On June 4 2015 the annual conference of the French Computer Law Association offered an "overview of recent developments in digital economy law", with a specific focus on the evaluation and compensation of intangible harm. This issue is a key concern for businesses and practitioners as the courts often award compensation that is insufficient or at least below the claims initially made by the victims of such harm.

Increase in intangible harm

Supreme Court Judge Vincent Vigneau highlighted how the appearance of new information and communication technologies is playing a key role in the increase in intangible harm. According to Vigneau, low damages awards are often due to difficulties in producing convincing evidence to support claims. Practitioners sometimes place limited importance on demonstrating the extent of the harm, because of the numerous difficulties encountered in these types of case (eg, difficulties in defining the temporality of reference or identifying the guilty persons). It is advisable to apply to the courts for the appointment of expert witnesses to evaluate the harm and then guide the courts in their assessment of the scale and type of harm.

Expert witnesses before the Court of Appeal Robert Vitkine and Stéphane Lipski provided insight into the resources used to evaluate the economic impact of harm as accurately as possible. Expert appraisal remains an effective way of determining the harm, but also with a view to producing evidence that will convince the courts. Therefore, market simulations and/or analyses of accounts before and after the harm may help to calculate the turnover actually or potentially lost.

In addition, an analysis of the costs incurred as a result of the harm will support the resulting evaluation of the harm. As highlighted by Anthony Level, assistant general counsel for new media at TF1, these could be survey and/or prospective analyses or bailiff reports.

Nevertheless, a demonstration of harm is affected by all sorts of uncertainty. Victims often refuse to produce, for strategic reasons, strong convincing evidence such as balance sheets presenting the losses sustained. Moreover, private expert appraisals are not always welcomed by the courts and so are sometimes not taken into account.

The litigation between TF1 and Dailymotion, presented by Level, illustrates the modest amount of damages awarded in a case involving a serious infringement of protected content. While TF1, assisted by an expert appraisal firm, had assessed its harm at €80 million, only €220,000 was eventually awarded by the Paris District Court on September 13 2012. Nevertheless, on December 2 2014 the Paris Court of Appeals finally awarded TF1 €1,132,000 in damages.

In order to minimise these obstacles, Vigneau raised the possibility of extending the harm evaluation methods developed for infringement cases under the 2007 and 2014 acts to cases of contractual intangible harm.

Recent changes in legislation and case law also open up new perspectives for the compensation of individual harm, such as the capture of data, as discussed by Jean-Laurent Santoni, chief executive officer of Clever Courtage. The modification of Article 323-3 of the Criminal Code by the Anti-terrorism Act 2014 and the Supreme Court's Bluetouff decision of May 20 2015 have made data theft a criminal offence, thereby reinforcing the legal means available to protect intangible property.

A better understanding of intangible harm will also imply some paedagogical efforts on the part of experts and practitioners to make it easier for the courts to grasp the issues and increase their awareness of what is at stake.

Comment

The conference offers hope for improvements in the evaluation of intangible assets – which are core components of the economy – in order to increase the compensation of harm in the IT sector and thus support the development of the digital economy.

For further information on this topic please contact Isabelle Gavanon at FIDAL by telephone (+33 1 4738 5400) or email (isabelle.gavanon@fidal.com). The FIDAL website can be accessed at www.fidal.fr.

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