Court of Justice confirms that you can't avoid sui generis database rights by locating a server outside of the jurisdict

Football Dataco and others v Sportradar GmbH and another - Case C-173/11

The Court of Justice of the European Union ("CJEU") has delivered a ruling that sui generis database rights under Directive 96/9/EC (the "Database Directive") might be infringed by operations uploading data onto servers located outside of the jurisdiction, if there is an intention to target the public within the jurisdiction and the database contents are accessed by users there.

The CJEU followed the recommendations of Advocate General Cruz Villalón from June this year and confirmed that, where a party uploads data from a database protected by the sui generis database right onto a web server located in one Member State A and then sends that data to a user's computer located in another Member State B, there is an infringing act of "re-utilisation". That act takes place, at least in Member State B, where there is evidence that the act discloses an intention to target members of the public in Member State B.

The ruling therefore confirms that, when assessing whether a Member State has jurisdiction in these cases, the criterion of the "intended target of information", as framed in L'Oreal v eBay, is key.

Background

The sui generis right set out in Article 7 of the Database Directive allows the maker of a database to prevent extraction and/ or re-utilisation of the whole or a substantial part of the contents of the database (the "Database Right").

In February 2012, in another case involving Football Dataco (as reported by Field Fisher Waterhouse here) the CJEU held that, in order for a business to claim copyright in a database compiled from data created by the business, there needs to be an element of creativity in the way that the database has been structured, through the selection or arrangement of the contents. Under the Database Directive, databases are protected by copyright if "by reason of the selection or arrangement of their contents, [the database] constitutes the author's own intellectual creation". The Courts should not take into account any skill or effort spent creating the raw data from which the database is compiled. The only relevant effort is that spent selecting or arranging the contents.

The current case now deals with whether the Database Right can be infringed in the UK if there has been on-line use of data in the UK but the data has been uploaded and held on servers operating outside the UK.

Facts

Football Dataco (with others) creates a database called "Football Live" containing data, collected mainly by ex-professional footballers, about football matches (e.g. goals and goalscorers, yellow and red cards, penalties and substitutions). German defendant Sportradar Gmbh ("Sportradar") provides a rival internet service called "Sport Live Data", which stores football results and statistical data in webservers in Germany and Austria. The defendants also have a website located at betradar.com. The defendant has customers based in the UK that use Sport Live Data, including Bet 365, a UK company which provides online betting services to customers located in the UK and whose website contains a link to betradar.com.

In 2010, the claimants commenced proceedings in the High Court of Justice of England and Wales claiming that the defendants were infringing their Database Right in the Football Live database on the basis that the UK is an important target for Sportradar.

The Court of Appeal took jurisdiction of the database infringement claim in so far as it concerned the joint liability of Sportradar and its customers using its website in the UK. The claimants, however, also claimed that Sportradar had committed an act of direct infringement of database right in the UK. They argued that, in accordance with the "transmission theory", the act of making the data available to the UK public, including the act of the user accessing it in the UK, should be sufficient to give rise to infringement in the UK. In contrast the defendants relied on the "emission theory", submitting that the act of transmission occurs only in the place from which the data emanates. The Court of Appeal did not consider the issue to be "acte clair", remarking that it was not appropriate for them to form their own view about this "very important and difficult question". In those circumstances, the Court of Appeal stayed the proceedings and referred a question to the CJEU seeking guidance on where the infringing act took place. (See here previous article covering this reference). 

CJEU Decision

The CJEU noted that the definition of "re-utilisation" in Article 7(2) the Database Directive should be understood broadly as extending to any act, not authorised by the maker of the database protected by the sui generis right, of distribution to the public of the whole or a part of the contents of the database. This includes an act in which a person sends, by means of his web server to another person's computer, data previously extracted from the content of a database protected by the Database Right. By such a sending, that data is made available to a member of the public.

The Court agreed with the Advocate General that re-utilisation carried out by means of a web server is characterised by a series of successive operations, ranging from the placing online of the data on the website to the transmission of that data to interested members of the public, which may take place in different territories. This method of making available to the public should be distinguished, in principle, from traditional modes of distribution by the ubiquitous nature of the content of a website, which can be consulted instantly by an unlimited number of internet users throughout the world. 

The mere fact that data is accessible in a certain jurisdiction is not necessarily sufficient to give jurisdiction to that territory. The localisation of an act of re-utilisation depends on there being evidence from which it may be concluded that there is an intention on the part of its performer to target persons in that territory, as set out in L'Oreal v Ebay reported here. This is a question of fact for the national court to decide but, in the instant case, the fact that the data is in English rather than German and relates to English football matches might constitute such evidence.

The CJEU specifically noted that it would be wrong to consider re-utilisation to only occur in the territory where the server is located because in many circumstances it is difficult to locate the server. In addition, the effectiveness of the protection of Database Rights would be undermined if operators could target the public of a specific territory but escape liability simply by locating his server elsewhere.

Comment

Holders of sui generis Database Rights will welcome this ruling as it allows them to bring proceedings in the country where users access the database contents on the Internet, provided that it is clear that members of the public in that country were targets of the website. The judgment will therefore assist those who wish to enforce their UK Database Rights against infringing operations, which base their servers outside of the UK but direct their services to customers within the UK. This will certainly assist in the fight against many IP infringers who try to locate their servers in remote jurisdictions in order to avoid liability.

The judgment should also provide helpful guidance to the copyright sector. "Re-utilisation" of data is a very similar infringement to "communicating to the public" copyright works under article 3 of the Copyright Directive (2001/29/EC) and consequently the CJEU would be expected to follow a similar line of reasoning should a similar question arise in relation to copyright.

James Martin is a Director and Beverley Potts is a Senior Associate (PSL) in the IP Litigation and Enforcement Group of Field Fisher Waterhouse LLP.