BGH: hyperlinks, freedom of expression and copyright infringing software

Already decided on 14 October 2010, even though only published in its entirety now, has been a decision (case reference: I ZR 191/08; 'AnyDVD') by the German Federal Supreme Court (Bundesgerichtshof) concerning a lawsuit brought by several music companies against Heise Verlag, an online publisher specializing in IT and computer news. The claimaint's took objection to reports published on Heise’s website which included links to a third party website (SlySoft) that offered software that allowed circumventing copy protection for DVDs.

While the lower courts, the Regional and Higher Courts of Munich I, had held that Heise's online reports were itself copyright infringing, the First Civil Senate of the Bundesgerichtshof took the view that adding the links on Heise's website which linked to SlySoft's website (where SlySoft offered copyright right infringing software) was covered by the constitutional right of freedom of press and freedom of opinion under Article 5(1) German Constitution (Grundgesetz). Further, in cases where the actual text of a report was protected by freedom of expression and freedom of press, the included links would also be afforded equal protection. The judges stressed that the purpose of the links on Heise's website was not only to technically facilitate to access the SlySoft's website but the links were to be regarded as part of Heise's reporting because they were complementing and 'backing up' what was reported with additional information. The fact that the Heise was aware that the software offered on SlySoft's website was copyright infringing did not change this and so could not be blamed on Heise since the information interest of the general public was of higher importance.

The judges also argued that reports on illegal conduct (here: that SlySoft offering copyright infringing software) could be of particular public information interest. It was also important that Heise had clearly indicated in its report that SlySoft's software was copyright infringing. In this context the Bundesgerichtshof explained that protection of Article 5(1) Grundgesetz encompassed freedom of expression and freedom of media in all its aspects and was thus not limited to the content of the report, but it also included the (outer) form of this reporting. As such, it was up to Heise itself, as the subject entitled to the fundamental right under Article 5(1) Grundgesetz, to decide which form of presentation it chose for its reporting. This also encompassed the decision whether additional information about a company and its products (here: SlySoft) should be expressly used in the report and it could include the decision to publish links to SlySoft's website.

The court, inter alia, based its decision on Article 95 a German Copyright Act which is based on Article 6 of the Copyright Directive (Directive 2001/29/EC) (“Obligations as to technological measures”). Intriguingly, the Bundesgerichtshof interpreted Article 95 a German Copyright Act not only in the light of Article 5(1) Grundgesetz but also in light of Article 11 (1) of the Charter of Fundamental Rights of the European Union which stipulates as follows “(e)veryone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers.” Article 11 (2) provides that “(t)he freedom and pluralism of the media shall be respected.” Referring to the ECJ's precedent in Connolly/Commission (C-274/99 P), the Bundesgerichtshof also stressed that content and quality of a report are irrelevant when it comes to the application of Article 11 of the Charter of Fundamental Rights of the European Union.

This interesting decision can be retrieved from the Bundesgerichtshof's website here (in German).

BGH - Art exhibitions in an online archive

In a decision (I ZR 127/09) of October 2010 the German Bundesgerichtshof had to decide on the legality of the online archiving of reports about art exhibitions under Article 50 German Copyright Act (UrhG). The case was brought by the VG Bild-Kunst (the collecting society image and art) against an online news publisher who had illustrated its reports about art exhibitions with images of the works of arts on display.

Article 50 UrhG stipulates that the for ‘the purposes of reporting about events of the day by broadcasting or through similar technical means, in newspapers, periodicals and other printed matter or by means of other data carriers, which are mainly devoted to current event, as well as in films, the reproduction, distribution or and public communication of works, that can be perceived in the course of the reporting of such events, is justified to the extent as this is necessary for the purposes of this reporting’.

Thus, on the face of it, reports can legally include images of art for as long as the reports are about events of the day and the images are used for the purposes of illustrating the report. The reports about art exhibitions which the Bundesgerichtshof had to assess included the depiction of works of art, which due to their online archiving, could be regarded as permanent rather than current. However, the Bundesgerichtshof decided that reporting on current events under Article 50 UrhG was only permissible for as long as the event could still be regarded as an ‘event of the day’.

The court of appeal (Regional Court of Braunschweig) had decided that a permanent archiving of such reports was within the ambit of Article 50 UrhG and taken the view that the relevant time was when the respective report was added to the archive. If the reports had still been current at the point of being archived, then the reports including the depictions of the works had to be considered as permissible reports about an ‘event of the day’ in the sense of Article 50 UrhG. As such, the court of appeal had concluded that the depictions of works of art had not become illegal just because of the time that had passed. In particular, the court of appeal had found that there was not duty for the press to constantly check its online archives to establish whether the reports were still up-to-date.

On further appeal, the Bundesgerichtshof disagreed with the court of appeal’s view. The Bundesgerichtshof referred to its earlier precedents in the ‘Zeitungsbericht als Tagesereignis’ (I ZR 285/99 - newspaper report as event of the day) and ’TV-Total’ (I ZR 42/05) cases and decided that an event was an 'event of the day' in the sense of Article 50 UrhG for as long as the public regarded the report as reporting of an event of the present. It followed that one had to differentiate between the 1) reproduction and distribution of the reports on the one hand and 2) the question of making them publicly accessible in archives on the other hand.

In the first case, the art exhibition had to be current only at the point of the reproduction and distribution of the reports. However, where the reports were made permanently accessible to the public, they had to remain current for the whole time access was granted. The further Bundesgerichtshof disagreed with the court of appeal and held that checking the archive with a view to it being up to date was not too much to ask of the defedant. The Bundesgerichtshof stressed in this context that the claimant in the proceedings, the VG Bild-Kunst, allowed the press to publish its reports on the art exhibitions on the internet for a period of four weeks before the beginning of an exhibition until four weeks after they exhibtions had ended. In view of the judges a deletion of the reports after this period of time was easily possible and could be expected.

The Bundesgerichtshof further denied the defense under Article 53 (2) No. 2 UrhG which only allows the reproduction of copies for an internal archive or internal use. Furthermore, the court held that the defendant could also not invoke the right of quotation under Article 51 UrhG since reports about art exhibition s did not include any separate finding s about the works in the images had been used as proof. Consequently, the court found that the images of the works of arts were not used for the purposes of quotation.

The decision can be retrieved from the court’s website by clicking here.

Can Journalism Handle the Technology/Copyright Interface?

With the rise of online newspaper content (not to mention blogs), the fate of print newspapers continues its seemingly relentless downward trajectory. That said, one likely outcome of this process is the even greater prominence that surviving newspapers will enjoy. On any shortlist of survivors is the New York Times. For that reason, the manner in which the New York Times chooses to cover IP matters is particularly noteworthy.

It is against this backdrop that I read with interest the 16 January article in the New York Times by Nick Bilton (described as "the Lead Technology Writer/Reporter for The New York Times Bits Blog") entitled "Can Your Camera Phone Turn You Into a Pirate?" here. In considering this piece, and with apologies to that most trite of rhetorical conventions--the double entendre--I came away with the feeling that something was a bit off-focus in the piece.

The foundation for the article is Bilton's confession that his wife and he had used their camera phone to make dozens of digital pictures of kitchen layouts and hardwood floor textures, all taken from various books found at a Barnes & Noble store. The pictures were then shared with their contractor. Upon reaching home, the question arose to Bilton:

"Did we do anything wrong? And, I wondered, had we broken any laws by photographing those pages?" After all, Bilton mused, if they had wheeled in a photocopy machine, the store's management would have immediately wheeled the photocopy machine out of the store. Replace smart phone for photocopy machine--and what do you get. Bilton went on to consider answers to the question (or, as he wrote, "[d]id we go too far?").

First stop in providing an answer came from Julie Ahrens, associate director of the Fair Use Project at the Stanford Law School. Her response: "Is it morally incorrect? Maybe. But it entirely depends upon how much of the book you copy, that would determine if it was illegal." But no answer to Bilton's specific question--concerning the very different context of pictures taken by a smartphone-- was offered by Ahrens; maybe she was not even asked to provide an answer. In any event, Bilton then goes on to discuss the attack by the publishing industry on the photocopy machine in the 1960s and 1970s. And what was the result? According to the article, "the publishing industry succeeded in persuading Congress to pass the Copyright Act of 1976, which defined "fair use" of copyrighted material ...."

The article proceeds to consider the view of Professor Stan Liebowitz of the University of Texas, Dallas, that camera phone pictures are "closer to music piracy" than to copies made by a photocopy machine. After all, while in the 1970s, most persons did not keep a photocopy machine for personal use, everyone has the potential to keep a cellphone in his pocket and make copies at his will. In a similar vein, Professor Charles Nesson of Harvard observed that "[i] people are taking a picture of a picture to take with them, then it is exactly like the MP3 issue."

So what are my concerns? They are of two kinds.The first relate to the specific contents of the article:

1. Perhaps my memory of the history of the 1976 Coyright Act is faulty, but I don't remember that it was the publishing industry and its concern with the photocopy machine that was the principal driver of the legislation. One of the drivers, probably so, but the "principal" driver? After all, antecedents to the legislation reached back to the mid-1950s.

2. Equally, I don't remember that, except at the margin (as the article itself writes, mere "snippets" of content), "fair use" became was the principal solution to the publishers' unease with the photocopy machine. References to arrangements reached regarding certain educational copying by teachers had nothing to do with sanitizing wholesale copying of chapters and entire books. Ditto for pictures taken with a smartphone camera.

3. Then, as now, the fundamental issue is about "infringement", and not "fair use", and, more importantly, whether, even if there is infringement, technology threatens to overwhelm the ability of the legal system to enforce unauthorized copying by means of a technology, such as the smartphone camera. However, the word "infringement" does not appear in the article and there is scant discussion of enforcement. Instead, there are multiple references to "piracy", which is great for journalists but less than satisfying for lawyers.

I can already hear the rumbling--get off it Kat, this is mere nit-picking at best. I don't think so, and that brings me to my second set of concerns, namely, the ability of even quality journalism adequately to cover the intersection of technology with IP generally, and copyright more specifically. More people will likely have read the New York Times article than any piece this Kat has or will ever publish. If influence is the name of the game, the New York Times will likely win hands down. If so, here are some of my concerns:

1. Can any article of 20 some short paragaphs (whether or not the factual account is totally accurate) do justice to the question of the potential challenges to copyright posed by the use of a smartphone camera?

2. More than that, should quality journalism even try to tackle the topic in such a platform, whereby this 20-paragraph article moves from the photocopy machine to fair use and morality to the MP3 player to piracy in a reporting mode, eschewing conclusions and leaving the reader to reach her own result?

3. If the answers to (1) and (2) are negative, who, if anyone, fills that vacuum?

The Lionel, the Bezpečnostní softwarová asociace and the Wandering Court of Justice

Watch out, Court of Justice --
you can't appropriate jurisdiction
with impunity!

When the lion roars, do we not all sit up and pay attention?  How much so when it is more than a lion -- a Lionel, in fact -- and none other than Professor Lionel Bently, holder of the Herchel Smith chair in IP Law at the University of Cambridge, author, sage and lively commentator on a wide number of IP issues of which copyright is not the least significant.   Anyway, this member of laden ladenfam team was intrigued by some high-powered and carefully thought-out email correspondence which crossed his path.  Lionel was bouncing some thoughts around; the bouncees (named at the foot of this post) were not shy to respond -- and they were not all by any means sympathetic to the plea of this Common Lawyer with regard to the fate of copyright subject-matter in Europe.  Resisting the temptation to insert a plot-spoiler at this point, the Kat will let Lionel say his piece, in his very own words:

"The decision of the Third Chamber of the CJEU in Case C-393/09 Bezpečnostní softwarová asociace –Svaz softwarové ochrany v Ministerstvo kultury has attracted some criticism from laden ladenfam (per Jeremy, here) for the holding that copyright in a graphic user interface is not infringed by the broadcasting of an image of that interface (para. 57). The reasoning offered by the Court (via rapporteur Judge George Arestis, who largely followed the Opinion of Advocate General Bot) is that the essence of the graphic user interface lies in its interactivity, and interaction with the interface is not possible when the image of the computer screen is broadcast to the public. This is surprising because, having concluded that a graphic user interface is not a computer program one would have expected the infringement analysis to be as for any other work: that is, whether there had been communication to the public of a sufficient part of the work in question. Following Case C-5/08 Infopaq, that would have depended on whether the elements communicated were in themselves sufficient to constitute their author’s own intellectual creation. If they were, then the broadcaster would have communicated a “part” of the work and thus have infringed. The final analysis would be for the national court. Curiously, the ECJ had hinted at just such an analysis in relation to whether copyright would subsist in the interface (at [48]-[50]), but then failed to follow that reasoning when assessing infringement.

Nevertheless, from a British perspective, it is the first aspect of the decision that is most startling. This has two elements. First, uncontroversially (in my view), the CJEU holds that, as a matter of European law, a graphic user interface is not a computer program (at [42]) that must be protected under Directive 91/250 on the legal protection of computer programs. Second, and more startlingly, the Court indicated that the graphic user interface must be protected by copyright if it is original in the sense of being its authors own creation. The key paragraphs states:

“[44]...it is appropriate to ascertain whether the graphic user interface of a computer program can be protected by the ordinary law of copyright by virtue of Directive 2001/29.

[45] The Court has held that copyright within the meaning of Directive 2001/29 is liable to apply only in relation to subject matter which is original in the sense that it is its author's own intellectual creation...

[46] Consequently, the graphic user interface can, as a work, be protected by copyright if it is its author’s own intellectual creation.”

Although the language is not as clear as it might be, the CJEU seems to be saying that Directive 2001/29 requires that protection be afforded to any and every “intellectual creation”. In so doing, the CJEU has taken upon itself the task of identifying when a particular subject matter constitutes a work that is protected under the Information Society Directive 2001/29.

From a civil law perspective, this part of the judgment is rather unremarkable. Civil law jurisdictions typically offer copyright protection to all works falling within a broad category of "works of the mind" or something equivalent. Graphic user interfaces would clearly fall within those broad categories. However, some interesting questions might arise in relation to exotic subject matter such as perfumes, which some countries regard as works and others do not; and in any other circumstances where national laws purported to apply a more onerous standard of originality.

But for us in the UK (and Ireland), copyright protects a closed list of specified works. In the UK, the list comprises eight items: original literary, dramatic, musical and artistic works; films; sound recordings; broadcasts and typographical arrangements of published editions. In order to be protected a particular item of subject matter must fall within one of these boxes (as Jacob LJ has called them – Hyperion v Sawkins [2005] EWCA Civ 565, at [74]). Being a “work of the mind” is insufficient if the work claimed cannot be fitted within one of the boxes (Creation Records [1997] EMLR 444). In Nova v Mazooma [2007] EWCA Civ Jacob LJ explained that this was “an aspect of UK copyright law untouched by any EU harmonisation.”

Following Case C-393/09, it seems, the eight categories of work must now be interpreted to ensure compliance with European law (even though, for a good while, we are unlikely to know what the European conception of “work” comprises). There would, of course, probably be little problem with fitting some aspects of a graphic user interface within the concept of artistic works in section 4 – particularly “graphic works”: Navitaire v EasyJet [2006] RPC 111, 153 (para 98); Nova v Mazooma [2006] RPC 379 (para 100). But more difficult questions may well arise in relation to what counts as “work of artistic craftsmanship”, an “engraving”, a “dramatic work”, and a “sculpture” (cp. Lucasfilms v Ainsworth [2009] EWCA Civ 1328, and on appeal to the Supreme Court). Matters are made slightly more complicated in relation to the latter, as Professor Matthias Leistner has pointed out to me, by Article 17 of the Designs Directive 98/71 which contains a proviso to the effect that “the extent to which, and the conditions under which, such a protection [of registered designs by copyright] is conferred, including the level of originality required, shall be determined by each Member State.”

Moreover, one might wonder where the appropriation of jurisdiction over national copyright law by the European judicature will end. Is the recording requirement for literary, dramatic and musical works in section 3(2) of the UK's Copyright, Designs and Patents Act 1988 (CDPA) now to be done away with too? Can the UK courts refuse to offer protection to works they regard as immoral? Will the CJEU start laying down rules to identify where a work begins and ends? Is the division of songs into literary and musical works consistent with the European idea of the work? Is the question as to whether a title is a work in itself, or a part of a work to which it relates, now a matter for the CJEU to decide?

As a member of the Wittem Group of academics who formulated a draft European Copyright Code, in which harmonization of the work concept as well as originality are proposed, my objection to these developments is less substantive than procedural. Ultimately a European consensus on the concept of work and originality is in my view both inevitable and desirable.

But, at the political level, these matters were simply not agreed. (See e.g., on originality, Commission Staff Working Paper on the Review of the EC Legal Framework in the field of copyright SEC(2004)995, 14). Had an opportunity been offered to discuss the question, British interests would likely have objected. At a workshop held by SABIP in July 2009 (indeed, on the very day that Infopaq was decided) , many “stakeholders” indicated that they find a closed list easy to understand, and an open rubric to be dangerously vague, and worry that an open concept of work will generate unnecessary litigation and impose unnecessary costs on business.

Serious and careful consideration of what would be a suitable regime in the British cultural and legal context is important. Moreover, a political process would have offered an opportunity to consider transitional matters and, perhaps, whether changes in related areas of law might be desirable. Whether it be a consequence of jurisdictional ambition or a genuine attempt to make sense of the existing Directives in order to offer helpful assistance to the courts of Member states, the Court of Justice appears to be denying us these opportunities. Or am I reading too much into this?"

It is very much hoped that the Kat's copyright-focused readers will let us all know what they think. Please post your comments below!

Lionel thanks Dirk Visser, Thomas Dreier, Estelle Derclaye, Matthias Leistner, Annette Kur, Severine Dusollier and Antoon Quaedvlieg, with whom he has been discussing the case by e-mail.

What Counsel Would You Have Given: UMG Recordings v. Augusto?

When asked in polite company what this Kat does for a living, he tries his best to explain what IP is all about. Not infrequently, there is a retort at some point by the interlocutor about the exotic nature of IP practice. Contrast that with a discussion about contracts and contract law. Generally speaking, everyone has a rough idea about what a contract is all about--the parties agree and there is a written contract that sets this out, such that the parties more or less have a reasonable expectation what they can expect from each other. IP is esoteric, even inpenetrable, while contracts are part and parcel of our daily lives.

I have found that, in reality, the situation may sometimes be quite the opposite. People have an instinctive notion of what is protected by copyright, namely, you cannot copy the work of someone else with that person's permission. If you do so, or try to make some changes without altering the basic character of the underlying work, there is little uncertainty about what you are doing. You are simply prepared to take the risk of copyright infringement. On the contrary, contracts are often a lot more uncertain about what they allow or forbid. In part this is due to the indeterminacy of language, in part it is due to the absence of a clear legal position on multiple provisions of the contract. Both uncertainty and risk must be taken into account. The upshot is that, from the point of view of risk, persons may sometimes have a better sense of when they are taking the risk of copyright infringement than breach of contract.

I reflected on this while reading a virtually fresh-off-the-press copy of a judgment rendered by the (IP)-influential United States Circuit Court of Appeals for the Ninth District in the case of UMG Recordings, Inc. v Troy Augusto, No. 08-55998 (January 4, 2011) here. In brief, the Court describes the case as follows:

"UMG Recordings appeals the district court’s grant of summary judgment in favor of defendant Troy Augusto on UMG’s claim of copyright infringement in violation of § 501 of the Copyright Act, which entitles copyright owners to institute an action for infringement of the exclusive right to distribute copies of the copyrighted work. See 17 U.S.C.§§ 501(a), (b), 106(3) (2006). The copies in issue comprise eight specially-produced compact discs, each embodying a copyrighted sound recording. UMG, the copyright owner, used the discs solely for marketing purposes, sending them unsolicited to individuals such as music critics and radio disc jockeys. Although Augusto was not one of those individuals, he managed to obtained the discs from various sources. He later sold them at auction [via eBay.com--NJW], an act which UMG contends infringed its exclusive right to distribute the discs."

Augusto argued that the initial distribution of the promotional copies constituted a transfer of ownership in the discs; as a result, the first sales doctrine applies. This doctrine provides that a person who acquires ownership of a copy of a work is permitted to dispose of that copy as he sees fit without requiring the permission of the copyright owner. UMG (being Universal Music Group, described as being among the world's largest music companies, here ) countered with the argument that the distribution of promotional copies was a mere grant of of licence and, as such, the first sale doctrine did not apply in favour of Augusto. The Court of Appeals agreed with the ruling of the district court and affirmed the decision that a transfer of ownership of the discs had taken place.

What I want to focus on is the promotional statement that accompanied the discs in, more or less, the following language:

"This CD is the property of the record company and is licensed to the intended recipient for personal use only. Acceptance of this CD shall constitute an agreement to comply with the terms of the license. Resale or transfer of possession is not allowed and may be punishable under federal and state laws."

Some of the CDs bore a more succinct statement, such as “Promotional Use Only—Not for Sale.”

Put yourself in the position of counsel for a recording company and that you are presented either form of the promotional statement. You are asked: "Will one or both of these forms of promotional statement provide us with a reasonable basis to claim that a licence, and not a sale of the disc, has taken place?" Assume that you are not given a $50,000 budget to research the question and that you are requested to give your advice by the end of the day. Hand over heart, how many of you would advise that the more reasonable construction is that a licence has been created?

You recall the cases on shrink-wrap licences and the various decisions that have
held that a transaction to use mass-distributed software has been construed as a licence (even, as I recall, when language referring to "sale" may sometimes appear). You even reach out to offer a bit of policy by analogy: just as the courts are loathe to apply the copyright law in such a way as to competely overturn the manner in which mass-market software is commercialized, so too will they avoid overturning 'business as usual' in the musical disc business, battered as it is by the challenge of the digital world. Yes, you might consider some or all of these points--and you would, in the eyes of the Ninth Circuit, be wrong.

Consider the court's reasoning, as it noted as follows:

"Our conclusion that the recipients acquired ownership of the CDs is based largely on the nature of UMG’s distribution. First, the promotional CDs are dispatched to the recipients without any prior arrangement as to those particular copies. The CDs are not numbered, and no attempt is made to keep track of where particular copies are or what use is made of them. As explained in greater detail below, although UMG places written restrictions in the labels of the CDs, it has not established that the restrictions on the CDs create a license agreement."

Further on, the Court adds additional observations:

"There are additional reasons for concluding that UMG’s distribution of the CDs did not involve a consensual licensing operation. Some of the statements on the CDs and UMG’s purported method of securing agreement to licenses militate against a conclusion that any licenses were created. The sparest promotional statement, “Promotional Use Only—Not for Sale,” does not even purport to create a license. But even the more detailed statement is flawed in the manner in which it purports to secure agreement from the recipient.... It is one thing to say, as the statement does, that “acceptance” of the CD constitutes an agreement to a license and its restrictions,but it is quite another to maintain that “acceptance” may be assumed when the recipient makes no response at all. This record reflects no responses."

If that is not clear enough for the reader, consider that the district court granted the summary judgment motion on different grounds. As the Court of Appeal itself states:

"The district court based its decision in favor of Augusto in part on somewhat different grounds from those we have adopted. The district court first held that the licensing language in the detailed promotional statement did not create a license because it lacked any provision for UMG to regain possession of the CD", 

relying on a prior decision of the Ninth Circuit (United States v Wise, 550 F.2d. 1180 (9th Cir 1977). No problem here for the Court. Wise and its progeny apply to software users who pay for to acquire products; that is "a very different position from that held by the recipients of UMG's promotional CD's." Indeed, one wonders how the lower court did not see this "obvious" distinction (the Court also found that the recipients could freely distribute the discs under an indiosyncratic piece of U.S. legislation, the Unordered Merchandise Statute, but let's leave that discussion for legal salons in San Francisco and New York.)


When all of this is said and done, this Kat renews his question: how many of you lawyers out there, faced with a similar siutation and requested to give advice in real time, would have counselled your client in accordance with the decision of either of these courts? Copyright law, except perhaps at the margin of giving a view on issues of infringement when non-literal copying is involved, may be a more certain excercise than the challenge of applying contractual provisions of sale and licensing to the disposition of IP rights.

Atari vs. RapidShare: Higher Regional Court of Düsseldorf decides

Several German websites report (here, here, here) that Swiss file- and share-hosting service RapidShare has been victiorious in a copyright infringement lawsuit brought by video game maker Atari before the Higher Regional Court of Düsseldorf concerning illegal copies of the game "Alone in the Dark" which had been shared on RapidShare's site. Case reference: OLG Düsseldorf, I-20 U 59/10 of 21 December 2010). The appeal decision comes after the Regional Court of Düsseldorf had recently decided in Atari's favour. On appeal, the Higher Regional Court of Düsseldorf has now overturned this decision holding in RapidShare's favour.

What had happened? The claimant in the proceedings, Atari, had taken objection to the distribution of the game via the RapidShare site, and argued that the hosting service had a legal responsibility to block downloads. Ataria had, inter alia, demanded that the RapidShare had a duty to automatically retrieve, filter and delete all files which included certain keywords. RapidShare responded by, inter alia, arguing that this would be taking its duties too far and could lead to a deletion of perfectly legal files which just happened to include the respective keywords.

The Higher Regional court appears to have been swayed by RapidShare's arguments. While the court agreed that there was copyright infringement under Article 97 German Copyright Act, it nonetheless found that a giving RapidShare a duty to filter the content under "disturbance liability" principles ("Störerhaftung") would be “arbitrary” since a keyword was not compelling evidence that a file included infringing material. The court apparently also found that a manual check of potentially infringing files was too work intensive to be feasible.

The court allowed a further appeal since the question as to what duties a file sharing service had to fulfil in order not to be caught by "disturbance liability" had yet to be decided by the Bundesgerichtshof.

Helpfully, openjur.de has published the court's decision here. The decision certainly warrants some closer scrutiny and it will be interesting to see whether this matter will make its way to the Bundesgerichtshof.

Merpel wonders whether other Higher Regional Courts, such as the OLG Hamburg, may have decided this case differently but has, shall we say, an inkling that the Bundesgerichtshof would uphold the Higher Regional Court's decision if Atari decided to file a further appeal.

The BGH and the photographs of Prussian castles

laden ladenfam almost missed these three "copyright-related" cases, which were decided by 5th Civil senate of German Bundesgerichtshof, which is the senate that is, inter alia, responsible for property law.

On 17 December 2010, the 5th Civil senate of German Bundesgerichtshof decided in three cases brought by the Prussian Palaces and Gardens Foundation Berlin-Brandenburg ("Stiftung Preußische Schlösser und Gärten Berlin-Brandenburg", "SPSG") against third parties that had taken and/or distributed pictures of the SPSG's gardens and palaces without the foundation's permission. The Bundesgerichtshof held that public foundations, such as the SPSG, which curate palaces, gardens, etc., own the exploitation rights for photographs taken of these facilities from within the property boundaries as well as for photographs which have been taken of the facilities for commercial use and exploitation.

Please click here to retrieve the court's detailed press release which laden ladenfam has translated and summarised below.

The first case (case reference: V ZR 45/10 of 17 December 2010) dealt with a law suit the SPSG had brought against a photo agency. The SPSG had claimed that the photo agency had commercially exploited photos of the SPSG's parks and palaces without. The court of appeal, the Higher Regional Court of Brandenburg had dismissed the SPSG's claim and taken the view that taking photographs and making films of the parks and palaces did not infringe the SPSG foundation's property right since the SPSG had allowed free access to the parks and palaces. As such, the exploitation rights for the photographs and films rested with the actual copyright owners rather than the SPSG.

On appeal, the Bundesgerichtshof saw things differently and referred the case back to the court of appeal. In its decision the curt referred to two precedents of the Bundesgerichtshof's 1st Civil Senate, which is the senate responsible for copyright matters: "Schloss Tegel" (case reference: I ZR 99/73) and "Friesenhaus (case reference: I ZR 54/87). In these decisions the Bundesgerichtshof's 1st Civil Senate had legally differentiated between pictures had been taken from outside the property boundaries and those that had been taken from within the property boundaries. The latter ones can be prohibited by the property owner since it is he who can determine the use of the land. The 5th Senate applied these precedents and took that the view that despite the fact the SPSG's legal interests were different to those of a private owner of a real estate property, since the SPSG was a public foundation and so had to pursue the common good ("Gemeinwohl") as its main interest, the SPSG nonetheless had no (public) duty to allow third parties to use the parks and palaces for their commercial purposes. The Higher Regional Court now has two decide the case again applying these legal principles to the facts of the case.

A second case dealt with the SPSG's claim against a film producer who was distributing DVDs of films about the city of Potsdam (case reference: V UR 45/10 of 17 December 2010). Since the (real estate property) rights of SPSG were obvious in this case, with the films having clearly been made from within the property of the SPSG, the Bundesgerichtshof was able to decide the case in favour of the SPSG without having to refer it back to the Higher Regional Court.

As regards to the SPSG's third lawsuit (case reference: V ZR 44/10 of 17 December 2010), a claim against an Internet platform which allowed the exploitation of third party photographs by photographers and photo agencies on its virtual forum, the Bundesgerichtshof referred to its recent precedent concerning Wireless Lan networks in the "Sommer unseres Lebens" (case reference: I ZR 121/08) and held that the claimant only had a duty of care in those cases where there was an obvious infringement of third party rights. Hence, an Internet portal which publishes photos was free from liability unless it has positive knowledge of the infringement. The mere fact that someone had shared the photos on the forum was not enough to constitute knowledge since it was impossible for the forum owners to determine whether the photos had been taken with permission and/or from within our outside the property boundaries.

Merpel summarises these three cases as follows: the decisions clarify that public proprietors of real estate property enjoy the same rights as private property owners: while neither can prevent that photos are being taken from outside the property boundaries, public and private owners alike nonetheless have identical rights to control photography which takes place within the property's boundaries.

The SPSG's website (picture top left) can be found here - it does include some very beautiful photographs of the respective parks and gardens.

Interface, in-yer-face: Court of Justice rules on Czech GUIs

Here's a little copyright case which, laden ladenfam thinks, may just be wrongly decided. The Court of Justice of the European Union has just delivered its ruling in Case C‑393/09, Bezpečnostní softwarová asociace – Svaz softwarové ochrany v Ministerstvo kultury, a reference for a preliminary ruling from a Czech Court, the Nejvyšší správní soud.

In April 2001 the BSA applied to the Ministry of Culture for authorisation for the collective administration of copyright in computer programs, under Paragraph 98 of the Czech Copyright Law, its objective being to secure the right to the collective administration of graphic user interfaces (GUIs -- the bits that computer users see on the screen, like icons which they can click on when navigating a program). After nearly four years of ding-dong battle in the courts and before the Ministry itself, the Ministry rejected the BSA application yet again on two grounds: (i) the Copyright Law protected only the object code and the source code of a computer program, but not the result of the display of the program on the computer screen, since the graphic user interface was protected only against unfair competition; (ii) the collective administration of computer programs was possible in theory, but since voluntary collective administration served no purpose, mandatory collective administration was not an option in reality.  A further appeal ended up with the following questions being referred to the Court of Justice for a preliminary ruling:

‘1. Should Article 1(2) of [Directive 91/250: the Software Directive, now codified here as Directive 2009/24] be interpreted as meaning that, for the purposes of the copyright protection of a computer program as a work under that directive, the phrase ‘the expression in any form of a computer program’ also includes the graphic user interface of the computer programme or part thereof?

2. If the answer to the first question is in the affirmative, does television broadcasting, whereby the public is enabled to have sensory perception of the graphic user interface of a computer program or part thereof, albeit without the possibility of actively exercising control over that program, constitute making a work or part thereof available to the public within the meaning of Article 3(1) of [Directive 2001/29]?’

The first thing the Court had to do was to decide whether it even had jurisdiction to make a ruling, since the dispute arose before the date of accession of the Czech Republic to the European Union. Yes, said the Court: while the original dispute pre-dated accession, subsequent decisions arising from it took place after accession and, in any event, since the effect of the appealed-against decision was prospective, not retrospective, it was governed by EU law and the Court could therefore take jurisdiction.

"Being able to see the mouse is all very nice", said Katrina to her kittens,
"though they're not much use if you can see them but not click them"

The Court then ruled as follows:

1. A graphic user interface is not a form of expression of a computer program within the meaning of Article 1(2) of Council Directive 91/250 ... and cannot be protected by copyright as a computer program under that directive. Nevertheless, such an interface can be protected by copyright as a work by Directive 2001/29 ... on the harmonisation of certain aspects of copyright and related rights in the information society if that interface is its author’s own intellectual creation.

2. Television broadcasting of a graphic user interface does not constitute communication to the public of a work protected by copyright within the meaning of Article 3(1) of Directive 2001/29.

The reason for the Court's second holding is simple.

"55 ... in principle, television broadcasting of a work is a communication to the public which its author has the exclusive right to authorise or prohibit.

56 In addition, ... the graphic user interface can be its author’s own intellectual creation.

57 Nevertheless, if, in the context of television broadcasting of a programme, a graphic user interface is displayed, television viewers receive a communication of that graphic user interface solely in a passive manner, without the possibility of intervening. They cannot use the feature of that interface which consists in enabling interaction between the computer program and the user. Having regard to the fact that, by television broadcasting, the graphic user interface is not communicated to the public in such a way that individuals can have access to the essential element characterising the interface, that is to say, interaction with the user, there is no communication to the public of the graphic user interface within the meaning of Article 3(1) of Directive 2001/29."

With respect, this member of laden ladenfam team thinks the Court is wrong because it is asking itself an irrelevant question. The Court is assuming that the issue is one of functionality -- can the viewer interact with the GUI -- and that, if the answer is "no", there has been no communication of it.  In the Kat's opinion the question is whether a copyright-protected work is being communicated (and in principle the Court says yes, it is), followed by the question whether the communication is of all or of a sufficiently substantial part of the work to constitute infringement -- and this is a question for the referring court to determine on the facts, applying its own judgment.  A GUI might have very little graphic content but a good deal of interface, or vice versa.

laden ladenfam thanks fellow IP blogger and enthusiast Martin Husovec (who got there first) for drawing this decision to his attention.

"Read all about it!" Court rules web is permanent, newspapers are ephemeral

Daily Mirror: from today's
fresh news ...

Here's a case which might have just been about the effect of an implied, unwritten and ephemeral contract, but it is also about the permanence of an internet presence.  In October 2009, in the Chancery Division, England and Wales, Lord Justice Patten dropped down from his natural habitat in the Court of Appeal to hear (i) Alan Grisbrook v MGN Ltd, Scottish Daily Record & Sunday Mail Ltd and Syndication International Ltd; (ii) Alan Grisbrook v MGN Ltd and Syndication International Ltd [2009] EWHC 2520 (Ch), noted by laden ladenfam here. This was an application by Grisbrook, a freelance photographer, to commit newspaper publisher MGN, publishers of the Daily Mirror, for contempt of court following the alleged breach of an undertaking contained in a consent order, with an alternative claim for sequestration of MGN's assets.

Grisbrook had provided photographs for MGN for a number of years, without a written contract, being paid when his photographs were used. MGN archived the photographs it used; any subsequent use by MGN entitled the photographer to a further fee. It was conceded that Grisbrook licensed MGN to use his photos in this way while retaining copyright in them, though there was some dispute as to how far this licence extended. In particular, did it extend to the use of Grisbrook's works on MGN's websites?

... to tomorrow's
fish and chip wrapper

Following a dispute over unpaid licence fees, a consent order was made which (i) terminated the licence, (ii) entitled Grisbrook to the return of materials held by MGN and in which he retained the copyright and (iii) contained an undertaking by MGN not to infringe Grisbrook's copyright. Grisbrook conducted an agreed search of MGN's archive to locate his material and, at its conclusion, served a further copy of the consent order on MGN. Subsequently Grisbrook carried out random searches of MGN's websites, including such staples as mirrorpix.com and mydailymirror.com, and discovered that a large number of his photographs were still being used. Although MGN removed his photographs from some of its websites, it refused to compromise in respect of images contained on websites which offered complete back issues of its publications.

Grisbrook was not best pleased with this and went to court, arguing that any reproduction of already-published material constituted an infringement of his copyright and was therefore a breach of the undertaking. No, said MGN: the consent order was not intended to cover the reproduction of photographs which were contained in already-published newspapers and should be construed accordingly. MGN further argued that, even if the undertaking was unlimited and included such infringements, no infringement had taken place or could take place as the licence granted by Grisbrook had to be treated as extending to the subsequent reproduction or use of published material. Patten LJ concluded that MGN had infringed Grisbrook's rights but refused the application to commit MGN for contempt. In his view

* The real issue between the parties was whether the operation of the back issues websites amounted to an infringement of Grisbrook's copyright in the photographs contained in those issues: did MGN's licence impliedly extend to the storage of and access to Grisbrook's photos as they appeared in the back issues?

* Since such an implied licence derogated from or relaxed the copyright owner's statutory rights, it was for MGN to justify the basis for extending the licence to cover what would otherwise be separate acts of infringement.

* The compilation of a database and its use for archival purposes might be so justified, but the exploitation of Grisbrook's photos through the back issues websites seemed to be a different kind of operation, one that was not contemplated at the time the licence was granted and could not be said to have been necessary to regulate the rights of the parties at that time. MGN's operation of the back issues websites accordingly infringed Grisbrook's copyright.

* MGN was entitled to take a different view on this difficult question, and disputes of this sort should not be resolved through committal proceedings. The dangers inherent in generally worded injunctions or undertakings not to infringe a patent or copyright had long been recognised and could often lead to a further round of litigation in order to determine whether an infringement had occurred. Nor was the infringement point which Grisbrook was arguing a point that featured in the actions which led to the consent order. A party who argues in good faith that his conduct did not amount to an infringement should not ordinarily be penalised by a fine or sequestration in the event of failure merely because an applicant had chosen to use committal proceedings rather than an ordinary claim to resolve the issue.

* Although the operation of the back numbers websites did infringe Grisbrook's copyright in his photographs, those rights could be adequately protected by a declaration to that effect.

MGN appealed and, today, the Court of Appeal (The Chancellor himself -- Sir Andrew Morritt, Lord Justice Leveson and Lord Justice Etherton) [2010] EWCA Civ 1399, dismissed the company's appeal. Delivering a judgment with which his colleagues agreed, the Chancellor held as follows:

"... it is common ground that there was a separate contract between Mr Grisbrook and MGN in relation to the reproduction of each photograph produced by the former and submitted to the latter for publication in its newspapers. The contract was formed by conduct, no terms were reduced to writing nor is there any evidence that there was any express oral agreement in relation to any of them. It follows that the broad principle to be applied is that ..."...the engagement for reward of a person to produce material of a nature which is capable of being the subject of copyright implies a permission or consent or licence in the person giving the engagement to use the material in the manner and for the purpose in which and for which it was contemplated between the parties that it would be used at the time of the engagement." 

...  the application of this principle gave rise to a licence to reproduce the photograph in the Daily Mirror and to add the photograph, both separately and as part of the published newspaper, to the MGN archive and picture store. A second or subsequent use might be made of the photograph but on terms that MGN paid Mr Grisbrook a further fee. ... It is accepted ... that the licence extended to reproducing the photograph and newspaper in a microfiche and, later, in an electronic form as part of the MGN archive. It is not suggested that Mr Grisbrook was not entitled to revoke the licences ... All his photographs have now been removed from MGN's archive. But such revocation extended only to future use. It could not retrospectively constitute the previous publications of Mr Grisbrook's photographs in the Daily Mirror as infringements. All those publications remain in the MGN archive and copyright in them is vested in MGN.

There are many reported cases in which the issue arose as to whether a written licence extended to subsequent forms of technology. That has depended on the form of words used and has not, for the most part, been limited to the technology which the parties contemplated at the time they entered into the relevant licence. ... In those cases the modern jurisprudence on the interpretation of written agreements ... may need to be re-examined. But this appeal does not concern a written contract. The implication is not to be made into a written contract from the words used in their context but into a contract by conduct "from the manner and for the purpose in which and for which it was contemplated between the parties that it would be used at the time" the contract was made. 

... In relation to the application of that principle the area of disagreement is limited. In paragraph 65 of his judgment Patten LJ recognised that the application the correct principle gave rise to a licence to copy Mr Grisbrook's photographs and any other infringing act in relation to the compilation of the MGN database and its use for archive purposes. The dispute relates to the commercial exploitation of that database by means of the three websites to which I have referred.
...

The internet: an early screen shot
shows the medium's permanence 

For my part I would agree that the operation of the website can be regarded as further delivery of the original, but not that it can only be so regarded. A website operates over a global area, its coverage is greatly in excess of anything MGN could have reached with hard copy newspapers. It enables a member of the public to read it before deciding whether he wants a hard copy and the production of hard copies by the public far in excess of anything MGN could have produced. The extent of the market and the costs incurred in reaching it are quite different to those of the hard copy newspapers of the past. There is no need to emphasise the differences further. The suggestion that an intention may be imputed to Mr Grisbrook and MGN from their conduct in relation to Mr Grisbrook's photographs in the period 1981 to 1997 that MGN should be entitled without further charge to exploit the copyright of Mr Grisbrook in his photographs by inclusion on their websites is, to my mind, unacceptable. Newspapers are essentially ephemeral and, save for the enthusiastic collector, retain no long lasting status: the parties will have intended that they would be treated as daily papers are generally treated, that is to say, read and replaced with the following day's edition. To incorporate the pictures into the website is to provide a permanent and marketable record easily available world-wide which could well reduce the value of the further use by Mr Grisbrook of the photographs over which it is common ground he possesses the copyright. That is why, to my mind, this is not just a question of degree but of kind ...".

laden ladenfam says, one can hardly imagine a clearer statement: what we term "hard copy" is actually ephemeral, the creature of a moment, almost instantly irrelevant, while the presence of a work on a server from which it can be accessed by the internet is a sign of its permanence.  The implications of this decision may take a little while to appreciate, but laden ladenfam will be surprised if these dicta are not cited with increasing frequency in all manner of disputes as to not just the interpretation of licences but the nature of damage for wrongful use and the calculation of quantum.

Tip of the iceberg: media monitoring and copyight licences

Media monitor cuts no ice with Kats ...

Do you know where your web end is?  If not, be warned -- you may need a licence for it.  In Newspaper Licensing Agency Ltd and others v Meltwater Holding BV and other companies [2010] EWHC 3099 (Ch), Mrs Justice Proudman (Chancery Division, England and Wales) last week gave a keenly-awaited ruling to the effect that the use of a media monitoring service which provided customers with copies of headlines and extracts from articles on newspaper websites infringed the copyright in those newspapers if the customer didn't have a "web end-user licence" to use and receive those headlines and extracts from that media monitoring service.

In this action the claimants (a number of newspaper publishers and the NLA, a company that managed some of their intellectual property rights) sought a declaration that the defendants (the Meltwater media monitoring service and the Public Relations Consultants Association Limited -- PRCA --a professional association representing public relations providers) each needed a copyright licence in order lawfully to produce and/or use copies of the claimants' newspaper content.   The media monitoring service consisted of the supply of reports which included the headline, opening text and an extract from articles which matched search terms selected by the customer. Whether these reports were sent by email to the PRCA or downloaded from Meltwater's website, they inevitably ended up being copied into the memory of PRCA's computer.

In these proceedings the judge was asked to rule on the following issues:

(i) is a newspaper headline capable of being a free-standing original literary work?

(ii) is the text extract constituted a "substantial part" of the article as a literary work?

(iii) do the PRCA and its members need a web end-user licence from the NLA or its members in order to lawfully use and receive Meltwater's service?

Mrs Justice Proudman first identified the relevant principle of law, this being the test laid out by the Court of Justice of the European Union in Case C-5/08 Infopaq International A/S v Danske Dagblades Forening: no distinction should be be made between part of an article and the whole, provided that the part contained elements which were the expression of the author's intellectual creation. The Information Society Directive (2001/29), which governed the extraction of works, did not itself make reference to the need for the extraction to be of a "substantial part" of the copied work.  Rather, the Directive (as Infopaq explained) made it clear that originality -- not substantiality  -- was the test to be applied to the part extracted.  On this basis the judge attacked the questions before them and answered them as follows:

(i) On evidence from the newspaper publishers that the creation of headlines involved considerable skill, some headlines were indeed capable of being independent literary works. However, even those that were not independent legal works still formed part of the articles to which they related.

(ii) As to whether the text extracts constituted a substantial part of the articles, what is decisive is the quality of the extracted part and the level of the author's skill and labour which the copier has appropriated, not the amount extracted. In Infopaq the Court of Justice found that copying an extract of 11 consecutive words from an article would be partial reproduction in part for the purposes of Article 2 of the InfoSoc Directive -- so long as those words had the necessary quality of originality. This does not require the court to conduct some sort of assessment of whether the extract is novel or artistically worthwhile on its own, since that would be treating the extract as if it was itself a literary work. In these proceedings, many of the text extracts did contain elements that could be said to be the expression of the intellectual creation of the author of the article as a whole, and which thus infringed.

(ii) Since customers of the media monitoring service made copies of the headline and text extract when viewing or accessing Meltwater's report, there was a prima facie copyright infringement. There were no fair dealing or other defences either, since the sole reason why the extracts were copied was to see if the news items were of any further use or not. 

laden ladenfam says, this ruling is an inevitable consequence of the fact that copyright infringement is broken down into so many restricted acts which can constitute infringement even if they closely follow the performance of a permitted act by a licensed person -- but that is in the nature of the right itself.  And while he can see that customers may feel peeved that they need a licence even to have their own copy of extracts which are made under licence themselves and which they've paid for, he can also see why newspaper proprietors are desperate to turn opportunities such as this into a sort of 'last chance saloon' for coaxing a little more income out of a news provision service that is increasingly harder to finance and run profitably.  Merpel says, I bet within a few years the availability of increasingly improved search engines and better techniques for harnessing them will lead many current customers of media monitoring services to do their owb self-monitoring.
Neat analysis on the 1709 Blog here
Press Gazette report here
Appeal to Court of Appeal under consideration here
How cats drink water here