BREAKING: AG Szpunar advises CJEU to rule that unlicensed sampling MAY be a copyright infringement and German free use may be contrary to EU law

Moses Pelham

Last year The IPKat reported that the German Federal Court of Justice (BGH) had referred the longstanding Metall auf Metall litigation to the Court of Justice of the European Union (CJEU). The case is now Pelham and Others, C-476/17.

Background

The referral arose out of the longstanding and complex litigation in Germany concerning the unauthorized sampling by music producer Moses Pelham of a 2-second rhythmic sequence from Kraftwerk's 1977 song Metall auf Metall for use in his own 1997 Nur Mir. The sample featured in the latter’s song (performed by Sabrina Setlur) is a continuous background loop. 

Following a number of lower courts' decisions and an instalment before the German Constitutional Court, the case is now pending before Germany’s Federal Court of Justice for the third time. This court decided to stay the proceedings and seek guidance from the CJEU on the correct interpretation of EU law with regard to the notion of ‘reproduction in part’ for phonograms under Article 2(c) of the InfoSoc Directive in order to determine whether a 2-second sample may fall within the scope of the right of reproduction. 

The question is whether a phonogram sampling an earlier phonogram is a copy of it within the meaning of Article 9(1)(b) of the Rental and Lending Rights Directive.

Should the answer be in the affirmative, then the referring court asks: whether the German 'free use' exception within §24(1) of the German Copyright Act (Urheberrechtsgesetz – UrhG) (‘An independent work, created in the free use of the work of another person, may be published and exploited without the consent of the author of the work used.’) is compatible with EU law; should the defendants be unable to rely on the 'free use' exception, whether the quotation exception within Article 5(3)(d) of the InfoSoc Directive might nonetheless shield them from liability on grounds quotation would be a 'right', rather than just an exception; what role the rights granted by the EU Charter of Fundamental Rights play, with particular regard to the interplay between Article 17(2) (copyright protection) and Article 13 (freedom of the arts) therein.

Why it matters

The case is very important for a number of reasons:

• First, because it will serve to gauge the impact of the seminal decision in Infopaq and its progeny in relation to the right of reproduction as applied to sampling musical content; that is taking part of a sound recording for re-use in a different song or piece. It is expected that the outcome of this referral will serve to qualify further what is meant by ‘reproduction in part’ under Article 2 of the InfoSoc Directive
• Second, because it will require the Court to weigh in on the interplay between economic rights and exceptions and limitations, including the 'right' to quote [under Article 10(1) of the Berne Convention 'quotation' appears like a right, but under Article 5(3)(d) InfoSoc Directive it is formally just one of the various optional copyright exceptions]. This will be particularly important in a number of creative fields, especially music, where the lawfulness of practices like unlicensed sampling and remixing remains controversial.
• Third, this case is one of the few ones currently pending before the CJEU asking about the role of different fundamental rights in the context of copyright protection: readers will in fact remember the recent Opinion of Advocate General (AG) Szpunar in the Afghanistan Papers cases [here], and might be aware that on 10 January there will be another Opinion of AG Szpunar, the one in Spiegel Online, C-516/17 [background here].

Also Merpel
loves free samples

Today's AG Opinion

This morning AG Szpunar delivered his Opinion in the case. The text is not yet available, but according to the press release, AG Szpunar reasoned as follows:

First, a phonogram producer has in principle the right to do or authorize others to do any reproductions thereof, and is a right that exists irrespective of protection of the work embodied in the recording:

The fact that the right of the phonogram producer in the phonogram is aimed at protecting his financial investment does not preclude that right from covering other uses such as sampling.

It follows that

the taking an extract of a phonogram for the purpose of using it in another phonogram (sampling) infringes the exclusive right of the producer of the first phonogram to authorise or prohibit the reproduction of his phonogram, where it is taken without his permission. 

Second, with regard to whether a phonogram which contains extracts transferred from another phonogram (samples) constitutes a copy of another phonogram, the AG pointed out that, in accordance with the Rental and Lending Rights Directive, a copy incorporates all or a substantial part of the sounds of a protected phonogram and is intended to replace lawful copies thereof:

Since sampling is not used to produce a phonogram that replaces the original phonogram and does not incorporate all or a substantial part of the sounds of the original phonogram, Advocate General Szpunar concludes that such a phonogram does not constitute a copy of that other phonogram. 

Third, the AG held the view that the InfoSoc Directive precludes a provision - like German free use - according to which an independent work may be created in the free use of another work without the consent of the author of the work used, in so far as it exceeds the scope of the exceptions to and limitations on exclusive rights provided for in that directive. 

Fourth, with regard to the quotation exception, the AG stressed that:

a quotation must satisfy certain conditions in order to be considered lawful, in particular, that it must enter into some kind of dialogue with the work quoted, the extract quoted must be incorporated in the quoting work without modification and finally a quotation must indicate the source, including the author’s name.

According to the AG sampling would not be a quotation, and would be as such ineligible for protection as such.

Fifth, with regard to the degree of latitude afforded to the Member States in transposing the provisions of the InfoSoc Directive, the AG noted that:

those rights are worded unconditionally and the protection of those rights in the national law of the Member States is mandatory. Accordingly, those rights can be limited only in the application of the exceptions and limitations listed exhaustively in that directive. Member States are nevertheless free as to the choice of form and methods which they consider appropriate to implement in order to comply with that obligation. 

Finally, with regard to the possible primacy of the freedom of the arts over the exclusive right of phonograms producers, the AG found that

the exclusive right of phonogram producers to authorise or prohibit reproduction, in part, of their phonograms in the event of its use for sampling purposes is not contrary to that freedom as enshrined in the Charter of Fundamental Rights of the European Union. Copyright and related rights establish a rightholders’ monopoly over intellectual or artistic property and are likely to restrict the exercise of certain fundamental rights, in particular, the freedom of expression and the freedom of the arts. In addition, intellectual property is itself protected as a fundamental right to property. It is therefore necessary to strike a balance between those rights. In the view of the Advocate General, the requirement of obtaining a licence for use such as that at issue in the main proceedings does not restrict the freedom of the arts to a degree that extends beyond normal market constraints. 

A more detailed commentary will follow as soon as the text of the Opinion becomes available: stay tuned! For the time being, it looks like another VERY interesting and thoughtful Opinion of AG Szpunar ...