Case Analysis: Novex Communications Pvt Ltd. v. Hyatt IndiaConsultance Pvt Ltd.

By Mudit Bafna

I. Introduction

Novex Communications Pvt. Ltd. v. Hyatt India Consultancy Pvt. Ltd. & Ors. is a Delhi High Court case which happened in 2024 where Novex, the owner of public performance rights in several sound recordings, sued Hyatt hotels for playing its copyrighted music during events and daily operations without licenses. The court granted an ex-parte ad-interim injunction restraining Hyatt from unauthorised use of Novex’s music and further referred the matter to mediation. 

II. Facts

Novex Communications Pvt. Ltd. owns and controls public performance rights in sound recordings of several major music labels such as Zee Entertainment, Tips Industries, Think Music, Red Ribbon Entertainment, etc. Novex Communications sued Hyatt Consultancy Pvt. Ltd. and its associated entities for playing its copyrighted music in hotels like Andaz Delhi, Grand Hyatt Mumbai and Hyatt Regency Ahmedabad without obtaining licenses. Multiple cease and desist notices were sent to the defendants, but they always denied any sort of infringements and continued unauthorized public performances during the events and daily operations. 

Novex argued that the defendants had previously taken licenses and were aware of its rights. They were gaining commercial benefits while causing irreparable harm to its business and the music industry. The Delhi High Court found a prima facie case of infringement, held the balance of convenience in favour of Novex and granted an ex-parte ad-interim injunction restraining the defendants from using or publicly performing Novex’s sound recordings without authorization. It also referred the matter to mediation and listed it for further hearing.

III. Issues

The key issues before the Delhi High Court were as follows - 

1. Whether the defendants’ act of playing Novex’s copyrighted sound recordings in their hotels without a license constituted copyright infringement under the Copyrights Act, 1957?

2. Whether Novex had established a prima facie case, balance of convenience and the likelihood of irreparable harm to justify the grant of an ex-parte ad-interim injunction?

3. Whether pre-litigation mediation under the Commercial Courts Act, 2015 could be dispensed with in light of the plaintiff’s urgent need for interim relief?

IV. Laws Involved

This case revolves around the Copyright Act, 1957. Specifically, it involves the following sections of the Act:

1. Section 14(e) - grants the copyright owner exclusive rights to communicate sound recordings to the public. 

2. Section 51 - defines unauthorised public performance as infringement.

3. Section 52(a) - mandates disclosure of ownership details on sound recordings

4. Section 55 - provides for civil remedies like injunctions, damages and account of profits.

Additionally, procedural laws like Order XXXIX Rules 1 and 2 of the Code of Civil Procedure (CPC) allows the court to grant temporary injunctions where a prima facie case and irreparable harm are shown. Moreover, Section 12A of the Commercial Courts Act, 2015 states that pre-litigation mediation is mandatory unless urgent interim relief is required.

V. Analysis

The court examined the plaintiff’s documents showing ownership and assignment of on-ground public performance rights for various sound recordings. It noted that the defendants were established commercial operators who had previously obtained licenses from Novex, proving their knowledge of the plaintiff’s rights. The evidence of unauthorised use, particularly the New Year’s Eve Event at Andaz Delhi, supported by video recordings, demonstrated a clear pattern of infringement. In the case of India Performing Rights Society Ltd. v Aditya Pandey, the Supreme Court held that when a sound recording is publicly communicated, royalties are due to the owner of the sound recordings. This case reaffirms the rights of owners and creators of music to enjoy the benefit from commercial use of their works.

The defendants’ denial of infringement despite detailed cease and desist notices indicated deliberate non-compliance. In the case of Super Cassettes Industries Ltd. v. Nirulas Corner House Pvt. Ltd., the principle used was that hotels which previously obtained licenses and later played copyrighted works without authorisation showed wilful infringement. The Supreme Court granted an ex-parte ad-interim injunction in favour of Super Cassettes, finding that the hotel's use of copyrighted material in rooms was likely a public performance/communication to the public, requiring a license. Similarly, in the case of Novex Communications, there were public performances where copyrighted music was played without licensing and the court granted ex parte-ad interim injunction in favour of Novex Communications. 

On the test for an interim injunction, the court held that Novex had a prima facie case as it was the rightful copyright holder. The balance of convenience favoured the plaintiff since the defendants could easily obtain licenses, whereas continued infringement would cause commercial and reputational harm to Novex. The harm was irreparable, as it undermined the licensing ecosystem and discouraged lawful acquisition of performance rights, further, the court recognised the urgency of the matter, allowing exemption from pre-litigation mediation under the Commercial Courts Act. In the case of Wander Ltd. v. Antox India Pvt. Ltd., the Supreme Court laid down the requirements for granting an interim injunction as follows - prima facie case, irreparable harm and balance of convenience, all three of which were established in the case of Novex Communications. 

VI. Conclusion

The Delhi High Court, finding that the plaintiff had satisfied all conditions for interim relief, granted an ex-parte ad-interim injunction restraining the defendants, their agents and associates from using, playing, exploiting or publicly performing Novex’s copyrighted sound recordings in any of their hotels or events without proper authorisation. It directed defendant no. 1 to circulate the order to all Hyatt entities in India within three days. The matter was simultaneously referred to the Delhi High Court Mediation and Conciliation Centre for a mediation session while being listed for further hearing on 14 January 2025. Thus, the plaintiff secured immediate protection of its rights pending the outcome of the suit. 

References:

1. Novex Commc’ns Pvt. Ltd. v. Hyatt India Consultancy Pvt. Ltd., CS(COMM) 770/2024 (Del. HC Sept. 9, 2024).

2. Copyright Act, 1957, § 14(e), No. 14, Acts of Parliament, 1957 (India).

3. Copyright Act, 1957, § 51, No. 14, Acts of Parliament, 1957 (India).

4. Copyright Act, 1957, § 52(a), No. 14, Acts of Parliament, 1957 (India).

5. Copyright Act, 1957, § 55, No. 14, Acts of Parliament, 1957 (India).

6. Commercial Courts Act, 2015, § 12A, No. 4, Acts of Parliament, 2016 (India).

7. Indian Performing Right Society Ltd. v. Aditya Pandey, 2012 SCC OnLine Del 2645.

8. Wander Ltd. v. Antox India P. Ltd., 1990 Supp. SCC 727 (India)

9. Super Cassettes Industries Ltd. v. Nirula's Corner House (P) Ltd., (2008) 37 PTC 237 (Del).