Mr Video (Pty) Ltd and Others v Nu Metro Filmed Entertainment (Pty) Ltd and Others

Nu Metro Filmed Entertainment (Pty) Ltd and several international film companies (the copyright owners) discovered that Mr Video (Pty) Ltd and its franchisees were importing DVD films from the United States (Zone 1 DVDs) and offering them for hire in South Africa. These DVDs were encoded for Zone 1 use only and were accompanied by copyright warnings limiting their use to that territory. The Video Group also supplied customers with instructions on how to bypass regional coding restrictions on DVD players. Nu Metro and the copyright owners applied to the Cape High Court for interdicts, delivery up of infringing copies, and costs. Although the Video Group initially disputed copyright ownership and Nu Metro’s standing, they later conceded copyright ownership and tendered to submit to interdicts shortly before the hearing. The High Court nevertheless granted orders on locus standi, delivery up of infringing copies, and punitive costs, which the Video Group appealed.

The appeal was dismissed in its entirety, with costs, including the costs of two counsel.

The case clarifies the standing of distributors and licensees to participate in copyright enforcement proceedings, affirms that parallel importation of region-encoded DVDs for hire can constitute copyright infringement, and confirms the court’s power to order delivery up of infringing articles. It is also significant for endorsing punitive costs orders to mark judicial disapproval of deliberate and persistent copyright infringement.