On Your Marks

07 May 2008

All's Fair in our Love of Sport?

New Zealanders certainly have a love/hate relationship with the game of rugby union, which we sometimes treat more like war than sport. But when it came to the biggest international event in the rugby union calendar, the 2007 Rugby World Cup in France, it was the commercial value of the coverage on television which gave rise to a more interesting battle for many of us.

In New Zealand, Sky Television is a subscriber based broadcaster. It has over the last decade or so obtained the exclusive rights to broadcast the majority of the major sporting events, with a major focus on the Super12/14 rugby and Tri-nations series. For the 2007 Rugby World Cup, though, the free-to-air broadcaster TV3 won the exclusive rights to broadcast the event.

Aware that there may be some debate over acceptable industry practice in this field and that the extent of news and other coverage by competing networks would continue to be an issue for the Rugby World Cup and other sporting events, the major New Zealand broadcasters entered a "News Access Agreement" in July 2007. This agreement governs the use of footage from major sporting events, explicitly including the Rugby World Cup, in bona fide news programmes for which hard news is the main feature. Sports magazine shows are specifically excluded.

The News Access Agreement limits use of footage by non-rights holders to no more than three news programmes per day per channel, not exceeding two minutes per programme, with a gap of at least three hours between such programmes on the channel. This varies slightly for dedicated news channels.

Importantly, the News Access Agreement provides that it does not apply to or limit fair use rights relating to use of footage in programmes not covered by the agreement, such as sports magazine shows.

New Zealand does not have a general "fair use" doctrine as in the United States. Instead, all of the exceptions to copyright protection, or permitted uses, are set out in more specific provisions of the Copyright Act 1994. The "fair dealing" exceptions cover research or private study, criticism or review, and reporting current events. The relevant reporting current events exception appears in disarmingly simple wording:

S42(2):  Fair dealing with a work for the purposes of reporting current events by means of a sound recording, film, broadcast or cable programme does not infringe copyright in the work.

No maximum amount or proportion of copying is prescribed in order to qualify as fair dealing. The exception is general in nature, and involves a weighing of relevant interests.

TV3 invested considerably in the raised profile it saw as flowing from the increased viewership it predicted from its coverage of the Rugby World Cup. It had agreed not to air advertisements during the coverage of the games themselves, so saw its magazine style programmes as its primary source of revenue. Sky competed directly for the audience for such shows.

TV3 put other broadcasters on notice that it would take steps to defend its exclusivity if necessary. Sky responded by asserting that it would be relying on its fair dealing rights.

From the beginning of the Rugby World Cup, Sky used TV3 footage in a number of different programme formats and across a number of channels. TV3 sought an interim injunction to stop the bulk of this use.

Winkelmann J in the High Court approached the fair dealing defence in a two tier way. First, considered objectively, is the ‘use’ part of news coverage, or has it crossed the line into more general entertainment? She acknowledged that use in a specialist news programme would fall within the ambit of reporting current events.

Her Honour rejected a submission that, if footage is current and newsworthy, and of short duration, it does not matter that the footage sits within a programme which is not hard news or sports news. She held that the purpose for which footage is being used should be determined by reference to the content of the programme and hence the context in which the material is used.

She made the following distinction: a sports news programme entertains its viewers by presenting up-to-date reporting of current events in the world of sports; a sports magazine programme may use current events as the point of embarkation for reporting matters other than the results of matches, indeed sometimes matters only tangentially connected to the result of the matches.

On this basis, she held that a number of the programmes at issue, The Cup, The Crowd Goes Wild, and Reunion were magazine style and failed to satisfy the (section 42(2)) threshold requirement that the use be for the purpose of reporting current events.

The second question was whether Sky's use in the news or magazine style cases might be fair dealing.

Winkelmann J observed, however, that in less clear cases the factors relevant to the current events threshold purpose issue, and to the issue of whether a dealing is fair may be so indistinguishable or so connected that the matter may need to be considered in a composite way. That is, the closer the purpose is to the boundaries of reporting current events, the less likely that the fair dealing defence will apply.

Whether a dealing is fair is a question of degree and impression. The degree to which the use competes with the copyright owner's exploitation of the work is a very important, or even the key, consideration. The extent and manner of the use is also relevant, as is whether it is reasonably necessary to refer to the copyright material to report the current events. Motive can be relevant, but it is accepted that competing media businesses desire to win viewers or readership and generate a profit.

Winkelmann J considered that it was necessary to look at the totality of Sky's use, and compared this case to the BBC v BSkyB case in England, which related to coverage of football matches during a World Cup. While the lengths of excerpts were similar, BSkyB's use was limited to sports news programmes and was infrequent.

She found that, through the number of programmes and the rate of their repetition, Sky was achieving an intensive level of broadcasting of TV3 sourced footage. Indeed, at times of significant match activity, the longest gap between screening was 25 minutes as a result of regular repetition of Sky's 365 Headlines format, and considerably shorter on occasions when all of the other programmes were added in. This intensity of use would tend to coincide with the intensity of viewer interest. Sky's multi-channel format also meant footage on Sky would be more accessible than footage on TV3 for large periods of the day.

Consequently, Sky's repetition of the coverage would erode to at least some extent TV3's position as the exclusive broadcaster of the Rugby World Cup. Winkelmann J held, for interim injunction purposes, that TV3 had a strong case that Sky's use of TV3 footage did not amount to fair dealing. The balance of convenience and overall justice also favoured the granting of the injunction.

The form of injunction to be granted was not easy to formulate. Winkelmann J appeared to be influenced by the fact that the other major broadcaster, TVNZ, was abiding by the News Access Agreement. The form of injunction largely followed the rules in that agreement, with some refinement to address Sky's multi-channel offering.

Lastly, Her Honour observed that, while the extent of permitted use under the terms of the injunction may well exceed what is fair dealing, she had to weigh the fact that her decision was made on an urgent basis and could be final in effect because of the short duration of the tournament.

In a small jurisdiction such as New Zealand, we often have to rely on interim injunction decisions to provide guidance on difficult areas of the law, particularly where even the best and responsible efforts of industry players have failed to be definitive.

The stakes were high and time short. Despite those pressures, Winkelmann J's performance in this decision outshone that of New Zealand's All Blacks in the quarter final at Cardiff.

Authors

Earl Gray

Partner - Intellectual Property

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John Shackleton

Partner - Dispute Resolution

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Tracey Walker

Partner - Dispute Resolution

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Richard Watts

Partner - Intellectual Property

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Sarah Chapman

Senior Associate - Intellectual Property

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Claire Foggo

Senior Associate - Intellectual Property

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