The Court of Justice of the European Union (CJEU) has ruled on the question of online cross border copyright infringement in Case C-170/12 Pinckney v KDG Mediatech AG. The questions referred to, and reformulated by the CJEU, asked whether a court of a Member State in which CDs containing reproductions of copyright music works were made available online, had jurisdiction to rule on copyright infringement proceedings brought in relation to such CDs, even if the act of reproduction had not occurred in the Member State of the court seized.
The CJEU considered that the courts of the Member States in which the copyright works were protected and in which the ‘harmful event’ had or may occur were competent to determine liability and damage caused in that territory.
On the facts, the CJEU ruled that there was a likelihood of the harmful event arising in a territory where it was possible to obtain infringing copies of works from web sites accessible in that territory.
In contrast to Advocate General Jääskinen’s opinion, the CJEU considered that the relevant criterion was not whether the activity of the web site was ‘directed to’ the Member State of the court seized, but rather whether copies were accessible online in the Member State of the court seized.
Business impact
- The CJEU ruling is good news for copyright owners wanting to take action against infringement of their works in the courts of the Member States in which the infringing contents are made available.
- It will not be necessary for copyright owners to show that a web site’s activity is targeted at Internet users of the Member States of the courts which they seize.
- Copyright owners may however still need to bring multiple actions in multiple jurisdictions to obtain redress in all the territories in which the infringing articles may have been accessible online.
- The decision may favour ‘forum shopping’ with authors taking action in jurisdictions in which they consider they have the most chance of success and it may trigger multiple cross-border actions.
- The decision is a surprising departure from previous settled case law on infringement of other intellectual property rights online pursuant to which liability attaches to a web site only if it is targeted at consumers of the Member State in which protection is sought.
- The decision suggests that harm occurs in all Member States in which the web site content is made accessible, regardless of the intention of the web site to target consumers in all Member States.
Background
Mr Pinckney, a French resident, claimed to be the author of 12 songs, which were made into a vinyl disk in the 1970s. Mr Pinckney brought a claim against Austrian domiciled company KDG Mediatech AG (‘Mediatech’), which he claimed had copied his songs onto a CD, copies of which were sold by UK companies via web sites accessible from France.
While the French First Instance Court considered that it had jurisdiction to rule on the matter, this was overturned by the French Court of Appeal on the grounds that the country of residence of the defendant was Austria and the damage had occurred outside France. Mr Pinckney appealed the decision and the French Supreme Court referred two questions to the CJEU in relation to the application of Article 5(3) of the Brussels I Regulation which provides that in matters of tort, delict or quasi-delict, a person domiciled in a Member State may be sued in the courts of another Member State where the harmful event occurred or may occur.
The French Supreme Court asked whether Article 5(3) of the Regulation meant that courts of Member States in which infringing content was made accessible had jurisdiction or whether the infringing content would need to be targeted at that Member State. Secondly, the French Court asked whether the answer would be different if the infringement resulted from the online sale of a ‘carrier medium’ as opposed to the placing of copyright content online.
Key findings
Admissibility of the questions referred
The Austrian government argued that the questions referred by the French Court were inadmissible and that in particular the first question concerned the online offer of digital content whereas Mediatech had been involved in the reproduction of CDs. In his Opinion of June 2013, Advocate General Jääskinen had also deemed the questions inadmissible as he considered that the only right which may have been breached by Mediatech was the reproduction right, to which the questions referred did not relate.
The CJEU acknowledged that it was settled case-law that it could decline to rule on requests for preliminary rulings where it was obvious that the interpretation of EU law bore no relation to the facts of the main action. In this instance however, the CJEU considered that the outcome of the dispute depended on the CJEU’s answers and that the questions were admissible as a result.
The CJEU nevertheless rephrased the question and asked whether Article 5(3) of the Regulation meant that a court of a Member State in which a work is protected by copyright has jurisdiction to rule on the liability of a company which is established in, and has reproduced in, a second Member State the copyright work on a CD, when that CD is subsequently marketed in a third Member State through an internet site accessible in the Member State of the court seized.
Derogation to the general defendant’s domicile rule
The CJEU noted that the general rule relating to questions of jurisdiction could be found in Article 2(1) of the Regulation under which jurisdiction is attributed to the courts of the defendant’s domicile.
The CJEU noted that, by derogation to this rule, Article 5(3) granted special jurisdiction to courts of Member States in which a harmful event occurred or may occur. The CJEU specified that, since this rule constituted a rule of special jurisdiction it should be interpreted restrictively, although the ‘place where the harmful event occurred or may occur’ was still to be understood as covering, both (i) the place where the damage occurred and; (ii) the place of the event giving rise to it.
Place where the harmful event occurred
Personality and intellectual and industrial rights
The Court referenced previous CJEU rulings on the interpretation of Article 5(3) of the Regulation in relation to online infringement of personality rights (eDate Advertising & Martinez) and of intellectual and industrial rights (Wintersteiger).
In eDate Advertising & Martinez, the CJEU had ruled that, in relation to personality rights, claimants may choose to bring actions in the court of a territory in which the online content has been placed or has been made accessible (for damages caused in that territory) and that, in addition, given the impact which materials could have on an individual’s rights, claimants could also bring proceedings in the courts of a territory in which the claimant had his ‘centre of interests’, in respect of all the damage caused.
In Wintersteiger, the CJEU ruled that in respect of intellectual and industrial property rights for which protection is granted by registration, jurisdiction was limited to courts of the Member State in which registration occurred.
Copyright infringement
The CJEU considered that, as for trade mark rights, copyright was subject to the principle of territoriality. However, the Court noted in contrast that, since copyright arises automatically, it can be infringed in all Member States.
Considering the facts in issue, the CJEU considered that the likelihood of the harmful event occurring arose from the possibility of obtaining a reproduction of the work from an Internet site accessible from the Member State of the court seized. The CJEU considered that it was not necessary for the web site activity to be ‘targeted’ at the territory of the court seized, since this was not a requirement under Article 5(3) of the Regulation. The CJEU indeed drew a distinction between Article 5(3) and Article 15(1)(c) on jurisdiction in relation to consumer contracts, which specifically requests activities to be directed to the Member State of the court seized.
On the scope of competency however, the Court noted that since copyright protection was territorial, the court seized only had jurisdiction to determine damage caused within that Member State.
Joel Smith is a partner at Herbert Smith Freehills LLP, London.
Alexandra Leriche is an associate in the IP Group in London, at Herbert Smith Freehills LLP, focusing upon contentious IP.
