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Thursday, 27 March 2014

BREAKING NEWS: CJEU says that blocking orders are OK and do not have to be specific

Are blocking injunctions compatible with EU law? If so, under what conditions?

In a nutshell, this is what this reference for a preliminary ruling from the Oberster Gerichtshof (Austrian Supreme Court) was all about. 

To be more precise, however, Case C-314/12 UPC Telekabel Wien was about the following questions:

1.  Is Article 8(3) of the [InfoSoc] Directive to be interpreted as meaning that a person who makes protected subject matter available on the internet without the right holder's consent is using the services of the access providers of persons seeking access to that protected subject matter?
2.  If the answer to the first question is in the negative, are reproduction for private use and transient and incident reproduction permissible only if the original reproduction was lawfully reproduced, distributed or made available to the public? [this question is also at the centre of another pending reference for a preliminary ruling which will be decided soon: it is Case C-435/12 ACI Adam, on which see here]
3.  If the answer to the first and second question is in the affirmative, and an injunction is therefore to be issued against the user's access provider in accordance with Article 8(3) of the Directive, is this compatible with Union law, in particular with the necessary balance between the parties' fundamental rights [as per the Charter of Fundamental Rights of the European Union]
4.  If the answer to the third question is in the negative, is it compatible with Union law to require an access provider to take specific measures to make it more difficult for its customers to access a website containing material made available unlawfully if those measures require not considerable costs and can easily be circumvented without any special technical knowledge?

This reference was made in the course of proceedings [see hereconcerning unauthorised online availability of films. Constantin Film and and Wega held the rights to various films, and successfully applied for an interim injunction aimed at prohibiting defendant UPC Telekabel (a major Austrian internet access provider) from providing access to a website ( where such films were made illicitly available for streaming and downloading. The decision of the Handelsgericht Wien (Vienna Commercial Court) was however overturned by the Oberlandesgericht Wien (Vienna Higher Regional Court), that found that the order granted by the former did not specify what specific measures UPC Telekabel was actually required to adopt. Constantin Film and Wega appealed the decision before the Austrian Supreme Court, that decided to stay the proceedings and revert to the Court of Justice of the European Union (CJEU) for guidance.

Website blocking may be OK 
In his Opinion [which, unlike the press release, has not yet been made available in English, after mere ... 4 months] on 26 November 2013 Advocate General (AG) Cruz Villalón stated that an ISP can be required to block access by its customers to a website which infringes copyright. However, such court order must refer to specific blocking measures that may be aimed at bringing infringements already committed to an end, and also preventing news ones from occurring [this is pursuant to the seminal CJEU decision in Case C-324/09 L'Oréal, on which see here], and achieve an appropriate balance between the opposing interests which are protected by fundamental rights. 

According to the AG it would be incompatible with the weighing of the fundamental rights of the parties to prohibit an ISP generally and without ordering specific measures from allowing its customers to access a particular website that infringes copyright, ie to adopt general filtering measures. As IPKat readers will remember, this echoes earlier CJEU (twin) decisions in Cases C-70/10 Scarlet [here] and C-360/10 Netlog [here]

As expected, this morning the CJEU issued its handy [just 66 paragraphs: is this a new trend, wonders Merpel, who is however very fond of those good old CJEU decisions composed of - minimum - 180 paragraphs] decision [also available in English!], which - to some extent - appears to depart from the AG Opinion [press release here].

Interpretation of Article 8(3): infringers use the services of an ISP

Having recalled that Recital 59 in the preamble to the InfoSoc Directive states that intermediaries are, in many cases, best placed to bring infringing activities and that the objective [to be more precise: one of the objectives] of this directive is to provide rightholders with a high degree of protection, the CJEU held that an ISP which allows its customers to access protected subject-matter made available to the public on the internet by a third party is an intermediary whose services are used to infringe a copyright or related right within the meaning of Article 8(3) of the InfoSoc Directive.

Specific measures may be left
to ISPs to decide ...
National courts must strike a balance between fundamental rights

This said, the Court considered the third question [no need to address the second one, which will then have to be answered when the Court decides ACI Adam]ie whether the fundamental rights recognised by EU law must be interpreted as precluding a court injunction prohibiting an ISP from allowing access to a website placing protected subject-matter online without the agreement of the rightholders, when that injunction does not specify the measures which that access provider must take and when that access provider can avoid incurring coercive penalties for breach of that injunction by showing that it has taken all reasonable measures.

The CJEU observed that the conditions to be met and the procedures to be followed for the granting of injunctions are a matter of national law. In any case, where several fundamental rights are at issue, the authorities and courts of the Member States must not only interpret their national law in a manner consistent with the InfoSoc Directive, but also ensure that they do not rely on an interpretation of it which would be in conflict with those fundamental rights or with the other general principles of EU law, such as the principle of proportionality.

Having said this, the Court found that an injunction such as that at issue in the main proceedings results primarily in a conflict between (i) copyrights and related rights, which are intellectual property and are therefore protected under Article 17(2) of the Charter, (ii) the freedom to conduct a business, which economic agents such as ISPs enjoy under Article 16 of the Charter, and (iii) the freedom of information of internet users, whose protection is ensured by Article 11 of the Charter.

... But then they will have to demonstrate
that they have taken
all reasonable measures
(alas! Frederik is not so sure about this ...)
ISPs' freedom to conduct a business must be respected but basically they have to think how to repress (and prevent further) infringements
The adoption of an injunction such as that at issue in the main proceedings restricts an ISP's freedom to conduct a business, in that it obliges it to take [unspecified] measures which may represent a significant cost, have a considerable impact on the organisation of its activities or require difficult and complex technical solutions.
However, such an injunction does not seem to infringe the very substance of the freedom of an ISP, in that: (1) it leaves its addressee to determine the specific measures to be taken in order to achieve the result sought; and (2) such an injunction allows its addressee to avoid liability by proving that it has taken all reasonable measures. 
The Court concluded by holding that:
"EU law must be interpreted as not precluding a court injunction prohibiting an internet service provider from allowing its customers access to a website placing protected subject-matter online without the agreement of the rightholders when that injunction does not specify the measures which that access provider must take and when that access provider can avoid incurring coercive penalties for breach of that injunction by showing that it has taken all reasonable measures, provided that (i) the measures taken do not unnecessarily deprive internet users of the possibility of lawfully accessing the information available and (ii) that those measures have the effect of preventing unauthorised access to the protected subject-matter or, at least, of making it difficult to achieve and of seriously discouraging internet users who are using the services of the addressee of that injunction from accessing the subject-matter that has been made available to them in breach of the intellectual property right, that being a matter for the national authorities and courts to establish."
Thank goodness:
no unbearable sacrifices required
Although this Kat will now read the judgment more carefully, she is under the (first) impression that this decision may have serious implications for ISPs. In particular, she wonders how easy it will be for an ISP to prove that it has taken all "reasonable measures" [which of course do not require it "to make unbearable sacrifices"], especially if it is left to its discretion to decide what measures "are best adapted to the resources and abilities available to him [are all ISPs males?] and ... are compatible with the other obligations and challenges which he will encounter in the exercise of his activity."

Furthermore, ISPs will have to be careful when deciding what measures adopt, in that they may become liable for infringing their customers' fundamental rights. These measures have in fact to be "strictly targeted, in the sense that they must serve to bring an end [but also prevent: see para 37] to a third party’s infringement of copyright or of a related right but without thereby affecting internet users who are using the provider’s services in order to lawfully access information. Failing that, the provider’s interference in the freedom of information of those users would be unjustified in the light of the objective pursued."

What are readers' early impressions?


Anonymous said...

These are the questions that should have preceded Scarlet. Can you? Yes you can. How can you? Scarlet still applies. The judgment in Scarlet precluded filtration software where it is imposed as a remedy. It seems that in the present case that this would still be the case. An ISP can voluntarily use filtration software but it cannot be required to do so.

Anonymous said...

Maybe I'm a crazy conspiracy theorist, but paragraph 57 came out of nowhere..?

[57] In order to prevent the fundamental rights recognised by EU law from precluding the adoption of an injunction such as that at issue in the main proceedings, the national procedural rules must provide a possibility for internet users to assert their rights before the court once the implementing measures taken by the internet service provider are known.

So national courts must provide for a procedure for internet users to assert their 'fundamental rights' – and I'm sure this covers any relevant stuff within the Charter – to be brought up in contesting the adoption of an injunction?

Might that not give certain 'fundamental rights' a free-standing cause of action to contest the adoption of (or to discharge, alternatively) an injunction?

Or am I misunderstanding?.

Eleonora Rosati said...

@Anonymous at 18:58: ISPs would (will) be thus caught between a rock and hard place. On the one hand, they will have to demonstrate that they have taken all reasonable measures in order to avoid liability towards rightholders. On the other hand, they could be liable towards their own customers if those measures infringe the latter's fundamental rights!

Anonymous said...

@anonymous 18.58, this paragraph stems in part from an issue which is peculiar to Austria (it had long been removed from German law if we understand correctly) and which was under particular scrutiny in this litigation and risked infecting the entire Article 8(3) debate. Article 8(3) is not a procedural rule (as these are usually but not always left to MS) but a substantive rule -it is a remedy but it relies on national procedural rules and now we know how it impacts on MS's own procedural rules. Some procedural rules might be too harsh and need to take account of all interests. In Austria, they are particularly so as there is a rule about injunctions arriving at a given result.
At the hearing Austria was asked if there had ever been a constitutional challenge within Austria to injunctions of this nature ("national procedural rules" )which must lead to a particular result.

Anonymous said...

...the citation of question 4 to the court should read "inconsiderable", not "considerable".

Petar said...

I am just thinking aloud here, but why hasn't the article 12 of ecommerce directive been implemented into this decision? It seems like the most logical defense for ISPs to use this exemption.

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