Copyright: communication to the public, infringement and enforcement

Summary

Background

Infringement of copyright occurs where there is communication to the public of a copyright work (Article 3, Copyright Directive) (Article 3). An act of communication occurs when protected subject matter is communicated to a new public, which means a public not taken into account when the copyright holder authorised the initial publication of their work or protected subject matter.

The Enforcement Directive requires EU member states to implement measures, procedures and remedies necessary to ensure the enforcement of intellectual property rights. The measures must be fair and equitable, not unnecessarily complicated or costly, without unreasonable time limits or unwarranted delays, and must be effective, proportionate and dissuasive. They must also provide for safeguards against their abuse.

Article 4 of the Enforcement Directive (Article 4) provides that rights holders and other persons authorised to use those rights, such as licensees, are entitled to benefit from the measures, procedures and remedies provided for in the Enforcement Directive.

Article 8(1) of the Enforcement Directive (Article 8) gives claimants the right to request information from infringers and third parties involved in infringing activities.

Facts

M held licences for the communication to the public of films on peer-to-peer networks and internet file-sharing networks. The contracts required M to investigate acts of infringement of the film producers' exclusive rights committed on the networks and, in its own name, to take legal action against the infringers to get compensation, half of which must be passed on to the producers.

M issued proceedings in Belgium. M argued that some of T’s customers' internet connections had been used to share films from M's catalogue on a peer-to-peer network using the BitTorrent protocol. M sought an order for the ISP, T, to produce identification data in relation to those customers.

The Belgian Court stayed the proceedings and referred to the ECJ questions involving an interpretation of the Copyright Directive, Enforcement Directive and EU GDPR.

Decision

The ECJ held that uploading from the terminal equipment of a user of a peer-to-peer network to equipment of other users of the network pieces of a media file containing a protected work previously downloaded by the original user constitutes making the work available to the public under Article 3, even though the pieces were unusable in themselves, but only usable as from a certain download rate and in combination with other related pieces of the same media files. It held that it was irrelevant that, due to the configuration of BitTorrent client sharing software, the uploading was automatically generated by it when the user, from whose terminal equipment the uploading took place, subscribed to the software by giving their consent to its application after having been informed of its characteristics.

Any user of a peer-to-peer network can easily reconstruct a media file from pieces available on the computers of users in the same network. The fact that a user might not succeed in downloading the entire file does not prevent them from making available to their peers the pieces of the file that they have managed to download onto their computer. Therefore, the user ultimately contributes to all the users participating in the network having access to the complete file.

It is unnecessary to prove that the user has previously downloaded several pieces representing a minimum threshold. Any act by which a user in full knowledge of the consequences of what they are doing gives access to a protected work is liable to constitute an act of communication. In the context of a peer-to-peer network, the communication is aimed at an indeterminate number of potential recipients and involves a fairly large number of persons. The works are also made available to a new public. There needs to be a fair balance between copyright holders and users, as well as the public interest.

A contractual rights holder who does not use the rights but merely claims damages from alleged infringers, might benefit in principle from the measures, procedures and remedies provided for in the Enforcement Directive, unless it is established on the basis of an overall and detailed assessment that their claims are abusive. A request for information based on Article 8 must also be rejected if it is unjustified or disproportionate, which will be for the referring court to determine.

To achieve the status of a rights holder under Article 4, it was unnecessary for the rights holder to use the rights. A company like M could be considered to be another person authorised to use rights within Article 4.

The fact that a person referred to in Article 4 merely brings an action as assignee does not exclude them from the benefit of the measures, procedures and remedies provided for in the Enforcement Directive. The general objective of the Enforcement Directive is to ensure a high level of protection of rights in the internal market. If a rights holder chooses to outsource the recovery of damages by assigning claims, they should not suffer less favourable treatment than another rights holder who chooses to assert the rights personally.

The fact that a request for information under Article 8 is made during the pre-litigation stage does not render it inadmissible.

To determine whether a rights holders' request under the Enforcement Directive is abusive, the national court should examine the requester's operating method, by evaluating the way in which they might offer amicable solutions to alleged infringers and by ascertaining whether they brought legal proceedings following a refusal to reach an amicable solution. It should also examine whether, in all the circumstances, M was attempting, under the guise of proposing amicable solutions to alleged infringements, to extract economic revenue from the users in a peer-to-peer network, without seeking to combat the copyright infringements caused by the network.

The EU GDPR does not preclude the systematic recording by the rights holder, or by a third party on the rights holder's behalf, of Internet Protocol addresses of users of peer-to-peer networks whose internet connections have allegedly been used in infringing activities. Nor does it preclude the communication of the names and postal addresses of those users to the rights holder or to a third party to enable it to bring a claim for damages court for prejudice allegedly caused by the users. However, the initiatives and requests of the rights holder or third party must be justified, proportionate and not abusive and have their legal basis in a national legislation.

Comment

The ECJ's decision that entities which have been assigned rights of action can rely on provisions in the Enforcement Directive does not appear to be controversial in itself, however the ruling does contain interesting guidance for national courts on determining whether that reliance might be excluded if the assignee’s actions are abusive.

Case: Mircom International Content Management & Consulting (MICM) Limited v Telenet BVBA C-597/19.

First published in the August 2021 issue of PLC Magazine and reproduced with the kind permission of the publishers. Subscription enquiries 020 7202 1200.