Overview of recent CJEU Copyright Case Law

Dr. Christian Freudenberg
Schomerus & Partner
StB · RAe · WP
Deichstraße 1 · 20459 Hamburg
Tel. +49 40 37601 - 00 · Fax +49 40 37601 - 199
www.schomerus.de · info@schomerus.de
Who said there are margins?
Overview of recent CJEU copyright case law
ECTA Copyright Session 2015
Dr. Christian Freudenberg, DE

1
Overview
A. Introduction
B. Legal Framework
C. CJEU Copyright Case Law 2014/2015
I. Recent decisions June 2014 – May 2015
II. Pending proceedings
D. Conclusion

2
A. Introduction
EU Commission strategy paper (COM(2015) 192 final):
The Digital Agenda 2020 and the Digital Single Market Strategy
as Europe´s political priority
The EU Commission´s new focus on Copyright Law

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B. Legal Framework
 Directive 93/83/EEC (“Satellite & Cable”)
 Directive 96/9/EC (“Databases”)
 Directive 2001/29/EC (“Info-Soc”)
 Directive 2001/84/EC (“Resale Right”)
 Directive 2004/48/EC (“Enforcement”)
 Directive 2006/115/EC, replacing Directive 92/100/EEC (“Rental & Lending”)
 Directive 2006/116/EC, replacing Directive 93/98/EEC, amended by Directive 2011/77/EU
(“Term of Protection”)
 Directive 2009/24/EC, replacing Directive 91/250/EEC
(“legal protection of computer programs”)
 Directive 2012/28/EU (“Orphan Works”)
 Directive 2014/26/EU (“Collective Rights Management”)

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C-360/13 – Public Relations Consultants Association vs. The Newspaper
Licensing Agency Ltd.
Judgment of the Court (Fourth Chamber) of 5 June 2014
(request for a preliminary ruling from the Supreme Court of the United Kingdom)
Article 5 of Directive 2001/29/EC (...”Info-Soc”...) must be interpreted as meaning
that the copies on the user’s computer screen and the copies in the internet
‘cache’ of that computer’s hard disk, made by an end-user in the course of viewing
a website, satisfy the conditions that those copies must be temporary, that they
must be transient or incidental in nature and that they must constitute an
integral and essential part of a technological process, as well as the conditions
laid down in Article 5(5) of that directive, and that they may therefore be made
without the authorisation of the copyright holders.

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C-117/13 – Technische Universität Darmstadt vs Eugen Ulmer KG
Judgment of the Court (Fourth Chamber) of 11 September 2014
(request for a preliminary ruling from the Bundesgerichtshof — Germany)
1. The concept of ‘purchase or licensing terms’ provided for in Article 5(3)(n) of Directive 2001/29/EC
(…„Info-Soc“…) must be understood as requiring that the rightholder and an establishment, such as a
publicly accessible library, referred to in that provision must have concluded a licensing agreement in
respect of the work in question that sets out the conditions in which that establishment may use that
work.
2. Article 5(3)(n) of Directive 2001/29, read in conjunction with Article 5(2)(c) of that directive, must be
interpreted to mean that it does not preclude Member States from granting to publicly accessible
libraries covered by those provisions the right to digitise the works contained in their collections, if
such act of reproduction is necessary for the purpose of making those works available to users, by means
of dedicated terminals, within those establishments.
3. Article 5(3)(n) of Directive 2001/29 must be interpreted to mean that it does not extend to acts such as
the printing out of works on paper or their storage on a USB stick, carried out by users from dedicated
terminals installed in publicly accessible libraries covered by that provision. However, such acts may, if
appropriate, be authorised under national legislation transposing the exceptions or limitations provided for
in Article 5(2)(a) or (b) of that directive provided that, in each individual case, the conditions laid down by
those provisions are met.

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C-348/13 – BestWater International GmbH vs Michael Mebes/Stefan Potsch
Order of the court of 21 October 2014
(request for a preliminary ruling from the Bundesgerichtshof - Germany)
The mere fact that a protected work, freely available on an internet site, is inserted
into another internet site by means of a link using the ‘framing’ technique, such as
that used in the case in the main proceedings, cannot classified as
‘communication to the public’ within the meaning of Article 3(1) of Directive
2001/29/EC (...”Info-Soc”...) since the work at issue is not transmitted to a new
public or communicated a specific technical method different from that of the
original communication.

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C-419/13 – Art & Allposters International BV vs Stichting Pictoright
Judgment of the Court (Fourth Chamber) of 22 January 2015
(request for a preliminary ruling from the Hoge Raad der Nederlanden — Netherlands)
Article 4(2) of Directive 2001/29/EC (...”Info-Soc”...) must be interpreted as meaning
that the rule of exhaustion of the distribution right set out in Article 4(2) of Directive
2001/29 does not apply in a situation where a reproduction of a protected work,
after having been marketed in the European Union with the copyright holder’s
consent, has undergone an alteration of its medium, such as the transfer of that
reproduction from a paper poster onto a canvas, and is placed on the market again
in its new form.

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C-41/14 – Christie´s France SNC vs Syndicat national des antiquaires
Judgment of the Court (Fourth Chamber) of 26 February 2015
(request for a preliminary ruling from the Cour de cassation — France)
Article 1(4) of Directive 2001/84/EC (...”Resale Right”...) must be interpreted as not
precluding the person by whom the resale royalty is payable, designated as
such by national law, whether that is the seller or an art market professional involved
in the transaction, from agreeing with any other person, including the buyer,
that that other person will definitively bear, in whole or in part, the cost of the
royalty, provided that a contractual arrangement of that kind does not affect the
obligations and liability which the person by whom the royalty is payable has towards
the author.

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C-463/12 – Nokia vs Copydan Bandkopi
Judgment of the Court (Fourth Chamber) of 5 March 2015
(request for a preliminary ruling from the Oestre Landsret — Denmark)
1. Article 5(2)(b) of Directive 2001/29/EC (...”Info-Soc”...) does not preclude national legislation which
provides that fair compensation is to be paid, in accordance with the exception to the reproduction right
for copies made for private use, in respect of multifunctional media such as mobile telephone
memory cards, irrespective of whether the main function of such media is to make such copies,
provided that one of the functions of the media, be it merely an ancillary function, enables the operator
to use them for that purpose. However, the question whether the function is a main or an ancillary
one and the relative importance of the medium’s capacity to make copies are liable to affect the amount
of fair compensation payable. In so far as the prejudice to the rightholder may be regarded as minimal,
the making available of such a function need not give rise to an obligation to pay fair compensation.
2. Article 5(2)(b) of Directive 2001/29 does not preclude national legislation which makes the supply of
media that may be used for copying for private use, such as mobile telephone memory cards, subject
to the levy intended to finance fair compensation payable in accordance with the exception to the
reproduction right for copies for private use, but does not make the supply of components whose main
purpose is to store copies for private use, such as the internal memories of MP3 players, subject to
that levy, provided that those different categories of media and components are not comparable or
the different treatment they receive is justified, which is a matter for the national court to determine.

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3. Article 5(2)(b) of Directive 2001/29 must be interpreted as not precluding national legislation which
requires payment of the levy intended to finance fair compensation, in accordance with the exception to
the reproduction right for copies for private use, by producers and importers who sell mobile telephone
memory cards to business customers and are aware that those cards will be sold on by those customers
but do not know whether the final purchasers of the cards will be individuals or business
customers, on condition that:
- the introduction of such a system is justified by practical difficulties;
- the persons responsible for payment are exempt from the levy if they can establish that they have sup-
plied the mobile telephone memory cards to persons other than natural persons for purposes clearly
unrelated to copying for private use, it being understood that the exemption cannot be restricted to the
supply of business customers registered with the organisation responsible for administering the levy;
- the system provides for a right to reimbursement of that levy which is effective and does not make
it excessively difficult to repay the levy and only the final purchaser of such a memory card may obtain
reimbursement by submitting an appropriate application to that organisation.
4. Article 5(2)(b) of Directive 2001/29, read in the light of recital 35 in the preamble to that directive, must be
interpreted as permitting the Member States to provide, in certain cases covered by the exception to the
reproduction right for copies for private use, for an exemption from the requirement under that exception
to pay fair compensation, provided that the prejudice caused to rightholders in such cases is
minimal. It is within the discretion of the Member States to set the threshold for such prejudice, it being
understood that that threshold must, inter alia, be applied in a manner consistent with the principle of
equal treatment.

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5. Directive 2001/29 is to be interpreted as meaning that, where a Member State has decided, pursuant to
Article 5(2) of that directive, to exclude, from the material scope of that provision, any right for
rightholders to authorise reproduction of their works for private use, any authorisation given by a
rightholder for the use of files containing his works can have no bearing on the fair compensation
payable in accordance with the exception to the reproduction right for reproductions made in accordance
with Article 5(2)(b) of that directive with the aid of such files and cannot, of itself, give rise to an
obligation on the part of the user of the files concerned to pay remuneration of any kind to the
rightholder.
6. The implementation of technological measures under Article 6 of Directive 2001/29 for devices used to
reproduce protected works, such as DVDs, CDs, MP3 players and computers, can have no effect on the
requirement to pay fair compensation in accordance with the exception to the reproduction right in
respect of reproductions made for private use by means of such devices. However, the implementation of
such measures may have an effect on the actual level of such compensation.
7. Directive 2001/29 precludes national legislation which provides for fair compensation, in accordance
with the exception to the reproduction right, in respect of reproductions made using unlawful sources,
namely from protected works which are made available to the public without the rightholder’s consent.
8. Directive 2001/29 does not preclude national legislation which provides for fair compensation, in
accordance with the exception to the reproduction right, in respect of reproductions of protected works
made by a natural person by or with the aid of a device which belongs to a third party.

12
C-279/13 – C More Entertainment AB vs. Linus Sandberg
Judgment of the Court (Ninth Chamber) of 26 March 2015
(request for a preliminary ruling from the Högsta domstolen – Sweden)
Article 3(2) of Directive 2001/29/EC (...”Info-Soc”...) must be interpreted as not
precluding national legislation extending the exclusive right of the
broadcasting organisations referred to in Article 3(2)(d) as regards acts of
communication to the public which broadcasts of sporting fixtures made live on
internet, such as those at issue in the main proceedings, may constitute, provided
that such an extension does not undermine the protection of copyright.

13
C-516/13 – Dimensione Direct Sales srl vs Knoll International SpA
Judgement of the Court (Fourth Chamber) of 13 May 2015
(request for a preliminary ruling from the Bundesgerichtshof – Germany)
Article 4(1) of Directive 2001/29/EC (...”Info-Soc”...) must be interpreted as meaning
that it allows a holder of an exclusive right to distribute a protected work to prevent
an offer for sale or a targeted advertisement of the original or a copy of that work,
even if it is not established that that advertisement gave rise to the purchase of the
protected work by an EU buyer, in so far as that advertisement invites consumers
of the Member State in which that work is protected by copyright to purchase
it.

14
C-572/13 – Hewlett Packard Belgium SPRL vs Reprobel SCRL
Request for a preliminary ruling from the Cour d’appel de Bruxelles (Belgium) lodged on 8 November 2013
Questions referred:
Must the term ‘fair compensation’ contained in Article 5(2)(a) and Article 5(2)(b) of Directive 2001/29
(...”Info-Soc”...) be interpreted differently depending on whether the reproduction on paper or a
similar medium effected by the use of any kind of photographic technique or by some other process
having similar effects is carried out by any user or by a natural person for private use and for ends
that are neither directly nor indirectly commercial? If the answer is in the affirmative, on what
criteria must that difference of interpretation be based?
Must Article 5(2)(a) and Article 5(2)(b) of Directive 2001/29 be interpreted as authorising the Member
States to fix the fair compensation payable to rightholders in the form of:
(1) a lump-sum remunerative payment made by the manufacturer, importer or intra-Community
acquirer of devices enabling protected works to be copied, at the time when such devices are put into
circulation on national territory, the amount of which is calculated solely by reference to the speed at
which the copier is capable of producing a number of copies per minute, without being otherwise
linked to any harm suffered by rightholders;
and;

15
(2) a proportional remunerative payment, determined solely by means of a unit price multi-plied by
the number of copies produced, which varies depending on whether or not the person liable for
payment has cooperated in the collection of that remuneration, which is payable by natural or legal
persons making copies of works or, as the case may be, in lieu of those persons, by those who, for
consideration or free of charge, make a reproduction device available to others.
If the reply to this question is in the negative, what are the relevant and consistent criteria that the
Member States must apply in order to ensure that, in accordance with European Union law, the
compensation may be regarded as fair and that a fair balance is maintained between the persons
concerned?
States to allocate half of the fair compensation due to rightholders to the publishers of works
created by authors, the publishers being under no obligation whatsoever to ensure that the authors
benefit, even indirectly, from some of the compensation of which they have been deprived?
States to introduce an undifferentiated system for recovering the fair compensation due to
rightholders in the form of a lump-sum and an amount for each copy made, which, implicitly but
indisputably, covers in part the copying of sheet music and counterfeit reproductions?

16
C-325/14 – SBS Belgium NV vs SABAM
Request for a preliminary ruling from the Hof van beroep te Brussel (Belgium) lodged on 7 July 2014
Question referred:
Does a broadcasting organisation which transmits its programmes exclusively via
the technique of direct injection — that is to say, a two-step process in which it
transmits its programme-carrying signals in an encrypted form via satellite, a fibre-
optic connection or another means of transmission to distributors (satellite, cable or
xDSL-line), without the signals being accessible to the public during or as a
result of that transmission, and in which the distributors then send the signals to
their subscribers so that the latter may view the programmes — make a
communication to the public within the meaning of Article 3 of Directive
2001/29/EC (...”Info-Soc”...)?

17
C-470/14 – EGEDA vs Administración del Estado and Others
Request for a preliminary ruling from Tribunal Supremo — Sala Tercera Contencioso-Administrativo (Spain) lodged on
14 October 2014
Question referred:
Is a scheme for fair compensation for private copying compatible with
Article 5(2)(b) of Directive 2001/29 (...”Info-Soc”...) here the scheme, while taking as
a basis an estimate of the harm actually caused, is financed from the General
State Budget, it thus not being possible to ensure that the cost of that compensation
is borne by the users of private copies?
If the first question is answered in the affirmative, is the scheme compatible with
Article 5(2)(b) of Directive 2001/29 where the total amount allocated by the General
State Budget to fair compensation for private copying, although it is calculated on the
basis of the harm actually caused, has to be set within the budgetary limits
established for each financial year?

18
C-572/14 – Austro Mechana GmbH vs Amazon EU Sàrl
Request for a preliminary ruling from the Oberster Gerichtshof (Austria) lodged on 11 December 2014
Question referred:
Does a claim for payment of ‘fair compensation’ under Article 5(2)(b) of Directive
2001/29/EC (...”Info-Soc”...) which, in accordance with Austrian law, is directed
against undertakings that are first to place recording material on the domestic market
on a commercial basis and for consideration constitute a claim arising from ‘tort,
delict or quasi-delict’ within the meaning of Article 5(3) of Council Regulation (EC)
No 44/2001 of 22 December 2000 on jurisdiction and the recognition and
enforcement of judgments in civil and commercial matters?

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1. The European Commission has identified Copyright Law as one of Europe´s
political priorities being part of the Digital Agenda 2020 and the Digital Single
Market Strategy.
2. The national courts in the European Union are constantly filing requests for
preliminary rulings by the CJEU, most of them – so far – with regard to the
interpretation of Directive 2001/29/EC (”Info-Soc”).
3. The copyright-related CJEU decisions will have a substantial influence on the
further development of the European Copyright Law and will help to establish
the guidelines for a more harmonized European copyright regime.
D. Conclusion

Schomerus & Partner
StB · RAe · WP
Deichstraße 1 · 20459 Hamburg
Tel. +49 40 37601 - 00 · Fax +49 40 37601 - 199
www.schomerus.de · info@schomerus.de
Thank you!
Rechtsanwalt
Fachanwalt für Gewerblichen Rechtsschutz
christian.freudenberg@schomerus.de

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Wirtschaftsprüfer
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Overview of recent CJEU Copyright Case Law

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Overview of recent CJEU Copyright Case Law