The Federal Court has overturned a recent Copyright Tribunal determination that significantly increased the rates payable by the fitness industry for the use of sound recordings in exercise classes.

Fitness Australia appealed to the Federal Court to have the May 2010 Tribunal determination reviewed, arguing that there was a breach of the rules of natural justice in connection with the making of the decision. The Federal Court concluded that the Tribunal had conducted itself “in a way which was procedurally unfair to Fitness Australia”. [at 4]

The appeal essentially turned on whether Fitness Australia had been given an adequate chance to respond to all the evidence considered by the Tribunal in determining the new rate. The Federal Court did not consider whether the rate selected was correct, but rather whether the Tribunal followed correct processes in making its determination.

In particular, the debate largely revolved around the use to which the Roberts Research study was put. The Federal Court stated that, “the position of both parties was that the study was not to be used to fix a rate. It was procedurally unfair for the Tribunal to use the study to fix a rate in light of that clear position.” [at 45]

The case will be sent back to the Copyright Tribunal to redetermine the case.

To read the full decision, see:

http://www.austlii.edu.au/au/cases/cth/FCAFC/2010/148.html