period of one year (s) commencing on the 17th day of November, 1981 and shall continue for two successive periods of one year each on the same terms and conditions as are herein laid down unless the Company terminates the Agreement by giving notice in writing to the Producer 60 days before the expiration of the initial or extended period.
3(A) the Producer hereby assigns and transfers and agrees to assign and transfer to the company absolutely and beneficially for the world:
(i) the copyright for making records of all contract works which are made available to the Company under the terms of this Agreement and the copyright, performing right and all other rights title and interest in and to the literary dramatic and musical Works embodied in the Producer’s Films including all rights of publication, sound and television broadcasting, public performance and mechanical reproduction of the said Works.
(ii) The sole and exclusive right to make or authorize the making of any record embodying the contract recordings, either alone or together with any other recordings. The Producer undertakes to execute or obtain the execution of such further assignments or assurances as may be required to safeguard the parties’ rights.
(iii) the right to grant licenses for publication, sound, and television broadcasting public performance and mechanical reproduction of the contract works or any of them.
(iv) the right to use and public performance (including sound and television broadcasting) throughout the world by any and every means whatsoever of the contract works or any of them.
(Clause 9 of the agreement restricts the Producer from manufacturing or selling records the whole or any part of the work which is made available to the Company through this agreement)
11. The Producer agrees that all the rights and obligations under this Agreement shall be construed to apply to works included or to be included in Producer’s Films commenced and/or under production during the period of this Agreement”
The plaintiff relied primarily on clause 1 stating that the Defendant no. 6’ rights to make records expired on November, 1984 and since 17th September, 2007 all the rights to grant permission in using any portion of the song rested with the Plaintiff alone.
The defendants, on the other hand, argued that all the clauses in the agreement should be harmoniously construed to understand the true scope and intention of the agreement. It was further contended by the defendants that a clause in the agreement stated that the copyright in the film produced during these three years could not be assigned to a third party without the consent of the Defendant no. 6.
The Court, upon examining the contentions of both the parties, interpreted that when the clauses of the Agreement dated 17th November 1981, are read harmoniously, it makes clear that the Agreement did not expire in 1984.
The learned Single Judge quoted, “I am unable to persuade myself that the agreement expired in the year 1984…. In my opinion, the agreement has to be read as a whole and not in a piecemeal.”
Upon examining clause 3A of the agreement, the Court also held that Defendant no. 6 also retained the performing rights including rights of publication, sound, and television broadcasting public performance and mechanical reproduction in respect of the producers’ film.
Thus the Court held that the plaintiff, neither managed to make out a prima facie case nor is suffering any irreparable loss and injury and therefore dismissed the application.

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