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Monday, 13 February 2012

Might one presume? Luxembourg court advises Austrians on validity of domestic provisions

"Who gets what?" was the issue at stake in the litigation leading to Case C‑277/10, Martin Luksan v Petrus van der Let, a reference for a preliminary ruling from the Handelsgericht Wien (Austria), in which the legal issues were a good deal more complex than "who gets what?" might suggest: at stake was the right of an EU Member State to legislate for the enjoyment of rights provided under European harmonising legislation so that their benefit might fully or presumptively be enjoyed by someone other than their intended initial owner.

Martin Luksan was the scriptwriter and principal director of an original documentary film [in modern parlance, a 'movie'; in EU legalese, a 'cinematographic work'], ‘Fotos von der Front’ (‘Photos from the Front’), about German war photography during the Second World War. Petrus van der Let was a commercial film producer.  As recently as March 2008 the two concluded a ‘directing and authorship agreement’ which stated that
  • Luksan was the scriptwriter and principal director of the film;
  • van der Let would produce and exploit it;
  • all copyright and/or related rights held by Luksan in the film were assigned to van der Let, except that
  • in respect of certain methods of exploitation -- making available to the public on digital networks and encrypted broadcasts via closed circuit television and by pay TV -- Luksan was entitled to receive a separate payment.
The contract made no express provision of statutory rights to remuneration, such as remuneration from the blank recording levy referred to in Paragraph 42b of the German Copyright Law.

Van der Let made the film available online and assigned the rights for this purpose to Movieurope.com so that viewers could downloaded it by means of video on demand. He also made the trailer for the film available on the internet through YouTube, and assigned the pay TV rights to Scandinavia TV.

At this juncture Luksan sued van der Let for both infringement of copyright and breach of contract, maintaining that, since the contract reserved to him alone the right to broadcast to closed circles of users by video on demand and by pay TV,  van der Let's exploitation of the film was unauthorised and unlawful. Van der Let disagreed and argued that, on the basis of the ‘statutory assignment’ provided for in the first sentence of Paragraph 38(1) of the Austrian Copyright Law, all exclusive exploitation rights in the film in question vested in him as the producer of the film and that any agreements to contrary effect were void. Not only that, but the statutory rights to remuneration from the levy on recording materials shared the fate of the exploitation rights and also therefore vested in him.

The referring court considered that, under Austrian law, agreements departing from the principle of direct and original allocation of the rights in question were void.and that the provisions of the Austrian law were contrary to European Union law. However, to be on the safe side the court decided to stay proceedings and refer a number of questions to the Court of Justice for a preliminary ruling.

The Court last week agreed with the position prelimnarily taken by the referring court and ruled as follows:
"1. Articles 1 and 2 of Council Directive 93/83 ...on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, and Articles 2 and 3 of Directive 2001/29 ... on the harmonisation of certain aspects of copyright and related rights in the information society in conjunction with Articles 2 and 3 of Directive 2006/115 ... on rental right and lending right and on certain rights related to copyright in the field of intellectual property and with Article 2 of Directive 2006/116 ... on the term of protection of copyright and certain related rights, must be interpreted as meaning that rights to exploit a cinematographic work such as those at issue in the main proceedings (reproduction right, satellite broadcasting right and any other right of communication to the public through the making available to the public) vest by operation of law, directly and originally, in the principal director. Consequently, those provisions must be interpreted as precluding national legislation which allocates those exploitation rights by operation of law exclusively to the producer of the work in question.

2. European Union law must be interpreted as allowing the Member States the option of laying down a presumption of transfer, in favour of the producer of a cinematographic work, of rights to exploit the cinematographic work such as those at issue in the main proceedings (satellite broadcasting right, reproduction right and any other right of communication to the public through the making available to the public), provided that such a presumption is not an irrebuttable one precluding the principal director of that work from agreeing otherwise.

3. European Union law must be interpreted as meaning that, in his capacity as author of a cinematographic work, the principal director thereof must be entitled, by operation of law, directly and originally, to the right to the fair compensation provided for in Article 5(2)(b) of Directive 2001/29 under the ‘private copying’ exception.

4. European Union law must be interpreted as not allowing the Member States the option of laying down a presumption of transfer, in favour of the producer of a cinematographic work, of the right to fair compensation vesting in the principal director of that work, whether that presumption is couched in irrebuttable terms or may be departed from".
The IPKat has always found it a little strange that European law -- which was initially concerned with such crude economic issues as creating and preserving the conditions for fair competition within the single market -- is now focusing on what to him appear to be issues of fine-tuning of the balance of rights as between performers, creators, investors and entrepreneurs.  The big issues, like having the same copyright term for the same type of work in each country, making sure the same works are where possible protected in each country and so on, were high on the EU's agenda -- but how much detailed thought and discussion has been given by legislators and policy-makers at pan-European level into issues such as whether a rebuttable or irrebuttable presumption of entitlement to enjoy a right should exist, or what the effect of the presence of absence of a presumption might be upon the commercial and moral interests of the copyright communities? Can any reader advise him?

Merpel is overjoyed to learn that the German for "photo" is "Foto" and that "front" is translated as "Front". She has now added two more words to her small but growing German vocabulary.

'Fotos von der Front' YouTube clip here

A katpat to Steve Preece for prodding this Kat into action on a case which appears to have attracted a disappointingly small amount of interest so far ... and a further katpat to Lorna Woods (City University) for being the first and so far only person to spot a glaring error in the original version of this post.

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