NoCopyrightSounds v AEI Music: High Court grants interim injunction in IP rights dispute

The High Court has granted an interim injunction preventing AEI Music Limited and Featherstone Music Limited from exploiting intellectual property rights held by NoCopyrightSounds Limited, in a case highlighting the complexities of long-standing commercial relationships in the music industry.

His Honour Judge Jarman KC handed down his judgement on 6 February 2026, restraining the defendants from using NCS's sound recordings, audio-visual content and musical compositions until trial or July 2026, when the contractual relationship between the parties will expire regardless of the outcome.

The parties had maintained various agreements since 2014, whereby AEI and FM exploited NCS's rights and accounted for proceeds whilst retaining a percentage. The relationship deteriorated significantly, with AEI acknowledging a debt of £4.1 million by May 2025. AEI confirmed it could only pay £250,000 without jeopardising its business and warned that full payment would trigger insolvent liquidation.

NCS claimed to have terminated the agreements for unremedied material breach, alternatively relying on termination provisions not dependent on breach. The central dispute concerned heads of agreement signed in July 2017, intended to replace existing arrangements with a long-form operating agreement following good faith negotiations. Whilst a draft was prepared, it was never executed.

AEI contended the heads of agreement itself constituted a freestanding grant of rights that discharged all previous agreements, containing no termination provision for material breach. The defendants also relied on alleged representations suggesting NCS would not demand immediate payment, providing reasonable time for settlement.

NCS argued this interpretation contradicted the agreement's plain language, which explicitly stated terms "will be incorporated in long form agreements" following "good faith negotiations". The clause providing for an "Operating Agreement" to "replace the existing distribution Agreement and catalogue licencing agreements" undermined the defendants' case that it had already done so.

The claimant also highlighted commercial absurdity in suggesting it intended to grant rights without any termination mechanism for breach, particularly given such provisions existed in all previous agreements and the subsequently drafted operating agreement. The parties' conduct further contradicted the defendants' position: AEI continued accounting twice yearly under the old distribution agreement rather than quarterly as the heads of agreement required, whilst FM continued exploiting rights despite not being party to that agreement.

Judge Jarman KC initially considered whether to grant the injunction on grounds that the defendants had no arguable defence, citing authorities including Manchester Corp v Connolly and Official Custodian for Charities v Mackey. However, he concluded that whilst NCS's case was strong, it fell short of demonstrating no arguable defence existed, making a mini-trial inappropriate before disclosure and full evidence.

Applying the principles from National Commercial Bank Jamaica Ltd v Olint Corporation Ltd, the judge found damages would not adequately remedy NCS if no injunction were granted. Evidence showed potential licensees had expressed concern about using the rights during the dispute, one platform operator had suspended payments, and AEI's poor financial position created substantial doubt about its ability to satisfy any damages award.

Conversely, damages would adequately compensate the defendants if they ultimately succeeded, given NCS held reserves exceeding £1.5 million. The balance of convenience favoured NCS, particularly given the strength of its case and the potential non-financial harm from continuing uncertainty over its intellectual property rights.

The injunction will remain in force until trial or the natural expiry of the contractual relationship in July 2026.

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