In brief

The Full Federal Court this morning found that Optus infringed copyright with its Optus TV Now service. The Full Federal Court overturned the first instance decision that the Optus TV Now service did not infringe copyright.

The Full Federal Court’s view was that:

  • both Optus and the subscriber were jointly responsible, or in the alternative Optus was responsible, for making the recordings of the NRL and AFL broadcasts on the Optus TV Now cloud based personal video recorder, and
  • Optus could not rely on the private and domestic recording exception in s111 of the Copyright Act to avoid copyright infringement.

This decision has significant implications for content owners given the value placed on content and exclusive internet and mobile rights.

Appeal

The Full Federal Court has found that the Optus TV Now service (Service) infringes copyright and Optus could not rely on the private and domestic recording exception in s111 of the Copyright Act to avoid copyright infringement. 

The decision of the Full Federal Court (Justices Emmett, Finn and Bennett) overturns the decision at first instance that the Optus TV Now subscriber (Subscriber), rather than Optus, made the recordings. NRL, AFL and Telstra appealed the decision.

Appeal issues

The two key issues on appeal were:

  • Who made the recording? – whether Optus or the Subscriber made the recordings of the NRL and AFL broadcasts through the Service, and
  • Could Optus rely on s111? – if Optus, or Optus and the Subscriber jointly, made the recordings, whether Optus could rely on the private and domestic recording exception in s111 of the Copyright Act.

Optus launched the Service in July 2011. The Service allows Optus mobile customers to access an electronic guide of upcoming free-to-air TV programs. Customers can then record programs to a cloud based personal video recorder (PVR) and view these at a later time on the customer’s mobile or computer device.

Optus and the subscriber made the recording

In determining that Optus had a role in making the recording, the court said,

Optus’ role in the making of a copy – ie in capturing the broadcast and then in embodying its images and sounds in the hard disk – is so pervasive that, even though entirely automated, it cannot be disregarded when the ‘person’ who does the act of copying is to be identified.1

This was the case even if the Subscriber was required to select a program to be recorded and initiate the process. On the basis that Optus designed and maintained the Service that could effect the making of recordings,

Optus is not merely making available its system to another who uses it to copy a broadcast…Rather it captures, copies, stores and makes available for reward, a programme for later viewing by another.2

The court’s preferred view was that Optus and the Subscriber acting together were jointly and severally responsible for the act of making copies,

The subscriber, by selecting the programme to be copied and by confirming that it is to be copied, can properly be said to be the person who instigates the copying. Yet it is Optus which effects it. Without the concerted actions of both there would be no copy made of a football match for the subscriber. Without the subscriber’s involvement, nothing would be created; without Optus’ involvement nothing would be copied.3

The court did not agree that the Subscriber alone made the recording or that Optus made the recording as the Subscriber’s agent. At first instance, the court had held the Subscriber alone made the recording.

The court also considered that a reasonable person was likely to characterise the terms and conditions of the Service as a contract pursuant to which Optus was to provide a reproduction service to the Subscriber.

Optus could not rely on s111

The court found that Optus could not rely on the private and domestic recording exception in s111 of the Copyright Act because:

  • Optus makes no use of the copies itself, and
  • Optus’ purpose in making the copies is to derive such market advantage in the digital TV industry as its commercial exploitation can provide4 rather than the purpose prescribed by s111.

The language of s111 concerns copying done by private individuals for private and domestic use for the prescribed purpose of watching or listening to the broadcast at a more convenient time.

The court held that there was nothing in this language to suggest it was intended to cover commercial copying undertaken on behalf of individuals and that the natural reading of s111 suggested that the person making the copy is the person whose purpose the provision prescribes.

The court was not required to determine whether the Subscriber could rely on s111 in these circumstances but indicated in passing that the Subscriber probably could.

Implications

The Full Federal Court’s decision has significant implications for content owners and exclusive licensees in maintaining the value of their content and exclusive licences.

The Full Federal Court emphasised however that its review is limited to the particular technology comprised in the Service and the specific Optus/Subscriber relationship.