Cast Aside - Recording of TV Through the Cloud Infringes Copyright, Says CJEU

Many foreign nationals who have immigrated abroad yearn for a piece of home, either through food, music or TV and movies. Often this is done using online or on-demand services, and this interest can create opportunists who wish to capitalise on the home-sickness of ex-pats. Quite a few websites offer both legitimate and illegitimate means of doing so. In that vein, would the recording of TV shows for users, without copying it into your own servers, infringe copyright?

The case of VCAST Limited v RTI SpA concerns this question, where VCAST offered a service to users enabling them to record Italian television on-demand to an external storage provider of their choice. The user would select which show on which channel they would want to record, which VCAST then recorded for them onto their storage provider's servers. VCAST was subsequently sued by RTI, an Italian TV channel, for copyright infringement, ending up all the way at the CJEU.

The CJEU was posed two questions in the proceedings, which it subsequently merged into one, as they asked two sides of the same coin. The question was whether "…[the InfoSoc Directive], in particular Article 5(2)(b) thereof, precludes national legislation which permits a commercial undertaking to provide private individuals with a cloud service for the remote recording of private copies of works protected by copyright, by means of a computer system, by actively involving itself in the recording, without the rightholder’s consent". In other words, is it possible for national legislation to prevent the private copying of copyright protected works using a cloud recording service.

As set out by the Court: "…Article 5(2)(b) of Directive 2001/29, Member States may provide for exceptions or limitations to the reproduction right in respect of reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial". So long this use doesn't conflict with the works' normal exploitation or prejudice the legitimate interests in the works, exceptions and/or limitations are allowed.

According to case law, the CJEU considered that copying by natural persons acting in a private capacity would be likely to cause harm to the rightsholders concerned if prior authorisation from them isn't sought. This position was developed further in ACI Adam where the Court allowed for rightsholders objecting to infringements that might accompany the making of private copies, even though the exception prohibits them from objecting to private copying. Finally, third-parties can be involved in the making of private copies, provided they are a precondition to it.

The distinction between a mere third-party copying content and VCAST is VCAST's provision of the programs themselves, which the user then selects from. They therefore both copy and make available the copyright protected works to the consumer.



The Cloud can makes emotions run high

Even though rightsholders are prohibited from preventing the private copying of copyright works, as discussed above, they are not prohibited from preventing access to the works that are desired to be privately copied. This allowed the Court to move onto the matter of communication to the public, which third-parties cannot do. The distinction between simply copying, where the entity does not make the content available in a wider scale, and making works available and then copying them on request, is important and requires the court to address this point.

When assessing 'communication to the public' Courts have to consider two cumulative criteria; an 'act of communication' that is done to a 'public'. The former is a transmission of protected works, irrespective of technical means, and the latter an undetermined amount, although impliedly large, of people as possible recipients.

Through their service VCAST records broadcasts of TV shows and makes them available for its users. The amount of users is clearly enough to constitute a 'public', while the original transmission through VCAST's service is transmitted to that public. The service therefore infringes the right to communication to the public, and would require the authorisation of RTI (and other relevant parties not involved in the litigation).

The CJEU concluded that VCAST's service does not fall under the scope of Article 5(2)(b). In different words, answering the question posed: "…Directive 2001/29, in particular Article 5(2)(b) thereof, precludes national legislation which permits a commercial undertaking to provide private individuals with a cloud service for the remote recording of private copies of works protected by copyright, by means of a computer system, by actively involving itself in the recording, without the rightholder’s consent".

The case is quite surprising, since the matter didn't involve communication to the public at the face of it, only private copying. Even so, the connection made between the two makes sense, and is a relevant consideration in the wider issue. Third-parties making copies for users is still very much allowed; however, the stumbling block will be the making available of that content to users as done by VCAST.

Walking the Online Plank - Advocate General Szpunar Sets the Scene for Blocking Infringing Websites

Peer-to-peer file sharing has had its enemies since its very beginning, especially when used for sharing either protected or non-protected works online. A particular offender in the former category is the infamous Pirate Bay website, which shares hyperlinks to files known as 'torrent' files, which contain metadata on the files, linking a variety of peers (i.e. file sharers) with others wishing to download said file, and deliver pieces of the file using the P2P protocol. The fight against the Pirate Bay as an intermediary has been going on for a very long time, and the matter has been winding its way through the EU courts as well. While the CJEU has yet to rule on the matter, Advocate General Szpunar handed down his opinion before the CJEU's determination on this long-standing matter.

The case of Stichting Brein v Ziggo BV concerned Stichting Brein, a Dutch organization that focusses on combatting the illegal exploitation of copyright protected works, and to protect the interests of rights holders. Ziggo BV and the other defendant, XS4ALL Internet BV, are Dutch internet service providers who largely control the Dutch market. Stichting Brein took the ISPs to court, applying to compel the ISPs block all internet access to the Pirate Bay under the Dutch transposition of Article 8 of the InfoSoc Directive.

What the CJEU had to answer were two questions that the Court summarized as follows: "… the referring court raises in reality the matter of the liability of operators of indexing sites of peer-to-peer networks for copyright infringements committed in the context of the use of those networks. Can those operators themselves be regarded as being the originators of those infringements, which would mean they are directly liable (first question)? Or, even if they are not directly liable, can an order be made blocking access to their websites, which, as I shall explain below, requires a form of indirect liability (second question)?"

The first aspect of the larger question is whether the provision of indexed metadata relating to P2P files through a search engine is a communication to the public. As has been firmly established, a communication to the public comprises of two criteria, in essence (1) an act of communication and (2) it is made to a public.

The Advocate General first set out the basics, where an 'act of communication' emphasises the essential role of the player originating the communication and the deliberate nature of their intervention (including full knowledge of the consequences of their actions), without which the customer would not have gained access to the work and therefore does. The nature of the communication is also important, with rights holders also being able to prevent the infringement even if the communication, at the choosing of the end-user, hasn't taken place yet.

A 'public' is one where the communication is intended for an indeterminate, but fairly large number of recipients; however, as was discussed in Svensson, the public has to be a new one, and the provision content to the entire internet would not necessarily amount to a 'new' public. Even If provided for the internet at large, you still have to consider the intention of the communicator and the public it wanted to reach during the communication.  If the communication is made without the authorization of the rights holder, it's clearly made to a new public they didn't consider, making the public a 'new' one for this purpose.

Online piracy is real and scary

The AG then moved onto the actual application of the above to P2P networks. In his view, a copyright protected work would be communicated to the public via a P2P network, as; firstly, the works are made available on the computers of the network users, so any other user can download them; Secondly, the amount of users in P2P networks and using the Pirate Bay clearly would be an undefined and significant number of persons; and lastly, as no consent was given by the rights holder to share the works on these systems or websites, the works have been distributed to  a 'new public', since "if the author of the work has not consented to it being shared on a peer-to-peer network, the users of that network constitute by definition a new public". While this amounts to a clear communication to the public, the AG had to still decide, in his opinion, who the works originated from (i.e. the users or the indexing website).

The role of the indexing websites was also deemed necessary by the AG, since "...[infringing] works would not be accessible and the operation of the network would not be possible or would at any rate be much more complex and its use less efficient" without them. He also highlighted the need for knowledge by the website operators, and specified that "...from the moment that operator has knowledge of the fact that making available took place in breach of copyright and does not take action to render access to the work in question impossible, its conduct may be regarded as being intended to allow, expressly, the continuation of the illegal making available of that work and, hence, as an intentional action". The website operators' intervention is therefore necessary and deliberate (at least in the instances as detailed above), meaning the operators would be jointly with the user making the works available and thus communicating them to the public.

The AG then moved onto the second question, discussing the need to block access to websites such as the Pirate Bay (albeit only in the instance should the CJEU disagree with his answer to the first question).

In his view, Article 8 presupposes a link between the infringement and the subject of the injunction, meaning the services of the intermediary are used to facilitate the infringement happening through the website in question. He concluded that, in the light of this dependant relationship, the intermediary has to prevent access to the site to protect itself from liability.

He also added that this would not, potentially at least, impinge on the users' fundamental rights. The blocking of websites like the Pirate Bay would be proportionate to the significance and seriousness of the copyright infringements committed on that site. The block would also not prevent legitimate uses of P2P technologies, or the finding of legally shared files online. The measures themselves, ultimately, will have to be "...proportionate to the significance and seriousness of the copyright infringements committed, which is a matter for the national court to determine".

The AG's opinion sets the scene for the CJEU, and clearly will envision the decision going the way of the rights holders. Admittedly, this would seem like the most logical solution to a complex and difficult problem to tackle; however, measures would indeed have to be proportionate and non-restricting to the public at large. This writer would envision a possible avalanche of blocking injunctions being pushed after a decision to the affirmative; however, an EU-wide block seems highly unlikely, as application has to be done on a national basis.

Source: IPKat