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China – Beijing Court Issues Permanent Injunction And 5m Against A TV Drama In A Copyright Infringement Case.

2 April, 2015

 

 
On Dec 25, 2014, Beijing No.3 Intermediate Court issued a ruling in Chiung Yao v. Yu Zheng, Wanda Media Co., Ltd (“Wanda Inc.”), Hunan eTV Culture Media Co., Ltd. (“Hunan eTV Inc.”) etc., ruling that the defendants have jointly infringed the copyrighted works “Plum Blossom Scar (梅花烙)” of Chiung Yao, awarding 5m RMB damages and a permanent injunction against the infringing TV series “Palace 3: The Lost Daughter (宫锁连城)1.
 
I. Background Of The Litigation
 
1. Chiung Yao And Her Copyrighted Novel And Script
 
Chiung Yao is the most popular Chinese romance novelist. Many of her works have been made and remade into movies and TV series, and she has a huge group of fans in Mainland China. In this case, she asserted copyright infringement of the following two pieces of works:
 
  • The script of TV series: Plum Blossom Scar, created in 1992 and publicly played in 1993;
  • The novel: Plum Blossom Scar, created and published in 1993.
 
It is largely not disputed that the novel and the script substantially tell the same story.
 
2. Yu Zheng’s Accused TV Series
 
Yu Zheng is a famous Chinese scriptwriter. He is noted for Palace, which earned him a Best Writing at the 16th Asian Television Award.
 
In April, 2014, after Yu Zheng’s new TV series production Palace 3: The Lost Daughter had been publicly played in a few local cable TV stations, Chiung Yao sued Yu Zheng for copyright infringement, and asked for (1) 20m RMB damages; (2) permanent injunction; and (3) a public apology. The accused TV series was invested by Wanda Inc. (the Chinese company that had recently purchased AMC Cinema Chain), and collectively produced by three studios. Thus, the investor and the studios have been sued as co-defendants for joint liabilities.
 
When the suit was initially brought in April, 2014, the public seemed to favor Chiung Yao much more. For example, one widely circulated news report said that this was not the first time Yu Zheng was accused of plagiarism. Wikipedia also gives details of Yu Zheng’s plagiarism allegations.
 
II. Court’s Reasoning and Ruling
 
1. Legal Standards
 
(1) Idea/Expression Dichotomy: Special Experience Test
 
Generally speaking, copyright law protects the expression of an idea, but copyright does notprotect the original idea. This limitation is called the idea–expression dichotomy.
 
Sometimes it is a challenge to draw a clear line between idea and expression. In this case, the Beijing Court establishes a “source-identifying special experience test”, saying:
 
“A plot in a story might be either summarized as an abstract idea, or be presented as a specific expression. Thus, a plot itself still could be further distinguished as an idea or an expression. To distinguish between an idea and an expression, one shall look at whether the plot in question is abstract and general, or specific to the extent that it gives a special aesthetic experience that is sufficient to identify the source of the work. If the plot is specific to such an extent, it can be considered as an expression.”
 
(2) Two-Prong Test For Infringing The Right To Make A Derivative Work: Access + Relevance
 
In deciding infringement, the Beijing Court adopts a two-prong test that is similar to U.S. courts.
 
First, it is assumed that the defendant had access to the plaintiff’s 1993 published copyrighted works.
 
Second, the court found there was relevance between the accused work and the plaintiff’s work. After finding substantial similarity between two parties’ works, the court concluded such similarity was sufficient to prove that the accused work was a derivative work of the plaintiff’s work. In other words, the accused work came from the plaintiff’s work.
 
2. Infringement Analysis
 
Applying the above mentioned “special experience test”, the court compared the accused TV series “Palace 3” with the plaintiff’s work in three aspects: characters, plots and overall story lines.
 
(1) Overall Story Line
 
To give readers some clues about the story presented in both parties’ works, I summarize the story line shared by both parties’ work as follows:
 
At the birthday celebration ceremony of a royal king, a beautiful girl was presented to the king as a gift. This created a sense of crisis to the wife of the king, who had given birth to three girls but no boys. Shortly after the birthday celebration, the wife gave birth to the fourth girl. Out of the fear of losing her status in the royal family, she accepted the suggestion of her servant and replaced the newly born girl with a baby boy from another family. Her baby girl was abandoned besides a creek, and a mark of plum blossom was imprinted on her shoulder so that the mother could identify her in future. (In the accused Palace 3, it was a piece of red mark being imprinted on the abandoned girl’s shoulder).
 
When the boy grew up as a prince, he met the abandoned princess accidentally, and actually saved her from a miserable situation. They immediately fell in love. However, at the order of the emperor, the prince was granted a marriage, and had an official wife. This created a complicated triangle love relationship among the fake prince, his assigned wife, and his concubine (the abandoned princess). Under the context and interactions among the emperor, the king, the prince, his official wife, and the abandoned princess, etc., the story was further driven by two factors: truth about births of the abandoned princess and the fake prince, and jealousy from the official wife against the abandoned princess.
 
The above is a very general and rough story line. To prove infringement, the plaintiff submittedmuch more evidences about specific character settings and plots to show substantial similarity.
 
(2) Characters Settings
 
After a thorough comparison, the court found that both parties’ works shared the following character settings:
 
  • The king, the sole authority of the royal family;
  • The wife of the king, who gave no birth to boys and replaced her fourth girl with a boy;
  • The fake prince, who grew up in the royal family, and fell in love with the abandoned princess;
  • The abandoned princess, who grew up in a grass-root family, loved the prince and became his concubine;
  • The Emperor, who granted an official marriage to the fake prince; and
  • The official wife of the prince, who hated her husband’s concubine out of jealousy. She accused that the concubine was actually a witch. After she discovered that the concubine was actually the abandoned princess, she told it to the Emperor.
 
(3) Specific Plots
 
In order to show striking similarity, the plaintiff further raised a total number of 21 specific plots from both parties’ work, and compared them one by one.
 
After a thorough analysis, the court concluded that
 
  • Plots No. 6, 14, and 17 were not copyrightable because they did not have sufficient originality;
  • Regarding plots No. 2, 3, 4, 11, 12, 13, 15, 16, 20, while they were copyrightable, the court found no substantially similarity between two parties’ works.
  • Regarding plots No. 1, 5, 7, 8, 9, 10, 18, 19, 21, the court found them were copyrightable and also found substantially similarity between parties’ works.
 
Based on the finding of substantial similarity in the above 9 plots, the court concluded that it constituted infringement of the plaintiff’s right to make a derivative work (including a derivative script and a derivative TV series).
 
3. Rulings
 
The court rules that the defendants have jointly infringed:
 
  • Right of adaption, i.e., the right to make a derivative new script based on the original copyrighted work; and
  • Right of cinematography, i.e., the right to make a derivative TV series based on original copyrighted work.
 
The court decides that the defendants’ liabilities include:
 
  • 5m RMB damages, jointly taken by five defendants, including the investor (Wanda Inc.), studios (Hunan eTV Inc., Dongyang Huan Yu Inc2 ., Dongyang Xing Rui Inc.3 ) and the scriptwriter (Yu Zheng);
  • Permanent injunction against the accused TV series: Palace 3; and
  • A public apology from the scriptwriter Yu Zheng.
 
III. Potential Issues In Appeal
 
1. “Special Experience Test” For Distinguishing Idea And Expression
 
According to the court, if a plot is specific “to the extent that it gives a special aesthetic experience that is sufficient to identify the source of the work, … it can be considered as an expression.” In addition, the court considers such a test is universally applicable to character settings, plots, story lines, etc.
 
However, as far as I know, there is no Chinese precedent for such a “source-identifying special experience test”. Let’s see whether the appellate court, Beijing High Court, will support this test or not.
 
2. Damages Calculation
 
The plaintiff asked for damages of 20m RMB, asserting that the accused scriptwriter Yu Zheng was typically paid 200k RMB for one episode, and would be paid 12m RMB for this 63-episodes TV series.
 
The defendants refused to disclose any data in relation to profits or costs in investing, writing, making and distributing the accused TV series. Accordingly, the court decided the 5m RMB damages under its own discretion.
 
It would be interesting to see whether the defendants would still insist this non-compliance strategy during appeal.
 
3. Permanent Injunction
 
It is rare for Chinese court to issue a permanent injunction to protect a private right, i.e., an individual’s copyright. Interestingly, according to the court, the judges have considered the balances of hardships between the parties. The court says:
 
“when the case was heard before the court, the accused work had been played in cable TV for eight months…. Such a period has granted the defendants a relatively high reward… thus it will not cause an imbalance of hardships between the parties”.
 
It seems to imply that the court will probably not issue a permanent injunction if the litigation was brought earlier, for example, when the accused TV series had not finished or had not been publicly played. I hope the appellate court will give comments on this approach.
 
4. Joint Liability Of Investor
 
It will also be interesting to see whether the investor, Wanda Inc., will appeal. Actually, it is not common to rule an investor to take joint liability. From the perspective of entertainment industry, this is clearly not a friendly ruling and is likely to deter future investors. I am curious to see whether the appellate court will affirm such a ruling, or alternatively, create a safe harbor for investors.
 
End Notes:
 
1. See Chiung Yao v. Yu Zheng, Judegement No. 07916 by Beijing No.3 Intermediate Court
2 Chinese name: 东阳欢娱影视文化有限公司。
3 Chinese name: 东阳星瑞影视文化传媒有限公司。
 
Jun He 4
 
For further information, please contact:
 
Haining Song, Partner, Jun He
songhn@junhe.com
 

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