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Recorded Artists Actors Performers Limited v Phonographic performance (Ireland) Limited & ors (Approved) [2021] IEHC 22 (04 February 2021)
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[2021] IEHC 22
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APPROVED
[2021] IEHC 22
THE HIGH COURT
2016 No. 6897 P
BETWEEN
RECORDED ARTISTS ACTORS PERFORMERS LIMITED
PLAINTIFF
AND
PHONOGRAPHIC PERFORMANCE (IRELAND) LIMITED
MINISTER FOR JOBS ENTERPRISE AND INNOVATION
IRELAND AND THE ATTORNEY GENERAL
DEFENDANTS
JUDGMENT of Mr. Justice Garrett Simons delivered on 4 February 2021
INTRODUCTION
1. This judgment addresses the orders to be made in consequence of a preliminary ruling
delivered by the Court of Justice in respect of a reference under Article 267 of the TFEU.
The reference concerned the interpretation of a European Directive in respect of
copyright and intellectual property rights (Directive 2006/115/EC).
2. The High Court had made the reference to the Court of Justice for the reasons set out in
detail in a judgment delivered in January 2019 (Recorded Artists Actors Performers
3. The Court of Justice delivered its judgment in September 2020 (Case C-265/19, EU:C:2020:677,
Recorded Artists Actors Performers Ltd). The High Court proceedings were then relisted
before me on 29 January 2021 to address two issues as follows. First, the appropriate
form of order to be made having regard to the judgment of the Court of Justice. Secondly,
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the allocation of the costs associated with the trial of the preliminary issues and the
proceedings before the Court of Justice.
4. For the balance of this judgment, I will use the shorthand "RAAP" to refer to the plaintiff,
Recorded Artists Actors Performers Ltd., and the shorthand "PPI" to refer to the first
named defendant, Phonographic Performance (Ireland) Ltd.
PROCEDURAL HISTORY
5. To assist the reader with a better understanding of the issues which fall for determination
in this judgment, it is necessary to refer briefly to the procedural history. These
proceedings concern a long running commercial dispute between the entities representing
respectively the producers of, and performers on, sound recordings. The relationship
between the parties is governed primarily by contract. However, the contract itself had
defined certain terms by reference to the Copyright and Related Rights Act 2000. To this
extent, therefore, the interpretation of the domestic legislation and the related EU
Directive is, potentially at least, relevant to the resolution of the underlying dispute
between the parties.
6. It is apprehended that the full trial of these proceedings will take a significant period of
time and will involve extensive documentation and a large number of witnesses. In an
attempt to reduce the cost of the proceedings and the hearing time necessary for same,
PPI applied to have a number of issues tried as preliminary issues. (To avoid confusion,
the reader should bear in mind the distinction between (i) the trial of the preliminary
issues before the High Court, and (ii) the preliminary ruling of the Court of Justice on the
reference made to it by the High Court).
7. The application for the trial of preliminary issues was resisted, unsuccessfully, by RAAP.
The High Court (Cregan J.) delivered a written judgment on the application on
3
21 February 2018. Cregan J. directed the trial of three preliminary issues (by order dated
30 April 2018).
8. Given the nature of the dispute which has now arisen between the parties, it is necessary
to set out the operative terms of the High Court order in full, as follows.
THE COURT DOTH ORDER that the following matters be dealt with by
way of preliminary hearing:-
Whether the Plaintiff is entitled to the Reliefs set forth at paragraphs (1), (2)
and (3) of the Statement of Claim herein which provide as follows:
"As against Phonographic Performance (Ireland) Limited and, insofar as it is
necessary, as against the Minister for Jobs, Enterprise and Innovation Ireland
and the Attorney General:
1.
A declaration that Directive 2006/115/EC of the European Parliament
and of the Council 12 December 2006 on rental right and lending
right and on certain right related to copyright in the field of
intellectual property requires the right to remuneration accorded to
owners of sound recordings in respect of the broadcasting and of any
communication to the public in the State of the said sound recordings
to be equally accorded to all performers whose performances are
incorporated on the said sound recordings;
2.
A declaration that the proper construction of the Copyright and
Related Rights Act 2000, in the light of Directive 2006/115/EC of the
European Parliament and of the Council 12 December 2006 on rental
right and lending right and on certain rights related to copyright in
the field of intellectual property, taking account of the EU law treaty-
based obligation of consistent interpretation, is that the right to
remuneration accorded thereunder to owners of sound recordings in
respect of the broadcasting and of any communication to the public
in the State of the said sound recordings is also accorded to any and
all performers whose performances are incorporated on the said
sound recordings;
In the alternative to the foregoing declaratory relief sought, as against the
Minister for Jobs, Enterprise and Innovation, Ireland and the Attorney
General:
3.
A declaration, in so far as the Copyright and Related Rights Act 2000
cannot be construed so as to accord to all performers whose
performances are incorporated on sound recordings, a right to
remuneration in respect of the broadcasting and communication to
the public in the State of their said recorded performances in
circumstances where the owners of the rights in the sound recordings
carrying such performances are accorded such a right to
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remuneration, that the said Act does not properly transpose Directive
2006/115/EC of the European Parliament and of the Council 12
December 2006 on rental right and lending right and on certain rights
related to copyright in the field of intellectual property, and in
particular Article 8(2) thereof, into Irish law."
9. As appears, the first issue to be determined centres on the correct interpretation of the
EU Directive. The second and third issues are interrelated, and centre on the ancillary
question of whether the domestic legislation is consistent with the EU Directive (on its
correct interpretation). The latter two issues are presented as alternatives: either the
domestic legislation is open to an interpretation which is consistent with the EU Directive
or it is not, in which case the EU Directive has not been properly transposed.
10. It should also be explained that the preliminary issues were presented at a level of
generality, divorced from the underlying facts of the contractual dispute between the
parties. This is important because it delimits the findings which this court can properly
make in the context of the trial of the preliminary issues.
11. The trial of the preliminary issues was heard by me over four days towards the end of
November 2018, and I delivered a written judgment on 11 January 2019.
12. As appears from my judgment of January 2019, the principal issue which arose for
determination on the trial of the preliminary issues concerned the correct interpretation
of the EU Directive. In particular, an issue arose as to the extent to which that
interpretation was to be informed by reference to international treaties and conventions
governing copyright and intellectual property rights. The respective positions of the
parties on these issues were as follows. RAAP took the view that the EU Directive fell
to be interpreted by reference to the international instruments, notwithstanding that
certain of the terms in the latter were not expressly included in the EU Directive. PPI
and the State respondents took the opposite view.
5
13. As appears from the judgment of the Court of Justice of September 2020, the
interpretation advocated for by RAAP prevailed. The Court of Justice held that the EU
Directive must be interpreted, as far as possible, in a manner consistent with the WIPO
Performances and Phonograms Treaty 1996 ("WPPT"). This has the consequence that
the right to equitable remuneration under the EU Directive must be granted both to
performers and phonogram producers who are nationals of Member States of the
European Union and to those who are nationals of other contracting parties to the WPPT.
14. By contrast, under the Copyright and Related Rights Act 2000, a performer is not entitled
to share in the equitable remuneration unless they are (i) an Irish citizen or domiciled or
resident in Ireland, or (ii) domiciled or resident in an EEA country. To this extent, the
Irish State has failed to properly transpose the EU Directive.
FORM OF ORDER
15. Given the unequivocal terms of the judgment of the Court of Justice, one might have
been forgiven for thinking that there could be no disagreement as to the appropriate form
of order which follows. The parties have, unfortunately, been unable to reach agreement
in this regard. At the core of this disagreement is a dispute as to the implications for the
underlying proceedings of my earlier finding that the domestic legislation cannot be
given an interpretation which is consistent with what we now know to be the correct
interpretation of the Directive. To elaborate: for the reasons explained in my judgment
of January 2019, I had found that the Copyright and Related Rights Act 2000 cannot be
interpreted in a manner which would allow for the inclusion of non-EEA nationals.
16. The position now adopted by PPI is that, irrespective of the correct interpretation of the
EU Directive, RAAP cannot succeed in its proceedings against it. More specifically, it
is said that the failure in the transposition of the EU Directive cannot be relied upon in
6
proceedings, such as the present, which involve a dispute between two private law
entities. The jurisdiction of a national court, such as the High Court, is confined to either
(i) interpreting national legislation in a manner which is sympathetic to or consistent with
EU legislation, or (ii) disapplying that legislation. The latter remedy is only open in cases
taken against the State.
17. Put otherwise, PPI now adopt the paradoxical position that notwithstanding that their
arguments as to the interpretation of the EU Directive failed before the Court of Justice,
they should nevertheless be regarded as having succeeded in the trial of the preliminary
issues directed by the High Court. The earlier finding that the domestic legislation cannot
be interpreted in a manner consistent with the EU Directive is, it is now said, fatal to
RAAP's claim.
18. With respect, it is not open to PPI to adopt this position now, given its approach to the
proceedings to date. It was PPI who applied for, and ultimately obtained, an order
directing the trial of the preliminary issues. PPI itself identified the issues it wished to
have tried (albeit that it did so by reference to the language used in the statement of claim
served by RAAP). This court was, therefore, specifically asked to determine an issue in
respect of the correct interpretation of the EU Directive. There is no doubt but that PPI
failed in its arguments in this regard.
19. The second and third preliminary issues were ancillary to the first issue. The latter two
issues were presented as alternatives: either the domestic legislation is open to an
interpretation which is consistent with the EU Directive or it is not, in which case the EU
Directive has not been properly transposed. The resolution of these latter two issues
hinged on the finding on the first issue. If the correct interpretation of the EU Directive
was that contended for by RAAP, then it followed almost inevitably that there had been
a failure of transposition. The definition of qualifying persons under the domestic
7
legislation is incapable of bearing a meaning consistent with RAAP's interpretation of
the EU Directive.
20. This court had not been asked to determine--and did not determine--what the
consequences of a finding of non-transposition would be for the underlying dispute
between the parties. It had never been suggested, for example, that a finding of non-
transposition would be fatal to RAAP's claim against PPI. This question simply never
arose in the context of the trial of the preliminary issues.
21. Rather, the approach adopted by PPI had been to apply to have the three identified issues
determined by way of the trial of preliminary issues in advance of any adjudication on
the underlying merits of the contractual dispute. This had been done on the basis that the
correct interpretation of the domestic and EU legislation was relevant to the underlying
dispute given the fact that certain of the contractual terms were defined by reference to
the legislation. As appears from the judgment of Cregan J., part of PPI's justification for
seeking the trial of preliminary issues had been that the issues were questions of law and
statutory interpretation. It was never suggested that the judge hearing the trial of the
preliminary issues would embark upon a consideration of the underlying dispute.
22. Having presented the issues in this way, PPI cannot now turn around and argue, in effect,
that the finding in January 2019 that a consistent or sympathetic interpretation of the
Directive was not open is conclusive in its favour. Indeed, it is telling in this regard that
notwithstanding that the parties were afforded an opportunity to make submissions in
relation to the form of the reference to the Court of Justice in the period between the date
of delivery of my judgment (January 2019) and the formal transmission of the reference
to the Court of Justice (March 2019), it was never suggested that the reference was now
unnecessary in that the finding as to the absence of a consistent or sympathetic
interpretation was sufficient to ensure victory for PPI.
8
23. At the hearing on 29 January 2021, counsel on behalf of PPI sought to explain his client's
new position by saying that, notwithstanding the finding in January 2019, the question
of a conforming interpretation might nevertheless arise on appeal, and, therefore, it was
necessary for PPI to address the interpretative issue also. With respect, this argument
proves too much. It simply highlights that the correct interpretation of the EU Directive
has always been regarded by PPI as a relevant issue in the proceedings. Indeed, it could
hardly be otherwise in circumstances where PPI expressly requested the court to decide
the issue.
24. The artificiality of PPI's position is highlighted by the fact that, during the course of his
submissions, counsel conceded on instructions that he was no longer looking for an award
of costs against RAAP in respect of the hearing before the Court of Justice.
25. It seems to me that having chosen to pursue the case by way of the trial of preliminary
issues, and having framed those issues in the manner that it did, PPI must accept the
consequences. The appropriate order therefore is that RAAP is entitled to the reliefs set
forth at paragraphs (1) and (3) of the statement of claim.
26. I have carefully considered whether the order should be framed so as to replicate
precisely the language used by the Court of Justice. On balance, I do not think that it is
necessary to do so. First, it seems to me that having framed the preliminary issues in a
particular way, this court should answer those issues in the same manner. Secondly, and
in any event, it is not necessary for there to be a formal order of this court to give effect
to the judgment of the Court of Justice. The terms of the judgment of the Court of Justice
could not be clearer and would not be improved upon by recitation in this judgment.
9
COSTS
27. It only remains, therefore, to address the issue of costs. The parties are agreed that the
costs fall to be determined by reference to the recently commenced provisions of Part 11
of the Legal Services Regulation Act 2015 ("the LSRA 2015").
28. Part 11 of the LSRA 2015 draws a distinction between a party who is "entirely
successful" in proceedings, and a party who has only been "partially successful". The
default position is that a party who is entirely successful in civil proceedings is entitled
to an award of costs against a party who is not successful in those proceedings unless the
court, in the exercise of its discretion, orders otherwise. The reasons for such an order
must be stated. A non-exhaustive list of the factors to be taken into account by a court
in exercising its discretion are enumerated under section 169(1).
29. No such default position applies in respect of a party who has only been "partially
successful". As explained by Murray J. in Higgins v. Irish Aviation Authority
[2020] IECA 277 (at paragraph 10), such a party may nevertheless be entitled to recover
all of their costs in an appropriate case.
"[...] it is particularly important to bear in mind that whether a party
is `entirely successful' is primarily relevant to where the burden lies
within process of deciding how costs should be allocated. If a party
is `entirely successful' all of the costs follow unless the Court
exercises its discretion to direct otherwise having regard to the factors
enumerated in s.169(1). If `partially successful' the costs of that part
on which the party has succeeded may be awarded in its favour,
bearing in mind those same factors. Indeed, having regard to the
general discretion in s.168(1)(a) and O.99 R.2(1) a party who is
`partially successful' may still succeed in obtaining all of his costs,
in an appropriate case."
30. Murray J. goes on in his judgment in Higgins to explain that in determining whether a
party has been "entirely successful" for the purposes of section 169(1), the correct
approach is to look beyond the overall result in the case and to consider whether the
10
proceedings involve separate and distinct issues. If so, it is appropriate to determine
which side succeeded on those issues.
31. These costs principles have been stated in the context of the final outcome of litigation.
By contrast, I am concerned with the outcome of an interlocutory hearing, i.e. the trial of
the preliminary issues. Order 99, rule 2 of the Rules of the Superior Courts indicates that
the High Court, upon determining any interlocutory application, shall make an award of
costs save where it is not possible justly to adjudicate upon liability for costs on the basis
of the interlocutory application. It seems to me that I should apply, by analogy, the
principles discussed above, albeit directed to the outcome of the interlocutory hearing.
32. For the reasons which follow, I am satisfied that RAAP has been "entirely successful"
and is entitled to its costs: there are no discretionary factors against such an order.
33. As appears from my judgment of January 2019, and the subsequent judgment of the Court
of Justice, the principal issue in dispute between the parties had been in respect of the
correct interpretation of the EU Directive. This was the issue with which almost all of
the time at the hearing before me had been taken up. RAAP has succeeded on this issue
in that its interpretation, and not the rival interpretation of PPI and the State respondents,
has been found to be correct.
34. PPI submits that the related finding, i.e. that the domestic legislation could not be
interpreted in a manner which is consistent with what we now know to be the correct
interpretation of the EU Directive, represents the true "event", and, accordingly, it should
be entitled to its costs.
35. For reasons similar to those set out under the previous heading, this submission is
incorrect. It is evident from the terms of the preliminary issues themselves that the
principal issue advanced was as to the interpretation of the EU Directive, and that the
consequences of same were, at this stage of the proceedings at least, an ancillary matter.
11
Crucially, as appears from the language used in its statement of claim, RAAP was
satisfied either with a finding of consistent interpretation or a declaration of non-
transposition. To put the matter colloquially, the battle between the parties centred on
the interpretation of the EU Directive. RAAP were entirely successful on this issue, and
are accordingly entitled to their costs.
36. Even if I am incorrect on this, and the trial of the preliminary issues should instead be
analysed as involving two distinct "events", i.e. the interpretation of the EU Directive,
and the transposition issues, I am satisfied, in the exercise of my discretion, and having
regard to the principles as set out by the Court of Appeal in Higgins v. Irish Aviation
Authority, that the appropriate order is still that RAAP should recover the entire of the
costs of the hearing on the preliminary issues and of the hearing before the Court of
Justice. If and insofar as the question of whether the domestic legislation was capable of
a consistent or sympathetic interpretation represented a separate event, it took up only a
fraction of the time before the High Court, and none of the time before the Court of
Justice. (The latter because of course the interpretation of domestic legislation is a matter
for the national court alone). The costs associated with this issue are minimal, and it is
unnecessary to adjust the costs order in this regard.
37. I have also been asked to address the costs of the initial application to have the trial of
preliminary issues. The order of 30 April 2018 records that Cregan J. directed that these
costs be reserved to the judge hearing the trial of the preliminary issues. I am not in a
position to make an informed decision as to the appropriate allocation of costs in this
regard. It seems to me that the true victor will not necessarily emerge until such time as
the trial of the action has taken place, and it has been determined whether the contractual
relationship is indeed influenced by the outcome of the issues in respect of the
interpretation of the EU Directive. This is the consequence of PPI's having chosen to
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have the preliminary issues presented at a level of generality. Accordingly, I reserve
those costs to the trial judge.
38. A dispute also arose as to the proper allocation of costs between the defendants inter se.
It was suggested by the State respondents that liability to pay RAAP's costs should be
divided equally between PPI and the State respondents. It seems to me that the correct
order is that the costs be awarded against the defendants jointly and severally. There is
no rational basis for distinguishing between them: both vigorously pursued the incorrect
interpretation of the EU Directive, and thus are equally responsible for the running up of
costs.
CONCLUSION AND FORM OF ORDER
39. The order on the preliminary issue will be as follows. The Plaintiff is entitled to the
reliefs set forth at paragraphs (1) and (3) of the statement of claim as follows.
As against Phonographic Performance (Ireland) Limited and, insofar as it is
necessary, as against the Minister for Jobs, Enterprise and Innovation Ireland
and the Attorney General:
(1).
A declaration that Directive 2006/115/EC of the European Parliament
and of the Council 12 December 2006 on rental right and lending
right and on certain right related to copyright in the field of
intellectual property requires the right to remuneration accorded to
owners of sound recordings in respect of the broadcasting and of any
communication to the public in the State of the said sound recordings
to be equally accorded to all performers whose performances are
incorporated on the said sound recordings;
as against the Minister for Jobs, Enterprise and Innovation, Ireland and the
Attorney General:
(3).
A declaration, in so far as the Copyright and Related Rights Act 2000
cannot be construed so as to accord to all performers whose
performances are incorporated on sound recordings, a right to
remuneration in respect of the broadcasting and communication to
the public in the State of their said recorded performances in
circumstances where the owners of the rights in the sound recordings
carrying such performances are accorded such a right to
remuneration, that the said Act does not properly transpose Directive
13
2006/115/EC of the European Parliament and of the Council 12
December 2006 on rental right and lending right and on certain rights
related to copyright in the field of intellectual property, and in
particular Article 8(2) thereof, into Irish law.
40. As to legal costs, the Plaintiff is entitled to the costs of, and incidental to, the trial of the
preliminary issues in November 2018 (to include the costs of written legal submissions,
and of an overnight transcript); the costs of, and incidental to, the reference for a
preliminary ruling to the Court of Justice; and the costs of the hearing before me on
29 January 2021 (to include the costs of two sets of written legal submissions). The costs
order is made as against the defendants jointly and severally. The costs are to be
adjudicated by the Office of the Legal Costs Adjudicator in default of agreement. The
usual stay on the execution of costs will be imposed pending an appeal, if any, to the
Court of Appeal or an application for leave to appeal to the Supreme Court.
41. The parties are asked to agree a date upon which the matter can be relisted before the
judge in charge of the Commercial List with a view to the progression of these
proceedings to full hearing.
