Military Grade News - CJEU Advocate General Opines on Copyright and the Freedom of Expression

IP and freedom of speech have always had a difficult relationship. What could be freer that the ability to use any works you have seen, and share them with a wider potentially different audience, while IP seeks to protect the interests of the original author, even sometimes at the expense of the rightsholders. These issues often come to blows in the courts, and a recent case in the CJEU has brought this conversation back to the forefront. Can you protect works using copyright, even with strong issues of freedom of speech underpinning the sharing of those documents? We found out the precursor to the European answer to this question late last October.

The case of Funke Medien NRW GmbH v Federal Republic of Germany concerned military status reports drawn up for the German government on a weekly basis, which detail developments of deployed forces abroad. These reports are subsequently sent to e.g. various members of the Federal Parliament and the Ministry of Defense for briefing purposes. The documents are classed as classified and restricted. Funke Media published summaries of some of these reports, having acquired copies of them through potentially illicit means as an application to access them was rejected by the German government. They were subsequently taken to court for copyright infringement, with the matter ultimately ending with Advocate General Szpunar.

The balancing act between ensuring freedom of expression, but still protecting copyright owners' rights, is a difficult one, since the interests are often very much in competition with each other. The Court was tasked in balancing this difficult dichotomy.

Copyright through numerous exceptions allows for some freedoms when it comes to using copyright materials, including for critique, satire and review. However, the exceptions are by no means very broad (like in the US under fair use), and could be used to curtail genuine public discourse and commentary.

The Charter of Fundamental Rights of the European Union sets out the various rights enjoyed within the Union, and Article 51 asserts those rights onto any EU legislation implemented by Member States. In this case, Article 11 is in contention, which gives everyone the right of freedom of expression.

Other methods might've worked better to keep matters 'secret'

The main question that the Advocate General sought to answer is whether the grounds asserted by the German government are good enough to trump the Claimant's right to freedom of expression. The Advocate General did, however, note that as the copyright holder in this case is a Member State, it does not enjoy the same rights as the people living in that Member State. He distinguished the matter in that "...the State cannot rely on the fundamental right to property as a means of restricting another fundamental right guaranteed by the ECHR or the Charter", even though the State might have a remedy under civil rights.

The Advocate General summarized the position as "...If the State were able to invoke its individual rights, other than the public interest, in order to limit fundamental rights, the result would be the destruction of those fundamental rights". The State would have to put forward an argument under public interest to protect the works in question in order to limit the fundamental rights guaranteed in the Charter. In his view, the State fails under the public interest argument.

He then turned to the matter of copyright protection offered for the military reports. Copyright at its core aims to achieve two objectives: (i) to protect the personal relationship between the author and his work as his intellectual creation; and (ii) to enable authors to exploit their works economically.

While Germany does own the copyright in the military reports, the country itself cannot be construed as the author of those works. Even though they were drafted by State employees, strictly speaking the works themselves do not have an author at all. The Advocate General saw that, as copyright endeavors to protect the relationship between the author and the works created, the State's interests cannot be protected in works it isn't the author of. As he put succinctly: "...where there is no author, there is no copyright, in the form of either moral or property rights".

Similarly, as the State does not seek to profit from the works themselves economically, but to protect the contents from public scrutiny, the Advocate General deemed the matter outside of the remit of copyright.

In short, "...the answer should be that Article 11 of the Charter, read in conjunction with Article 52(1) thereof, must be interpreted as precluding a Member State from invoking copyright under Article 2(a) and Article 3(1) of [the] Directive in order to prevent the communication to the public, in the context of a debate concerning matters of public interest, of confidential documents emanating from that Member State. That interpretation does not prevent the Member State from applying, in compliance with EU law, other provisions of its domestic law, including those relating to the protection of confidential information".

The Advocate General clearly sought to protect the interests of those seeking to share and disseminate information, while the State attempted to curtail those efforts through incorrect means. Copyright clearly was not the appropriate vehicle to protect the legitimate interests in keeping military documents secret, and the State therefore could pursue it through other avenues. In the end, it remains to be seen what the CJEU rules in this case.

An Opinion on Whisky - AG Øe Sets Boundries for Geographical Indicators and their Infringement

Having looked at the legal intricacies of using protected Geographical Indications in a recent case regarding Champagne, this writer has grown to appreciate the complexities of PDOs and the law surrounding them. What amounts to an infringement of GIs rights is very tricky, and any clarification from higher courts is always appreciated. Scotch whisky is one GI that is vehemently defended, and many third-parties would want to benefit from the image that the GI imparts, but to avoid the 'pesky' issues of actually conforming to the classification. In terms of a name for a whisky produced outside of Scotland, what amounts to an infringement of a GI? Ahead of a CJEU decision, Advocate General Øe gave their opinion of this question.

The case of The Scotch Whisky Association v Michael Klotz dealt with the production and sale of a whisky called "Glen Buchenbach" in Germany by Mr Klotz. The SWA objected to the sale of the whisky using the term 'Glen', which, in their view, referred to a geographical location in Scotland and implies the product is a Scotch whisky.  The use could potentially therefore infringe on the Geographical Indications Regulation, which protects Scotch whisky as a GI.

The German courts referred three questions to the CJEU on the matter, which were considered by the Advocate General.

The first question, in essence, asked "…what is meant by ‘indirect commercial use [of a] registered geographical indication’ for a spirit drink, within the meaning of Article 16(a) of Regulation No 110/2008".

The first part of the first question then focusses on whether "… in order to establish the existence of such use, prohibited by Article 16(a), it is necessary that the disputed indication be used in identical or phonetically and/or visually similar form to the protected geographical indication, or whether it is sufficient that the disputed indication evokes in the relevant public some kind of association with the indication or the geographical area relating thereto". In brief, this is whether the indication has to be phonetically or visually identical to the GI, or if the public associate the term with the GI without similarity (i.e. 'Glen' would be associated with Scotland, and therefore Scotch whisky).

The Advocate General determined that, under Article 16(a), the expression of 'direct or indirect commercial use' requires that "…the use is made of the disputed indication in the form in which it was registered or at least in a form with such close links to it that the sign at issue is manifestly inseparable from it". This means that the use would have to be in an identical or phonetically and/or visually similar form, and not just associated with the GI.

The Court has firmly established that 'direct' use would amount to the use of the GI, or a corresponding term or translation, in conjunction with goods that don't meet the specification. However, the Advocate General had to consider what amounts to 'indirect' use of a GI. In his view, this requires use where "…the indication… feature[s] in supplementary marketing or information sources, such as an advertisement for that product or documents relating to it". Additionally, broadening the provision would make following provisions, such as Article 16(b), redundant, and has to therefore be kept narrower, and won't cover cases of mere association by the public. This interpretation supports the interpretation of the objectives of the Regulation and the Article, which clearly seek to protect GIs from misuse, and to ensure quality of the goods.

The AG probably needed a drink after the case

In terms of the second part of the first question (additional information in relation to an 'association' with a GI in the minds of the public), the Advocate General swiftly concluded that the Court would not have to rule on the point, in the light of the above, but he did make brief observations on the same. In his view there is no ambiguity under the provision on what amounts to infringement, which differs from Article 16(b) that is not at issue in the matter. The Advocate General added that, in considering any "misuse, imitation or evocation" under Article 16(b), a court could take into account the context where the disputed indicator is used, and the same would apply if the Court would consider 'association' as a possibility under Article 16(a).

The second question, split into two parts as well, asks clarification on "…the concept of ‘evocation’ of a registered geographical indication relating to a spirit drink, within the meaning of Article 16(b)".

As with the first question, the first part of the second question asks whether, in determining the existence of 'evocation' "…the disputed designation must be in an identical or phonetically and/or visually similar form to the protected geographical indication, or whether it is sufficient that the designation evokes in the relevant public some kind of association with that indication or the geographical area relating to it".

Having considered relevant case law, the Advocate General concluded that for the purposes of identifying an ‘evocation’ "…the only determining criterion is whether, ‘when the consumer is confronted with the name of the product, the image triggered in his mind is that of the product whose designation is protected’, which the national court must verify by taking into account, as appropriate, the partial incorporation of a protected name in the disputed designation, a phonetic and visual relationship, or a conceptual proximity". He also outright rejected the concept of evocation in relation to a mere association with the GI in the might of the relevant public.

As above, the second part deals with the existence of 'evocation' and whether it has to be determined looking at the use in isolation, or whether the context of the use can be taken into account. Having briefly discussed the matter, the Advocate General concluded that "…for the purposes of establishing the existence of an ‘evocation’… it is not necessary to take account of additional information found alongside the sign at issue in the description, presentation or labelling of the product concerned, in particular with regard to its true origin". That is because this information is largely irrelevant in the assessment, and that 'evocation' can exist even in the absence of confusion in the relevant public.

Finally the Advocate General considered the third question, which asked, in essence, "…whether, for the purposes of determining whether there is ‘any false or misleading indication… liable to convey a false impression as to its origin’, within the meaning of Article 16(c)… it is necessary to take account of the context in which the disputed element is used, in particular where the disputed element is accompanied by an indication of the true origin of the product". The question concerns the use of the name 'Glen', whether its use is false or misleading, and if its use in context can be taken into account (i.e. the use of a German location, Buchenbach, after the name).

Having considered all parties' arguments extensively, the Advocate General determined that "…for the purposes of establishing the existence of a ‘false or misleading indication’ prohibited by [Article 16(c)], it is not necessary to take account of additional information found alongside the sign at issue in the description, presentation or labelling of the product concerned, in particular with regard to its true origin". He also noted that, in the current case, the use of the name 'Glen' does not have a sufficiently clear and direct link with the protected geographical indication, or with its origin country, in order for it to be a 'false or misleading' indication.

The Advocate General's opinion is very important, particularly in the light of GIs and the assessment of their protection and remit thereof. It clearly narrows down the use of any disputed indication in isolation, avoiding any other contextual indicators as to origin or otherwise; however, the CJEU's ultimate decision will set the scene in a more concrete fashion later in the year. This writer expects them to follow the opinion, but that is by no means a certainty.

Coffee Shop Conundrum - ECJ Set to Decide on Free WiFi and Third Party Liability

In a time when the internet is nearly always with us, be it in a smartphone, a laptop or other smart devices, you often taken things for granted such as free WiFi. For many travelers it has saved their behinds from being lost, out of money, or in some unfortunate cases, even potential harm, and many of us in bigger cities like London can easily overlook the need for WiFi. But, as Uncle Ben framed it so eloquently: with great power (i.e. Internet connectivity) comes great responsibility. People can be inconsiderate, and at times outright indifferent, to potential liability issues in using other peoples' or organizations' free WiFi, which begs the question: can a third-party be liable for possible infringement on their wireless network?

The answer to the question possible lies in the forthcoming decision of McFadden, faced by the European Court of Justice later this year (this writer hopes). The case, refereed to the ECJ from the Regional Court of Munich (decision in German can be found here), concerned a store owner, Toby McFadden, in Germany who's store specialized in light and acoustic engineering services. To further promote the store and its offerings the owner allowed potential customers to freely access a WiFi connection, with no password protection included. An unknown user used this free network to upload and share an infringing song on an online file-sharing platform, and Mr. McFadden was subsequently sued by Sony Music who argued he is liable for the infringement (among other things) that occurred on his unprotected network.

The case does bring forth several questions concerning Article 12 of Directive 2000/31/EC, more commonly known as the E-Commerce Directive. Although each of the questions merits an assessment in their own right, for the sake of brevity this writer shall endeavor to answer the question above, at least in the light of Article 12.

Wifi can cause some degree of envy

What Article 12 seeks to protect are service providers, or in other words 'mere conduits', who provide a service such as free WiFi, should they remain largely hands-off of the provision of that network (i.e. don't cherry-pick the users accessing the network, don't initiate the transmission of information or alter what is received in some way). This, however, cannot be a service for which the provider is remunerated, per Recital 18 of the Directive, and aims to facilitate the better sharing and access of information within the European Community.

This writer will freely admit his lack of knowledge in German law, but proposes to give a perspective from the UK side of things. Pinsent Masons in their Out-Law blog have set out that, per German law, individuals have to secure their internet connections through reasonable means, such as a password, to avoid liability should a third-party use their connection for nefarious purposes; however, this standard does not extend to commercial entities, which the case aims to settle.

Under the Copyright, Designs and Patents Act 1988 the High Court has the capability to issue an injunction against a service provider, provided that the "...service provider has actual knowledge of another person using their service to infringe copyright". What this has been interpreted in Twentieth Century Fox Film Corp & Ors v British Telecommunications Plc to encompass is true knowledge of one or more infringers using the provided network to do so, and the more detail of knowledge or facts given to the service provider (notices etc.) the less protection the provision offers to them. One could argue that a lack of password protection would not in itself give rise to an actual knowledge of possible infringement, as users, even if filtered through via password protection, could still abuse the network without the knowledge of its provider.

Whether Mr. McFadden was brazenly aware of the infringing acts being committed on his network is unknown to this writer, and he awaits the decision of the ECJ with some interest. Voices have been raised in the protection of open networks and access thereto by entities such as the Electronic Frontier Foundation, and one must agree with them to a certain extent. The 'locking down' of networks does provide a more cumbersome regime through which information and the Internet can be accessed, but one still does have to keep in mind the protection of legitimate rights within that space. What the ECJ decides will undoubtedly have ramifications on our WiFi networks, but one can imagine they'll only remain a login away.

Source: JDSupra

Domain Registrar Faces Infringement Liability in Germany

Internet Service Providers have, for a long time, been the favorite target of copyright holders simply because they are often the conduit between the infringer and the material which is being illegally copied, although their liability as secondary infringers has been rejected since. The Internet provides a web of connectivity between a multitude of actors, such as ISPs, computer manufacturers and others, who in some ways, do enable the infringement of copyright, albeit not as their primary function. As with the former Betamax recorders, the simple function of potentially enabling infringement does not incur liability, arguably at least in most instances, however a new challenge was set against web domain registrars in Germany.

In a recent decision (which can be found here, unfortunately only in German), the German Regional Court of Saarbrücken had to decide on the liability of domain registrars, and whether they could be held liable as secondary infringers should the domain owners facilitate the aforementioned infringement. The case concerned the website h33t.com, which acts as a torrent tracker site, much like the more notorious Pirate Bay. The copyright holders of Robin Thicke's song "Blurred Lines", Universal Music, took on the domain registrar Key-Systems, who registered h33t's domain.

Ed was confused about domains

In their decision the Court saw that domain registrars could face liability if the domains they have registered facilitate the infringement of copyright. If they are notified of the potential infringement of copyright, and choose to do nothing about the infringements, they could face liability. The Court imposed a duty to investigate onto domain registrars; a duty which can be argued to be quite onerous, especially for bigger registrars which manage vast numbers of domains. Key-System's general council, Volker Greimann, commented on the decision: "The courts’ definition of what is obviously violating is however extremely broad and the duty to act is expanded to deactivation of the entire domain even if only one file or link is infringing... If left unchallenged, this decision would constitute an undue expansion of the legal obligations of each registrar based in Germany, endangering the entire business model of registering domain names or performing DNS addressing for third parties". One can agree with Mr. Greimann as to the onerous nature of the new duty imposed on registrars, especially when considering the vagueness of the duty and the potential numbers of websites which might infringe copyright in one way or another.

The Court did mention that the infringements in relation to h33t were "...obvious and easy to identify", potentially presenting registrars with protection in cases where infringements are not obvious or are a result of negligence or ignorance. The Court in this instance ordered Key-Systems to prevent the infringement; however what those measures are remains unclear to this writer. Even though the domain is shut down by Key-Systems, its transition to another service outside of Germany can be said to be quick and painless - making the duty to investigate and take action both onerous, and arguably frivolous, as infringers will merely change service providers if their activities can be said to be illegal. Through this Mr. Greimann's argument of it hurting German domain registrars could be said to carry some merit.

Secondary liability has been a hot question since peer-to-peer services have made infringement much easier, and websites which provide users with, for example, torrent links, have become abundant. Whether liability should be extended to all middle actors can be argued to be potentially damaging to the Internet and its function. This writer does not have much insight into German law specifically, and people who might want to hear Universal Music's general council, Mirko Brüß's, arguments can refer to his opinion post here (again in German only).

Source: Bloomberg

Streams of Infringers - Germans Face Infringement Allegations over Adult Material

People's Internet browsing habits can be incredibly personal, especially when it relates to certain materials of an adult nature. As such pornographic materials have been used to coerce people into paying for alleged cases of copyright infringement, mostly because of the potentially embarrassing effect a publicly accessible litigation process would have on those individuals. Recent instances have been noted in Australia and more prominently in the US by Prenda Law (something which will be discussed on this blog very soon in more depth). Although seemingly a much rarer vehicle for short-term profits for some entities, recent times have shown an increase in behavior deemed as "copyright trolling"; much akin to patent trolling discussed on this blog prior.

The Germans are the current recipient of such claims, with thousands of Germans being targeted as alleged copyright infringers after visiting the streaming website RedTube (no affiliation with the more known YouTube I'm sure). With numbers having been reported as high as 30,000 Germans as recipients of these letters, the potential value sought by the firm U+C would be over 7,5 million euros.

As such web streaming has been deemed to not infringe copyright in many jurisdictions due to no copy being created in the process of streaming; however U+C argue that "...watching videos on sites such as Redtube can qualify as a proliferation of copyrighted material as a small copy of the file is created in the memory of the viewer’s computer", thus making a copy of the work and potentially infringing copyright. Commenting on behalf of RedTube Alex Taylor, their Vice-President. stated that "RedTube stands by its firm opinion that these letters are completely unfounded and that they violate the rights of those who received it in a very serious manner".

Many are unsure of how to pay the pizza delivery man, if some videos are any indication

Alongside the potential precedent that could be set by the case should it be taken further, potentially causing web streaming to be deemed to infringe copyright, the issue of whether this does infringe the privacy of German citizens can be raised. As stated by Christian Solmecke for the Guardian "...there was not only no legal basis for the fines, but that it was possible that the law firm behind the letters may have broken the law...[and] [i]t is hard to imagine how the IP addresses of the users could have been obtained on a legal basis". More notably this could be an infringement of the right to a private and family life under the European Convention on Human Rights, in addition to any specific German legislation.

The issue of the temporary copies has been argued by Tim Worstall as being potentially correct, stating that "If the original streaming site hasn’t been paying the right royalties it is possible that the viewers owe them. for that idea of a copy existing in the browser would not be, in at least some jurisdictions, be rejected out of hand". This writer for one can see the potential argument as being valid given the right line of argument or set of facts; however due to the current precedent surrounding web streaming it would be unlikely for it to be deemed a form of infringement.

As it stands the matter has not been taken to court, but due to the sheer visibility of the matter it seems unlikely it would avoid litigation entirely, assuming U+C have belief in their argument and are not simply trying to use peoples' embarrassment as a way to make a quick buck. Whether this will go further will remain to be seen, but this writer for one would love for U+C's argument to be tested in court.

Source: The Guardian