FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd & Anor

For secondary infringement under section 23 of the Copyright, Designs and Patents Act 1988, “reason to believe” requires more than facts from which a person might merely suspect infringement. The court must assess objectively whether the relevant facts known to the defendant would have led a reasonable person in that defendant’s position to believe that the articles were infringing copies. The reasonable person need not understand the legal detail of the infringement or identify the precise copyright owner. A short period may be sufficient for evaluating a rights-holder’s complaint. On the facts, the distributor neither knew nor had reason to believe that the copies were infringing.

The claimant, a record company, claimed ownership of copyright in a sound recording on Eminem’s album Infinite. It alleged that the first defendant infringed copyright by making vinyl copies and that the second defendant committed secondary infringement by importing, offering for sale and selling vinyl and CD copies.

The court found that the claimant owned the copyright. The defendants accepted that no licence had been granted if the claimant owned it. The central issue was whether the second defendant knew or had reason to believe that the copies were infringing articles for the purposes of section 23 of the Copyright, Designs and Patents Act 1988.

1. The claimant owned the copyright in the sound recording. The 1995 recording agreement was between Eminem and the Bass Brothers partnership trading as F.B.T. Productions. The 1998 agreement did not assign copyright in earlier recordings because its Schedule 1 was blank.

2. Under section 23 of the Copyright, Designs and Patents Act 1988, secondary infringement required proof that the defendant knew or had reason to believe that the relevant articles were infringing copies. The expression “reason to believe” had to be given its own meaning and was not to be treated as no more than imputed knowledge under the Copyright Act 1956.

3. The court applied the approach in L.A. Gear Inc v Hi-Tech Sports plc [1992] FSR 121, as approved on appeal. All relevant facts known to the defendant had to be considered objectively. The question was whether a reasonable record distributor in the defendant’s position would have arrived at the belief that the copies were infringing. Facts giving rise only to suspicion were insufficient. A reasonable period had to be allowed for evaluating the facts.

4. The reasonable person was not a lawyer and did not need to understand the full legal basis of infringement, including the identity of the copyright work, the precise owner or the absence of a licence. It was sufficient that the facts would have led that person to believe that dealing in the copies breached a right in the nature of copyright held by another person.

5. The relevant circumstances included the approach to the Mechanical Copyright Protection Society, its apparent approval of a limited number of copies, the openness of the defendants’ dealings, the prior distribution of the album, and the prompt withdrawal of sales after the complaint. Those matters did not establish knowledge or reason to believe. The claimant’s arguments concerning further investigation and use of a master tape were rejected.

6. LTEV was liable for primary infringement by making the vinyl copies. Neither defendant was liable for the pleaded secondary infringements of importing, offering for sale or selling copies.

First-instance decision. No appellate history was stated in the judgment.