Rank Film Distributors Ltd v Video Information Centre

JurisdictionEngland & Wales
Judgment Date15 February 1980
Judgment citation (vLex)[1980] EWCA Civ J0215-5
Date15 February 1980
CourtCourt of Appeal (Civil Division)
(1) Rank Film Distributors Limited
(2) Universal City Studios Inc.

(suing on behalf of themselves and on behalf of and as representing all other members of the Motion Picture Association of America Inc.

(3) Cinema International Corporation (U. K.)

(A Company Incorporated with unlimited liability) suing on behalf of themselves and on behalf of and as representing all other members of the Society of Film Distributors Ltd.

(4) Itc Entertainment Limited
(5) Itc Film Distributors Limited and
(6) Emi Film Limited
(1) Video Information Centre (a firm)
(2) Michael Anthony Lee
(3) Susan Gomberg
(4) Stylestone Limited
(5) Videochord Limited and
(6) Michael George Dawson

[1980] EWCA Civ J0215-5


The Master of the Rolls (Lord Denning)

Lord Justice Bridge and

Lord Justice Templeman

In The Supreme Court of Judicature

Court of Appeal

On Appeal from the High Court of Justice Chancery Division (Patents Court)

(Mr. Justice Whitford)

MR. D. NICHOLLS, Q. C., MR. H. LADDIE and MR. D. KITCHEN (instructed by Messrs. Clifford-Turner & Co.) appeared on behalf on the Plaintiffs (Respondents).

MR. C. ROSS-MUNRO, Q. C. and MR. D. SEROTA (instructed by Messrs. Attwater & Liell) appeared on behalf of the 1st, 2nd, 3rd and 4th Defendants (Appellants).


"It is, it is a glorious thing, to be a Pirate King", said W. S. Gilbert: but he was speaking of ship pirates. To-day we speak of film pirates. It is not a glorious thing to be, but it is a good thing to be in for making money. Film pirates plunder the best and most recent cinema films. They transpose them on to magnetic tape: and then sell video cassettes on the black market.


A film pirate works like this: He gets hold of a technician in a cinema or in a ship or an aircraft – any place where cinematograph films are projected on to a screen The pirate then bribes the technician. He pays him, say, £100. The technician then "borrows" a film for a night. It is simple enough. Instead of putting the film into the cupboard, as he should, he puts it into his own case. He hands the celluloid film to the pirate. Overnight the pirate takes the film to his "laboratory". He has there a machine for transferring the film from celluloid on to magnetic tape. It only takes an hour or so. Next morning the pirate returns the film to the technician. He puts it into the cupboard. No one is any the wiser. The pirate has during the night made a "master tape". He uses it for making video cassettes. He then sells these cassettes on the black market. There are many buyers available. A lot of people nowadays have video cassette recorders. Universities have them. Hotels have them. Private homes have them. They can use the cassette so as to reproduce the film when they like or wherever they like.


This black market makes huge inroads into the legitimate business of the film companies. They have been put to great expense in producing the best films: they have the copyright which gives them the sole and exclusive right to reproducethem. Yet here are the pirates plundering it – stealing all the best films.


By far the biggest buyers come from the Middle East and Africa. The newspapers have drawn attention to it. In the "Evening Standard" of the 17th April, 1979 there appeared an article with the headline:


"London's £1m video pirates.


"One world-beating success that is not likely to feature in the trade figures is the emergence of London as the international centre for a black market in video cassettes.


"Trade in these recordings, made without payment of copyright, and carried on through a network of London box numbers, is estimated to be worth up to £1,000,000 a year.


"Crates full of pre-recorded cassettes are being shipped out of London to the Middle East…


"The recent emergence of London as a world centre is due to the large number of Middle Eastern and African travelers who meet here, and who have an insatiable appetite for an alternative to the poor quality programmes put out by their own television networks".


The pirates have good salesmen about. For instance, in February 1979 an executive of a film company was in Iran. He stayed a night in a hotel in Kuwait. Someone came up to him and said: "Are you going to London? Here is a list of films which you can buy on video cassettes in London. Call the telephone number 937-0555 and ask for Miss Sue. The price of the tape will be £50 per hour running time".


The film companies followed up that clue and others. Eventually they discovered the "laboratory" where a pirate used to transpose the celluloid films on to magnetic tape.It was in a house in a suburb of London – half-an-hour out on the Underground. No. 66 Goldings Road, Loughton, Essex. It was a three-bedroomed house in a suburban street. It was occupied by a Mr. and Mrs. Dawson who carried on a company under the name of Videochord Ltd. In a back-room on the ground floor they had an expensive machine called the Rank Cintel Flying Spot Scanner Mark III. It cost £50,000. In the house they found also much other equipment including 20 video recorders. They found a library of 400 films.


On the 23rd April, 1979 the police entered the house pursuant to a search warrant. They found Mrs. Dawson actually using the machine so as to transpose films on to tape. The police took Mr. and Mrs. Dawson into custody. They were detained overnight, but next morning were released on bail. The case is being considered by the Director of Public Prosecutions.


The film companies, in a separate inquiry, discovered the selling organisation. It was a selling place in a shopping arcade in Kensington. It is at 49-53 Kensington High Street. There is a glass booth on the ground floor. Here they found "Mike" Lee and "Sue" Gomberg. Those two carry on under the name of the Video Information Centre. "Mike" Lee puts on the trappings of a substantial business. To impress his customers, he drives a Rolls Royce motor car. They do business in video cassettes. They have a catalogue of some 600 feature films – video-piracy – and a further catalogue of pornographic films – video-porn. Incidentally, video-porn is a big industry in itself as we have just learned in a case brought by Mr. Blackburn. They sell the video-pirate cassettes at £50 a running hour. They tell customers that they have a laboratory in Essex where they have to get the films. They are quitefrank with their customers. They warn them that the supply of the films may be a breach of copyright and may possibly lead to conspiracy: but it is worth the risk. They said as much to a solicitor, Mr. Perkins, a partner in Clifford-Turner. On Monday, 23rd April, 1979 they agreed to sell him three films – "Julia" for £100, "Animal House" for £100 and "The Boys from Brazil" for £150, making £350 altogether. He paid a deposit of £150 in cash. "Mike" Lee said he would obtain the films from his "laboratory" that evening and let him have them the following day. There was some delay (no doubt because of the police visit to 66 Goldings Road, Loughton). "Mike" apologised to the solicitor for the delay. He said: "Things have been getting rather warm". But "Mike" did deliver the three video cassettes on the 2nd May, 1979. They were clearly obtained illegally. The copyright in the films belonged to the film companies: and they have never given any permission for the films to be copied or put on to video cassettes.


Such is the outline. The affidavits give the story in much more detail. But the evidence is quite sufficient to warrant the inference that here there was a conspiracy to defraud at common law. (That still exists, see section 5(2) of the Criminal Law Act 1977). And that those concerned were engaged in offences of making and selling infringing copies contrary to section 21 of the Copyright Act 1956.


But the criminal law does not provide an adequate remedy for the film companies. The Committee presided over by Mr. Justice Whitford reported that "the criminal provisions are of little use and little used", 1977 Cmnd. 6732, paragraph 708. The criminal law is too slow and the penalties too small. Section 21 creates only a summary offence: and the penaltieshave not been increased by the legislature.(The offence is regarded so lightly that it was not included when other penalties were increased by section 30 of the Criminal Law Act 1977). The fine for an offence under the Copyright Act 1956 is still only £50. That is a small price for a film pirate to pay. He can. look upon it as one of the incidental expenses of his trade. In any case it is very difficult to catch the real people behind this illicit traffic. As a rule the only people who can be caught are small traders in back streets. They may sell video cassettes to an inquiry agent who gives a "trap" order. But as soon as legal proceedings are in the offing, the stock of the street trader disappears. He protests his innocence, saying that he had no knowledge that there was any infringement of copyright.


So in waging this war against this crime, the film companies have had recourse to the civil courts: and especially to the Chancery Division of the High Court. They sought the advice of counsel, Mr. Hugh Laddie, and he suggested that they should apply for an ex parte order – before the defendant was served with the writ – so as to take the trader by surprise before he could get rid of his stock and any incriminating documents. The first application came up for close consideration by Mr. Justice Templeman in E. M. I.. v. Pandit (1975) 1 Weekly Law Reports 302. His judgment set a most valuable initiatives It was followed by this court in the Anton Piller case (1976) Chancery 55 and. extended in E. M. I.. v. Sarwar (1977) Fleet Street Patent Law Reports 146. Those cases were heard ex parte. In this case we have heard both sides, As a result, I think that we should affirm those decisions and also those that have...

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