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The Court of Session in Scotland has found a director personally and jointly liable with his company for infringement of copyright in a music recording (a transcript of the case can be found here).
The director, Mr Salmon, made copyrighted recordings (of Vivaldi's "four seasons" and the Christmas carol "joy to the world") available for sale or download on his company's website and licensed the recordings to other websites for resale. He was the company's sole director and shareholder, and the domain name for the company's website was registered in his name.
The copyright owner issued a claim against Mr Salmon personally as well as his company. In his defence Mr Salmon relied on the well established principal that he had separate legal personality to the company and could not be liable for the company's acts – he failed. Mr Salmon was held liable as a principal as he was acting not only as a director but also as an individual setting up the website and putting the infringing material on it; he was liable not only for his own acts but also for those of the company on the basis both of procurement of breaches of copyright by the company and of acting in concert with the company for a common purpose.
This case is warning to directors to be careful not to blur the lines between two separate legal entities - the individual's and the company's.
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