I. Dispute over the Copyright of Nan Huai-Chin’s Works

Nan Pinren filed a lawsuit against Fudan University Press Co., Ltd., Laogu Culture Enterprise Co., Ltd. (“Laogu Company”), Shanghai Laogu Culture Education Co., Ltd. for infringement of property rights in a work [Civil Judgment (2014) HYZMW (Z) CZ No. 170 of Shanghai No. 1 Intermediate People's Court, members of collegiate panel: Hu Zhenyuan, Gui Jia, Chen Rongxiang; Civil Judgment (2017) HMZ No.233 of Shanghai High People's Court, members of collegiate panel: Wang Jing, Xu Zhuobin, Kong Liming]

[Case Brief] 

On January 31, 2001, Nan Huai-Chin and Guo Hengyan signed a Power of Attorney stating that "I have entrusted Guo Hengyan as my special authorized agent, who shall have the sole authority to represent me in handling all copyright matters of all my works in the Chinese mainland. Agency authorities include signing copyright licensing contracts, dealing with other affairs related to copyright licensing on my behalf, and dealing with all other legal matters related to the copyright of all my works in the Chinese mainland on my behalf. All documents signed by the agent within the authority of the agent will be recognized by me – Nan Huai-Ching. The agent shall have the right of sub-entrustment.” Guo Hengyan submitted the “Licensed Use Certificate” dated June 8, 2001, which states that “1. The exclusive licensed use right of Mr. Nan’s works in China shall belong to Laogu Company, who may use or permit any third parties to use such works. 2. The license period enjoyed by Laogu Company shall coincide with the copyright period of Mr. Nan's works under law. 3. The royalties payable by Laogu Company shall be fully used for the establishment and operation of Shanghai Laogu Cultural Undertakings." After that, Nan Huai-Chin's works were published in China’s mainland by Fudan University Press, Oriental Publishing House, The Shanghai People's Publishing House and other publications under the authorization by either Laogu Company or Nan Huai-Chin, and some of the royalties were collected by Nan Huai-Chin, and some were collected by Shanghai Laogu Company. The above situation is known to both Nan Huai-Chin and Guo Hengyan.

In October 2014, Nan Xiaoshun, the son of Nan Huai-Chin, filed a lawsuit, claiming that he inherited the property rights of Nan Huai-Chin’s works in China’s mainland. Because Fudan University Press did not pay part of the copyright royalties after publishing many works of Nan Huai-Chin, he required Laogu Company and Fudan Publishing House jointly compensate for economic losses of RMB 9.88 million yuan and reasonable expenses of over RMB 350,000 yuan. Laogu Company filed a counterclaim requesting for confirming that it had copyright to Nan Huai-Chin's works.

[Adjudication]

The court of first instance held that, Fudan University Press had paid the royalties to Shanghai Laogu Company for publishing Nan Huai-Chin’s works before July 2012. The fact was known by Nan Huai-Chin, so Fudan University Press did not commit infringement. The outstanding RMB 1.36 million yuan of copyright fee arising after the death of Nan Huai-Chin was the payment for the use of other people's works, which constituted an infringement. As Fudan University Press had no subjective fault, it should not be required to bear the right protection expenses. The counterclaim of Laogu Company was rejected. After the judgment of the first instance, Laogu Company and Fudan University Press refused to accept the judgment delivered in the first instance and filed an appeal. The court of second instance held that the Licensed Use Certificate shall not be a sub-entrustment in the nature of law, and Laogu Company can authorize Fudan University Press to publish the works of Nan Huai-Chin based thereon. Fudan University Press’s payment of the copyright license fee to Nan Huai-Chin in the early period and Shanghai Laogu Company in the late period per the instructions of the Laogu Company was a normal performance and was not in violation of Nan Huai-Chin’s will. Therefore, Fudan University Press did not infringe copyright. Accordingly, the court of second instance upheld the first-instance judgment, rejected all the counterclaims of Laogu Company, and changed the judgment to reject all the claims of Nan Pinren (the successor of the lawsuit after the death of Nan Xiaoshun).

[Typical Significance]

This case involves the dispute over the ownership of Nan Huai-Chin's works, and attracts attentions from all sectors of society and Chinese both at home and abroad. The facts of this case are intricate and the legal relationship is complicated. The second-instance judgment of this case, by exploring the true meaning of Nan Huai-Chin's pre-life will, accurately defined the legal significance of the parties' behaviors, and rationally allocated the relevant rights and interests of the parties involved in the case in line with Nan Huai-Chin's willingness, and has achieved a balance of interests between the parties. After the second instance judgment was pronounced, all parties accepted it, and the verdict received favorable comment from all sectors of society, achieving good legal and social effects.

photo from: knowsky.com