Representing CITVC in a copyright infringement case against Travel Channel
Attorney: Ping LIU
Synopsis:
China International Television Corporation (hereafter CITVC) is the copyright holder of the TV series Kang Xi Wang Chao (the Reign of Kangxi) (condensed version, 16 episodes). Travel Channel broadcasted, without permission, the TV series through its Yang Guang Ju Chang (Sunshine theater) column on its satellite channel, the "Travel Channel". This seriously infringed CITVC's right to broadcast and right to show as to the said TV series and caused great economic loss to CITVC.
The Court found that, at the end of each episode of the 50-episode version of Kang Xi Wang Chao, it showed that the TV series were jointed produced by Shanghai Qiu Suo Ying Shi Producer, Co. Ltd. (hereafter Qiu Suo Ying Shi), Shanghai Huang He Ying Shi Ltd. Co. (hereafter Huang He Ying Shi) and were presented by CITVC.
On March 7th, 2001, Qiu Suo Ying Shi, Huang He Ying Shi and CITVC entered into a contract regarding the Kang Xi Di Guo (Empire of Kangxi) TV series. The former two firms transferred the TV show outright to CITVC. The TV series consisted of 50 episodes. Each episode lasted for 50 minutes. CITVC had the exclusive right to all the copyrights embody in the TV show, including rights to broadcast through radio television, cable television, toll television, on-demand television, I-cable television and satellite television or any other form of media, known or unknown, in all jurisdictions of the world, including mainland China. Moreover, CITVC had the right to abridge, edit and dub it with different language or adapt it and had the right to recoup the benefit from exploiting such rights. The Kang Xi Di Guo mentioned in the contract was indeed the 50-episode TV series of Kang Xi Wang Chao.
On December 18th, 2005, CITVC and Beijing Dong Fang Jin Hao Wen Hua Fa Zhan Co. Ltd. (hereafter, Dong Fang Jin Hao) entered into a license contract. The contract authorized Dong Fang Jin Gui to adapt Kang Xi Wang Chao into four shorter TV series. The adapted version consisted of four series, titled Kang Xi Wang Chao (Xiao Zhuang Chu Jian), Kang Xi Wang Chao (San Fan Zhi Luan), Kang Xi Wang Chao (Huang Yu Quan Tu) and Kang Xi Wang Chao (Yu Jia Xi Zheng) respectively. Each series consisted of 4 episodes; therefore, there were 16 episodes in total. Each episode lasted for 48 minutes.
Besides, CITVC also authorized Dong Fang Jin Hao to distribute the abridge version of Kang Xi Wang Chao through cable television, radio television and satellite channels. The scope of the authorization covered Mainland China, but not Hong Kong, Macau and Taiwan. And the license term was from February 1, 2006 to July 31, 2007.
The license fee included fixed fee and loyalty. The fixed fee was 20,000 yuan. The loyalty was 50% of the profit, i.e. the gross income minus the fixed fee and minus the costs.
The copyright on the abridged version of Kang Xi Wang Chao belonged to CITVC. Dong Fang Jin Hao was not allowed to distribute the TV series after the termination of the contract, unless authorized by CITVC in written permissions.
In the end of each episode of the abridged Kang Xi Wang Chao, it showed that the TV series were "joint produced by Qiu Suo Ying Shi and Huang He Ying Shi" and "the abridged version was produced by CITVC and Dong Fang Jin Hao." The abridged version was a re-arrangement of the 50-episode Kang Xi Wang Chao. Each series centered on one particular story.
On July 2nd, 2010, Travel Channel signed a contract with Beijing Qing Shen Yi Chang Ying Shi Wen Hua Chuan Bo Co. Ltd. (hereafter Qing Shen Yi Chang). The contract authorized Travel Channel to broadcast the 16-episode version of Kang Xi Wang Chao in its network for two years, from July 10th, 2010 to July 9th, 2012. The transfer fee of the right to broadcast of each episode was 2,000 yuan. Qing Shen Yi Chang offered a corresponding Letter of Authorization to Travel Channel on the same day.
"Travel Channel" was a satellite channel operated by Travel Channel, Co. Ltd. (hereafter Travel Channel). On July 23rd, July 26th to July 28th, Travel Channel broadcasted the abridged Kang Xi Wang Chao through the "Travel Channel" on its "Yang Guang Ju Chang" column. The specific showing time was 1:50 pm. to 5:10 pm. And it broadcasted 4 episodes each day.
In order to prove it obtained the right to broadcast of the abridged Kang Xi Wang Chao from a legal source, Travel Channel submitted a duplicate copy of Letter of Authorization, which indicated that Dong Fang Jin Hao licensed Beijing Dong Hai Ying Shi Wen Hua Chuan Bo Co. Ltd. (hereafter Dong Hai Ying Shi) to distribute and broadcast the TV series on November 11th, 2007. The term of license was from November 11th, 2007 to November 11th, 2017. Besides, Travel Channel submitted a duplicate copy of business letter, indicating that Dong Hai Ying Shi legally obtained the right to distribute and broadcast the TV series from Dong Fang Jin Hao and it transferred these rights to Qing Shen Yi Chang. CITVC denied the authenticity of the Letter of Authorization and other related business letters in the reason that these documents were all duplicate copies.
On October 11th, 2005, CITVC licensed Si Chuan Guang Dian Group, Inc. (Si Chuan Guang Dian) exclusively the right to distribute and broadcast the 46-episode Kang Xi Wang Chao TV series through cable television, radio television and satellite channel. The term of license was from March 1st, 2007 to February 28th, 2011. And the license fee was 60,000 yuan for each episode.
On July 23rd, July 26th, July 27th, July 28th, 2010, the daily audience rating of Travel Channel was ranking No. 37, No. 39, No.38 and No. 39 respectively, among four 47 satellite channels. Whereas, Si Chuan Channel was ranking No. 12, No. 20, No. 20 and No. 21.
CITVC had spent 4'000 yuan attorney fee on this and another case. And it had spent 1,750 yuan for investigation.
The forgoing facts were supported by the following evidence: 1) the video cassettes of the 50-episode TV series Kang Xi Wang Chao; 2) Contract regarding the transfer of the TV series between CITVC and Qiu Suo Ying Shi & Huang He Ying Shi; 3) Contracts regarding the license of TV series between CITVC and Dong Fang Jin Hao; 4) the video cassettes of the abridged Kang Xi Wang Chao; 5) Contract regarding the license of TV series between Travel Channel and Qing Shen Yi Chang; 6) Surveillance Report and the discs of the surveillance; 7) duplicate versions of Letter of Authorization regarding the TV series between Dong Fang Jin Hao and Dong Hai Ying Shi; 8) related business letters regarding the license of TV series between Dong Hai Ying Shi and Qing Shen Yi Chang; 9) Contract regarding the license of the TV series between CITVC and Si Chuan Guang Dian; 10) receipts; 11) data regarding audience rating; 12) receipts regarding attorney fee; 13) receipt regarding surveillance fee and 14) affidavits of parties.
The Court held that CITVC acquired all the economic rights of the 50-episode TV series Kang Xi Wang Chao, according to the attributions in each of the episode and the contract between CITVC and Qiu Suo Ying Shi & Huang He Ying Shi. In the contract regarding adaptation and distribution of the 50-episode version of Kang Xi Wang Chao, both parties had agreed that the copyright of the abridge version of Kang Xi Wang Chao belonged to CITVC. Therefore, CITVC was the copyright holder of Kang Xi Wang Chao.
Although Travel Channel got license from Qing Shen Yi Chang to broadcast the abridge version of Kang Xi Wang Chao through "Travel Channel" in its "Yang Guang Ju Chang" column, Travel Channel failed to show that Qing Shen Yi Chang was the right holder of the abridged version of Kang Xi Wang Chao or had authority to license the show.
Moreover, the Letter of Authorization between Dong Fang Jin Hao and Dong Hai Ying Shi and related business letters between Dong Hai Ying Shi and Qing Shen Yi Chang were all duplicate copies, without other evidence to support their authenticity. And CITVC denied the authenticity of this evidence.
Alternatively, even if the Letter of Authorization and related business letters were authentic, the fact that Dong Fang Jin Hao did not have copyright of the abridged Kang Xi Wang Chao and it was merely authorized to distribute the show between February 1st, 2006 to July 31st, 2007 decided that Dong Fang Jin Hao's Letter of Authorization on November 11th, 2007 was unable to authorize the right to distribute and right to broadcast to Dong Hai Ying Shi. Therefore, Qing Shen Yi Chang and Travel Channel could not legally acquire the right to broadcast as to the abridged Kang Xi Wang Chao.
In sum, Travel Channel broadcasted, without permission of CITVC, the abridged Kang Xi Wang Chao through the "travel channel", infringing CITVC's right to broadcast of the abridged version of Kang Xi Wang Chao. Travel Channel was liable for the economic loss of CITVC.
Travel Channel broadcasted the TV series through satellite channel instead of showing it through players, projectors and other equipment. Thus, the Court rejected CITVC's claim that Travel Channel infringed its right of showing the copyrighted work.
CITVC claimed a damage of 1,920,000 yuan. (60,000 yuan per episode multiple by 16 episode multiple by 2) The 60,000 yuan per episode was based on the royalty of the 46-episode version of Kang Xi Wang Chao, which CITVC licensed to Si Chuan Guang Dian Group.
The Court determined the price to be unreasonable. First, CITVC licensed the 46-episode Kang Xi Wang Chao to Si Chuan Guang Dian Group whilst what was at issue in this case was the 16-episode abridged Kang Xi Wang Chao. Therefore, the res of the two cases were different. Second, CITVC authorized Si Chuan Guang Dian Group the right to broadcast through radio television, cable television and satellite channel. On the contrary, Travel Channel merely broadcasted the TV show through its satellite channel. Third, the license term for Si Chuan Guang Dian was 4 years. In contrast, Travel Channel broadcasted the show for one time. Last but not least, the audience rating of Si Chuan Channel was higher than that of Travel Channel on July 23rd, July 26th to July 28th. Thus, Travel Channel was not as influential as Si Chuan Channel. In sum, the amount of the royalty, i.e. 60,000 yuan per episode, was unreasonably too high.
In the contract regarding the license of the TV series between CITVC and Dong Fang Jin Hao, both sides agreed the license fee for Kang Xi Wang Chao should consist of a fixed fee, i.e. 20,000 yuan and a royalty of 50% of the profit, which was the gross income minus the fixed fee and all the costs of producing and distributing the show. The res of this contract was the same as the case at hand, therefore the Court decided to followed this criteria, taking into account the ways of utilizing the works, the timing of broadcasting the show, the intent of Travel Channel, and the nature and plots of Travel Channel's infringing acts, etc. The Court held that a royalty of 5,000 yuan for each episode was reasonable. Attorney fee and surveillance fee were also reasonable costs paid by CITVC. Therefore, the Court upheld this claim. Travel Channel infringed CITVC's right to broadcast, but did not infringe its persona rights. Therefore, the Court rejected CITVC's claim for extension of apology.
In conclusion, the Court ruled pursuant to Copyright Act of P.R.C. Article 48 (1) and Article 49:
I. Hainan Travel Channel Co. Ltd. should pay a damage of 80,000 yuan to CITVC to cover its economic loss no later than 10 days after this judgment came into effect.
II. Hainan Travel Channel Co. Ltd. should pay a damage of 3,000 yuan to cover the reasonable costs of CITVC no later than 10 days after this judgment came into effect.
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Representing CITVC in a copyright infringement case against Travel Channel