The English High Court and the Court of Justice of the European Union (“CJEU”) have each recently given rulings on the interpretation and scope of unlawful “re-utilisation” of data contrary to the provisions of European directive 96/9/EC (“Database Directive”).

In 1996 the European Commission adopted the Database Directive to harmonise the legal protection given to databases in EU member states, which was implemented in the United Kingdom by the Copyright and Rights in Databases Regulations 1997 (“Database Regulations”) with effect from 1 January 1998. The Database Regulations introduced a new database right under which data stored in electronic databases is protected.

Under Regulation 16 of the Database Regulations, a person infringes a database right in a database if, without the consent of the owner of the right, he extracts or re-utilises all or a substantial part of the contents of the database in question. The term “re-utilisation” is defined under Regulation 12(1) of the Database Regulations as being, in relation to the contents of a database, making those contents available to the public by any means. This definition differs slightly from its corresponding definition within the Database Directive at Article 7(2) which states that re-utilisation is “any form of making available to the public of all or a substantial part of the contents of a database by the distribution of copies, by renting, by online or other forms of transmission”.

Clarification of test of “re-utilisation” of data held on a database

The High Court recently clarified the test for “re-utilisation” in the case of British Sky Broadcasting Group Plc v Digital Satellite Warranty Cover Ltd (in liquidation) and others [2012] , which concerned the alleged illicit supply of confidential customer data belonging to British Sky Broadcasting Group Plc (“BSkyB”) to competitor companies and the subsequent marketing by those companies of satellite equipment warranty services to such customers.

The defendants referred to Article 7(2) of the Database Directive for the definition of “re-utilisation” and claimed that this definition went further than simply making the contents of BSkyB’s database available to the other defendants. However, this argument was rejected by the High Court who held (among other things) that the sixth and ninth defendants had infringed BSkyB’s database rights by participating in the supply of substantial quantities of data unlawfully obtained from BSkyB’s confidential customer databases to the first, second and (acting in concert) third, fourth and fifth defendants contrary to Regulation 16 of the Database Regulations.

The judge in his analysis of this issue referred to the case of British Horseracing Board Ltd v William Hill Organisation [2004], in which it was determined that the term “re-utilisation” was intended to “protect the maker of a database against acts which go beyond the legitimate rights and thereby harm the investment of the maker”. On this basis, the judge concluded that the correct test for “reutilisation” was whether the distribution to the “public” concerned was an act which would harm BSkyB’s investment in creating the database in question. Using this approach, he determined that the purported distribution of copies of data taken from BSkyB’s database by one defendant to another would have amounted to “re-utilisation”, which covered any form of making available to the public, including the distribution of copies.

Confirmation that data is re-utilised in the location where the defendant intended the downloading to occur

The CJEU also gave a ruling earlier this month on certain questions referred to it on the issue of “reutilisation” by the Court of Appeal arising from the case of Football Dataco and others v Sportradar GmbH and another [2012].

In this case, Football Dataco Limited (“Dataco”) claimed against Sportradar GmbH (“Sportradar”) and its associated companies for infringement of its database right in its “Football Live” database. Dataco alleged that Sportradar had copied data from Football Live in order to compile data for Sportradar’s own “Sport Data Live” service.

In the first instance, the High Court held among other things that the infringing act of “re-utilisation” of a database content only took place where the data-containing server was based, rather than where the transmission was received; in this case the Dataco server was based outside of the UK and therefore the English Court did not have jurisdiction to hear the claim. Dataco appealed the decision arguing that the “transmission” of data involved the hosting of the website as well as the act of the user in accessing it.

The Court of Appeal decided that the issue of location as regards re-utilisation of data should be referred to the CJEU. Accordingly, the CJEU was asked to determine:

  • Whether the act of sending data was an act or “extraction” or “re-utilisation”, where a party uploads data from a database protected by a database right under the Database Directive onto that party’s server located in one EU member state (“Member State A”), and in response to requests from a user in another EU member state (“Member State B”) the server sends such data to the user’s computer so that the data is stored in the memory of that user’s computer and displayed on its screen; and
  • if such sending of data does constitute “extraction” or “re-utilisation”, where does the act of infringement occur?

In June 2012, the Advocate General notably opined that the sending of such data would constitute an act of “re-utilisation” (rather than extraction) which would occur in all member states where a necessary act in the chain of utilisation took place.

However, the CJEU has now narrowed the scope of the Advocate General’s analysis and held that:

  • the sending of data, which has previously been uploaded from a database protected by a database right, from a server in Member State A via the internet to a user in Member State B for the purpose of storage in that user’s computer’s memory and display on its screen, constitutes an act of re-utilisation by the person sending it within the meaning of Article 7 of the Database Directive; and
  • the infringing act of re-utilisation occurs at least in the location where the internet user downloads the data (namely, Member State B in the example), provided always that there is evidence of an intention on the part of the person performing the infringing act to target members of the public in that particular member state. It is for the national courts to decide whether its public audience has been targeted.

WAB Comment:

The above cases serve as reminder that electronic databases are an important part of the information economy and that, as such, they are valuable business assets. Accordingly, database owners are keen to ensure that the commercial value inherent in their databases is adequately protected.

The decision in the Dataco case is consistent with current practices in trade mark law, under which website use does not constitute use everywhere in the world by virtue of the fact that the website in question is accessible globally; it is important to consider the target audience of the site. Accordingly, the CJEU’s decision indicates that database right holders may only be able to bring claims against infringers in each EU member state in which the person who has carried out the infringing act has targeted users. Nevertheless, the decision also means that potential infringers will not be able to avoid legal liability simply by locating their servers or operations in a jurisdiction which is favourable to them and/or unfavourable to the rights owner.