Universal City Studios Inc and Others v Network Video (Pty) Ltd

• Jurisdiction: South Africa
• Judge: Corbett JA, Kotzé JA, Miller JA, Botha JA and Galgut AJA
• Judgment Date: 27 February 1986
• Citation: 1986 (2) SA 734 (A)
• Hearing Date: 15 November 1985
• Court: Appellate Division

Corbett, JA.:

In recent years the viewing of video tapes of cinematograph films in the home has become a popular pastime in South Africa. The manufacture and supply, either by way of I letting or by way of sale, of such video tapes is a fast-growing and, it would seem, profitable industry. As the evidence in this case indicates, manufacturers and suppliers of video tapes are not always very scrupulous about respecting the rights of the owners of the copyright in the films concerned. In fact there is a great deal of trafficking in what are called "pirate" tapes, ie tapes of films produced without authority from the owner of the copyright. That essentially is what this J case is about.

Corbett JA

A The ten appellants are all American corporations who make and distribute cinematograph films. They are said to be the major filmproducing companies in the United States of America. They constitute the entire membership of an American organisation known as the Motion Picture Association of America Inc ("the B MPAA"). This association, which has its headquarters in New York City, was formed for the purpose of representing and looking after the interests of motion picture companies based in the United States of America. Among the activities undertaken by the MPAA on behalf of members is the policing and enforcement of copyright in cinematograph films made and/or C distributed by members.

In South Africa the MPAA is represented by a company known as Business Information Services (Pty) Ltd ("BIS"), which operates from Johannesburg. The proprietor of BIS is a Mr E I Askew. He is assisted in the business by June Askew. The primary activity of BIS, as representative of the MPAA in South Africa, is the D policing of the home video market in this country. BIS assists dealers and distributors in the home video market to distinguish between legitimate copies of members' films, ie copies made under licence from the copyright owner, and pirate copies. To this end BIS conducts what are termed "voluntary inspections". A voluntary inspection takes place at the request E of the video dealer concerned. A representative of BIS visits the dealer's premises, inspects his stock, identifies any pirate tapes and furnishes the dealer with a list of infringing material. BIS has also on occasion been instrumental in causing the police to take criminal action against persons producing or dealing in pirate video tapes, but in general the police are F willing to act only where the copyright in the cinematograph films in question has been registered in terms of the Registration of Copyright in Cinematograph Films Act 62 of 1977. On such occasions Askew or a member of the staff of BIS often accompanies the police on raids of the premises of video dealers suspected of dealing in pirate video tapes of registered cinematograph films in order to assist in the identification of offending material.

G The respondent is a South African company, with premises on the Foreshore in Cape Town. It carries on business as a maker and distributor of video tape versions of cinematograph films and as a dealer in video tapes for the home video market. None of the appellants has given respondent a licence to reproduce H any of its cinematograph films on video tape or to distribute video tapes of its films on the home video market.

Alleging, on grounds which I shall detail later, that respondent had been making and/or selling video tapes which were unauthorized copies of cinematograph films, both registered and unregistered, in respect of which appellants I owned the copyright and that respondent had thereby been infringing appellants' copyright and had been competing unlawfully with the appellants, appellants made application in the Cape of Good Hope Provincial Division (the "CPD"), for certain relief (to be specified shortly). One of the prayers in the notice of motion was that the usual requirements of service of the application upon the respondent be dispensed with and that the matter be heard in Chambers. This prayer was acceded J to. On 4 October 1983 the matter came before LATEGAN J in Chambers and without notice having been given to the respondent. The

Corbett JA

learned Judge granted an order as prayed. Before setting out A this order, I would add that on 13 October 1983 respondent made application for leave to appeal against the order. This was granted on 28 November 1983 and it was directed that the appeal be heard by the Full Court of the CPD. The costs of the application were ordered to stand over for determination by the Full Court. The appeal was heard on 14 May 1984. Prior to this, B on 26 April 1984, a notice was filed on behalf of the appellants (respondents in the appeal to the Full Court) in which it was indicated that they had abandoned certain portions of the order granted in their favour by LATEGAN J. I now quote in full the text of the order, with those portions which were C so abandoned placed in square brackets:

"1.

The Deputy Sheriff, Cape Town, is authorized and directed in the company of the attorneys of record of the applicants and the deponent, Edward Irving Askew and/or June Askew, to enter upon the premises of the respondent at 4th Floor, Foretrust Building, M Hammerschlag Way, Foreshore, Cape Town, and upon any D other premises at which it conducts business and/or stores, maintains or processes materials used in conducting its business, and to attach and keep in his possession, pending the final determination of these proceedings:

1.1

all video tapes or other copies of the cinematograph films Breakheart Pass, E Frankenstein & The Monster, Bear Island, The Big Fix, Meteor, The Undefeated and Different Strokes (hereinafter referred to as 'the original works'), which constitute infringing copies in respect of the copyright in such cinematograph films, in the possession of the respondent or under its control at the respondent's aforesaid F premises;

1.2

all other video tapes or other copies of any other cinematograph films in respect of which the applicants are the holders of rights under the copyright in the Republic of South Africa, and which are infringing copies of such cinematograph films in the possession of the respondent or under its control at the respondent's aforesaid G premises;

1.3

all video tapes or other copies of the original works and any other cinematograph films released in the Republic of South Africa in the applicants' names, in or with which the respondent is competing unlawfully with the applicants;]

All video tapes or other copies of the H aforementioned in paras 1.1, 1.2 [and 1.3] above are collectively referred to hereinafter as 'infringing video tapes'.

1.4

[All films and/or] master video tape copies of any cinematograph films in respect of which the applicants are the holders of rights under the copyright in the Republic I of South Africa, and which [films and/or] master video tape copies have been and/or are being used by the respondent to unlawfully reproduce infringing video tapes and which are in the possession of the respondent or under its control at the respondent's aforesaid premises;

1.5

all printed matter, photographs, negatives, or plates, depicting scenes from the J original works or any other cinematograph

Corbett JA

A films in respect of which the applicants are the holders of rights under the copyright in the Republic of South Africa, which were produced by infringing copyright in any of the said cinematograph films.

(All the aforementioned materials are collectively B referred to hereinafter as 'infringing documents'.) (For the purposes of this order, the deputy sheriff shall be entitled to rely on the identification of such [films and/or] master video tape copies and/or infringing video tapes and/or cinematograph films in respect of which the applicants are the copyright owners in the Republic of South Africa and/or infringing documents by the deponents, C Edward Irving Askew and June Askew.)

2.

The said Deputy Sheriff, Cape Town, is authorised and directed further to attach as aforesaid all documents and records in the respondent's possession or under its control, relating to the sale or supply by it of any infringing video tapes.

[3.

D The respondent is required within seven days of such order, to make discovery under oath to the applicants of the name or names of all persons or parties to whom it has supplied infringing video tapes.]

4.

The Deputy Sheriff, Cape Town, is authorised and E directed to keep in his possession as aforementioned all infringing video tapes, infringing documents and master [films or] video tapes pending the final determination of actions or applications to be instituted by the applicants within six months of the date of this order.

5.

The costs of this application are costs in the cause.

6.

F Should it appear on information placed before this Court by the respondent that this order should not have been granted, the applicants shall notwithstanding this order be jointly and severally liable for any damages sustained by the respondent by reason of the execution of this order. To give effect to this order applicants shall lodge security to and G to the satisfaction of the Registrar of the Supreme Court in the amount of R30 000."

On 15 June 1984 the Full Court delivered a reserved judgment, in terms whereof the appeal was upheld with costs (including the costs of two counsel), the order of LATEGAN J was set aside and appellants (respondents before the Full Court) were ordered H to pay the costs of the application for leave to appeal. No order was specifically substituted for that of LATEGAN J, but clearly the intention was that it be ordered that the application be dismissed. The judgment of the Full Court has been reported (see Network Video (Pty) Ltd v Universal City Studios Inc and...