Copyright owner on song against karaoke lounge

You may recall our previous post regarding infringement of copyright in song films by karaoke lounge K Square Pty Ltd (K Square).  Now, following a hearing to determine damages, Federal Magistrate Raphael has given the copyright owner, Top Plus Pty Ltd (Top Plus), something to croon about.

In assessing quantum under s 115(2) of the Copyright Act 1968 (Cth) (the Act), the licence fee (or royalty) approach involved considering the value of licences Top Plus had entered into with other karaoke operators for the relevant year.  Licences which were genuinely at arms length and not subject to exclusivity were used by Federal Magistrate Raphael to arrive at an amount that would fairly be charged for use of the copyright works on a per room basis.

Additional damages were awarded under s 115(4) of the Act based mainly on K Square’s conduct relevant to the substantive allegations following the breakdown of licence renewal negotiations (eg: continuing to make the copyright works available without a licence).  

Noting that “[t]he assessment of damages is not a science”, Federal Magistrate Raphael decided on a total of $80,000 in damages.  The proportion of general versus additional damages is often of interest, and so we have made an attempt to determine the breakdown.  It’s not easy to calculate because of GST, and because the general damages were calculated on a “per room” basis.  However, based on the information provided in the judgment, we would estimate that the general damages equated to approximately $45,000 – $60,000.  The additional damages would make up the rest. 

Federal Magistrate Raphael also considered that K Square’s conduct in the litigation “seriously increas[ed] the costs of the applicant in an unnecessary manner” which would be “best reflected in … orders for costs” (subject to further submissions).

Damages were not awarded to K Square for Top Plus’s conduct in the course of licence renewal negotiations which amounted to a breach of s 51AC of the Trade Practices Act 1954 (Cth).  This was because K Square had not paid the licence fee and therefore had not suffered any loss.


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