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Implied Licenses and Ownership of Intellectual Property Rights in the United Kingdom

Backgroundwork overseas. Classic FM was prevented from
exploiting their database abroad without the
Mr Ray was a highly respected expert inconsent of Mr Ray, which would require
classical music in England, reputed to havepayment  of  license  fees.
an encyclopaedic knowledge of classical
music. He was engaged by Classic FM in theWhen implying licences in this way, a court
United Kingdom in 1991 to compile the radiowill only go so far as is necessary in the
station's repertoire, compile playlists,circumstances to give effect to the intention
categorising tracks for play lists, and rateof the parties. If a grant of a licence is
their popularity under each of therequired, the ambit of the licence will be
categories. The contract did not deal withthe minimum required to give effect to the
intellectual property rights. Theintention of the parties at the time of the
consultancy agreement was originally for 11contract. An implied term that copyright
months, however the work of Mr Ray provedwould be assigned to a client will be
beneficial for Classic FM, and his servicesexceptionally rare, as most often an
were extended until 1997. Some 50,000 tracksexclusive licence will have the same effect
were eventually categorised. The results ofin  law.
the work were incorporated into a database
that was used to select music on a rotationalThe judge held that the contractor retains
basis,  and  prevent  overplaying.the copyright in default of some express or
implied term to the contrary effect. The
The project was success. After internal usecontract may expressly state which party is
for about 5 years, Classic FM proposed toentitled to the copyright, and the mere fact
licence the database to overseas companies.that the contractor has been commissioned -
Mr Ray objected and commenced proceedings toperformed by a contractor - is insufficient
prevent Classic FM licensing the use outsideto grant rights in the copyright to the
the UK without his permission, on the basisclient. In the absence of express rights,
that he was the author of documents that werethe client is left to establish an
incorporated  into  the  database.entitlement under the express or implied term
of  the  contract.
The  Decision  of  the  High  Court
Conclusion
Mr Justice Lightman in the High Court ruled
that in the case of a consultancy, the authorThe decision means that contractors retain
retained the copyright in the absence of anthe copyright in the absence of an implied or
express or implied term to the contraryexpress term. An implied licence must be
effect. Where services by a consultant arereasonable and equitable; necessary to give
performed for an express purpose, a courtbusiness efficacy to the contract, capable of
will readily imply a term into a contract forclear expression and not contrary to any
services that a client is entitled to use itexpress term of the contract, and so obvious
for that purpose. In this case, Classic FMthat it goes without saying. This means that
always intended to utilise the Mr Ray's worka licence will be implied for the client to
in the UK. It was not until 1996 thatuse the work for the stated purposes at the
Classic FM intended to exploit Mr Ray's workoutset of the engagement. It is important to
overseas. The court was not prepared todocument the purposes of the engagement and
imply a licence into the contract thatthe intended use for the copyright work
Classic FM would be entitled to exploit hiscreated during the course of the engagement.



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