Exploitation of Digital Rights

Exercise: 1
A. The parties can enter into either Licensing or Assignment but it is advised that Licensing
should be preferred over Assignment in the light of following reasons:
a. The Licensor retains all the IP rights.
b. If is more feasible when licensor wants to exploit the Licensed rights on multiple
platforms.

B. The Licensor hereby grants as and by the way of a non-exclusive license during the term
to Netflix, the non-exclusive right to display, exhibit, stream, communicate to the public
and make available the film in any or all of the licensed languages on an SVOD
basis( defined hereafter) via the Netflix services( defined hereafter) within the territory.
The Licensor further grants to Netflix the Non-exclusive license to subtitle the film in all
languages at Netflix’s sole cost, provided however, all rights including but not limited to
copyright in such subtitled versions of the film shall vest with the Licensor solely on an
‘as-is’ basis. The licensor also grants to Netflix during the term a limited, no-exclusive
right to copy, install, display, use, cache, store, transmit, exhibit, distribute and
communicate to the public the Licensor’s trademark(s) and logo(s) for the purpose of
exercising its right under this Agreement. Netflix agrees that it shall not insert any third
party advertisements and/or any commercial interruptions before, during and after the
display or exhibition of the film on the Netflix Service.
Sublicensing/ sub-distribution to be restricted.

a) SVOD: Subscription Video on Demand- shall mean the delivery and/or exhibition of a
film on a streaming and/or Temporary Download basis, wherein the timing of such
delivery and/or exhibition is not pre-determined but rather at the consumer’s
discretion (hereinafter On Demand), and in connection with which, a recurring fee
and/or periodic access fee is charged.
b) Netflix services: shall mean the global subscription service that provides
subscription with On-Demand access to content on a non-liner basis through
internet transmission under the Netflix brand, a successor brand or other
brand/mark owned by or otherwise controlled by Netflix or a company Netflix
directly or indirectly controls, or a company controlled by or under common control
of Netflix.
c) Temporary download rights: for the avoidance of doubts, the right of Netflix to
distribute, communicate to public and exhibit films include the right to make such
films available via the Netflix service in the territory on a Temporary Download basis;
which shall mean the digital transmission of audio-visual content in a format that
allows for offline viewing of all such content and its storage on device in accordance
with the following usage rules:
 All temporary download of the film must be rendered unviable upon
I. Expiry of thirty days following the download of the film
II. Expiry of the film License Period as per this agreement and
III. Expiry of forty-eight hours from a subscriber beginning offline viewing of
temporary download of the film

Licensor Reserved Rights: all the rights not expressly granted to Netflix under
this Agreement shall be reserved in favour of the Licensor in perpetuity throughout the world,
subject to the rights and holdbacks granted herein. Such reserved rights shall include, for
clarity, any future rights that may come into existence during the term of Agreement. The
Licensor shall be entitled to exploit any and all of the Licensor Reserved Rights in its sole
discretion.

C. Holdbacks: During the licensed period, the Licensor shall not license or permit any third
party to license, exhibit, distribute or otherwise exploit the Film in any basis or format in
any version including but not limited to any resolution/format/dimension in the
Licensed Languages in any country in the territory other than the following-
1. On a theatrical, non-theatrical, home video basis
2. On a linear pay TV or Linear free TV basis
3. On a purely SVOD basis

D. Promotion: The Licensor grants to Netflix during the term a limited non-exclusive right
and license to create short promotional clips from the film, each of which shall not
exceed a length of 3(Three) minutes and shall include no more than 30(thirty) seconds
of music for the purpose of marketing and promoting the availability of the film on the
Netflix Service. For clarity, the foregoing marketing and promotion rights shall be solely
with respect to marketing and promoting the Film and not the Netflix Service itself.
For the purpose of pre-promotion, Netflix shall only use the marketing materials
provided to Netflix by the Licensor for the purpose of promoting the availability of film
on the Netflix Service. In the event Netflix wishes to create or use any other promotional
materials, Netflix may do so at the sole cost of Netflix and submit the same to the
Licensor for prior written approval, which the Licensor hereby agrees to not
unreasonably withhold.

E. Withdrawal for cause: Notwithstanding anything to the contrary in this Agreement,

Netflix shall have the right to temporary suspend or withdraw the Film from the Netflix
Service in any part of the Territory at any time for any reason. Such suspension or
withdrawal shall not release Netflix of its payment obligation hereunder.
In the event Netflix temporarily suspend or withdraws the Film from the Netflix Service
because of its reasonable, good faith determination that the Film may create legal or
regulatory liability for Netflix and/or its affiliates, or a change in law or regulation
impacts Netflix’s ability to exploit in such part of the Territory any or all the Rights
granted to Netflix hereunder, Netflix shall invoke the clause for Removal for cause. In
such event, the Licensor as its own option shall either remedy the cause within 60
calendar days of such notice of removal, or issue pro-rated refund/ credit in accordance
with the terms of this Agreement
In the event the Film has been permanently withdrawn, the Licensor shall refund to
Netflix a prorated amount of the License fee paid to the Licensor for the film which shall
be calculated as effective from the date of withdrawal and with respect to the amount
of time remaining the License period. (Amount to be decided by the parties mutually in
good faith)

Exercise: 2

1. Relevant clauses: Recital, Definitions, Reps and Warranties, Grant of Rights,

Marketing and promotion , License Fee, Withdraw, Indemnity, Termination,
Confidentiality, Jurisdiction
2. Relevant Fee: The parties can agree to both Fixed and Variable fee or only Fixed
fee
25% upon delivery
25% 45 days after delivery
25% on or before ……….. (Specific date)
25% before ………….. (Specific date)

3. Ground of Termination:
o Uncured breach by either party after notice being served
o Order passed against exploitation of the film
o Third-party claim gets proven against the film
o Either party goes bankrupt
Consequences of Termination:
o Termination of license. Netflix to lose rights of exploitation, destroy all materials and
their copies and notify such compliance; either party to be absolved of all obligations.
o If Netflix terminates owing to Licensor’s breach- refund of prorated amount by Licensor
(with/without interest)
o If Licensor terminates for Netflix’s breach- no refund

4. Reps and Warranties:

Netflix’s-
o Right and power to enter into this Agreement
o No encumbrances likely to conflict with Netflix’s reps and warranties

Licensor’s-
o Right and power to enter into this Agreement
o No encumbrances likely to conflict with Licensor’s reps and warranties
o Music right are clear
o Information related to the Film including but not limited to the ratings
thereof, as provided to Netflix by the Licensor shall be genuine and true
o Netflix’s exploitation shall not amount to infringement of Third-Party
rights
o Netflix’s exploitation shall not amount to infringement of any
laws/regulations

5. Exclusivity: exclusivity has very less relevancy under this association, as all the
rights granted by the Licensor to Netflix are of Non-exclusive and Temporary
nature. Clauses like Grant of Rights, Promotion and Advertisement also grants
certain right. But against they are also qualified with the term Non-exclusive.
Meaning thereby, this association is of non-exclusive in nature.