TV Formats with copyright protection in Italy

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The Italian Supreme Court has issued a decision that some TV formats can take advantages of copyright protection.

As it is well-known many countries around the world don’t acknowledge specific copyright protection for TV formats mainly because they don’t fit well in the definition for such protection.

In the Italian case, however, the court considers these formats as eligible for copyright protection if they can meet some requirements such as identification of the structural elements of the story, as well as its space and time collocation, the main characters and the main thread of the plot. In addition, the structure must be repeatable and possessing at least a modicum of creativity.

More information here.

Source: IP Kat.

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Collective societies, rates, monopoly positions and a EU Court decision

european_court_justiceweb-thumb-largeThe European Court ruled in case C‑177/16 Autortiesību un komunicēšanās konsultāciju aģentūra / Latvijas Autoru apvienība v Konkurences padome. This case concerns the following:

The AKKA/LAA, a collective management organisation handling copyright for musical works, is the only entity authorised in Latvia to issue, for consideration, licences for the public performance of musical works in respect of which it manages the copyright. It collects the fees from which Latvian copyright holders are remunerated as well as, through contracts concluded with foreign collecting societies, those from which foreign copyright holders are remunerated. Holders of its licences include shops and service centres, as users of works protected by copyright and related rights.

By decision of 1 December 2008, the Competition Council imposed a fine on the AKKA/LAA for abuse of a dominant position as a result of the application of excessively high rates. The AKKA/LAA subsequently adopted new rates applicable from 2011. On 31 May 2012, the Competition Council opened a procedure to examine those new rates.

In the context of that procedure, the Competition Council first compared the rates applied in Latvia for the use of musical works in shops and service centres with those applied in Lithuania and Estonia as neighbouring Member States and markets. The Competition Council found that the rates applied in Latvia were higher than those applied in Estonia and, in most cases, higher than those charged in Lithuania. Although, in those three Member States, rates are set according to the surface area of the shop or service centre concerned, the Competition Council observed that, for surface areas of between 81 m² and 201-300 m², the rates applied in Latvia were two to three times higher than those applied in the other two Baltic States.

Secondly, the Competition Council, having recourse to the purchasing power parity index (‘PPP index’), compared the fees in force in approximately 20 other Member States and found in this regard that the rates payable in Latvia exceeded the average level of those charged in those other Member States by 50% to 100%. More specifically, in the case of shops or service centres with surface areas of between 85.5 m² and approximately 140 m², only the rates applied in Romania were higher.

Having taken the view that the fees in force in Latvia, in the segments where they were significantly higher than in Estonia and in Lithuania, were unfair, the Competition Council, by decision of 2 April 2013, imposed a fine of 45 645.83 Latvian lats (LVL) (approximately EUR 32 080) on the AKKA/LAA for abuse of a dominant position pursuant to Article 13(1)(4) of the Law on competition and point (a) of the second paragraph of Article 102 TFEU (‘the contested decision’). The Competition Council calculated the amount of that fine on the basis of the AKKA/LAA’s turnover, considering in this regard that remuneration collected for rightholders constituted an integral part of that organisation’s turnover and had to be taken into account.

The AKKA/LAA brought an action before the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia) seeking the annulment of the contested decision, raising, in essence, four pleas in support of that action. First, it argued, the Competition Council essentially restricted the comparison of the rates applicable in Latvia to those applicable in neighbouring Member States, namely Estonia and Lithuania, whereas, in respect of gross domestic product and price levels, the situation in Latvia is also comparable to those in Bulgaria, Romania, Poland and Hungary. Secondly, it submitted, the Competition Council did not state clearly the method used to calculate the reference rates. Thirdly, in its opinion, the Competition Council erred in taking the view that it was incumbent on the AKKA/LAA to justify the level of its rates. Fourthly, it submitted, the Competition Council should not have taken into account, when calculating the AKKA/LAA’s fine, the sums collected for the remuneration of authors, given that those sums do not form a part of the assets of that organisation.

By judgment of 9 February 2015, the Administratīvā apgabaltiesa (Regional Administrative Court) partially annulled the contested decision. That court held that the Competition Council was right to find that there had been an abuse of a dominant position by the AKKA/LAA. It also took the view that the comparison of rates for the same type of services between Latvia, Estonia and Lithuania was justified and that the AKKA/LAA had provided no explanation for the fact that the rates applicable in Latvia were significantly higher than those applicable in Estonia and Lithuania. However, since it found that the Competition Council had, for the purpose of calculating the fine, improperly taken into account the sums collected for the remuneration of authors, that court ordered the Competition Council to recalculate the amount of the fine within two months following the delivery of its judgment.

The AKKA/LAA appealed in cassation against that judgment to the referring court on the ground that that judgment had not given it full satisfaction. The Competition Council, for its part, also appealed against that judgment on the ground that, by that judgment, the Administratīvā apgabaltiesa (Regional Administrative Court) had annulled the provisions of the contested decision concerning the fine imposed.

According to the AKKA/LAA, the Administratīvā apgabaltiesa (Regional Administrative Court) had not set out objective and verifiable criteria to justify its view that the rates applicable in Latvia were capable of being compared with those in Estonia and Lithuania. Thus, it argued, that court had not based its reasoning on economic criteria, but on criteria relating to the territorial, historical and cultural situation common to those States.

The AKKA/LAA challenges, in particular, the finding that the geographical proximity of the other Baltic States could be a decisive factor.

The Competition Council, for its part, argues that the fine imposed is consistent with the national legislation in force. It emphasises in particular that, in competition law, ‘turnover’ means the total amount of all revenue resulting from the economic activity, which, in the present case, includes the sums collected by the AKKA/LAA for the remuneration of authors.

The Augstākā tiesa, Administratīvo lietu departaments (Supreme Court, Administrative Cases Division, Latvia) is uncertain as to the proper interpretation of point (a) of the second paragraph of Article 102 TFEU. First, that court is unsure whether the AKKA/LAA’s activities have an impact on trade between Member States, and, therefore, whether the case at issue in the main proceedings comes within the scope of that provision. Secondly, that court has doubts as to the method used to determine the unfair nature of the prices. Thirdly, it has reservations concerning the calculation of the fine, in particular as to whether the remuneration collected for the rightholders should have been taken into account for that purpose.

Concerning the first point, the referring court notes that, in the contested decision, the Competition Council stated that the AKKA/LAA had also collected fees in respect of musical works originating in other Member States and that, consequently, unfair prices were liable to deter the use in Latvia of works of authors from other Member States.

As for the second point, concerning the method used to determine the unfair nature of the prices, the referring court takes the view, on the one hand, that, when rates charged in a Member State correspond to a multiple of rates applied in the other Member States, as in the case that led to the judgment of 13 July 1989, Lucazeau and Others (110/88, 241/88 and 242/88, EU:C:1989:326), that circumstance is indicative of an abuse of a dominant position. On the other hand, it draws attention to the fact that uncertainty still persists as to how rates are set in situations different to the one in that case.

In the present case, the question is whether the comparison of the rates applicable in Latvia with the rates applicable in Estonia and Lithuania is sufficient. Such a limited comparison could, however, prove itself counter-productive in the sense that organisations in neighbouring Member States could, in concert, raise their rates without that being perceptible. In the event that such a method of comparison were not to be valid, the referring court is uncertain whether it would be appropriate also to compare the rates in all the Member States adjusted in accordance with the PPP index.

Subsequently, the referring court is uncertain under what conditions rates are to be considered ‘appreciably higher’ within the meaning of paragraph 25 of the judgment of 13 July 1989, Lucazeau and Others (110/88, 241/88 and 242/88, EU:C:1989:326), and the undertaking concerning is under an obligation to ‘justify the difference by reference to objective dissimilarities between the situation in the Member State concerned and the situation prevailing in all the other Member States’, within the meaning of that same paragraph.

As for the third point, concerning the calculation of the amount of the fine, the referring court points out that a situation such as that in the main proceedings, in which a fine has been imposed on a copyright management organisation, has not yet been ruled adjudicated on by the Court. Thus, it is necessary to clarify the question of whether the sums collected as remuneration for copyright holders should be taken into account.

In those circumstances, the Augstākās tiesas, Administratīvo lietu departaments (Supreme Court, Administrative Cases Division) decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:

‘(1) Is [point (a) of the second paragraph of] Article 102 TFEU applicable to a dispute concerning the rates laid down by a national copyright management organisation if that entity also collects remuneration in respect of works of foreign authors and the rates laid down by it may be a deterrent to the use of those works in the Member State in question?

(2) For the purpose of defining the concept of “unfair prices” used in [point (a) of the second paragraph of] Article 102 TFEU, in the context of the management of copyright and related rights, is it appropriate and sufficient —– and in which cases —– to draw a comparison between the prices (rates) in the market in question and the prices (rates) in neighbouring markets?

(3) For the purpose of defining the concept of “unfair prices” used in [point (a) of the second paragraph of] Article 102 TFEU in the context of the management of copyright and related rights, is it appropriate and sufficient to use the PPP index based on gross domestic product?

(4) Must the comparison of rates be made for each separate segment thereof or in relation to the average level of the rates?

(5) When must it be considered that the difference in the rates examined in connection with the concept of “unfair prices [(rates)]” used in [point (a) of the second paragraph of] Article 102 TFEU is appreciable, with the result that it is incumbent upon the economic operator enjoying a dominant position to demonstrate that its rates are fair?

(6) What information can reasonably be expected from an economic operator to prove the fair nature of the rates for works covered by copyright, within the scope of [point (a) of the second paragraph of] Article 102 TFEU, if the cost of those works cannot be determined in the same way as that of products of a material nature? Is it solely a question of the cost of administering the copyright management organisation?

(7) In the event of infringement of competition law, is it appropriate to exclude from the business turnover of a copyright management organisation, for the purposes of determining a fine, the remuneration paid to authors by that economic operator?’

The Court’s decision:

1. Trade between Member States is capable of being affected by the level of rates set by a copyright management organisation that holds a monopoly and also manages the rights of foreign copyright holders, with the result that Article 102 TFEU may be applicable.

2. For the purposes of examining whether a copyright management organisation applies unfair prices within the meaning of point (a) of the second paragraph of Article 102 TFEU, it is appropriate to compare its rates with those applicable in neighbouring Member States as well as with those applicable in other Member States adjusted in accordance with the PPP index, provided that the reference Member States have been selected in accordance with objective, appropriate and verifiable criteria and that the comparisons are made on a consistent basis. It is permissible to compare the rates charged in one or several specific user segments if there are indications that the excessive nature of the fees affects those segments.

3. The difference between the rates compared must be regarded as appreciable if that difference is significant and persistent. Such a difference is indicative of abuse of a dominant position and it is for the copyright management organisation holding a dominant position to show that its prices are fair by reference to objective factors that have an impact on management expenses or the remuneration of rightholders.

4. In the case where the infringement referred to in point (a) of the second paragraph of Article 102 TFEU is established, remuneration intended for rightholders must be included, for the purpose of determining the amount of the fine, in the turnover of the copyright management organisation concerned, provided that that remuneration forms part of the value of the services provided by that organisation and that that inclusion is necessary in order to ensure that the penalty imposed is effective, proportionate and dissuasive. It is for the referring court to verify, in the light of all the circumstances of the case, whether those conditions are met.

 

 

 

Sculpture, logs, and a moral copyright lawsuit in the US

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The 1709 blog published an interesting article which concerns an alleged infringement of moral copyrights over the sculpture “Log Cabin” made out of wood and created by Cady Noland in the nineties in the US.

The collector Wilhelm Schurmann bought this work and gave it to a museum where it was being exhibited for 10 years. After that, the work was been transferred to Michael Janssen Gallery.

Over the years “Log Cabin” had deteriorated because of which after consultation with a conservator it was been reconstructed with new materials and new logs.

This provoked a lawsuit initiated by the author according to which she hadn’t given any permission for such reconstruction which in turn infringed her moral copyright over the work.

According to the US Visual Artists Rights Act of 1990 (VARA): authors of a work of visual arts have the right “to prevent any intentional distortion, mutilation, or other modification of that work which would be prejudicial to his or her honor or reputation, and any intentional distortion, mutilation, or modification of that work is a violation of that right, and… to prevent any destruction of a work of recognized stature, and any intentional or grossly negligent destruction of that work is a violation of that right.”

More information can be found here.

 

 

Furniture and originality in Switzerland

The Swiss Federal Supreme Court has ruled in a copyright lawsuit regarding an individual character of furniture.

The case at hand concerns a design of chairs and bar stools created by the Swiss designer Max Bill in the 50s and 60s of 20 century. These designs have been used by Horgenglarus since them producing the relevant furniture.

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After the death of Max Bill his copyrights started to be managed by the Bill Foundation which gave a license to Horgenglarus that was terminated in 2001. The manufacturer continued to use the designs which provoked a lawsuit. Horgenglarus contended that designs at point did not enjoy any copyright protection because they did not have the necessary individual character to be considered “works” in the sense of copyright law.

The commercial court upheld only the copyright protection over the frame chair considering the bar stool as lacking individual character taking into account the previous similar stools.

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The Supreme court reversed this decision stating that “the degree of individuality (originality) required for a work to have individual character depended on the degree of freedom the category of works permitted. If the degree of freedom was limited, even minor deviations from known designs could convey individual character.”

According to the court the fact that separate elements from the stool are similar to the previous one it doesn’t mean that the relevant design is lacks of originality because the assessment requires the entire design to be taken into consideration.

Based on the foregoing, the court considers that the individual elements had never been combined in the way Max Bill combined them so the work was unique at the time of creation.

More information can be found here.

Source: IP Kat.

 

Brief IP news

briefs_1131.Korea: Direct link to similar patents in KIPRIS. Form more information here.

2.LinkedIn’s Patent Strategy. For more information here.

3.Safeguarding innovation through confidentiality. For more information here.

Information from Intellectual Property Center at the UNWE. More information can be found here

Warner Bros settled a dispute over J.R.R. Tolkien’s books

Lord-of-The-Rings-Logo-PNG-FileWarner Bros has reached an agreement with HarperCollins, which manages the J.R.R. Tolkien’s estate over “The Hobbit” and “The Lord of the Rings” books. Based on this the lawsuit between them will be discontinued.

HarperCollins claimed that Warner Bros has been using both works outside the scope of the agreement signed in 1969. According to that document, Warner Bros can use these works for limited merchandising purposes. Warner Bros sold different video games based on both books despite the fact that the agreement doesn’t cover any electronic or digital rights.

HarperCollins sought damages up to 80 million dollars.

Source: WIPR.

BitTorrent under attack – an EU Court decision

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The European Court ruled in Case C‑610/15, Stichting Brein Ziggo BV, XS4ALL Internet BV. This case concerns the following:

Stichting Brein is a Netherlands foundation which safeguards the interests of copyright holders.

Ziggo and XS4ALL are internet access providers. A significant number of their subscribers use the online sharing platform TPB, an indexer of BitTorrent files. BitTorrent is a protocol through which users (known as ‘peers’) can share files. The essential characteristic of BitTorrent is that it divides files for sharing into segments, thus removing the need to rely on a central server to store those files, which lessens the burden on individual servers during the sharing process. In order to be able to share files, users must first download specific software called ‘BitTorrent Client’, which is not provided by the online sharing platform TPB. ‘BitTorrent Client’ is software which allows the creation of torrent files.

Users (called ‘seeders’) who wish to make a file on their computer available to other users (called ‘leechers’) have to create a torrent file through their BitTorrent Client. Torrent files refer to a central server (called a ‘tracker’) which identifies the users available to share a particular torrent file as well as the underlying media file. These torrent files are uploaded by the seeders to an online sharing platform, such as TPB, which then proceeds to index them so that they can be found by the users of the online sharing platform and the works to which those torrent files refer can be downloaded onto the users’ computers in several segments through their BitTorrent Client.

‘Magnet links’ are often used in place of torrent files. These links identify the content of a torrent file and refer to it through a digital fingerprint.

The torrent files offered on the online sharing platform TPB relate mainly to copyright-protected works, without the rightholders having given their consent to the operators or users of that platform to carry out the sharing acts in question.

In the context of the main proceedings, Stichting Brein’s principal request is that Ziggo and XS4ALL be ordered to block the domain names and IP addresses of the online sharing platform TPB in order to prevent the services of those internet access providers from being used to infringe the copyright and related rights of the rightholders, whose interests Stichting Brein protects.

The court of first instance upheld Stichting Brein’s requests. However, these were rejected on appeal.

The Hoge Raad der Nederlanden (Supreme Court of the Netherlands) notes that, in the present case, it has been established that the actions of the online sharing platform TPB make protected works available to the public without the rightholders’ consent. It has also been established that subscribers to Ziggo and XS4ALL, through this platform, make protected works available without the rightholders’ consent and thus infringe the copyright and related rights of those rightholders.

The Hoge Raad der Nederlanden (Supreme Court of the Netherlands) notes, however, that the Court’s case-law does not allow it to reply with any certainty to the question as to whether the online sharing platform TPB also communicates works to the public within the meaning of Article 3(1) of Directive 2001/29, in particular:

–  by creating and maintaining a system in which internet users connect with each other in order to be able to share, in segments, works present on their own computers;

–  by operating a website from which users can download torrent files which refer to segments of those works; and

–  by indexing the torrent files placed online on this website and by categorising them in such a way that the segments of those underlying works can be located and the users can download those works (as a whole) onto their computers.

Under those circumstances, the Hoge Raad der Nederlanden (Supreme Court of the Netherlands) decided to stay the proceedings before it and to refer the following questions to the Court for a preliminary ruling:

‘1. Is there a communication to the public within the meaning of Article 3(1) of Directive 2001/29 by the operator of a website, if no protected works are available on that website, but a system exists … by means of which metadata on protected works which are present on the users’ computers are indexed and categorised for users, so that the users can trace and upload and download the protected works on the basis thereof?

2. If Question 1 is answered in the negative:

Do Article 8(3) of Directive 2001/29 and Article 11 of Directive 2004/48 offer any scope for obtaining an injunction against an intermediary as referred to in those provisions, if that intermediary facilitates the infringing acts of third parties in the way referred to in Question 1?’

The Court’s decision:

The concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, must be interpreted as covering, in circumstances such as those at issue in the main proceedings, the making available and management, on the internet, of a sharing platform which, by means of indexation of metadata relating to protected works and the provision of a search engine, allows users of that platform to locate those works and to share them in the context of a peer-to-peer network.