Wednesday, 8 February 2017

BREAKING: AG Szpunar advises CJEU to rule that The Pirate Bay makes acts of communication to the public

Is there a communication to the public within the meaning of Article 3(1) of the InfoSoc Directive by the operator of a website [The Pirate Bay, TPB], if no protected works are available on that website, but a system exist by means of which metadata on protected works which is present on the users’ computers is indexed and categorised for users, so that the users can trace and upload and download the protected works on the basis thereof?

This is the principal question that the Dutch Supreme Court (Hoge Raad der Nederlanden) referred to the Court of Justice of the European Union (CJEU) in Stichting Brein, C-610/15.

As readers will promptly recall, this is just the last in a(n impressive, quantity-wise) series of references for a preliminary ruling seeking clarification on the interpretation of the right of communication to the public within Article 3(1) of the InfoSoc Directive, the most immediate precedents being GS Media [Kat-coverage here] and the (pending) Filmspeler case [on which see the Opinion of Advocate General (AG) Campos Sánchez-Bordona here].


There is not much to say here. Dutch anti-piracy organisation Stichting Brein applied for an injunction (to be granted under the Dutch equivalent of Article 8(3) of the InfoSoc Directive) against access providers Ziggo and XS4ALL to block access by recipients of their services to the internet addresses of the website of TPB.

That application, upheld at first instance, was dismissed on appeal, essentially on the grounds, first, that it is the recipients of the services of the defendants in the main proceedings, and not TPB, which are the originators of the copyright infringements and, secondly, that the blocking sought would not be proportionate to the aim pursued, namely the effective protection of copyrights. 

Stichting Brein appealed on a point of law against the latter decision before the referring court.

AG Maciej Szpunar
Today's Opinion

AG Szpunar has just issued his Opinion, advising the CJEU to answer the question of the Dutch Supreme Court in the AFFIRMATIVE. 

More specifically, "the fact that the operator of a website makes it possible, by indexing them and providing a search engine, to find files containing works protected by copyright which are offered for sharing on a peer-to-peer network, constitutes a communication to the public within the meaning of Article 3(1) of [the InfoSoc Directive], if that operator is aware of the fact that a work is made available on the network without the consent of the copyright holders and does not take action in order to make access to that work impossible." [para 54]

The Opinion is EXTREMELY interesting, for a number of reasons.

EU, not national solutions = a matter of primary liability

It is sufficient to note that the AG rejected at the outset the view of the European Commission and UK that any solution to the possible liability of a site like The Pirate Bay should be found under national law [translated (possibly): under secondary liability, an area unharmonised at the EU level].

According to the AG this would lead [and has led] to very diverging approaches and ultimately undermine the objective of the EU legislature to harmonise the substantial scope of the rights enjoyed by authors and rightholders within the single market [para 3].

The TPB case is different from GS Media's

Logically linked with the point above, the AG also noted that the problems raised in this case are different from those addressed in Svensson and GS Media.

According to the AG, in fact, while those cases concerned the secondary communication of works already accessible on the internet by a person providing the online content himself, the present case concerns original communication, made on a peer-to-peer (P2P) network. As such, the CJEU reasoning in those cases cannot be directly applied to the case at hand [para 4].

The "unavoidable" role of TPB

Following a review of the technical functioning of P2P networks, the AG said that what is relevant in order to answer the question posed by the Dutch Supreme Court is the consideration of the role played by websites such as TPB in file-sharing on P2P networks: "[t]hat role is crucial" [para 26].

More specifically, the use of any P2P network "depends on the possibility of finding peers available to share the desired file. The information, whether it is technically in the form of torrent files, ‘magnet links’ or some other form, is found on websites such as TPB. Those sites provide not only a search engine but also, as in the case of TPB, indexes of the works contained in those files, classified in various categories, for example, ‘100 best’ or ‘the latest’. So it is not even necessary to look for a particular work, it is sufficient to choose from those on offer, as in the catalogue of a library (or rather an audio or video collection, since it is mainly music and films). Those sites also often provide additional information, inter alia on the estimated download time and the number of active ‘seeders’ and ‘leechers’ for a particular file. Although, as the defendants in the main proceedings contend, it is therefore theoretically possible to find files offered for sharing on a peer-to-peer network without using a site like TPB, in practice, the search for such files generally leads to such a site or a site aggregating data from several peer-to-peer networks. The role of websites such as TPB is therefore practically unavoidable in the operation of those networks, in any event for the average internet user." [paras 26-27]

Communication to the public

Having exhausted these preliminary remarks, the AG turned to Article 3(1) of the InfoSoc Directive and what makes an act of communication to the public. 

As usual [just think of VOBMc Fadden, or Hotel Edelweiss], he provided an analysis of the history and rationale of the relevant provision considered and recalled [as per consistent CJEU case law, at least since SGAE] that to have an act of communication to the public it is necessary to have: (1) an act of communication, and (2) the presence of a public [para 36].

How Kats communicate
(1) An act of communication: no transmission is required

Considering the first condition, ie an act of communication, the AG recalled that the CJEU has emphasised "the essential role of the player originating the communication and the deliberate nature of its intervention. That player makes an act of communication when it intervenes, in full knowledge of the consequences of its action, to give its customers access to a protected work, and does so in particular where without that intervention its customers would not, in principle, be able to enjoy the broadcast work" [para 37, recalling GS Media, para 35].

The AG then tackled the thorny issue of whether transmission is actually required [readers will remember that the European Copyright Society stated that this is necessary to have an act of communication]

While it is true that "in the case of making available, the actual transmission of the work takes place only potentially and on the initiative of the recipient", the AG [correctly] stated "the ability of the copyright holder to prevent the communication arises at the actual time of making available, irrespective of whether and when transmission actually takes place." [para 38]

(2) The presence of the public: the 'new public'

Turning to the second criterion, ie the presence of the public, this involves two requirements: (a) an indeterminate but fairly large number of potential recipients [para 39]; and (b) a 'new public' [para 40] which only comes into consideration when the technical means used is different from that used for the initial communication [para 42].

Communication to the public on P2P networks

According to the AG, "[t]here is no question ... that the making available to the public of copyright-protected works takes place where those works are shared on a peer-to-peer network." [para 44]

The question is, however, who is to be regarded as making the relevant act of communication: is the P2P network users or, rather, the operator of an indexing site such as TPB?

According to the AG, while users deliberately make the works in their possession available to other users of the network [para 49], "those 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 sites such as TPB, which enable works to be found and accessed. The operators of those sites therefore arrange the system which enables users to access works that are made available by other users. Their role may therefore be regarded as necessary." [para 50]

The operator of a site that merely indexes the content that is present on the P2P network has, in principle, no influence over the appearance of a given work on that network (it is only an intermediary which enables users to share the content on a P2P basis). As long as he is unaware that the work has been made available illegally or if, once it has been made aware of the illegality, it acts in good faith to rectify the matter, it has no liability for the users' communications. 

"However, from the moment that operator has [actual, eg by means of a notification from the relevant rightholder: para 52] 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." [para 51]

No presumption of knowledge
Rejecting the idea of a presumption of knowledge

The AG rejected that in a case like this it would be appropriate to have a presumption of knowledge like the one adopted in GS Media [para 52] because such a presumption would amount to imposing on operators of indexing sites of P2P networks, which normally operate for profit, a general obligation to monitor the indexed content [contrary to Article 15 of the Ecommerce Directive].

The TPB operators: joint liability

Accordingly, in a situation like TPC, the intervention of their operators "meets the conditions of being necessary and deliberate, laid down in the case-law of the Court" and those operators should therefore "also be considered, simultaneously and jointly with the users of the network, as originating the making available to the public of works that are shared on the network without the consent of the copyright holders, if they are aware of that illegality and do not take action to make access to such works impossible."

The second question

The AG also considered the second question [to be answered only if the CJEU answers the one on communication to the public in the negative], ie whether Article 8(3) of the InfoSoc Directive must be interpreted as offering scope for obtaining an injunction against an ISP ordering it to block access for its users to an indexing site of a peer-to-peer network by means of which copyright infringements have been committed, even if the operator of that site does not itself communicate to the public the works made available on that network.

Applicability of Article 8(3) injunctions to sites such as TPB

The AG noted that the only peculiarity of a blocking injunction [ie a measure that the CJEU considered compatible with EU law, although in a different context, in Telekabel] in case like the one at hand would be that blocking of access to the TPB site would affect not only users who commit copyright infringements but also the TPB site, which would not be able to offer its services to users connected to the internet through the intermediary of the defendants in the main proceedings [para 61].

The AG noted that the circumstances envisaged in Article 8(3) presuppose the existence of a link between the subject of the injunction and the copyright infringement. A measure blocking a website implies that it has been established that the operator of that site has been held liable for copyright infringement using the services of the intermediary to which the injunction is addressed. 

Blocking order
Having distinguished between situations of primary and secondary liability and considered the need to balance different fundamental rights, the AG considered that depriving internet users of access to information, by blocking the TPB site, would be proportionate to the significance and seriousness of the copyright infringements committed on that site [big, yet unsurprising, win for copyright owners].

Overall, Article 8(3) should be interpreted as permitting an injunction to be obtained against an intermediary ordering it to block access for its users to an indexing site of a P2P network, if the operator of that site can, under national law, be held liable for copyright infringements committed by users of that network, provided that measure is proportionate to the significance and seriousness of the copyright infringements committed, which is a matter for the national court to determine [para 84].


This is yet another thoughtful and good opinion of AG Szpunar. 

His construction of the right of communication to the public appears appropriate not only in light of pre-existing CJEU case law [and also the InfoSoc objective to provide a high level of protection], but also ... despite it. His conclusion that the presumption of knowledge adopted in GS Media should not find application in a case like the one of operators of indexing sites is in fact sensible [that the GS Media presumption of knowledge is problematic is apparent from the early national applications of this CJEU judgment in Sweden - herehere, and here -, Germany - here and here - and the Czech Republic - here].

Equally sensible [a reality check] is the consideration that in situations like TPB the intervention of its operators in facilitating the exchange of copyright works is deliberate and, indeed, essential

Big kudos to AG Szpunar. Let's now see if the CJEU agrees with him. Stay tuned!

[Originally published on The IPKat on 8 February 2017]

Saturday, 4 February 2017

The next round of Cartier: UK Supreme Court will hear appeal re costs of intermediary injunctions

Readers with a fancy for online IP enforcement will remember that last July the Court of Appeal of England and Wales issued its decision in Cartier and Others v BSkyB and Others [here], in which it upheld the 2014 decision of Arnold J in the High Court [here and here] that blocking injunctions are also available in trade mark cases under the general power recognised by s37(1) of the Senior Courts Act 1981 (SCA)This provision states that “[t]he High Court may by order (whether interlocutory or final) grant an injunction … in all cases in which it appears to be just and convenient to do so.”

The missed implementation of Article 11 of the Enforcement Directive

UK Government, in fact, implemented Article 8(3) of the InfoSoc Directive into UK law by inserting s97A into the CDPA, and UK courts have ever since developed a consistent and thoughtful jurisprudence on the application of this domestic provision. 

However, no express implementation of the third sentence in Article 11 of the Enforcement Directive has been provided in the UK. UK Government justified its decision not to take any action to implement this more general rule by referring to s37(1) SCA.

The result has been that, until the 2014 decision of the High Court of England and Wales in Cartier it was uncertain whether rightholders could seek injunctions against intermediaries to block access to websites where content infringing IP rights other than copyright (more specifically: trade marks) is accessible. 

The High Court decision

Arnold J provided an interpretation of s37(1) SCA both in a domestic context and in light of the third sentence of Article 11 in the Enforcement Directive, and concluded that in principle the High Court of England and Wales would have jurisdiction to grant the order requested by the applicants, ie to order major UK access provider to block access to websites selling counterfeits. 

The judge added that in any case the court’s discretion under s37(1) SCA to grant website blocking orders is not unlimited, but must be exercised consistently with the terms of the Enforcement Directive, including Articles 3 and 11, and with the terms of the E-commerce Directive, including Articles 12 to 15. 

In line with his earlier judgment in Newzbin 2 [here, ie the first copyright blocking injunction granted in the UK], Arnold J also took the view that "the rightholders should pay the costs of an unopposed application ... [and] the ISPs should generally bear the costs of implementation as part of the costs of carrying on business in this sector". However the judge did "not rule out the possibility of ordering the rightholder to pay some or all of the implementation costs in an appropriate case." [para 240]

The Court of Appeal decision ... and the issue of costs

The "entirely correct" [para 35] decision of Arnold J was confirmed in appeal. 

Kitchin LJ (delivering the judgment of the Court of Appeal of England and Wales) recognized that "the ISPs are not guilty of any wrongdoing”, nor owe a common law duty of care to take reasonable care to ensure that their services are not used by the operators of the offending websites [para 54].This said, however, Kitchin LJ observed that the operators of the infringing websites need the services of the ISPs in order to offer for sale and sell their counterfeit goods to UK consumers. It follows that "the ISPs are therefore inevitable and essential actors in those infringing activities."[para 56] 

Kitchin LJ also dismissed the ISPs' point that Arnold J allegedly failed to carry out a fair evaluation of the relative merits of alternative measures to blocking, and confirmed that that Arnold J "was entitled to require the ISPs to bear the costs of the implementation of the orders in issue." [para 150] He also approved of Arnold J's proper consideration of the economic impact of website blocking orders upon the businesses of the ISPs, and that these could either bear these costs themselves or pass them on to their subscribers in the form of higher subscription charges.

Briggs LJ
The Court of Appeal judgment contains however the dissent of Briggs LJ on the issue of costs. In particular, “the cost burden attributable to the implementation of a particular blocking order should fall upon the rightholder making the application for it. [para 198] 

According to Briggs LJ, the reason is a domestic one. It is true that both the Enforcement Directive and the InfoSoc directives provide that rightholders should have the possibility of applying for an injunction against an intermediary who either carries a third party's infringement of a protected work in a network (in copyright cases) or whose services are being used by a third party to infringe the rightholder's industrial property right (in relation to trade marks). In both cases the conditions and modalities relating to such injunctions, or the conditions and procedures relating to such injunctions should be left to the national law of the Member States. 

In the UK, however, courts have jurisdiction as per s37(1) SCA, and this in substance reflects an originally unfettered jurisdiction exercised by the Court of Chancery on equitable principles. In the case of orders against innocent third parties, the law has evolved so to ensure that a standard condition or 'modality' for the grant of an injunction is that the cost reasonably incurred by the innocent respondent should be reimbursed by the applicant. 


“[T]he reason why the courts of England and Wales have jurisdiction to make blocking orders of the relevant type is that they are indeed a natural development of the court's enforcement of the equitable duty to assist so that, in the context of trade marks, the government was right to conclude that no specific legislation for that purpose was required … [T]he courts could and probably would have developed this jurisdiction regardless of the requirement in the two Directives that it be made available as specified. It was a jurisdiction with existing well-recognised conditions or modalities, one of which was that the victim indemnify the innocent party for its cost of complying with the court's order.” [para 202]

Who pays?
The next round: the Supreme Court

Via a precious Katfriend comes the news that last week the UK Supreme Court granted BT & EE’s application for permission to appeal the Court of Appeal decision in part.

More specifically:

1.     BT & EE have been granted permission to appeal the following ground:

That the Court was wrong to hold that the Appellants as innocent parties, should be required to bear the costs of the blocking injunctions.  To the contrary, as innocent parties who are discharging an equitable duty to assist, the Appellants should be indemnified against all costs, expenses and liabilities. 

2.    BT & EE have not be granted permission to appeal the following ground, because the ground was simply “not arguable”:

That the Court adopted the wrong threshold conditions for the grant of injunctive relief against an innocent third party, and in particular was wrong to conclude:

(a)   that a blocking injunction could be granted based on a mere possibility of future access to a target website, and in the absence of proof that a real and substantial number of infringements is occurring in the UK by means of the Appellants’ services; and

(b)   that the orders were “necessary” in circumstances where the Respondents had not taken reasonable steps (or any steps) to pursue the primary wrongdoers.


It will be very interesting to see what the Supreme Court says now. 

As mentioned, according to Briggs LJ the reason why intermediaries should not bear the costs of implementing a blocking order is essentially a domestic one. In addition, as I argued more at length here [see also here], in my view also the EU framework does not provide uncontroversial guidance on the point of costs.

An unusually confused Bertie:
is there an EU rule on costs of injunctions?
The EU law framework is in fact fundamentally silent regarding who should bear the costs of injunctions against intermediaries. Even the ambiguous wording of Article 14 of the Enforcement Directive ("Member States shall ensure that reasonable and proportionate legal costs and other expenses incurred by the successful party shall, as a general rule, be borne by the unsuccessful party, unless equity does not allow this.") does not seem to relate directly to injunctions. 

Substantially the issue of injunction costs appears to be an area of the law that has been left unharmonized at the EU level. This is possibly also because, as Recital 59 of the InfoSoc Directive eloquently puts, "[t]he conditions and modalities relating to such injunctions should be left to the national law of the Member States." 

Although the majority of national legal systems envisages that intermediaries are responsible for bearing the costs of an injunction against them for third-party infringements, Member States are ultimately free to choose the solution they prefer. As such, any discussion as to whether the solution indicated by Arnold J and subsequently followed in other cases is the one to prefer is a legitimate one. 

This is particular the case after the recent decision of the Court of Justice of the European Union (CJEU) in Mc Fadden [here].

In his Opinion on 16 March 2016 [here] Advocate General (AG) Szpunar held the view that an intermediary cannot be held liable for an IP infringement committed by a user of its services and, as a result, cannot be asked to bear pre-litigation and court costs. Holding otherwise "could potentially have the same punitive effect as an order to pay damages and could in the same way hinder the development of the intermediary services in question."[para 77] The AG further noted that injunctions may be imposed on innocent intermediaries to repress third-party infringements. However, the safe harbour regime (within Article 12 of the E-commerce Directive in that specific case) "precludes the making of orders against intermediary service providers not only for the payment of damages, but also for the payment of the costs of giving formal notice or other costs relating to copyright infringements committed by third parties as a result of the information transmitted." [para 80, emphasis added] The phrase ‘other costs’ might encompass the costs of implementing an injunction, including a blocking injunction. The statement of the AG in this part of the Opinion, in fact, does not appear to distinguish between costs arisen before an injunction is granted and costs arisen after an injunction is granted, eg costs of implementation. 

The CJEU decision in Mc Fadden is more nuanced and targeted on this point than the AG Opinion, although it appears to depart substantially from it. Holding that the safe harbour protection does not preclude one from seeking an injunction against an intermediary whose services are used to infringe his IP rights, the CJEU stated that the relevant rightholder can seek reimbursement from the intermediary at which the relevant injunction is addressed “of the costs of giving formal notice and court costs” [para 79] Arguably this part of the Mc Fadden judgment closes the door to the idea that intermediaries should not bear any costs, and also raises the question whether rightholders should even bear the application costs of an injunction. 

In this sense, the CJEU decision may be at odds with relevant EU law provisions and earlier CJEU case law from which UK judges had drawn authority to hold that the application costs should be borne by rightholders.

In all this, the UK Supreme Court's judgment is keenly awaited: stay tuned! 

[Originally published on The IPKat on 4 February 2017]

Wednesday, 1 February 2017

5 mistakes to avoid in IP student essays ... and not only there

When producing a piece of legal/IP analysis substance is of course important, but so is its presentation.

I have finished marking the scripts of my IP students for this semester and - like every year - there are some common mistakes that tend to be made repeatedly.

Apart from some confusion as regards use of something like "its" and "it's" here are the top formal [but also substantial!] mistakes that should be avoided [and yet appear also in texts produced by qualified lawyers ...]:

Ps: if you are wondering what the ECLI [European Case Law Identifier] citation system is, take a look here.

[Originally published on the IPKat on 1 February 2017]