Throughout the European Union, courts struggle to balance the diverging interests of copyright holders on the one hand, and of online intermediary service providers and end-users on the other hand. For each of these stakeholders, it is an ongoing challenge to try to apply the static provisions to scenarios in the digital environment which evolve very rapidly.
In September, the Court of Justice of the European Union (CJEU), handed down two long-awaited landmark rulings in the field of copyright and the digital economy - the GS Media (C-160/15) and the McFadden (C-484/14) judgments. In simple terms, both judgments address the scope of liability for copyright infringement of online intermediaries.
With the GS Media judgment, the CJEU addressed another issue of liability for hyperlinking. In its recent judgment, the court strengthened the protection of rights holders by increasing the obligations of website operators. A commercial website operator that publishes hyperlinks to copyright infringing material is presumed to do this for financial gain. If not removed upon notice, this act may constitute a copyright infringement by the website operator itself. This judgment may have broad implications to all kinds of Internet publishers, such as news websites or any other professional websites, that feature links in its editorial content since it may lead to a notice-and-takedown regime also for links.
In its McFadden judgment, the CJEU provided guidelines pursuant to which operators of commercial free Wi-Fi networks, such as hotels, coffee shops and the like, may be exempted from liability for copyright infringements committed by their customers via the free Wi-Fi network. At the outset, the court grants commercial free Wi-Fi network operators the same privileges as traditional Internet access providers. However, there is one crucial hurdle they have to clear: free Wi-Fi operators are required to password protect their networks and identify their customers before granting access.
Both of these cases illustrate the difficulties and uncertainties that rights holders, online intermediaries and end-users face concerning copyright issues in the Internet. Among the professional public and the media, these judgments have driven diverging comments. For some, these judgments "break the Internet" as they stifle the freedom of expression as well as the free and ubiquitous access to the Internet for everyone. On the other hand, these judgments try to balance the interests of each stakeholder and, in particular, provide the rights holders with at least some protection within the online environment.
Both rulings are preliminary. It remains to be seen how the national courts will define the exact scope of obligations that the intermediaries would have to comply with in order to avoid liability. However, it is clear that the obligations of website operators and commercial free Wi-Fi providers will increase and will be placed under the courts' greater scrutiny in the future.
On a side note, it is of particular interest that the EU has recently released first drafts of a proposed new Directive on Copyright in the Digital Single Market as well as a Regulation on liability of intermediaries. On the one hand, these instruments propose mandatory content screening and notice-and-takedown regimes for hosting platforms. On the other hand, the EU tries to strengthen the rights of press publishers if their works are used digitally on third-party platforms. In summary, the conflicts of interests in the Internet environment are not only being addressed on a judiciary level, but also on a legislative one. We will report on any new developments in this regard as they evolve.