Avocate General Sharpston has delivered her opinion (in Case
C-355/12 Nintendo v PC Box) on questions referred to the CJEU by the Milan District Court, relating to the extent to which EU copyright law protects technological protection measures ("TPMs") applied to video games and consoles, where such measures prevent both the playing of infringing copies of games but also legitimate third party games. This is the first time that the CJEU has been asked to rule specifically on the protection granted to TPMs, and the unlawfulness of measures circumventing such TPMs, under Article 6 of the Information Society Directive (Directive 2001/29/EC).

Summary

In summary, the AG stated that the term "technological measures" in Art. 6 of the Information Society Directive includes both measures employed within copyright protected works (such as video games) and within devices (such as games consoles). Where such measures have the dual effect of preventing both infringing but also legitimate acts, whether or not they qualify for protection under the Directive will depend on whether they are proportionate. In this regard, the national court must assess whether copyright infringement could be prevented or restricted without also restricting legitimate acts, or while only doing so to a lesser extent. Similarly, in determining whether protection may be provided against the supply of circumvention measures, it is relevant to consider the extent to which the circumvention measures in question are or can be used for legitimate purposes.

Full analysis

Article 6(1) of the Information Society Directive requires Member States to provide adequate legal protection against the circumvention of any effective technological measures, which the person concerned carries out in the knowledge, or with reasonable grounds to know, that he or she is pursuing that objective. Article 6(2) requires Members to provide protection against devices and services which are either (a) promoted, advertised or marketed for the purpose of circumventing TPMs, (b) have only a limited commercially significant purpose or use other than to circumvent TPMs, or (c) are primarily designed, produced, adapted or performed for the purpose of enabling or facilitating their circumvention.

On the facts of this case, Nintendo brought proceedings in Italy seeking an injunction against the sale by PC Box of devices (specifically game copiers and mod chips) enabling circumvention of the TPMs employed by Nintendo on both its DS and Wii consoles, and games (produced by Nintendo and its licensees) intended for use on those consoles. Nintendo claimed that the TPMs employed in its consoles and games were intended to prevent the use of unauthorised copies of games. PC Box claimed that, rather than trying to prevent the use of unauthorised copies of games, Nintendo was trying to increase sales of its own games above legitimate third party games and also partition markets.

Although Nintendo won at first instance, the Milan District Court referred a number of questions to the CJEU concerning the protection of TPMs under the Information Society Directive, and the extent to which measures circumventing such TPMs were unlawful under the Directive.

The AG has recommended that the CJEU give the following answers to the questions referred:

  • "Technological measures" within the meaning of Article 6 of the Information Society Directive may include both measures incorporated not only in copyright protected works themselves (i.e. in this case, video games) but also in devices designed to allow access to those works (in this case, consoles). 
  • When determining whether TPMs of the kind employed by Nintendo qualify for protection under Art. 6 where they have the dual effect of preventing or restricting both acts which infringe copyright (i.e. playing pirated games), but also legitimate acts (playing legitimate third party games), the national court must verify whether the application of the technological measures is proportionate. In particular, the court must assess whether copyright infringement could be prevented or restricted without also preventing or restricting those other legitimate acts, or while only doing so to a lesser extent.
  • When determining whether protection must be provided against any supply of circumvention measures pursuant to Article 6(2), it is relevant to consider the extent to which the circumvention measures are or can be used for legitimate purposes other than allowing copyright-restricted acts.

Ultimately, the AG took the view that the extent to which the circumvention measures supplied by PC Box may be used for purposes other than allowing infringing acts would be a factor to be taken into account when deciding both whether they fell within Art 6(2) but also whether Nintendo's TPMs meet the test of proportionality: if the circumvention devices are used primarily for other, legitimate, purposes (which is a finding of fact for the national court)  that will be a strong indication that the TPMs employed by Nintendo are not proportionate. Conversely, if the circumvention devices are primarily used to allow the playing of infringing games, that will be a strong indication that the TPMs are indeed proportionate.

If this view is upheld by the CJEU, it may mean it is more likely that TPMs used by the gaming industry will be found to be proportionate to the extent that circumvention measures are generally used for infringing purposes, although rightsholders would need to adduce evidence of what the circumvention measures are in fact used for. Certainly the finding that Art 6 protects TPMs in devices as well as copyright works themselves is a common sense finding and likely to be followed.

Nonetheless, it is not certain that the CJEU will follow the approach set out by the AG: observers note a trend for the CJEU to depart from AG opinions and it has done so recently in a number of opinions issued by this AG in IP cases. Judgment in the case is expected late this year/early 2014.

The AG's opinion was limited to the application of Art. 6 of the Information Society Directive, and did not rule on the application of the Software Directive, as the national referring court had made a finding of fact that the Nintendo games constituted copyright protected works other than just computer programs. Articles 5 and 6 of the Software Directive provide a more limited form of protection against circumvention measures specifically in relation to computer programs. The issue of whether the Information Society Directive or Software Directive should apply to video games is the subject of a recent reference to the CJEU in Case C-458/13 Grund and Nintendo.

Since then, WIPO has published a multi-jurisdictional study on the question of whether video games are protected as computer programs, audiovisual works, or a complex of copyright protected works. This survey can be accessed here.

Otherwise, rightsholders' ability to take action in respect of circumvention measures has been bolstered by the new Customs Regulation (Regulation 608/2013) which extends the EU Customs regime to include circumvention measures.

The Advocate-General's opinion can be found here.

Our client alert on the changes introduced by the new Customs regime can be found here.