Before the Supreme Court - Copyright Protection of the Design of Uniforms in the US Court of Appeal

In the light of the pending US Supreme Court decision regarding copyright protection in the design of cheerleaders' uniforms, this writer thought it would be good to set the scene for the decision by discussing the decision handed down by the Court of Appeal. The judiciary rarely takes on design copyright cases, as often their value is negligible or protection is not even sought (especially in the US where copyright registration is an important part of IP).

The case of Varsity Brands Inc. v Star Athletica LLC dealt with the design of a cheerleader uniform, comprising of several different designs, incorporating various colors that divide the uniform into specific shapes and segments (visible here). The designs themselves were of non-functional nature, and were only intended to be of aesthetic value. The original works were produced and sold by Varsity Brands, who noticed that a competitor, Star Athletica, also sold similar outfits in competition with Varsity's uniforms, and took the company to court for copyright infringement and a number of other civil claims in competition.

The Court of Appeal first took on the issue of whether Star Athletica has infringed Varsity Brands' copyright in the uniforms; the designs for which have been successfully registered at the US Copyright Office. After lengthy discussions, the Court did agree that successful registration at the Copyright Office could offer prima facie, although rebuttable, protection and acceptance of copyright in a given work. Star Athletica did, however, argue that the designs were in themselves useful article, and thus not protectable by copyright. The designs therefore would need to be "…identified separately from, and are capable of existing independently of, the utilitarian aspects of the article" for copyright protection to be afforded.

What amounts to a useful article is an article that has a utilitarian function that is not there merely to convey the appearance of the article (i.e. for aesthetic reasons). Following the above, the Court established that this would be determined by a two-prong test: "…first, whether the design for which the author seeks copyright protection is a 'design of a useful article,' and if so, second, whether the design of the useful article 'incorporates pictorial, graphic, or sculptural features that can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the [useful] article'".

Alan's Halloween outfit was totally non-functional

The Court then turned to the first prong of the test on separability, meaning that the article would not be a useful one, but only conveys the items appearance.  As illustrated by the Court's discussion, both appellate and first instance courts have struggled to formulate a concise and uniform approach in determining what would amount to a 'useful article'. The Court moved on to applying what they considered to be the correct approach, which would be applying a number of questions based on the Copyright Act itself. These questions are effectively to ask whether the design is "…a pictorial, graphic, or sculptural work", and if so, whether the design is a useful article within the definition above. The Court would then have to ask "…[w]hat are the utilitarian aspects of the useful article", which can include several aspects (for example, aesthetic, functional and non-functional elements).

Once the Court has identified the relevant utilitarian aspects of the design, it would then finally move onto assessing whether "…the viewer of the design [can] identify pictorial, graphic, or sculptural features separately from... the utilitarian aspects of the useful article", and if these features could exist separately from the design itself (i.e. are removable from the design and don't impact its functionality). If either one, or both, of the final questions fails, the design is not protected by copyright.

The Court subsequently moved onto its consideration of the copyright protection for Varsity Brands' designs. They quickly answered the first two questions in the affirmative, expanding on the second question that the designs, represented in sketches of the uniforms, have an "intrinsic utilitarian function that is not merely to portray the appearance of [clothing] or to convey information". They then set out the particular utilitarian aspects of the designs, which were to "cover the body, wick away moisture, and withstand the rigors of athletic movements". The Court rejected Star Athletica's assertion that the uniforms, through a decorative function, would not be copyrightable, as, rightfully so, this would cause artworks and other similar works to not be protected by copyright by virtue of their decorative function

Finally, the Court sought to answer the final two questions. In determining the separability of the pictorial, graphic or sculptural features (particularly the arrangement of stripes, chevrons, zigzags, and color-blocking), the Court saw that they could indeed be separated, as they do not enhance the uniform's functionality, and the uniforms remain fully identifiable even in the absence of this stylisation due to its distinctive shape. Additionally, purchasers would be able to distinguish each style from each other, and choose accordingly, making the designs separate and individual and therefore protectable. Even so, would they still exist independently of the utilitarian aspects of the uniforms, even if separable? The Court said yes, as the features could be incorporated into a number of garment styles, even if they are not meant for cheerleaders (meaning the designs are transferable), and do not affect the uniform's functionality for those purposes even if used or not. Following the answers to the questions the Court ultimately determined that the designs were copyrightable.

The Court distinguished this from the design of a dress, which, through its shape rather than a mere graphical addition adorning its surface, as its shape, cut and other features are "…inextricably connected with the utilitarian aspects of clothing" and thus can't be identified separately. This illustrates the difference in protectability for fabric designs and dress designs.

As is clear the US courts desperately need a unifying precedent to determine what the correct test is in relation to useful articles and the extent of copyright protection thereof. The Supreme Court's decision is still forthcoming, and this writer will be curious to see whether they follow the Court of Appeal's test, or formulate a different one entirely.

Used Treasures - CJEU Sets Limits on the Resale of Copyright Works

Resale of goods, particularly those protected by copyright, has been a question that the courts have been tackling for a long time. This is further exasperated by the online environment, where the sale and use of sold products or software is ever-more elusive, with the actual exhaustion of any rights (particularly in the sale of the protected goods) is unclear. For rightsholders, exhaustion of rights can often seem like having your cake and eating it, while those seeking to benefit from it perceive it as more of a possibility to create a second-hand market in the online environment. Not often discussed, cases dealing directly with exhaustion seem to be far and few between; however, the Court of Justice of the EU recently took on a case dealing with a question that is important in the context of software exhaustion.

The case of Aleksandrs Ranks and Jurijs Vasiļevičs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp deals with two Latvian individuals who sold Microsoft software products online during 2001 to 2004. The Court estimated that over 3,000 copies had been sold, with the pair making revenues nearing $300,000 during that time. Mr Ranks and Vasiļevičs were subsequently charged with a number of infringement claims, and having gone through the courts in Latvia, the matter ultimately ended up in the CJEU, particularly dealing with questions surrounding the exhaustion of rights in the aforementioned software products.

The Court, dealing with the two referred question together, summarized the matter as asking "…the interpretation of Article 4(2) of Directive 2009/24 [Software Directive], establishing the rule of exhaustion of the copyright holder’s distribution right, and of Article 5(1) and (2) of [the Directive], laying down exceptions to that rightholder’s exclusive right of reproduction, must be interpreted as referring to the equivalent provisions of Directive 91/250 [Computer Programs Directive], namely Article 4(c) thereof, on the one hand, and Article 4(a) and Article 5(1) and (2) thereof, on the other". Effectively the questions seek to establish whether the exhaustion of rights after their first sale under the Software Directive is interpreted as meaning the same equivalent provision as set out in the Computer Programs Directive.

Having discussed the admissibility of the claim overall, allowing for them to be referred to the CJEU, the Court first looked at the actual concept of exhaustion.

For exhaustion to apply to the right to distribute computer programs in the EU it is is subject to two conditions: "...(i) the copy must have been placed on the market and, more specifically, sold by the rightholder or with his consent, and (ii) it must have been placed on the market in the European Union". Sale in itself means the sale of a program for an unlimited period in return for a fee to remunerate the rightsholder for the distribution of that particular program. While the Court has clearly established that, at least in most cases, the sale applies to physical copies of the programs only; the case at hand discussed the resale of electronic copies, and thus would be outside of the prima facie remit of the provisions.

Even Santa has to resell some things

The Court followed this with observations that, although the provisions above discuss 'a copy' of the program, no particular medium is specified, and, following the decision in UsedSoft, the law "...makes no distinction according to the tangible or intangible form of the copy in question". The sale then clearly applies irrespective of the medium of the program, as long as it has been initially sold in the EU lawfully. The reseller can, therefore, resell a copy of a program provided that "…[the] sale does not adversely affect the rightholder’s exclusive reproduction right".

Mr Ranks and Vasiļevičs also argued that the rule would allow for the resale of computer programs stored on a non-original medium (i.e. electronically rather than on a CD or DVD, for example) if the original medium has been damaged. While Article 5 of the Computer Program Directive allows for the making of back-up copies, the exception is limited to instances where "… That copy… (i) [is] made by a person having a right to use that program and (ii) [is] necessary for that use". Clearly, the resale of 'back-up' copies would not fall under Article 5, even if the original copy has been damaged. The CJEU followed this rationale, establishing that a copy cannot be resold even if the original medium has been damaged, and can only be used to meet the sole needs of the person who made that back-up copy.

Although UsedSoft established that the purchaser of a legal electronic copy of a computer program does have the right to resell their copy (and the rights were exhausted as a result of that initial sale), this can be distinguished from the resale of a back-up copy, since the back-up would not have been the item that was originally sold (which was the tangible copy) and exhaustion would not, arguably, apply. Has the individuals purchased the copies from Microsoft legally from their website, they potentially could have had the right to resell the copies.

In the end the CJEU summarized their decision as "… that Article 4(a) and (c) and Article 5(1) and (2) of Directive 91/250 must be interpreted as meaning that, although the initial acquirer of a copy of a computer program accompanied by an unlimited user licence is entitled to resell that copy and his licence to a new acquirer, he may not, however, in the case where the original material medium of the copy that was initially delivered to him has been damaged, destroyed or lost, provide his back-up copy of that program to that new acquirer without the authorisation of the rightholder".

The resale of computer programs is a very thorny topic, as one can see, and the resolution the CJEU came up with seems to make the most sense. This allows for the resale of genuine copies of programs, yet reserves the rights to only those with a bona fide interest in doing so, rather than a mere opportunistic view for quick monetary gains. The limitation of the resale of back-up copies also makes sense, since, as the original program was bought in a tangible medium, the original seller's view couldn't have been one that allows for the resale of any back-up copies (especially since back-ups, by nature, are for the user and no one else as a means to access their programs in the event of damage or loss to the CD/DVD). It will be interesting to see whether this case spawns more litigation; however, this writer seems to be quite skeptical of this, due to the complexity and lack of benefit to those who'd pursue this avenue more vigorously.

In the Shadows - A Silhouette Image is Not a Registrable Trademark, Says EU General Court

Images can evoke powerful feelings, associations and preconceptions, especially when paired with particular goods that aim to enhance our lives or even our own well-being. With the health supplement market reaching a staggering $19 billion in 2015, even a small slice of that pie can make any product a huge success monetarily. As the market has grown this competitive, so have the efforts of product manufacturers to distinguish their goods from the rest, including through the use of trademarks and distinctive names. As the products are often, arguably at least, quite similar in functionality and marketing, can one expect to register something simple as, say the silhouette of a body builder, in conjunction with protein supplements? In a recent decision the EU General Court aimed to tackle this problem, and to potentially narrow or widen the scope of these types of marks in the EU.

The case of Universal Protein Supplements v EUIPO dealt with an application to register the silhouette of a body builder by UPS as a EU trademark (using the same image as their registered trademark 11827599), specifically in classes 5, 25 and 35, covering, among others, clothing, nutritional supplements and online retails store services for nutritional supplements. Following UPS' application both the initial examiner and the Board of Appeal rejected the mark, refusing it under both Article 7(1)(b) and (c) of Regulation No 207/2009. USP appealed both decisions, and ultimately ended up in the EU General Court, which handed down its judgment nearly three weeks ago.

Body-building is rough, even with supplements

The General Court first started by assessing whether the mark was only indicative of, among other factors, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods, under Article 7(1)(c). To further expand on this, the provision aims to allow all producers of goods to use certain common indicators of quality and origin, so as to enable proper competition in a particular area of commerce. These indicators also don't serve as proper indicators of origin, allowing for consumers to purchase the same quality product (or in the inverse, avoid the same) knowing fully where it comes from per the marks used. This means that, for a mark to avoid Article 7(1)(c) "...there must be a sufficiently direct and specific relationship between the sign and the goods or services in question such as to enable the public concerned to perceive immediately, without further reflection, a description of the goods and services in question or one of their characteristics".

The Court quickly determined that, in relation to all of the goods in the above classes, the mark was descriptive of those goods, as they related to body-building and were clearly designed for the very same. They added that "...it is common knowledge that drawings and photos of body-builders posing are often reproduced on the products themselves or in advertisements in order to indicate the intended purpose of the goods and services at issue, all relating, in particular, to the practice of body-building". One can appreciate this rationale, since the use of body builders, whether in silhouette form or not, is quite common in body-building and goods associated with it. It is arguable that, as there are plenty of other marks that use the same style of silhouette which have been registered, that the mark should be, potentially, registrable as well.

To summarize their position, the General Court concluded that "...informing the relevant public that the goods and services concerned are made or adapted for body-building, the mark applied for has a sufficiently direct and specific link with nutritional supplements, clothing, footwear, as well as online retail store services of those goods and goods related to health and diet", and the mark therefore fell foul of Article 7(1)(c).

The Court rejected the assertion that a silhouette could not be descriptive of goods as a style of mark, especially when the characteristics of the silhouette are clear and indicative of a body-builder. Also, the mark, although not highly detailed, doesn't require any mental effort from the public that perceives it, making a connection with body-building easily. Finally, although a silhouette of a body-builder can be, in many ways, a very variable style, it still does not mean the silhouette would not be descriptive, even with the possibility of several similar signs distinguishing similar goods successfully. The General Court ultimately rejected the appeal.

While the case is by no means revolutionary, it does illustrate a need to be careful in the choice of marks for specific goods, especially when the depiction could be closely linked to the goods at hand (by way of example, a bar bell could've just as well been descriptive here). Trademarks are a fickle mistress, as many similar marks to the one in question have been successfully registered, and applicants therefore have to be doubly careful with the marks that they choose to use.

Confusion Is Right - Likelihood of Confusion in a Part of the EU Doesn't (Necessarily) Lead to Pan-EU Injunction

Due to the vastness of the internal market in the EU, the enforcement of rights can be difficult, especially when those rights have been infringed in one Member State, but not necessarily in the rest (or to the same degree as in the original country of issue). The EU trademark gives for EU-wide protection, but in the event that national courts disagree on the interpretation of a degree of similarity between a registered EUTM and a competing mark, is EU-wide protection afforded or would the competing mark escape the clutches of the EUTM system? This question was recently answered by the CJEU in a decision handed down in late September.

The case of combit Software GmbH v Commit Business Solutions Ltd dealt with combit Software, a German software development and marketing company that holds the rights to the EU trademark for the word "combit" for similar goods and services. Commit Business Solutions is an Israeli company that sells software under the brand "Commit", on the web and in a number of countries, including in Germany, selling a German-language version of their Commit software in the country. Due to the similarity of the brands used, combit brought proceedings in Germany aiming to prevent the use of the mark for the marketing of Commit's software (with the matter ultimately being referred to the EU courts). As a peculiar part of the proceedings in Germany the court determined that, indeed, there was a likelihood of confusion in the EU for the German-speaking consumer; however, it also saw that there would be no likelihood of confusion for the English-speaking consumer. The court then referred the matter to the CJEU for ultimate determination, in particular for the lack of confusion for a significant portion of the Union.

What the referring court asked from the CJEU was summarized by the Court as whether "...Article 1(2), Article 9(1)(b) and Article 102(1) of Regulation No 207/2009 must be interpreted as meaning that, where an EU trade mark court finds that the use of a sign creates a likelihood of confusion with an EU trade mark in one part of the European Union whilst not creating such a likelihood in another part thereof, that court must conclude that there is an infringement of the exclusive right conferred by that trade mark and issue an order prohibiting the use concerned for the entire area of the European Union". This, in essence, is inquiring whether a partial likelihood of confusion in the EU would translate to a pan-EU injunction for the same, irrespective of the actual confusion determined for the other parts of the EU by the national courts.

With the EU being so different, pan-EU
injunctions are night impossible

The CJEU swiftly addressed the point, stating that when an EU trademark court finds "...that the use of a sign creates, in one part of the European Union, a likelihood of confusion with an EU trade mark, whilst, in another part of the Union, that same use does not give rise to such a likelihood of confusion, that court cannot conclude that there is no infringement of the exclusive right conferred by that trade mark". If there exists a likelihood of confusion in one part of the EU, the CJEU saw that it equates to an infringement of the conferred in the EU overall. This follows precedent in instances where a likelihood of confusion exists during opposition proceedings, but only with respect of one part of the EU.

While the above seems straightforward, the CJEU further complicated things. Following the decision in DHL Express France, if a court does not find a likelihood of confusion in a part of the EU (as in the case at hand) for any reason, such as a linguistic one, the mark isn't adversely affected and the scope of the injunction has to be restricted. However, the trade in which the potentially infringing sign is used has to be bona fide for the restriction to apply. The area restricted has to be clearly defined, not merely through linguistic borders, which does set a high threshold for a wider restricted area.

In summary, the CJEU set out that "...[the Articles of the Regulation] must be interpreted as meaning that, where an EU trade mark court finds that the use of a sign creates a likelihood of confusion with an EU trade mark in one part of the European Union whilst not creating such a likelihood in another part thereof, that court must conclude that there is an infringement of the exclusive right conferred by that trade mark and issue an order prohibiting the use in question for the entire area of the European Union with the exception of the part in respect of which there has been found to be no likelihood of confusion".

The finding of the CJEU is peculiar, since its rationale clearly leads in the direction of a pan-EU injunction, but can be restricted to only the areas affected in the EU if no likelihood of confusion arises. One has to wonder whether this would segment the single market, and potentially cause for the EU trademark to cease to function as intended; as an all-encompassing registration to protect an interest in the entire single market. Nevertheless, one can appreciate the rationale put forth by the Court. This writer will wonder whether the case will have bigger impact on the EU trademark, but doubts many courts will be brave enough to set very wide restrictions on any areas not covered by an EU trademark.

Source: IPKat

Change is Scary - The EU Commission Sets Out Proposals for New Copyright Changes

Copyright seems to have been immersed in a perpetual sea of change in the last couple of years, especially here in the UK and the EU as a whole. While this change is hugely important, including for the harmonization of aspects in technological change that have profoundly shaped the sphere in which copyright operates. With the EU's recent dive into a new perspective on the Single Digital Market having been published a little over a years ago (more on which here), future, more concrete changes have yet to be released; however, this changed only a few days ago.

As said, the EU Commission just recently published its propositions to modernize copyright in the wake of the Digital Single Market strategy. While the documents themselves are quite extensive, this writer would aim to discuss the proposed changes more in the broader sense, hopefully to encapsulate the main points of the propositions themselves.

Better choice and access to content online and across borders

As outline in the DSM strategy, access to online content within the EU is paramount to the Commission, with intentions to stop geo-blocking and allow for access to domestic content even abroad (i.e. using the BBC iPlayer when on vacation in the EU). This was expanded on in the proposition as an introduction of "...a legal mechanism for broadcasters to obtain more easily the authorisations they need from right holders to transmit programmes online in other EU Member States". Clearly this seems to envision a cross-EU licencing scheme, or the broadening of existing licences to cover more than their origin country. Initially, as outlined in the proposal, this would be done through a dialogue with the audiovisual industry on licencing issues; however, this writer would not see it as an impossibility that this would be legislated on somehow in the future if progress is not made as desired.

This is expanded on in the Commission's communication, which sets out measures to be taken in relation to access to online content, copyright exceptions and a more efficient enforcement regime.

Improving copyright rules on research, education and inclusion of disable people

Change is scary, so lets manage it!

There are also desires to improve the rules surrounding research, education and inclusion of disable people, particularly broadening access to protected materials for these types of uses. The proposal would include "...a new exception to allow educational establishments to use materials to illustrate teaching through digital tools and in online courses across borders", with additional provisions dealing with cultural heritage institutions (and their preservation of that heritage, as well as access to the content for citizens). While research and access to cultural heritage are very important, the EU sets out the desire to implement the Marrakesh Treaty, which aims to "...facilitate access to published works for persons who are blind, have other visual impairments or are otherwise print disabled", as well as adding measures that will allow for the full participation of disabled individuals in society by providing access to materials (or ways to convert such materials, presumably) that are protected by copyright.

Some of the proposed provisions include an exception for the use of works and other subject-matter in digital and cross-border teaching activities and the copying of cultural heritage materials without infringing copyright. Especially considering the former, the activities must be legitimate, and will undoubtedly be prescribed to certain situations and contexts, much like existing exceptions for research.

A fairer and sustainable marketplace for creators and press

Lastly, the Commission's proposed Directive on Copyright in the Single Market aims to (including the above) "...reinforce the position of right holders to negotiate and be remunerated for the online exploitation of their content on video-sharing platforms such as YouTube". The Directive would impose an obligation on the service providers to have an automatic system that tags and/or removes illegal content, much like YouTube's Content ID system already does (irrespective of its controversial nature). One can imagine this will be a treacherous and unpredictable imposition on service providers, and would remain to be seen how it is genuinely implemented, and whether the providers would face sanctions for lax or non-existent enforcement.

The EU Commission's proposals are quite interesting, and pose, at least in theory, a possible modernization of copyright in the Digital Single Market. As an individual with an international background, I welcome more access to content when abroad, and the expansion of teaching opportunities and the preservation of cultural heritage. What will be interesting are the measures deployed against large service providers, whose users might upload large or small quantities of illegal content on their systems. The provisions, however, in this regard seem to be aimed at cooperation and coexistence, but can pose a problem if presented as one-sided affairs for rights-holders.

Source: IPKat

Locked Out - Providers of WiFi Access Not Liable for Copyright Infringement, Says CJEU

As wireless internet connections have become near ubiquitous in our daily lives amongst the cafés, libraries or businesses we visit, so has our appreciation for the facility, especially when traveling when a weary traveler might not have a connection on their smartphone. But underneath these open networks lurks the danger, and question, of possible abuse, and thus liability for those who operate the networks. This matter has been litigated in the European courts for some time now, and after an Advocate General's opinion early this year (discussed more here), many IP specialists have been waiting for the decision in McFadden; something the CJEU finally handed down late last week.

The case of Tobias Mc Fadden v Sony Music Entertainment Germany GmbH dealt with the provision of an unprotected wireless network connection by Mr Mc Fadden at his business selling and leasing lighting and sound systems, which aimed to bring in business and interest for his endeavor.  In late 2010 a song was shared in his network by a third-party (the rights to which Sony Music owned), and Sony subsequently sent Mr Mc Fadden a notice to this effect. Mr Mc Fadden then took the matter to court, seeking a negative declaration of infringement, to which Sony counterclaimed infringement. The matter ultimately ended up in the CJEU, who sought to take on the matter of liability of infringement for the provider of an unprotected wireless network.

The referring court asked eight questions of the CJEU, who took each question in turn to answer the matter.

The first question dealt with whether the provision of an open WiFi connection could fall under Article 12(1) of the E-Commerce Directive, i.e. whether the service would be classed as an 'information society service'. The Court quickly saw that, even in the light of a lack of remuneration (as required by EU legislation in this instance), the service would be classed as an 'information society service' under the Directive if "...the activity is performed by the service provider in question for the purposes of advertising the goods sold or services supplied by that service provider". The provision of the service is clearly therefore equated to one producing a monetary gain, even if not charged for on the outset, possibly therefore being afforded safe harbor protection as a 'mere conduit'.

The CJEU then moved onto questions two and three, which they summarized together as asking whether Article 12(1) of the Directive only requires the provision of the aforementioned service so as to be included, or if further conditions have to be met for it to be deemed as have been provided under the Article. This would include a contractual relationship and the advertisement of the provider's services. The Court concluded that, for the service to have been provided under the provision, the access must not "...go beyond the boundaries of a technical, automatic and passive process for the transmission of the required information, there being no further conditions to be satisfied". This follows recital 43 to the tee, and clearly the mere passive provision of such a service would be deemed to have been 'provided' by virtue of doing only that.

Password required? Not interested!

The Court then answered the remaining questions in a non-sequential fashion, tackling question six first. This asks whether Article 12(1) should be interpreted as including a further condition set out in Article 14(1)(b) (on the removal of infringing content upon notification thereof). The CJEU saw that, as the Articles dealt with very different services (communication services v hosting), the condition does not apply to the provision of more transient services, but to ones that remain more permanent in the provided services (meaning, content hosted on a website stays on said website till removed, unlike in mere transient communication using a wireless connection).

This was followed by questions seven and eight, which the CJEU clumped together, summarizing them as asking whether Article 12(1) includes any further provisions in addition to the one within the Article, which are not expressly mentioned. The Court quickly dismissed this assertion, as further conditions would clearly impede the balance sought by the legislature in the introduction of the provision.

The Court then moved onto question four, which, in essence, asked whether a person (or entity) harmed through the infringement of a right could seek injunctive relief and/or possible costs for the harm caused using the above service to do so. If read in seclusion, the Article does preclude a person harmed from seeking such remedies; however, it does not expressly prevent them from doing so using national authorities to prevent the infringement from continuing. This would seem correct, as Article 12(3) expressly does not preclude national authorities from requiring such actions and/or allowing for the retrieval of costs.

Finally, questions five, nine and ten remained, which asked effectively whether the granting of an injunction such as the above is allowed (and complied with by the provider), when the provider is required to secure their connection through either a password or by monitoring the connection used. The Court emphasized the need to strike a balance between the rights afforded by the Directive and the Enforcement Directive 2004/48, especially when multiple rights are engaged in such an issue (as is the case here). The Court considered the different ways in which IP rights could be protected, and decided that "...a measure intended to secure an internet connection by means of a password must be considered to be necessary in order to ensure the effective protection of the fundamental right to protection of intellectual property". This measure would, according to the Court, protect both rights in intellectual property, as well as the freedom to conduct business through the supply on a wireless connection and the right to information in using the above. One has to, though, provide their details in order to be able to use the connection and therefore be identified if needed.

The CJEU's decision sets out a practical approach to protecting both interests, while not overly restricting the provision of wireless connections. The striking of this balance was key, and the CJEU seem to have settled on the right answer. The measures required are by no means excessive, and afford the provider plenty of protection in the event of the connection's abuse.

Link Away - CJEU Decides Hyperlinking to Images is Not Communication to the Public

After the Advocate General's opinion on the GS Media (discussed here) case some 5 months ago, many people in the IP sphere have awaited the ultimate decision of the CJEU with baited breath. While the Advocate General's opinion reflected a pragmatic, very liberal interpretation of the legislation, some seemed skeptical on whether the CJEU would follow his thoughts. After, what felt like a small eternity to this writer, the CJEU has released its judgment on the case yesterday.

The case of GS Media BV v Sanoma Media Netherlands BV dealt with pictures of Britt Dekker (a famous Dutch TV personality), commissioned by Sanoma Media for publication in Playboy magazine. Prior to their publication, the images were somehow acquired and posted by a user on the file-sharing service Filefactory; a link to which was subsequently sent to the website GeenStijl, which is operated by GS Media. GeenStijl shared a part of one of the images of their website, with an additional hyperlink to Filefactory where users could download the images onto their computers. Although vehemently demanded by Sanoma Media, GS Media refused to remove the link from the website, although the content itself was removed from Filefactory. Sanoma Media then took GS Media to court for copyright infringement, which ultimately ended in the CJEU.

The Court had to determine "...whether, and in what possible circumstances, the fact of posting, on a website, a hyperlink to protected works, freely available on another website without the consent of the copyright holder, constitutes a ‘communication to the public’ within the meaning of Article 3(1) of Directive 2001/29".

The context is important here too, as the images in question had not been published prior to their leaking to the website and then to GS Media, and their hyperlink makes the finding of the files a lot easier and they had, or ought to have had, the knowledge that the works' publication on that particular website was not authorized.

Following the judgment in Svensson (discussed more here), the concept of a 'communication to the public' under the Directive consists of two criteria, specifically  an 'act of communication' that was communicated to a 'public'. While the Court followed its earlier decisions on the nuances of what amounts to a communication to the public, the meat of the matter lie in the application of this in the current scenario.

As was decided in Svensson, posting hyperlinks on a website to works freely available on another website does not constitute a ‘communication to the public’ (followed in the BestWater case). The Court did distinguish that, in both of the aforementioned cases, the content linked to was authorized by the copyright holder, i.e. the content was legally on the website that the hyperlink lead to (meaning there was no new public for the content) As further clarified by the Court: "...as soon as and as long as that work is freely available on the website to which the hyperlink allows access, it must be considered that, where the copyright holders of that work have consented to such a communication, they have included all internet users as the public". This clearly distinguishes this case from both Svensson and BestWater, as the content was not authorized and therefore, arguably, the communication happened to a 'new public'.

The Court refused to infer the above, and stated that, to protect the freedom of expression and the Internet as we know it, one cannot simply categorize all linking to unauthorized content as a communication to the public. They further saw that, in assessing whether a communication to the public in such a scenario, one has to consider "...when the posting of a hyperlink to a work freely available on another website is carried out by a person who, in so doing, does not pursue a profit, to take account of the fact that that person does not know and cannot reasonably know, that that work had been published on the internet without the consent of the copyright holder". What remains interesting is the potential liability of an unknowing sharer, who still makes a profit by doing so. Ultimately, this seems to just raise the bar for negligence (or a willful blind eye), but is a curious consideration made by the Court.

Hyperlink profiteers enjoying their unlawful gains for one last time

The judgment did not, however, give everyone a free pass: "In contrast, where it is established that such a person knew or ought to have known that the hyperlink he posted provides access to a work illegally placed on the internet, for example owing to the fact that he was notified thereof by the copyright holders, it is necessary to consider that the provision of that link constitutes a ‘communication to the public’ within the meaning of Article 3(1)". This makes sense, and would offer a safe harbor for those who were notified of any infringing content, especially if it had been placed there without the express authorization of the rightsholding party. The Court also put the onus on checking the content on those who gained a profit from sharing hyperlinks to other websites: "...it can be expected that the person who posted such a link carries out the necessary checks to ensure that the work concerned is not illegally published on the website to which those hyperlinks lead, so that it must be presumed that that posting has occurred with the full knowledge of the protected nature of that work and the possible lack of consent to publication on the internet by the copyright holder. In such circumstances, and in so far as that rebuttable presumption is not rebutted, the act of posting a hyperlink to a work which was illegally placed on the internet constitutes a ‘communication to the public’ within the meaning of Article 3(1)". Knowledge, or presumed knowledge, is key here, and clearly the Court wants to curtail profiteers who would use this 'loophole' for their own benefit by sharing links to infringing, unauthorized content.

The Court then finally summarized their findings to the questions posed: "...the answer to the questions raised is that Article 3(1) of Directive 2001/29 must be interpreted as meaning that, in order to establish whether the fact of posting, on a website, hyperlinks to protected works, which are freely available on another website without the consent of the copyright holder, constitutes a ‘communication to the public’ within the meaning of that provision, it is to be determined whether those links are provided without the pursuit of financial gain by a person who did not know or could not reasonably have known the illegal nature of the publication of those works on that other website or whether, on the contrary, those links are provided for such a purpose, a situation in which that knowledge must be presumed".

The decision is a very interesting one, and this writer had been waiting for it for some time. What seems surprising is the emphasis of financial gain, but it makes sense, as often those who do not pursue pure monetary gains will be more honestly ignorant to the content  they have shared than those who aim to profit from it (often knowing full well what they are sharing, as it is the source of their users).