Can bicycle functional shapes be protected with copyright?

pexels-photo-686230The Advocate General of the European Court Campos Sánchez-Bordona has given his opinion in Case C‑833/18 SI, Brompton Bicycle Ltd. v Chedech / Get2Get. This case concerns the following:

In 1975, Mr SI created a design for a folding bicycle, which he named Brompton.

The following year, Mr SI founded Brompton Ltd. for the purpose of marketing his folding bicycle in collaboration with a larger undertaking which would deal with manufacturing and distributing the bicycle. Mr SI did not find any undertakings that were interested and therefore he continued to work alone.

In 1981, Mr SI received his first order for 30 Brompton bicycles, which he manufactured with an appearance that was slightly different from the original.

After that, Mr SI expanded his company’s activities to increase awareness of his folding bicycle design which, since 1987, has been marketed in the following form:

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Brompton Ltd. was the holder of a patent for its bicycle’s folding mechanism (the main feature of which is that it has three positions: unfolded, stand-by and folded); that patent later fell into the public domain. (7)

Mr SI also asserts that he holds the economic rights arising from the copyright in the appearance of the Brompton bicycle.

The Korean company Get2Get, which specialises in the production of sports equipment, produces and markets a bicycle which also folds into three different positions (Chedech) and is similar in appearance to the Brompton bicycle:

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Brompton Ltd. and Mr SI took the view that Get2Get had infringed their copyright in the Brompton bicycle and, therefore, they brought an action against that company before the referring court, from which they sought, in essence: (a) a ruling that Chedech bicycles, irrespective of the distinctive signs affixed to those bicycles, infringe Brompton Ltd.’s copyright and Mr SI’s non-pecuniary rights in the Brompton bicycle, and (b) an order to cease the activities which breach their copyright and to withdraw the product from the market. (8)

Get2Get submitted that the appearance of its bicycle was dictated by the technical solution sought and that it deliberately adopted the folding technique (previously covered by Brompton Ltd.’s patent, which subsequently expired) because that was the most functional method. Get2Get maintains that that technical constraint dictates the appearance of the Chedech bicycle.

Brompton Ltd. and Mr SI countered that there are other bicycles on the market which fold into three positions and are different in appearance from their own, from which it follows that they have copyright over their bicycle. The appearance of the bicycle demonstrates the existence of creative choices on their part and, therefore, originality.

In those circumstances, the referring court has referred the following questions to the Court of Justice for a preliminary ruling:

‘(1)  Must EU law, in particular 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, which determines, inter alia, the various exclusive rights conferred on copyright holders, in Articles 2 to 5 thereof, be interpreted as excluding from copyright protection works whose shape is necessary to achieve a technical result?

(2)  In order to assess whether a shape is necessary to achieve a technical result, must account be taken of the following criteria:

–   The existence of other possible shapes which allow the same technical result to be achieved?

–   The effectiveness of the shape in achieving that result?

–   The intention of the alleged infringer to achieve that result?

–    The existence of an earlier, now expired, patent on the process for achieving the technical result sought?’

The Advocate’s opinion:

‘(1) Articles 2 to 5 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 do not provide for copyright protection of creations of products with an industrial application whose shape is exclusively dictated by their technical function.

(2) In order to determine whether the specific features of the shape of a product are exclusively dictated by its technical function, the competent court must take into account all the relevant objective factors in each case, including the existence of an earlier patent or design right in the same product, the effectiveness of the shape in achieving the technical result and the intention to achieve that result.

(3) Where the technical function is the only factor which determines the appearance of the product, the fact that other alternative shapes exist is not relevant. On the other hand, the fact that the shape chosen incorporates important non-functional elements which were freely chosen by its creator may be relevant.’

Contracts and intellectual property – a decision by the European court

pexels-photo-169573The European court has ruled in case C‑666/18 IT Development SAS срещу Free Mobile SAS. The case concerns the following:

By a contract of 25 August 2010, amended by an addendum of 1 April 2012, IT Development granted a licence to and concluded a maintenance agreement with the company Free Mobile, a mobile phone operator offering mobile phone packages on the French market, for the ‘ClickOnSite’ software package, centralised project management software designed to enable Free Mobile to organise and monitor in real time the progress made by its teams and external technical service providers in deploying all its radiotelephone antennae.

By document of 18 June 2015, IT Development brought proceedings against Free Mobile before the tribunal de grande instance de Paris (Regional Court, Paris, France) for infringement of the copyright of the ClickOnSite software package and seeking compensation for its loss. IT Development alleged that Free Mobile had modified the software, in particular by creating new forms. In addition to the substantive nature, in IT Development’s opinion, of those modifications, it argued, in particular, that Free Mobile did not have the right to make such modifications because the provisions of Article 6 of the licence agreement, entitled ‘Scope of the licence’, stated, in essence, that the customer expressly undertakes not to reproduce, directly or indirectly, the software package, to decompile and/or carry out retro-engineering operations on it, as well as to modify, correct, adapt, create second works and add, directly or indirectly, to that software.

Free Mobile brought a counterclaim for abuse of process and argued that IT Development’s claims were inadmissible and unfounded.

By judgment of 6 January 2017, the Tribunal de grande instance de Paris (Regional Court, Paris) declared the claims brought by IT Development based on Free Mobile’s tortious liability inadmissible, dismissed Free Mobile’s claim for damages and interest for abuse of process and ordered IT Development to pay the costs. That court held that there are two separate sets of rules relating to liability in intellectual property matters, one being tortious liability in the event of infringement of the exploitation rights of the author of the software, as determined by law, the other being contractual liability in the event of infringement of a copyright reserved by contract, and that, in the present case, Free Mobile was clearly alleged to have failed to perform its contractual obligations, providing a basis for an action for contractual liability, and not for the tortious act of infringement of software copyright.

IT Development brought an appeal against that judgment before the cour d’appel de Paris (Court of Appeal, Paris, France), requesting the latter to refer a question to the Court of Justice for a preliminary ruling, to set aside the judgment at first instance and to declare the infringement proceedings which it had brought to be admissible. IT Development also seeks a declaration that the modifications to the software made by Free Mobile constitute copyright infringements, that Free Mobile be ordered to pay IT Development the sum of EUR 1 440 000 as compensation for the damage suffered and, in the alternative, that Free Mobile be ordered, on a contractual basis, to pay IT Development the sum of EUR 840 000 as compensation for that damage. It also requests, in any event, that Free Mobile and its subcontractor, Coraso, be prohibited from using the software and from extracting and reusing the data from it.

Free Mobile requests the cour d’appel de Paris (Court of Appeal, Paris) in particular, to uphold the provisions of the judgment at first instance, to order IT Development to pay it the sum of EUR 50 000 euros by way of damages and interest for abuse of process and to declare all IT Development’s claims inadmissible and in any event unfounded.

The referring court states that French civil liability law is based on the principle of non-cumulation, which means that, first, one person cannot hold another person liable in contract and tort for the same acts, and that, second, tortious liability is excluded in favour of contractual liability where those persons are bound by a valid contract and the damage suffered by one of them results from non-performance or improper performance of a contractual obligation. In addition, the referring court states that, under French law, copyright infringement, originally a criminal offence, is based on tortious liability but that, under that law, there is no provision under which such an infringement cannot exist where there is a contract binding the parties. In that respect, for example, infringement proceedings could be brought against a licensee who has infringed the limits of his contract in patent and trade mark matters.

However, the referring court points out that Article 2 of Directive 2004/48, which defines the scope of that directive, provides in general terms that the measures, procedures and remedies which it provides for are to apply to any infringement of intellectual property rights, without distinguishing between whether or not such infringement results from the non-performance of a contract.

In those circumstances, the cour d’appel de Paris (Court of Appeal, Paris) decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:

‘Does a software licensee’s non-compliance with the terms of a software licence agreement (by expiry of a trial period, by exceeding the number of authorised users or some other limit, such as the number of processors which may be used to execute the software instructions, or by modifying the source code of the software where the licence reserves that right to the initial rightholder) constitute:

–   an infringement (for the purposes of Directive [2004/48]) of a right of the author of the software that is reserved by Article 4 of Directive [2009/24] on the legal protection of computer programs,

–  or may it comply with a separate system of legal rules, such as the system of rules on contractual liability under ordinary law?’

The Court’s decision:

Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights and Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs must be interpreted as meaning that the breach of a clause in a licence agreement for a computer program relating to the intellectual property rights of the owner of the copyright of that program falls within the concept of ‘infringement of intellectual property rights’, within the meaning of Directive 2004/48, and that, therefore, that owner must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law.

An important decision by the European Court regarding e-books resales

pexels-photo-1329571The European Court has ruled recently in the case C‑263/18 Nederlands Uitgeversverbond, Groep Algemene Uitgevers v Tom Kabinet Internet BV. This case concerns the following:

NUV and GAU, associations whose purpose it is to defend the interests of Netherlands publishers, were mandated by several publishers to ensure that the copyright granted to them by copyright holders by means of exclusive licences is protected and observed.

Tom Kabinet Holding is the sole shareholder of Tom Kabinet Uitgeverij, a publisher of books, e-books and databases, and also of Tom Kabinet. Tom Kabinet operates a website on which, on 24 June 2014, it launched an online service consisting in a virtual market for ‘second-hand’ e-books.

On 1 July 2014, NUV and GAU brought an action under the Law on copyright against Tom Kabinet, Tom Kabinet Holding and Tom Kabinet Uitgeverij before the urgent applications judge at theDistrict Court, Amsterdam, Netherlands in respect of that online service. The District Court, Amsterdam dismissed their application on the ground that, according to that court, there was no prima facie breach of copyright.

NUV and GAU appealed against that decision before the Court of Appeal, Amsterdam, Netherlands, which, by judgment of 20 January 2015, upheld the decision but prohibited Tom Kabinet from offering an online service that allowed the sale of unlawfully downloaded e-books. No appeal on a point of law was lodged against that judgment.

From 8 June 2015 onwards, Tom Kabinet modified the services offered up to that point and replaced them with the ‘Tom Leesclub’ (Tom reading club, ‘the reading club’), within which Tom Kabinet is an e-book trader. In return for payment of a sum of money, the reading club offers its members ‘second-hand’ e-books which have been either purchased by Tom Kabinet or donated to Tom Kabinet free of charge by members of the club. In the latter case, those members must provide the download link in respect of the book in question and declare that they have not kept a copy of the book. Tom Kabinet then uploads the e-book from the retailer’s website and places its own digital watermark on it, which serves as confirmation that it is a legally acquired copy.

Initially, e-books available through the reading club could be purchased for a fixed price of EUR 1.75 per e-book. Once payment had been made, the member could download the e-book from Tom Kabinet’s website and subsequently resell it to Tom Kabinet. Membership of the reading club was subject to payment by members of a monthly subscription of EUR 3.99. Any e-book provided free of charge by a member resulted in that member being entitled to a discount of EUR 0.99 on the following month’s subscription.

Since 18 November 2015, payment of a monthly subscription has ceased to be a requirement of membership of the reading club. On the one hand, the price of every e-book is now set at EUR 2. On the other hand, the members of the reading club also need ‘credits’ in order to be able to acquire an e-book through the reading club; credits can be obtained by providing the club with an e-book, either for consideration or free of charge. Such credits can also be purchased when making an order.

NUV and GAU applied to the District Court, The Hague, Netherlands for an injunction prohibiting Tom Kabinet on pain of a periodic penalty payment, from infringing the copyright of NUV’s and GAU’s affiliates by the making available or the reproduction of e-books. In particular, in their view Tom Kabinet is, in the context of the reading club, making an unauthorised communication of e-books to the public.

In an interim judgment of 12 July 2017, the referring court found that the e-books at issue were to be classified as works, within the meaning of Directive 2001/29, and that Tom Kabinet’s offer, in circumstances such as those at issue in the main proceedings, did not constitute a communication to the public of those works, within the meaning of Article 3(1) of that directive.

The referring court observes, however, that the answers to the questions as to whether the making available remotely by the downloading, for payment, of an e-book for use for an unlimited period may constitute an act of distribution for the purposes of Article 4(1) of Directive 2001/29, and as to whether the right of distribution may thus be exhausted, within the meaning of Article 4(2) of that directive, are unclear. It also wonders whether the copyright holder may, in the event of a resale, object, on the basis of Article 2 of that directive, to the acts of reproduction necessary for the lawful transmission between subsequent purchasers of the copy for which the distribution right is, if such be the case, exhausted. Nor is the answer to be given to that question apparent from the case-law of the Court of Justice, according to the referring court.

In those circumstances, the District Court, The Hague decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1)  Is Article 4(1) of [Directive 2001/29] to be interpreted as meaning that “any form of distribution to the public by sale or otherwise of the original of their works or copies thereof” as referred to therein includes the making available remotely by downloading, for use for an unlimited period, of e-books (being digital copies of books protected by copyright) at a price by means of which the copyright holder receives remuneration equivalent to the economic value of the work belonging to him?

(2) If question 1 is to be answered in the affirmative, is the distribution right with regard to the original or copies of a work as referred to in Article 4(2) of [Directive 2001/29] exhausted in the European Union, when the first sale or other transfer of that material, which includes the making available remotely by downloading, for use for an unlimited period, of e-books (being digital copies of books protected by copyright) at a price by means of which the copyright holder receives remuneration equivalent to the economic value of the work belonging to him, takes place in the European Union through the rightholder or with his consent?

(3) Is Article 2 of [Directive 2001/29] to be interpreted as meaning that a transfer between successive acquirers of a lawfully acquired copy in respect of which the distribution right has been exhausted constitutes consent to the acts of reproduction referred to therein, in so far as those acts of reproduction are necessary for the lawful use of that copy and, if so, which conditions apply?

(4) Is Article 5 of [Directive 2001/29] to be interpreted as meaning that the copyright holder may no longer oppose the acts of reproduction necessary for a transfer between successive acquirers of the lawfully acquired copy in respect of which the distribution right has been exhausted and, if so, which conditions apply?’

The Court’s decision:

The supply to the public by downloading, for permanent use, of an e-book is covered by the concept of ‘communication to the public’ and, more specifically, by that of ‘making available to the public of [authors’] works in such a way that members of the public may access them from a place and at a time individually chosen by them’, 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.

Paintings and watches – a dispute from Denmark

The Court in Denmark has ruled in a case concerning a copyrightable work transformed into another work. The case at hand focus our attention on the following painting by artist Tel R:

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This painting has been purchased for $90 000 by Dann Thorleifsson and Arne Solmunde Leivsgarð, founders of the watch manufacturer company Letho.

They launched a campaign where the winners can order watches, which dials are made of small painting parts.

According to the artist, this was a completely new way of using of his painting that transforms the original work. He claimed that copyright permission for such use was needed.

The Letho’s position was that in this case there was a destruction of the work which according to the Danish law does not constitute copyright infringement.

The court ruled that there was a copyright infringement because the painting was made available to the public in a changed form, which requires copyright permission.

Source: WIPR.

Performers explicit consent – an EU Court decision

ballerina-1873265_1920.jpgThe European Court has ruled in case C‑484/18 Société de perception et de distribution des droits des artistes-interprètes de la musique et de la danse (Spedidam), PG, GF

v Institut national de l’audiovisuel. The dispute concerns the following:

The INA is a publicly owned industrial and commercial body of the French State which is responsible for conserving and promoting the national audiovisual heritage. In that capacity, it keeps, inter alia, the audiovisual archives of audiovisual producers, namely national broadcasting companies, and helps with the exploitation of those archives.

PG and GF are the successors in title of ZV, a musician who died in 1985.

During 2009, PG and GF became aware that INA was marketing, in its online shop, without their authorisation, video recordings and phonograms reproducing ZV’s performances during the years 1959 to 1978. It is apparent from the file before the Court that those video recordings and phonograms had been produced and then broadcast by national broadcasting companies.

On 28 December 2009, PG and GF, on the basis of Article L. 212-3 of the Intellectual Property Code, brought an action against the INA in order to obtain compensation for the alleged infringement of the performer’s rights which they hold.

By judgment of 24 January 2013, the Regional Court, Paris, France upheld that action. That court considered, in particular, that the application of Article 49 as amended did not exempt the INA from the requirement to obtain the performer’s prior authorisation for the use of the fixation of his performances. Thus, the sole purpose of the collective agreements provided for in the latter provision is to determine the remuneration due for new exploitations, provided that an initial exploitation has been authorised by the performers concerned. In the present case, proof of such authorisation has not been adduced by the INA. By judgment of 11 June 2014, the Court of Appeal, Paris, France, before which the INA brought its appeal, essentially upheld the judgment given at first instance.

By judgment of 14 October 2015, the Court of Cassation, France set aside in part the judgment of the Court of Appeal, Paris. The Court of Cassation found that that Court of Appeal had erred in holding that the application of the derogating rules at issue was subject to proof that the performer had authorised the initial exploitation of his performance, thus adding to the law a condition that it did not impose.

17      By judgment of 10 March 2017, the Court of Appeal, Versailles, France, before which the case was brought back, dismissed PG’s and GF’s claims. That court considered, in essence, that Article 49 as amended establishes, for the sole benefit of the INA, a simple presumption of the performer’s prior consent, which can be challenged, and thus does not call into question the performer’s exclusive right. The agreements with the trade union organisations referred to in that article do not confer on them the right to ‘authorise and prohibit’, which is vested in the performer, but have the sole purpose of fixing the performer’s remuneration.

18      PG, GF and Spedidam, which had intervened voluntarily before the Court of Appeal, Versailles, brought an appeal against the latter’s judgment before the referring court. The referring court indicates that it has doubts as to the compatibility of the legal rules set out in Article 49 as amended with Articles 2, 3 and 5 of Directive 2001/29.

19      In those circumstances, the Court of Cassation decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:

‘Must Article 2(b), Article 3(2)(a) and Article 5 of Directive [2001/29] be interpreted as not precluding national rules, such as those laid down in Article 49 [as amended] [of the Law on freedom of communication], from establishing, for the benefit of the [INA], the beneficiary of the exploitation rights of national broadcasting companies in the audiovisual archives, derogating provisions under which the terms on which performers’ works can be exploited and the remuneration for that exploitation are governed by agreements concluded between the performers themselves or the employee organisations representing performers and that institute, which must specify, inter alia, the scale of remuneration and the arrangements for payment of that remuneration?’

The Court’s decision:

Article 2(b) and Article 3(2)(a) 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 not precluding national legislation which establishes, as regards the exploitation of audiovisual archives by a body set up for that purpose, a rebuttable presumption that the performer has authorised the fixation and exploitation of his performances, where that performer is involved in the recording of an audiovisual work so that it may be broadcast.

Video games, the right of exhaustion and France

pexels-photo-275033.jpegJulien GOMIS (Nomos) reports about an interesting case from France where the Paris court has ruled that the right of exhaustion set out in Directive 2001/29/EC is applicable to the case of downloadable video games.

As it is known, according to Directive 2001/29/EC:

Distribution right

1. Member States shall provide for authors, in respect of the original of their works or of copies thereof, the exclusive right to authorise or prohibit any form of distribution to the public by sale or otherwise.

2. The distribution right shall not be exhausted within the Community in respect of the original or copies of the work, except where the first sale or other transfer of ownership in the Community of that object is made by the rightholder or with his consent.

The grounds for this decision were that every subscriber of the relevant website has an account through which he pays for and downloads the video game on its own computer. After this act, he can use it without time limitations.

This decision is surprising at least because as a general rule of thumb the right of exhaustion concerns material copies of a work. Of course, there is some development in the interpretation of this rule. However, recently the Advocate General of the CJEU, Maciej Szupunara has stated that the download should be considered as a communication to the public and not as a distribution. Thus, within the meaning of European legislation, digital resale should not be affected by the rule of exhaustion of the distribution right.

Google prevailed in a dispute against press publishers in the EU

pexels-photo-1931441The European court has rules in the case C‑299/17 VG Media Gesellschaft zur Verwertung der Urheber- und Leistungsschutzrechte von Medienunternehmen mbH v Google LLC.

The case concerns the following:

VG Media is a collective management organisation, authorised in Germany, that defends copyright and rights related to copyright of television channels and private radio stations, as well as rights to digital editorial content. Against this background, VG Media concludes with rights holders the ‘administration agreement for television, radio and publishers’, in which those rights holders grant it, for exclusive administration, their current rights as well as those accruing to them during the term of the agreement, in respect of the newspapers or magazines produced by them.

Google operates several internet search engines including, in particular, the search engine of the same name, together with an automated news site (‘Google News’). On the ‘Google’ search engine, after the search term has been entered and the search function has been initiated, a short text or text excerpt (‘the Snippet’) appears with a thumbnail image that is intended to enable users to gauge the relevance of the displayed website in the light of the information they are looking for. As regards the news site ‘Google News’, it displays news from a limited number of news sources in a format akin to that of a magazine. The information on that site is collected by computers by means of an algorithm using a large number of sources of information. On that site, ‘the Snippet’ appears in the form of a short summary of the article from the website concerned, often containing the introductory sentences of that article.

In addition, Google publishes, by means of its online services, third-party advertisements on its own websites and on third party websites for a fee.

VG Media brought an action for damages against Google before the referring court in which it disputes, in essence, the use by Google, since 1 August 2013, of text excerpts, images and animated images produced by its members, without paying a fee in return for displaying search results and news summaries.

The referring court seeks to ascertain whether Paragraphs 87f and 87g of the UrhG are applicable to the dispute in the main proceedings. That court seeks guidance on whether those provisions, arising from the amendment, with effect from 1 August 2013, to the UrhG, should have been notified to the Commission during their drafting stage as foreseen in the first subparagraph of Article 8(1) of Directive 98/34. In that connection, the referring court relies on the case-law of the Court according to which the provisions adopted in breach of the duty of notification under that provision are inapplicable and are, therefore, unenforceable against individuals.

In those circumstances, the Landgericht Berlin (Regional Court, Berlin, Germany) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) Does a national rule which prohibits only commercial operators of search engines and commercial service providers which edit content, but not other users, including commercial users, from making press products or parts thereof (excluding individual words and very short text excerpts) available to the public constitute, under Article 1(2) and (5) of [Directive 98/34], a rule which is not specifically aimed at the services defined in [Article 1(2)],

and, if that is not the case,

(2)  does a national rule which prohibits only commercial operators of search engines and commercial service providers which edit content, but not other users, including commercial users, from making press products or parts thereof (excluding individual words and very short text excerpts) available to the public constitute a technical regulation within the meaning of Article 1(11) of [Directive 98/34], namely a compulsory rule on the provision of a service?’

The Court’s decision:

Article 1(11) of Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and of rules on Information Society services (as amended by Directive 98/48/EC of the European Parliament and of the Council of 20 July 1998), must be interpreted as meaning that a provision of national law, such as that at issue in the main proceedings, which prohibits only commercial operators of search engines and commercial service providers that similarly publish content from making newspapers or magazines or parts thereof (excluding individual words and very short text excerpts) available to the public, constitutes a ‘technical regulation’ within the meaning of that provision, the draft of which is subject to prior notification to the Commission pursuant to the first subparagraph of Article 8(1) of Directive 98/34, as amended by Directive 98/48.