by Rodrigo Borges Carneiro
August 23, 2017
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In a major victory for ECAD (the Brazilian copyright collection society) the Superior
Court of Justice, in special appeal n. 1.559.264, ruled that music streaming is a form of public performance and, thus, the copyright royalties derived from these services should be collected by ECAD.
As a background, ECAD has filed the court action against the mobile operator OI in na attempt to collect public performance rights related to two services:
i. a simulcasting service RADIO OI which had the same program of a traditional over-theair radio station belonging to its economic group, and
ii. a webcasting service of RADIO OI where the users could select playlists using the streaming technology.
The Superior Court of Justice, recognizing the importance of the case to the industry, decided that it should be heard en banc, by the whole second section of the court.
The Reporting Judge, Ricardo Villas Boas Cueva, wrote the winning decision, which was accepted by seven other judges, achieving a vast majority, with the sole dissenting vote of Judge Marco Aurélio Belizze, who voted to maintain the decision of the Court of Appeals of Rio de Janeiro against ECAD.
The majority vote decided in favor or ECAD under the following reasons:
i. Streaming is a technology which allows the continuous transmission of packets of data and information without the need for the user to download the files to be executed.
ii. There are various types of streaming, among which are simulcasting and webcasting. The first involves the simultaneous transmission of a certain content by different channels (over the air and on the internet) while the
webcasting involves only the transmission by the Internet, which can happen with the intervention of the user or not (interactive of not).
iii. Streaming is a type of economic exploitation of works and, thus, demands
previous and express authorization from the copyright owners.
iv. According to sections 5, II and 68, paragraphs 2 and 3 of the Copyright Act, it is possible to affirm that streaming is one of the types under our law in which the Works are transmitted and the internet is a place of public attendance and thus streaming can be characterized as a public performance.
v. According to the copyright law the number of persons which are in the place where the public performance is taking place is irrelevant in order for the place to be considered a place of public attendance. What is relevant is the inclusion of works in the reach of a collective public which attends the digital ambient which will be able at any time to access the works which were made available there. Therefore what caracterizes the public performance of the musical work on the internet is its making available due to the transmission in view of the potential reach of an indeterminate number of persons.
vi. Our law has recognized a broad right of communication to the public in which the simple making available of the work already qualifies its use as a public execution, encompassing therefor, the interactive digital transmission (section 29, VII, of the Copyright Law) or any other form of transmission which enables the collection of royalties by ECAD.
vii. The criteria used to determine the need for authorization of use by the copyright owner is related to the mode of exploration and not to the content. Therefore in the case of simulcasting even if the transmitted content is exactly the same, the channel of transmission are not the same, and therefore are independent, (our copyright law in section 31 prescribes that the authorization granted to one mode of exploration is does not extend
automatically to any of the others as they should be considered independent).
viii. ECAD has the power to fix the amounts to be collected according to its regulations and the decision of the societies which are members of ECAD during its general meeting.
We respectfully consider that the majority decision is flawed.
The fact is that the mention of making available to the public in our copyright law is linked to both the concept of communication to the public and to the concept of distribution.
The simple fact that the works are made available to the public when the works are listed on the streaming site, in our view, is not sufficient to transform the service into a public performance. The inclusion and listing of the work on the site is a separate and diferente act in relation to the actual transmission of the work.
Also, our current statute defines, in section 29, VII, the act of digital distribution as the act of distribution for the purposes of offering works or productions by cable, optic fiber, satellite, electromagnetic waves or any other system enabling the user to select a work or production and receive it at the time and place of his
choice, provided that the access to the works or productions is made through any system requiring payment on the part of the user.
The facts of the case involve acts which are closer to the definitions of distribution and digital distribution than to the definition of public performance in our copyright law.
The decision fails to consider that the situation is different from the traditional over the air broadcasting where the broadcast is transmitted in a single transmission to na indefinite number of persons while streaming is transmitted directly to the user.
Although we are of the opinion that the decision was wrong, any attempt to discuss a similar case will have the heavy burden of dealing with this precedent of the second section of the Superior Court of Justice.
In fact in another recent decision on the Special Appeal 1559264 the Superior Court of Justice followed this precedent to decide that the webcasting of a television channel on the internet amount to public performance and involves another service which generates the obligation of payment of royalties to ECAD despite the payment of royalties for the original broadcasting.
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