Background
The respondent, a sheet-music publisher, created and sold band scores by transcribing recordings into notation for vocals, guitars, keyboards, drums, and other parts. That transcription process required specialized training and substantial time, labor, and expense. The respondent produced scores for 579 songs, although those scores were not “works” protected under Article 2(1)(i) of Japan’s Copyright Act because they were transcriptions based on the songs’ recordings.
GLNET Co., a competing company, and its representative director obtained the respondent’s scores and supplied them, together with the corresponding recordings, to GLNET personnel. Without independently transcribing the music, GLNET produced scores that imitated the respondent’s scores in detail throughout, published them free of charge on its website for at least approximately six and a half years, and earned advertising revenue. The respondent’s sales fell substantially while those scores were available and increased markedly immediately after the website closed. Alleging interference with its business and injury to its commercial interests, the respondent sought damages and other relief for joint tortious conduct. The Tokyo High Court ruled for the respondent, and the defendants appealed.
The Court’s Holding
The Supreme Court unanimously dismissed the appeal and assessed appellate costs against the appellants. It reaffirmed that conduct equivalent to exploiting a work ordinarily does not constitute a tort when the material is outside Copyright Act protection, absent special circumstances involving infringement of a legally protected interest distinct from the interest in exploiting the material itself. Such circumstances can exist, however, when the conduct exceeds the socially accepted bounds of free competition, interferes with another’s business, and injures that business’s legally protected commercial interests.
Those special circumstances were present here. For years, GLNET avoided the substantial costs of independent transcription by closely imitating hundreds of the respondent’s scores, then offered scores of comparable apparent quality for free while earning advertising revenue. The Court found that this conduct readily diverted customers, had a direct and serious adverse effect on the respondent’s ability to continue its business, and was knowingly undertaken. Allowing comparable conduct would place publishers that bear transcription costs at a pronounced market disadvantage and risk damaging fair competitive order. The defendants therefore used markedly unfair means to interfere with the respondent’s business, making their conduct tortious even though the scores themselves were not copyright-protected.
Key Takeaways
- Copying material that lacks copyright protection is generally not tortious merely because it resembles an act reserved to a copyright owner.
- Tort liability may nevertheless arise when special circumstances show interference with a legally protected business interest distinct from any claimed exclusive right in the material.
- Long-term, detailed imitation of 579 costly-to-produce scores, coupled with free distribution and advertising revenue, exceeded the socially accepted bounds of free competition.
Why It Matters
The decision preserves the distinction between copyright protection and general tort law: it does not create an exclusive right in unprotected transcriptions, but it permits relief against business practices that amount to seriously unfair competitive interference. The Court’s fact-intensive reasoning emphasizes the scale and duration of the copying, avoidance of production costs, market effects, and the defendants’ knowledge.
The supplementary opinions stressed that imitation and innovative advertising-supported business models can benefit competition, but not where a competitor’s model depends on free-riding on another firm’s costly work while placing that firm at a severe competitive disadvantage.