The right to prohibit extraction and re-utilisation of a substantial part of a protected database was established more than a decade ago by Directive 96/9/EC (the Database Directive). So far, however, the European Court of Justice (ECJ) has only provided guidance on the interpretation of this Directive in three cases. Apis-Hristovich EOOD v Lakorda AD (C 545/07) - a reference from the Bulgarian courts – is the most recent.
Apis owned a database of legislation and judgments and claimed to have made a substantial investment in the compilation, verification, systemisation and updating of its contents. It marketed two product modules of this database as 'Apis pravo' and 'Apis praktika'.
Persons who previously worked in Apis's software department had founded a rival company, known as "Lakorda". Apis claimed that these former employees had unlawfully extracted substantial parts of the contents of certain modules, which in turn enabled Lakorda to produce and market its own competing product modules. Apis claimed that the former employees had extracted approximately 82.5% of the documents contained in one of its modules, together with 2,516 unpublished judicial decisions from another module. The Bulgarian court referred several questions to the ECJ, focusing on the meaning of "extraction" and how to assess whether a "substantial part" has been taken either quantitatively or qualitatively.
Infringement by extraction
A large part of the ECJ's guidance in the Apis case is taken up with explaining what factors are irrelevant when determining whether an infringing extraction has taken place. In this respect all of the following are immaterial:
- The nature and form of the extraction (whether digital or manual)
- The objective of the transfer (i.e. whether or not the transfer was for commercial purposes and whether or not it was to form another database and, if so, whether or not that database was to be in competition with the original)
- The nature of the medium into which the content is transferred
- The arrangement or organisation of the transferred material in the new medium (i.e. whether or not it is different from that in the original database)
- Whether the transfer was temporary or permanent
The ECJ has confirmed that extraction is to be given a broad interpretation. It includes any unauthorised act of appropriation of the whole or a part of the contents of a database, with the nature and form of the process being immaterial. Therefore, if the whole or a substantial part of a database is transferred into another medium, even temporarily, infringement will be established.
The gravity of the infringement and the assessment of damages
Although certain factors are irrelevant when determining whether an infringing extraction has taken place, the ECJ ruled that some of them may be relevant, depending on the national law, to the assessment by the national court of the gravity of the infringement and/or the level of damages to be awarded. An example cited was whether the transfer was permanent or temporary.
Another example was whether an unlawful extraction from a protected database took place for the purpose of setting up and marketing a new database, in competition with the original. The ECJ stated that this, in certain circumstances, could be relevant in assessing the extent of the damage caused to the maker of the original database. This might require the national court to investigate the motives of the infringer.
Circumstantial evidence of extraction
Apis had claimed that the acts of extraction carried out by Lakorda concerned not merely the texts of the documents contained in the two relevant database modules but also other material such as editors' notes and hyperlinks.
In this respect the Bulgarian court had sought guidance as to whether it was an infringement if the protected database has a particular structure and other features which are also found in the allegedly infringing database.
In response the ECJ adapted an approach which will be familiar to UK copyright lawyers, stating "...the fact that ...the physical and technical characteristics present in the contents of a database also appear in the contents of another database may also be interpreted as an indication of the existence of a transfer between the two databases and therefore, of an extraction. However... it is for the national court to assess whether that coincidence can be explained by other factors, such as the use of identical sources when the two databases were being set up and the presence of those characteristics in the common sources".
The ECJ indicated that materials not available to the public from the original database may also indicate unlawful extraction if they appear in the accused database. This is, again, a concept very familiar to copyright lawyers.
How to assess a "substantial part"
The wording of Article 7(1) makes it clear that a substantial part can mean either a substantial part in a quantitative sense or a qualitative sense or both; it gives the maker of the protected database the right "to prevent extraction and/or re-utilisation of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database."
"A substantial part, evaluated quantitatively, of the contents of a protected database refers to the volume of materials extracted from the database...and must be assessed in relation to the volume of the contents of the whole of that database. If a user extracts ...a quantitatively significant part of the contents of a database whose creation required the deployment of substantial resources, the investment in the extracted...is, proportionately, equally substantial".
Often a large database is made up of parts or modules which are sometimes licensed separately. When the allegedly infringing extraction has been from one such module, what should be regarded as "the whole... database" to which the amount extracted must be compared to determine whether it amounts to a substantial part? The ECJ confirmed that where the module has itself involved sufficient investment to qualify for protection under Article 7(1)for protection by the suis generis right it is with just this module that the contents extracted needs to be compared to determine whether it was a substantial part.
If the module did not involve sufficient investment to qualify for protection although the main database as a whole did, then it is with the main database that the comparison must be made.
The ECJ confirmed that "the concept of a substantial part, evaluated qualitatively, of the contents of a protected database refers to the scale of the investment in the obtaining, verification or presentation of the contents of the subject of the act of extraction... regardless of whether that subject represents a quantitatively substantial part of the general contents of the protected database."
Accordingly "the fact that the materials allegedly extracted...from a database protected by the sui generis right were obtained by its maker from sources not accessible to the public may, according to the amount of human, technical and/or financial resources deployed in collecting the materials at issue from those sources, affect the assessment of whether there has been a substantial investment in the 'obtaining' of the material within the meaning of Article 7(1)".
It is important to note that "the intrinsic value of the materials affected by the act of extraction...does not constitute a relevant criterion". This differs somewhat from the UK test for assessing whether a substantial part of a copyright work has been taken. Here the value or the importance of that part in itself is a relevant factor in the qualitative assessment.
Although most of what the ECJ has said in this judgment could have been confidently predicted from its previous decisions in British Horseracing Board and Directmedia, it does provide additional clarity on some of the more difficult issues raised by the Database Directive. A review of the three cases which have reached the ECJ in respect of this under-employed intellectual property right suggests that obtaining protection for a database in the first place is quite difficult. However, once a database qualifies for protection the ECJ clearly has a very broad view of which acts will infringe.