Nintendo ruling confirmed lex specialis nature of Software Directive:does this have implications for UsedSoft exhaustion?

What to do on a rainy Sunday?
Put your new nail polish on ...
Earlier this week the Court of Justice of the European Union (CJEU) issued its decision in Case C-355/12 Nintendo v PC Box [here], in which it held that - in certain circumstances - it may be lawful to circumvent a protection system. 

However, what this Kat (and some of the readers she engaged in email correspondence with) found most interesting about this judgment was not really the interpretation of Article 6 of Directive 2001/29/EC (the 'InfoSoc Directive') that the Court provided therein, but rather its understanding of what protection is available for videogames, as well as the relationship between this directive and Directive 2009/24/EC (the 'Software Directive').

Starting with videogames, the Court made clear that these are not just software: 

"[V]ideogames ... constitute complex matter comprising not only a computer program but also graphic and sound elements, which, although encrypted in computer language, have a unique creative value which cannot be reduced to that encryption. In so far as the parts of a videogame ... are part of its originality, they are protected, together with the entire work, by copyright in the context of the system established by Directive 2001/29."

Play your favourite videogame
(not just software, of course) ...
This conclusion is not surprising, at least in Italy, ie where this reference originated. 

As Advocate General Sharpston noted in her Opinion, the Tribunale di Milano had already found that, in line with the case-law of the Italian courts, videogames such as those in issue could not be regarded simply as computer programs. Being complex multimedia works expressing conceptually autonomous narrative and graphic creations, such games must be regarded as intellectual works protected by copyright. 

However, this conclusion is particularly relevant because it appears to narrow down the scope of applicability of the Software Directive, and - most importantly - confirms the 'lex specialis' nature of this directive. 

As the AG stated in her Opinion (in terms which - by the way - are more explicit than those employed by the CJEU in its decision), the special nature of the Software Directive means that its provisions take precedence over those of Directive 2001/29/EC, but only where the protected material falls entirely within the scope of the former.

The implications of this statement seem particularly relevant for the videogame industry, in that they appear to limit the applicability of the (disruptive) conclusions that the CJEU reached in its 2012 decision in Case C-128/11 UsedSoft [on which see Katposts here and 1709 Blog posts here] to subject-matter that falls exclusively within the scope of the Software Directive.

... Or contemplate exhaustion,
as Shammai loves to do?
In particular, it would seem that interpretation of exhaustion of the right of distribution pursuant to Article 4(2) of the Software Directive would not extend to digital subject-matter other than "pure" software. 

This might imply the exclusion under EU law of the possibility of having a market for second-hand videogames which have "just" been licensed (and not sold) to the user.

IPKat readers will probably remember the Katpoll on UsedSoft [background information here], in which the question was whether the CJEU is likely to extend that ruling to works other than software. At that time, a broad majority of voters (57%) said that, yes, when given the opportunity to address this issue, the CJEU would say that exhaustion of the right of distribution as per Article 4(2) of the InfoSoc Directive encompasses both tangible and intangible copies.

However, following this week's ruling in Nintendo that stressed once again the special nature of the Software Directive, it looks like this conclusion may be more difficult to achieve in a future case involving the interpretation of this provision of the InfoSoc Directive ... But what do readers think? 
Nintendo ruling confirmed lex specialis nature of Software Directive:does this have implications for UsedSoft exhaustion? Nintendo ruling confirmed lex specialis nature of Software Directive:does this have implications for UsedSoft exhaustion? Reviewed by Eleonora Rosati on Sunday, January 26, 2014 Rating: 5


  1. I am a little surprised that here and in your earlier report you say that the CJEU held that technological measures may be circumvented legally in certain circumstances.

    While this is true it is not an accurate reflection of what the court found.

    The court held that that the prohibition only extends to technical measures which pursue the objective of preventing or eliminating acts not authorised by the rightholder (para 31 of the judgment).

    Thus there is subtle and important difference rather than circumvention being legal in exceptional circumstances it is the other way around. Circumvention is only illegal in the particular circumstance where the measure in question pursues the objective of protecting the exclusive rights granted under copyright.

    In all other circumstances they may be circumvented legally.

  2. Like many things, how a question is phrased reveals quite a bit about how the subject is viewed by the person making the post.

    "Truth" then, often is a silly-putty term, and like other terms that carry subjective connotations perhaps should not be used by either side in a legal debate. Everyone wants to be 'truthful,' and if your view is 'truthful,' then the other side must not be truthful if they do not agree with you (ignoring of course the shades of truth that the real world brings and likewise ignoring the maxim that the best lies have a kernel of truth).

  3. >> "In particular, it would seem that interpretation of exhaustion of the right of distribution pursuant to Article 4(2) of the Software Directive would not extend to digital subject-matter other than "pure" software."

    Nope. Both the Computer Program Directive and the Copyright Directive contain the same Article 4 exhaustion of distribution rights clause that says works are subject to the first-sale doctrine.

    See here:

    Computer Program Directive:

    "Article 4
    Restricted acts

    2. The first sale in the Community of a copy of a program by the rightholder or with his consent shall exhaust the distribution right within the Community of that copy, with the exception of the right to control further rental of the program or a copy thereof."

    Copyright Directive:

    "Article 4
    Distribution right

    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."

    So, all software in the EU, whether it is productive or video game software, features the same resale rights. Video games being evaluated by the Copyright Directive doesn't change a thing regarding the right to resell since the Copyright Directive's right to resell is the same as the Computer Program Directive's right to resell.


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