[Guest post] News in YouTube/Cyando: German Federal Court rules following CJEU decision

The YouTube/Cyando referrals kept EU copyright lawyers busy for a long time (Kat-coverage here). After last year's ruling of the Court of Justice of the European Union, the ball was back in the (literal) court of Germany's Federal Court of Justice (BGH). A few days ago, the BGH had its say, as Katfriend Finn Hümmer (Stockholm University) reports.

Here's what Finn writes:

News in YouTube/Cyando: German Federal Court rules following CJEU decision

by Finn Hümmer

Less than a year after the Court of Justice of the European Union (CJEU) decision in YouTube/Cyando C-682/18 and C-683/18 (Katpost here), the German Federal Court of Justice (Bundesgerichtshof - BGH) delivered its judgment a few days ago, adding another chapter to the already 13-year-long saga. The BGH followed the CJEU in its interpretation and changed its own case law. In order to clarify questions of detail, it referred the cases back to the courts of appeal.

Background

Sarah Brightman's A Winter Symphony ...

The BGH had to decide on a whole series of cases and bundled them into two referral proceedings to the CJEU, which in turn merged the proceedings in joined cases C-682/18 and C-683/18 and ruled on 22 June 2021.

In 2008, music producer Frank Peterson had sued YouTube, seeking injunctive relief, disclosure and damages. Previously, music titles and concert recordings of the artist Sarah Brightman from the studio album "A Winter Symphony" had been uploaded on YouTube. Following a decision of the Regional Court of Hamburg, the case first went to the Higher Regional Court of Hamburg and then to the BGH, which stayed the proceedings and referred them to the CJEU.

In parallel, various rightholders and collecting societies had sued the sharehosting service Uploaded in several proceedings, initially before the Regional Courts of Munich and Hamburg, seeking injunctive relief, the provision of information and a declaration of liability for damages. Although there is no content overview or search function on the platform operated by the Swiss company Cyando AG, users can access files uploaded by other users via link platforms on the internet, which in the cases contained copyright protected works. After an appeal to the Higher Regional Courts of Munich and Hamburg, the cases reached the BGH.

At the core of all this is the question of when the platforms YouTube and Uploaded themselves perform an act of communication or making available to the public under the German equivalent of Article 3(1) of the InfoSoc Directive.

The CJEU held that a platform operator does perform an own communication to the public when it does not limit itself to providing physical facilities (see recital 27 of the InfoSoc Directive) but rather performs a necessary and deliberate intervention that results in giving the public access to protected content. This is the case where the platform operator, despite it knowing or being supposed to know about the availability of copyright infringing material on its platform:

• refrains from putting in place the appropriate technological measures that can be expected from a reasonably diligent operator, or
• provides tools on its platform specifically intended for the illegal sharing of such content, or
• knowingly promotes such sharing, which is indicated if the operator has adopted a financial model that encourages users of its platform illegally to communicate protected content to the public. (para 102).

Change in the case law: Direct liability replaces the German interferer liability

In its appeal proceedings, the BGH followed the reasoning of the CJEU and changed its own case law in respective of the German "Störerhaftung" (interferer liability). Notwithstanding the decision of the CJEU according to which Article 8(3) of the InfoSoc Directive does not preclude the German interferer liability, the BGH undertook a turnaround in its case law regarding the liability of platform operators.

... and
a Kat-All-Seasons-Symphony

Where it previously found that, in this constellation of cases, a platform operator would not be liable as perpetrator of an unlawful communication to the public but at most as an interferer, the liability as perpetrator has replaced the interferer liability. As the BGH developed this interferer liability in the past few years in accordance with the case law of the CJEU, the requirements already applicable to this instrument are transferable to the examination of communication to the public. By this it acknowledged the full harmonised nature of the right of communication to the public under Article 3(1) InfoSoc Directive.

As the CJEU, however, did not disregard the interferer liability in general, it conceivably can be an instrument in future diverging cases.

The saga continues

The consideration of whether the platform operator has adopted appropriate technical measures to combat copyright infringements on the platform had emerged as an essential standard of assessment for the liability of the platform under the regime of Articles 3(1) InfoSoc Directive and 14 E-Commerce Directive. The BGH noted that, in the case of YouTube, the Court of Appeal did not make sufficient findings on this question. It therefore remanded the case, and it is now for the Higher Regional Court of Hamburg to decide upon it.

In the proceedings against Cyando, the BGH provided an indication of the final decision by stating that there are weighty indications that no sufficient technical measures were taken. In addition, the BGH found strong indications that Cyando's business model is based on the availability of infringing content and is intended to entice users to share infringing content via the platform. In these cases, too, however, the appeal proceedings must be reopened and the previous instance must make factual findings. Only in the case I ZR 135/18 did the BGH already find that the requirements of communication to the public have been fulfilled, as Cyando breached its duty to immediately take the necessary measures to prevent access to the content, according to the notification of the rightholders.

Application of Article 17 DSM Directive

In sum: all cases are now all being referred back to the Courts of Appeal. Interestingly, the BGH has ordered the previous instances to examine the prerequisites of communication to the public also under the law implementing Article 17 of the DSM Directive, which has been transposed in Germany through the Copyright Service Provider Act (Urheberrechts-Diensteanbieter-Gesetz - UrhDaG), in force since 1 August 2021. With this law, the EU legislator uniformly regulated the primary liability of online platforms. At least for YouTube, it is certain that it will fall within its scope of application.