4 Module 2 - Copyright Infringement: Communication to the Public and Linking 4 Module 2 - Copyright Infringement: Communication to the Public and Linking

4.1 European Union 4.1 European Union

4.1.1. European Commission Communication, Towards a modern, more European copyright framework, 9 December 2015, COM(2015) 626 final

European Commission Communication, Towards a modern, more European copyright framework, 9 December 2015, COM(2015) 626 final

4.1.2 Communication and Making Available to the Public 4.1.2 Communication and Making Available to the Public

4.1.2.1 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA, C-306/05, December 7, 2006 (ECJ) (communication to the public) (OPTIONAL) 4.1.2.1 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA, C-306/05, December 7, 2006 (ECJ) (communication to the public) (OPTIONAL)

JUDGMENT OF THE COURT (Third Chamber)

7 December 2006 (*)

(Copyright and related rights in the information society – Directive 2001/29/EC – Article 3 – Concept of communication to the public – Works communicated by means of television sets installed in hotel rooms)

In Case C-306/05,

REFERENCE for a preliminary ruling under Article 234 EC from the Audiencia Provincial de Barcelona (Spain), made by decision of 7 June 2005, received at the Court on 3 August 2005, in the proceedings

Sociedad General de Autores y Editores de España (SGAE)

Rafael Hoteles SA,

THE COURT (Third Chamber),

composed of A. Rosas, President of the Chamber, A. Borg Barthet, J. Malenovský (Rapporteur), U. Lõhmus and A. Ó Caoimh, Judges,

Advocate General: E. Sharpston,

Registrar: M. Ferreira, Principal Administrator,

having regard to the written procedure and further to the hearing on 4 May 2006,

after considering the observations submitted on behalf of:

– the Sociedad General de Autores y Editores de España (SGAE), by R. Gimeno-Bayón Cobos and P. Hernández Arroyo, abogados,

– Rafael Hoteles SA, by R. Tornero Moreno, abogado,

– the French Government, by G. de Bergues and J.‑C. Niollet, acting as Agents,

– Ireland, by D.J. O’Hagan, acting as Agent, assisted by N. Travers BL,

– the Austrian Government, by C. Pesendorfer, acting as Agent,

– the Polish Government, by K. Murawski, U. Rutkowska and P. Derwicz, acting as Agents,

– the Commission of the European Communities, by J.R. Vidal Puig and W. Wils, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 13 July 2006,

gives the following

Judgment

1 The reference for a preliminary ruling concerns the interpretation of Article 3 of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 2001 L 167, p. 10).

2 This reference was made in the context of proceedings between the Sociedad General de Autores y Editores de España (SGAE) and Rafael Hoteles SA (‘Rafael’), concerning the alleged infringement, by the latter, of intellectual property rights managed by SGAE.

Legal context

Applicable international law

3 The Agreement on Trade-Related Aspects of Intellectual Property Rights (‘the TRIPs Agreement’), as set out in Annex 1C to the Marrakesh Agreement establishing the World Trade Organisation, was approved on behalf of the European Community by Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994) (OJ 1994 L 336, p. 1).

4 Article 9(1) of the TRIPs Agreement provides:

‘Members shall comply with Articles 1 through 21 of the Berne Convention (1971) and the Appendix thereto. However, Members shall not have rights or obligations under this Agreement in respect of the rights conferred under Article 6bis of that Convention or of the rights derived therefrom.’

5 Article 11 of the Berne Convention for the Protection of Literary and Artistic Works (Paris Act of 24 July 1971), as amended on 28 September 1979 (‘the Berne Convention’) provides:

‘1. Authors of dramatic, dramatico-musical and musical works shall enjoy the exclusive right of authorising:

(i) the public performance of their works, including such public performance by any means or process;

(ii) any communication to the public of the performance of their works.

2. Authors of dramatic or dramatico-musical works shall enjoy, during the full term of their rights in the original works, the same rights with respect to translations thereof.’

6 Article 11bis(1) of the Berne Convention provides:

‘Authors of literary and artistic works shall enjoy the exclusive right of authorising:

(i) the broadcasting of their works or the communication thereof to the public by any other means of wireless diffusion of signs, sounds or images;

(ii) any communication to the public by wire or by rebroadcasting of the broadcast of the work, when this communication is made by an organization other than the original one;

(iii) the public communication by loudspeaker or any other analogous instrument transmitting, by signs, sounds or images, the broadcast of the work.’

7 The World Intellectual Property Organisation (WIPO) adopted in Geneva, on 20 December 1996, the WIPO Performances and Phonograms Treaty and the WIPO Copyright Treaty. Those two treaties were approved on behalf of the Community by Council Decision 2000/278/EC of 16 March 2000 (OJ 2000 L 89, p. 6).

8 Article 8 of the WIPO Copyright Treaty provides:

‘Without prejudice to the provisions of Articles 11(1)(ii), 11bis(1)(i) and (ii), 11ter(1)(ii), 14(1)(ii) and 14bis(1) of the Berne Convention, authors of literary and artistic works shall enjoy the exclusive right of authorising any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access these works from a place and at a time individually chosen by them.’

9 Joint declarations concerning the WIPO Copyright Treaty were adopted by the Diplomatic Conference on 20 December 1996.

10 The joint declaration concerning Article 8 of that Treaty provides:

‘It is understood that the mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of this Treaty or the Berne Convention. It is further understood that nothing in Article 8 precludes a Contracting Party from applying Article 11bis(2).’

Community legislation

11 The ninth recital in the preamble to Directive 2001/29 states:

‘Any harmonisation of copyright and related rights must take as a basis a high level of protection, since such rights are crucial to intellectual creation. Their protection helps to ensure the maintenance and development of creativity in the interests of authors, performers, producers, consumers, culture, industry and the public at large. Intellectual property has therefore been recognised as an integral part of property.’

12 The 10th recital in the preamble to that directive states:

‘If authors or performers are to continue their creative and artistic work, they have to receive an appropriate reward for the use of their work, as must producers in order to be able to finance this work. The investment required to produce products such as phonograms, films or multimedia products, and services such as “on-demand” services, is considerable. Adequate legal protection of intellectual property rights is necessary in order to guarantee the availability of such a reward and provide the opportunity for satisfactory returns on this investment.’

13 The 15th recital in the preamble to that directive states:

‘The Diplomatic Conference held under the auspices of the [WIPO] in December 1996 led to the adoption of two new Treaties, the [WIPO Copyright Treaty] and the [WIPO Performances and Phonograms Treaty], dealing respectively with the protection of authors and the protection of performers and phonogram producers. Those Treaties update the international protection for copyright and related rights significantly, not least with regard to the so-called “digital agenda”, and improve the means to fight piracy world-wide. The Community and a majority of Member States have already signed the Treaties and the process of making arrangements for the ratification of the Treaties by the Community and the Member States is under way. This Directive also serves to implement a number of the new international obligations.’

14 The 23rd recital in the preamble to that directive states:

‘This Directive should harmonise further the author’s right of communication to the public. This right should be understood in a broad sense covering all communication to the public not present at the place where the communication originates. This right should cover any such transmission or retransmission of a work to the public by wire or wireless means, including broadcasting. This right should not cover any other acts.’

15 The 27th recital in the preamble to Directive 2001/29 states:

‘The mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of this Directive.’

16 Article 3 of that directive provides:

‘1. Member States shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.

2. Member States shall provide for the exclusive right to authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them:

(a) for performers, of fixations of their performances;

(b) for phonogram producers, of their phonograms;

(d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.

3. The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.’

National legislation

17 The codified text of the Law on intellectual property, which rectifies, clarifies and harmonises the legislative provisions in force in that area (‘the LIP’), was approved by Royal Legislative Decree No 1/1996 of 12 April 1996 (BOE No 97 of 22 April 1996).

18 Article 17 of the LIP provides:

‘The author has the exclusive rights of exploitation of his works regardless of their form and, inter alia, the exclusive rights of reproduction, distribution, public communication and conversion which cannot be exercised without his permission except in circumstances laid down in this Law.’

19 Article 20(1) of the LIP provides:

‘Public communication shall mean any act by which a number of persons can have access to the work without prior distribution of copies to each of those persons.

Communication which takes place within a strictly domestic location which is not integrated into or connected to a distribution network of any kind shall not be classified as public.’

The main proceedings and the questions referred for a preliminary ruling

20 SGAE is the body responsible for the management of intellectual property rights in Spain.

21 SGAE took the view that the use of television sets and the playing of ambient music within the hotel owned by Rafael, during the period from June 2002 to March 2003, involved communication to the public of works belonging to the repertoire which it manages. Considering that those acts were carried out in breach of the intellectual property rights attached to the works, SGAE brought an action for compensation against Rafael before the Juzgado de Primera Instancia (Court of First Instance) No 28, Barcelona (Spain).

22 By decision of 6 June 2003, that court partially rejected the claim. It took the view that the use of television sets in the hotel’s rooms did not involve communication to the public of works managed by SGAE. It considered, on the other hand, that the claim was well founded as regards the well-known existence in hotels of communal areas with television sets and where ambient music is played.

23 SGAE and Rafael both brought appeals before the Audiencia Provincial (Provincial Court) de Barcelona, which decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) Does the installation in hotel rooms of television sets to which a satellite or terrestrial television signal is sent by cable constitute an act of communication to the public which is covered by the harmonisation of national laws protecting copyright provided for in Article 3 of Directive [2001/29]?

(2) Is the fact of deeming a hotel room to be a strictly domestic location, so that communication by means of television sets to which is fed a signal previously received by the hotel is not regarded as communication to the public, contrary to the protection of copyright pursued by Directive [2001/29]?

(3) For the purposes of protecting copyright in relation to acts of communication to the public provided for in Directive [2001/29], can a communication that is effected through a television set inside a hotel bedroom be regarded as public because successive viewers have access to the work?’

The request to have the oral procedure reopened

24 By letter received at the Court of Justice on 12 September 2006, Rafael requested the reopening of the oral procedure, pursuant to Article 61 of the Rules of Procedure of the Court of Justice.

25 That request is based on the alleged inconsistency of the Advocate General’s Opinion. Rafael submits that the negative response in the Opinion to the first question unavoidably implies a negative response to the second and third questions, whereas the Advocate General suggests that the answer to the latter questions should be in the affirmative.

26 On that point, it is appropriate to recall that neither the Statute of the Court of Justice nor the Rules of Procedure make provision for the parties to submit observations in response to the Advocate General’s Opinion (see, in particular, Case C-259/04 Emanuel [2006] ECR I‑3089, paragraph 15).

27 The Court may, certainly, of its own motion, on a proposal from the Advocate General or at the request of the parties, order that the oral procedure should be reopened in accordance with Article 61 of its Rules of Procedure, if it considers that it lacks sufficient information or that the case must be dealt with on the basis of an argument which has not been debated between the parties (see, in particular, Case C-209/01 Schilling and Fleck-Schilling [2003] ECR I‑13389, paragraph 19, and Case C-30/02 Recheio – Cash & Carry [2004] ECR I‑6051, paragraph 12).

28 However, the Court finds that in the present case it has all the information necessary to give judgment.

29 Consequently, there is no need to order the reopening of the oral procedure.

The questions

Preliminary observations

30 It should be stated at the outset that, contrary to Rafael’s submissions, the situation at issue in the main proceedings does not fall within Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission (OJ 1993 L 248, p. 15), but within Directive 2001/29. The latter applies to all communications to the public of protected works, whereas Directive 93/83 only provides for minimal harmonisation of certain aspects of protection of copyright and related rights in the case of communication to the public by satellite or cable retransmission of programmes from other Member States. As the Court has already held, unlike Directive 2001/29, this minimal harmonisation does not provide information to enable the Court to reply to a question concerning a situation similar to that which is the subject of the questions referred for a preliminary ruling (see, to that effect, Case C-293/98 Egeda [2000] ECR I‑629, paragraphs 25 et 26).

31 Next, it should be noted that the need for uniform application of Community law and the principle of equality require that where provisions of Community law make no express reference to the law of the Member States for the purpose of determining their meaning and scope, as is the case with Directive 2001/29/EC, they must normally be given an autonomous and uniform interpretation throughout the Community (see, in particular, Case C-357/98 Yiadom [2000] ECR I‑9265, paragraph 26, and Case C-245/00 SENA [2003] ECR I‑1251, paragraph 23). It follows that the Austrian Government cannot reasonably maintain that it is for the Member States to provide the definition of ‘public’ to which Directive 2001/29 refers but does not define.

The first and third questions

32 By its first and third questions, which it is appropriate to examine together, the referring court asks, essentially, whether the distribution of a signal through television sets to customers in hotel rooms constitutes communication to the public within the meaning of Article 3(1) of Directive 2001/29, and whether the installation of television sets in hotel rooms constitutes, in itself, an act of that nature.

33 In that respect, it should be noted that that Directive does not define ‘communication to the public’.

34 According to settled case-law, in interpreting a provision of Community law it is necessary to consider not only its wording, but also the context in which it occurs and the objectives pursued by the rules of which it is part (see, in particular, Case C‑156/98 Germany vCommission [2000] ECR I‑6857, paragraph 50, and Case C‑53/05 Commission v Portugal [2006] ECR I-0000, paragraph 20).

35 Moreover, Community legislation must, so far as possible, be interpreted in a manner that is consistent with international law, in particular where its provisions are intended specifically to give effect to an international agreement concluded by the Community (see, in particular, Case C‑341/95 Bettati [1998] ECR I‑4355, paragraph 20 and the case-law cited).

36 It follows from the 23rd recital in the preamble to Directive 2001/29 that ‘communication to the public’ must be interpreted broadly. Such an interpretation is moreover essential to achieve the principal objective of that directive, which, as can be seen from its ninth and tenth recitals, is to establish a high level of protection of, inter alios, authors, allowing them to obtain an appropriate reward for the use of their works, in particular on the occasion of communication to the public.

37 The Court has held that, in the context of this concept, the term ‘public’ refers to an indeterminate number of potential television viewers (Case C‑89/04 Mediakabel [2005] ECR I‑4891, paragraph 30, and Case C-192/04 Lagardère Active Broadcast [2005] ECR I‑7199, paragraph 31).

38 In a context such as that in the main proceedings, a general approach is required, making it necessary to take into account not only customers in hotel rooms, such customers alone being explicitly mentioned in the questions referred for a preliminary ruling, but also customers who are present in any other area of the hotel and able to make use of a television set installed there. It is also necessary to take into account the fact that, usually, hotel customers quickly succeed each other. As a general rule, a fairly large number of persons are involved, so that they may be considered to be a public, having regard to the principal objective of Directive 2001/29, as referred to in paragraph 36 of this judgment.

39 In view, moreover, of the cumulative effects of making the works available to such potential television viewers, the latter act could become very significant in such a context. It matters little, accordingly, that the only recipients are the occupants of rooms and that, taken separately, they are of limited economic interest for the hotel.

40 It should also be pointed out that a communication made in circumstances such as those in the main proceedings constitutes, according to Article 11bis(1)(ii) of the Berne Convention, a communication made by a broadcasting organisation other than the original one. Thus, such a transmission is made to a public different from the public at which the original act of communication of the work is directed, that is, to a new public.

41 As is explained in the Guide to the Berne Convention, an interpretative document drawn up by the WIPO which, without being legally binding, nevertheless assists in interpreting that Convention, when the author authorises the broadcast of his work, he considers only direct users, that is, the owners of reception equipment who, either personally or within their own private or family circles, receive the programme. According to the Guide, if reception is for a larger audience, possibly for profit, a new section of the receiving public hears or sees the work and the communication of the programme via a loudspeaker or analogous instrument no longer constitutes simple reception of the programme itself but is an independent act through which the broadcast work is communicated to a new public. As the Guide makes clear, such public reception falls within the scope of the author’s exclusive authorisation right.

42 The clientele of a hotel forms such a new public. The transmission of the broadcast work to that clientele using television sets is not just a technical means to ensure or improve reception of the original broadcast in the catchment area. On the contrary, the hotel is the organisation which intervenes, in full knowledge of the consequences of its action, to give access to the protected work to its customers. In the absence of that intervention, its customers, although physically within that area, would not, in principle, be able to enjoy the broadcast work.

43 It follows from Article 3(1) of Directive 2001/29 and Article 8 of the WIPO Copyright Treaty that for there to be communication to the public it is sufficient that the work is made available to the public in such a way that the persons forming that public may access it. Therefore, it is not decisive, contrary to the submissions of Rafael and Ireland, that customers who have not switched on the television have not actually had access to the works.

44 Moreover, it is apparent from the documents submitted to the Court that the action by the hotel by which it gives access to the broadcast work to its customers must be considered an additional service performed with the aim of obtaining some benefit. It cannot be seriously disputed that the provision of that service has an influence on the hotel’s standing and, therefore, on the price of rooms. Therefore, even taking the view, as does the Commission of the European Communities, that the pursuit of profit is not a necessary condition for the existence of a communication to the public, it is in any event established that the communication is of a profit-making nature in circumstances such as those in the main proceedings.

45 With reference to the question whether the installation of television sets in hotel rooms constitutes, in itself, a communication to the public within the meaning of Article 3(1) of Directive 2001/29, it should be pointed out that the 27th recital in the preamble to that directive states, in accordance with Article 8 of the WIPO Copyright Treaty, that ‘[t]he mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of [that] Directive.’

46 While the mere provision of physical facilities, usually involving, besides the hotel, companies specialising in the sale or hire of television sets, does not constitute, as such, a communication within the meaning of Directive 2001/29, the installation of such facilities may nevertheless make public access to broadcast works technically possible. Therefore, if, by means of television sets thus installed, the hotel distributes the signal to customers staying in its rooms, then communication to the public takes place, irrespective of the technique used to transmit the signal.

47 Consequently, the answer to the first and second questions is that, while the mere provision of physical facilities does not as such amount to a communication within the meaning of Directive 2001/29, the distribution of a signal by means of television sets by a hotel to customers staying in its rooms, whatever technique is used to transmit the signal, constitutes communication to the public within the meaning of Article 3(1) of that directive.

The second question

48 By its second question, the referring court asks, essentially, whether the private nature of hotel rooms precludes the communication of a work to those rooms by means of television sets from constituting communication to the public within the meaning of Article 3(1) of Directive 2001/29.

49 In that respect, Ireland submits that communication or making available of works in the private context of hotel rooms should be distinguished from the same acts which take place in public areas of the hotel. This argument cannot however be accepted.

50 It is apparent from both the letter and the spirit of Article 3(1) of Directive 2001/29 and Article 8 of the WIPO Copyright Treaty – both of which require authorisation by the author not for retransmissions in a public place or one which is open to the public but for communications by which the work is made accessible to the public – that the private or public nature of the place where the communication takes place is immaterial.

51 Moreover, according to the provisions of Directive 2001/29 and of the WIPO Copyright Treaty, the right of communication to the public covers the making available to the public of works in such a way that they may access them from a place and at a time individually chosen by them. That right of making available to the public and, therefore, of communication to the public would clearly be meaningless if it did not also cover communications carried out in private places.

52 In support of the argument concerning the private nature of hotel rooms, Ireland also invokes the European Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950 (‘the ECHR’), and in particular its Article 8, which prohibits any arbitrary or disproportionate interference by a public authority in the sphere of private activity. However, this argument cannot be accepted either.

53 In that respect, it should be pointed out that Ireland does not make clear who, in a context such as that of the main proceedings, would be the victim of such an arbitrary or disproportionate intervention. Ireland can hardly have in mind the customers who benefit from the signal which they receive and who are under no obligation to pay the authors. Nor can the victim be the hotel since, even though it must be concluded that the hotel is obliged to make such payment, it cannot claim to be a victim of an infringement of Article 8 of the ECHR in so far as the rooms, once made available to its customers, cannot be considered as coming within its private sphere.

54 Having regard to all of the foregoing considerations, the answer to the second question is that the private nature of hotel rooms does not preclude the communication of a work by means of television sets from constituting communication to the public within the meaning of Article 3(1) of Directive 2001/29.

Costs

55 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) hereby rules:

1. While the mere provision of physical facilities does not as such amount to communication within the meaning of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of copyright and related rights in the information society, the distribution of a signal by means of television sets by a hotel to customers staying in its rooms, whatever technique is used to transmit the signal, constitutes communication to the public within the meaning of Article 3(1) of that directive.

2. The private nature of hotel rooms does not preclude the communication of a work by means of television sets from constituting communication to the public within the meaning of Article 3(1) of Directive 2001/29.

4.1.2.2 Phonographic Performance (Ireland) Limited v Ireland, Attorney General, C-162/10, March 15, 2012 (ECJ) (communication to the public) 4.1.2.2 Phonographic Performance (Ireland) Limited v Ireland, Attorney General, C-162/10, March 15, 2012 (ECJ) (communication to the public)

JUDGMENT OF THE COURT (Third Chamber)

15 March 2012 (*)

(Copyright and related rights — Directive 2006/115/EC — Articles 8 and 10 — Concepts of ‘user’ and ‘communication to the public’ — Installation in hotel bedrooms of televisions and/or radios to which the hotelier distributes a broadcast signal)

In Case C‑162/10,

REFERENCE for a preliminary ruling under Article 267 TFEU, from the High Court (Commercial Division) (Ireland), made by decision of 23 March 2010, received at the Court on 7 April 2010, in the proceedings

Phonographic Performance (Ireland) Limited

Ireland,

Attorney General,

THE COURT (Third Chamber),

composed of K. Lenaerts, President of the Chamber, J. Malenovský (Rapporteur), E. Juhász, G. Arestis and T. von Danwitz, Judges,

Advocate General: V. Trstenjak,

Registrar: A. Impellizzeri, Administrator,

having regard to the written procedure and further to the hearing on 7 April 2011,

after considering the observations submitted on behalf of:

– Phonographic Performance (Ireland) Limited, by H. Sheehy, solicitor, and J. Newman, BL,

– Ireland, by D. O’Hagan, acting as Agent, and E. Fitzsimons and J. Jeffers, BL,

– the Greek Government, by G. Papadaki, M. Germani and G. Alexaki, acting as Agents,

– the Italian Government, by P. Gentili, acting as Agent,

– the French Government, by J. Gstalter, acting as Agent,

– European Commission, by J. Samnadda and S. La Pergola, acting as Agents.

after hearing the Opinion of the Advocate General at the sitting on 29 June 2011

gives the following

Judgment

1 This reference for a preliminary ruling relates to the interpretation of Articles 8 and 10 of Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 2006 L 376, p. 28).

2 The reference has been made in the course of proceedings between Phonographic Performance (Ireland) Limited (‘PPL’) and Ireland.

Legal context

International law

3 The World Intellectual Property Organisation (‘WIPO’) adopted in Geneva, on 20 December 1996, the WIPO Performances and Phonograms Treaty (‘the WPPT’) and the WIPO Copyright Treaty. Those two treaties were approved on behalf of the European Community by Council Decision 2000/278/EC of 16 March 2000 (OJ 2000 L 89, p. 6).

4 Under Article 2(b), (d) and (g) of the WPPT:

‘For the purposes of this Treaty:

(b) “phonogram” means the fixation of the sounds of a performance or of other sounds, or of a representation of sounds, other than in the form of a fixation incorporated in a cinematographic or other audiovisual work;

...

(d) “producer of a phonogram” means the person, or the legal entity, who or which takes the initiative and has the responsibility for the first fixation of the sounds of a performance or other sounds, or the representations of sounds.

...

(g) “communication to the public” of a performance or a phonogram means the transmission to the public by any medium, otherwise than by broadcasting, of sounds of a performance or the sounds or the representations of sounds fixed in a phonogram. For the purposes of Article 15, “communication to the public” includes making the sounds or representations of sounds fixed in a phonogram audible to the public.’

5 Article 15 of the WPPT reads:

‘(1) Performers and producers of phonograms shall enjoy the right to a single equitable remuneration for the direct or indirect use of phonograms published for commercial purposes for broadcasting or for any communication to the public.

(2) Contracting Parties may establish in their national legislation that the single equitable remuneration shall be claimed from the user by the performer or by the producer of a phonogram or by both. Contracting Parties may enact national legislation that, in the absence of an agreement between the performer and the producer of a phonogram, sets the terms according to which performers and producers of phonograms shall share the single equitable remuneration.

(3) Any Contracting Party may, in a notification deposited with the Director-General of WIPO, declare that it will apply the provisions of paragraph (1) only in respect of certain uses, or that it will limit their application in some other way, or that it will not apply these provisions at all.

(4) For the purposes of this Article, phonograms made available to the public by wire or wireless means in such a way that members of the public may access them from a place and at a time individually chosen by them shall be considered as if they had been published for commercial purposes.’

European Union law

6 According to recitals 5, 7 and 16 of the preamble to Directive 2006/115:

‘(5) The creative and artistic work of authors and performers necessitates an adequate income as a basis for further creative and artistic work, and the investments required particularly for the production of phonograms and films are especially high and risky. The possibility of securing that income and recouping that investment can be effectively guaranteed only through adequate legal protection of the rightholders concerned.

…

(7) The legislation of the Member States should be approximated in such a way as not to conflict with the international conventions on which the copyright and related rights laws of many Member States are based.

…

(16) Member States should be able to provide for more far-reaching protection for owners of rights related to copyright than that required by the provisions laid down in this Directive in respect of broadcasting and communication to the public.’

7 Article 7 of Directive 2006/115 provides:

‘1. Member States shall provide for performers the exclusive right to authorise or prohibit the fixation of their performances.

2. Member States shall provide for broadcasting organisations the exclusive right to authorise or prohibit the fixation of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.

3. A cable distributor shall not have the right provided for in paragraph 2 where it merely retransmits by cable the broadcasts of broadcasting organisations.’

8 Article 8(2) of that directive provides:

‘Member States shall provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public, and to ensure that this remuneration is shared between the relevant performers and phonogram producers. Member States may, in the absence of agreement between the performers and phonogram producers, lay down the conditions as to the sharing of this remuneration between them.’

9 Article 10 of that directive is worded as follows:

‘1. Member States may provide for limitations to the rights referred to in this Chapter in respect of:

(a) private use;

…

2. Irrespective of paragraph 1, any Member State may provide for the same kinds of limitations with regard to the protection of performers, producers of phonograms, broadcasting organisations and of producers of the first fixations of films, as it provides for in connection with the protection of copyright in literary and artistic works.

However, compulsory licences may be provided for only to the extent to which they are compatible with the Rome Convention.

3. The limitations referred to in paragraphs 1 and 2 shall be applied only in certain special cases which do not conflict with a normal exploitation of the subject matter and do not unreasonably prejudice the legitimate interests of the rightholder.’

10 Directive 2006/115 codified and repealed Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 1992 L 346, p. 61).

11 According to recital 9 of the preamble to Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 2001 L 167, p. 10):

12 Article 3 of that directive states:

(a) for performers, of fixations of their performances;

(b) for phonogram producers, of their phonograms;

(d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.

3. The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.’

National law

13 The Copyright and Related Rights Act 2000, (‘the 2000 Act’) provides in Section 97:

‘1. Subject to subsection (2), it is not an infringement of the copyright in a sound recording, broadcast or cable programme to cause a sound recording, broadcast or cable programme to be heard or viewed where it is heard or viewed:

(a) in part of the premises where sleeping accommodation is provided for the residents or inmates, and

(b) as part of the amenities provided exclusively or mainly for residents or inmates.

2. Subsection (1) does not apply in respect of any part of premises to which subsection (1) applies where there is a discrete charge made for admission to the part of the premises where a sound recording, broadcast or cable programme is to be heard or viewed.’

The dispute in the main proceedings and the questions referred for a preliminary ruling

14 PPL is a collecting society which represents the rights which phonogram producers hold over sound recordings or phonograms in Ireland.

15 The main proceedings concern an action brought by PPL against Ireland for a declaration that Ireland, in adopting and maintaining in force Section 97 of the Act of 2000, has acted in breach of Article 4 TEU and for damages for that breach.

16 PPL alleges that it was on the ground of the exemption from liability provided for by Section 97(1) of the Act of 2000 that the operators of hotels and guesthouses (collectively ‘hotels’) did not pay equitable remuneration to it for the use, in hotel bedrooms in Ireland, of phonograms included amongst those made available under licence to PPL, by means of apparatus provided by persons responsible for the operation of those hotels as part of the service they provide.

17 The exemption from liability for hoteliers broadcasting protected phonograms infringes certain European directives adopted in the area of rights related to copyright, which provide for the right of phonogram producers to equitable remuneration when their phonograms are used under certain circumstances.

18 The High Court (Commercial Division) makes clear that the main proceedings concern only sound recordings or phonograms heard by guests in hotel bedrooms in Ireland and not in other parts of those establishments. Nor do the proceedings concern the use by hotel guests of transmissions which are interactive or on-demand.

19 Moreover, according to the referring court, if a hotel in Ireland provides televisions or radios in its bedrooms and, by cable or other technology, distributes to those televisions and radios a signal received centrally, then that hotel is not required by reason of Section 97(1) of the Act of 2000 to make any payment of equitable remuneration to phonogram producers for sound recordings included in TV or radio broadcasts.

20 Similarly, if a hotel places in its bedrooms other apparatus and makes available sound recordings in physical or digital form which may be played by guests thereon, that hotel is, likewise, not obliged to pay equitable remuneration to phonogram producers by reason of Section 97(1) of the Act of 2000.

21 Moreover, whilst the claim in the main proceedings only relates to use of sound recordings in hotel bedrooms, the referring court points out that Section 97(1) of the Act of 2000 also has the effect of removing the requirement of equitable remuneration for such use in hospitals, nursing homes, residential care facilities, prisons and all other similar institutions.

22 Finally, it makes clear that the sound recordings at issue in the proceedings are phonograms published for commercial purposes.

23 Against that background, the referring court took the view that, having regard to the differences between the rights protected by Article 3(1) of Directive 2001/29 and Article 8(2) of Directive 2006/115, to the context in which the phrase ‘communication to the public’ is used in each, and the purpose of the respective provisions, that court should not apply to the concept ‘communication to the public’ the same meaning as the Court of Justice gave it in Case C‑306/05 SGAE [2006] ECR I‑11519).

24 It is in those circumstances that the High Court (Commercial Division) decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:

‘(1) Is a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal a “user” making a “communication to the public” of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Codified Directive 2006/115/EC …?

(2) If the answer to paragraph (1) is in the affirmative, does Article 8(2) of Directive 2006/115/EC … oblige Member States to provide a right to payment of equitable remuneration from the hotel operator in addition to equitable remuneration from the broadcaster for the playing of the phonogram?

(3) If the answer to paragraph (1) is in the affirmative, does Article 10 of Directive 2006/115/EC … permit Member States to exempt hotel operators from the obligation to pay “single equitable remuneration” on the grounds of “private use” within the meaning of Article 10(1)(a)?

(4) Is a hotel operator which provides in a guest bedroom apparatus (other than a television or radio) and phonograms in physical or digital form which may be played on or heard from such apparatus a “user” making a “communication to the public” of the phonograms within the meaning of Article 8(2) of Directive 2006/115/EC …?

(5) If the answer to paragraph (4) is in the affirmative, does Article 10 of Directive 2006/115/EC … permit Member States to exempt hotel operators from the obligation to pay “a single equitable remuneration” on the grounds of “private use” within the meaning of Article 10(1)(a) of Directive 2006/115/EC?’

The questions referred for a preliminary ruling

The first question

25 By its first question, the referring court essentially wishes to know whether a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal a ‘user’ making a ‘communication to the public’ of a broadcast phonogram for the purposes of Article 8(2) of Directive 2006/115/EC.

26 As a preliminary point, it must be borne in mind that, under Article 8(2) of Directive 2006/115, Member States are to provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public.

27 It follows from that provision that anyone who uses a phonogram for a broadcast or for communication to the public must be considered to be a ‘user’ for the purposes of that provision.

28 In those circumstances, it must be assessed whether, in a case such as that at issue in the main proceedings, there has been ‘communication to the public’.

29 As regards the concept of ‘communication to the public’ within the meaning of Article 8(2) of Directive 92/100, codified by Directive 2006/115, the Court held in Case C‑135/10 SCF ECR [2012], paragraph 76, that it requires an individual assessment. The same applies as regards the identity of the user and the question of the use of the phonogram at issue (SCF, paragraph 78).

30 Moreover, the Court made clear that, for the purposes of such an assessment, account has to be taken of several complementary criteria, which are not autonomous and are interdependent. Consequently, they must be applied individually and in their interaction with one another, given that they may, in different situations, be present to widely varying degrees (see SCF, paragraph 79).

31 Of those criteria, the Court emphasised, first and foremost, the indispensable role played by the user. The user makes an act of communication when it intervenes, in full knowledge of the consequences of its action, to give access to a broadcast containing the protected work to its customers. In the absence of that intervention, its customers, although physically within the area covered by the broadcast, would not, in principle, be able to enjoy the broadcast work (SCF, paragraph 82).

32 Second, the Court clarified certain aspects of the concept of ‘public’.

33 According to the Court, the term ‘public’ refers to an indeterminate number of potential listeners and a fairly large number of people (see, to that effect, SCF, paragraph 84).

34 As regards, to begin with, the ‘indeterminate’ nature of the public, the Court has observed that, according to the definition of the concept of ‘communication to the public’ given by the WIPO glossary, which, while not legally binding, none the less sheds light on the interpretation of the concept of public, it means ‘making a work … perceptible in any appropriate manner to persons in general, that is, not restricted to specific individuals belonging to a private group’ (SCF, paragraph 85).

35 Next, as regards, the criterion of ‘a fairly large number of people’, the Court has made clear that this is intended to indicate that, on the one hand, the concept of public encompasses a certain de minimis threshold, which excludes from the concept groups of persons which are too small, or insignificant (SCF, paragraph 86). On the other hand, in order to determine that number, account must be taken of the cumulative effects of making works available to potential audiences. In that connection, not only is it relevant to know how many persons have access to the same work at the same time but it is also necessary to know how many of them have access to it in succession (SCF, paragraphs 86 and 87).

36 Third, the Court has held that if it is relevant that a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29 is of a profit-making nature, this must be all the more true in the case of the essentially economic right to equitable remuneration of the performers and phonogram producers under Article 8(2) of Directive 2006/115 (see, to that effect, SCF, paragraphs 88 and 89).

37 According to the Court, it is thus understood that the public which is the subject of the communication is both targeted by the user and receptive, in one way or another, to that communication, and not merely ‘caught’ by chance (SCF, paragraph 91).

38 It is in the light, inter alia, of those criteria and in accordance with the need for an individual assessment established in paragraph 29 of this judgment that it must be assessed whether, in a case such as that at issue in the main proceedings, a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is making a communication to the public within the meaning of Article 8(2) of Directive 2006/115.

39 Although it is, in principle, for the national courts to determine whether that is the situation in a particular case and to make all definitive findings of fact in that regard, it must none the less be held that the Court has all the evidence necessary in relation to the case in the main proceedings to assess whether there is such an act of communication to the public.

40 It must be observed, first, that in the situation contemplated by the referring court, in which a hotel operator provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal, just as in the case leading to the judgment in SGAE (paragraph 42), although the guests of a hotel are in the area covered by the signal conveying the phonograms, they are able to listen to those phonograms only as a result of the deliberate intervention of that operator. Its role is thus indispensable, within the meaning of paragraph 31 of the present judgment.

41 As regards, next, the guests of a hotel such as those at issue in the main proceedings, it must be observed that they constitute an indeterminate number of potential listeners, insofar as the access of those guests to the services of that establishment is the result of their own choice and is limited only by the capacity of the establishment in question. In such a situation they are thus ‘persons in general’ in the sense of paragraph 34 of this judgment.

42 As regards, further, the number of potential listeners referred to in paragraph 33 of the present judgment, it must be observed that the Court has held that the guests of a hotel constitute a fairly large number of persons, such that they must be considered to be a public (SGAE, paragraph 38).

43 Finally, as regards the profit-making nature of the broadcast referred to in paragraphs 36 and 37 of this judgment, it must be held that the guests of a hotel may be described as ‘targeted’ and ‘receptive’.

44 Indeed, the action of the hotel by which it gives access to the broadcast work to its customers constitutes an additional service which has an influence on the hotel’s standing and, therefore, on the price of rooms (see, to that effect, SGAE, paragraph 44). Moreover, it is likely to attract additional guests who are interested in that additional service (see, by analogy, Joined Cases C‑403/08 and C‑429/08 Football Association Premier League and Others [2011] ECR I‑9083, paragraph 205).

45 It follows that, in the present case, the broadcasting of phonograms by a hotel operator is of a profit-making nature.

46 It follows from the foregoing considerations that, in a case such as that in the main proceedings, a hotel operator is making a ‘communication to the public’ within the meaning of Article 8(2) of Directive 2006/115.

47 Having regard to the foregoing, the answer to the first question is that a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is a ‘user’ making a ‘communication to the public’ of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Directive 2006/115.

The second question

48 By its second question the referring court asks, essentially, whether a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is obliged to pay equitable remuneration under Article 8(2) of Directive 2006/115 in addition to that paid by the broadcaster.

49 It should be recalled, at the outset, that the Court has already made clear, as regards the concept of ‘communication to the public’ for the purposes of Article 3(1) of Directive 2001/29, that a hotel operator which carries out an act of communication to the public transmits a protected work to a new public, that is to say, to a public which was not taken into account by the authors of the protected work when they authorised its use by communication to the original public (see, to that effect, SGAE paragraphs 40 and 42).

50 It must be pointed out that the notion of ‘new public’ derived from the case‑law cited in the previous paragraph must also be taken into account in the context of the application of Article 8(2) of Directive 2006/115.

51 When a hotel operator communicates a broadcast phonogram in its guest bedrooms, it is using that phonogram in an autonomous way and transmitting it to a public which is distinct from and additional to the one targeted by the original act of communication. Moreover, as observed in paragraph 45 of the present judgment, the hotel operator derives economic benefits from that transmission which are independent of those obtained by the broadcaster or the producer of the phonograms.

52 Consequently, in such a situation, a hotel operator is required, under Article 8(2) of Directive 2006/115, to pay equitable remuneration for the communication to the public of that phonogram in addition to that paid by the broadcaster.

53 In that respect, Ireland’s argument that it follows from the words ‘or’ and ‘single’ in Article 8(2) of Directive 2006/115 that a hotel operator is not required to pay any remuneration for the indirect communication of phonograms to the public if a radio or television broadcaster has already paid equitable remuneration for the use of the phonograms in its broadcasts cannot succeed.

54 By using the word ‘single’ in that provision, the European Union legislature merely wished to make clear that it is not necessary for the Member States to make provision for the user to pay separate remuneration several times for the same act of communication to the public, as that single remuneration will, as is clear from the second sentence of that provision, be shared amongst the different beneficiaries of the equitable remuneration, that is to say, the performers and the phonogram producers. The conjunction ‘or’ in the expression ‘by wireless means or for any communication to the public’ must be interpreted as meaning that remuneration is due both in the case of a broadcast and in the case of communication to the public.

55 Having regard to the foregoing observations, the answer to the second question is that a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is obliged to pay equitable remuneration under Article 8(2) of Directive 2006/115 for the broadcast of a phonogram, in addition to that paid by the broadcaster.

The fourth question

56 By its fourth question, which should be examined third, the referring court asks, essentially, whether a hotel operator which provides in guest bedrooms, not televisions and/or radios, but other apparatus and phonograms in physical or digital format capable of being broadcast or heard by means of that apparatus, is a ‘user’ making a ‘communication to the public’ of a phonogram, for the purposes of Article 8(2) of Directive 2006/115.

57 In those circumstances, the Court is required to verify that the considerations underlying its reply to the first question are still relevant even in a situation where a hotel operator provides apparatus for his clients other than a television or radio, and phonograms in a physical or digital format capable of being broadcast or heard by means of that apparatus.

58 In that regard, it must be pointed out that the concept of ‘communication to the public’ in Article 8(2) of Directive 2006/115 must be interpreted with due regard for the equivalent concepts used, inter alia, by the WPPT, and in a manner compatible with those concepts, and taking account of the context in which they are used and the objective pursued by the relevant provisions of conventions (SCF, paragraph 55).

59 Article 2(g) of the WPPT, concerning communication to the public and referring to Article 15 of the WPPT stipulates that such communication includes making the sounds or representations of sounds fixed in a phonogram audible to the public.

60 In those circumstances, the concept of ‘communication to the public’ in Article 8(2) of Directive 2006/115 must be interpreted as meaning that it also includes making the sounds or representations of sounds fixed in a phonogram audible to the public.

61 Moreover, that finding is borne out by the wording itself of Article 8(2) of Directive 2006/115 which states that it concerns ‘any’ communication to the public, and thus all forms of communication which can be envisaged and carried out.

62 So, a hotel operator which provides in guest bedrooms apparatus other than a television or radio, and phonograms in a physical or digital format capable of being broadcast or heard by means of that apparatus, is providing the two elements making it possible to make the sounds or representations of sounds fixed in a phonogram audible to the public, that is to say, phonograms.

63 Consequently, that form of communication falls within the scope of Article 8(2) of Directive 2006/115 interpreted in the light of Articles 2(g) and 15 of the WPPT read together.

64 Since, as is clear from paragraph 57 of this judgment, the fourth question differs from the first only as regards the form of transmission of the phonograms, it may be inferred that the operator and his customers are the same for the purposes of those two questions.

65 It may thus be presumed, first, that the operator of that hotel must be considered to be the ‘user’ for the purposes of Article 8(2) of Directive 2006/115 and, second, that the customers of that establishment must be considered to be a ‘public’ for the purposes of that provision, unless there is specific evidence which is such as to lead the Court to a different conclusion.

66 In that regard it must be assessed whether the particular form of transmission, by apparatus and by phonograms in physical or digital form which can be broadcast or heard by means of that apparatus, is such as to lead to a different conclusion from that reached in paragraph 40 of this judgment.

67 That is not the case. Since a hotel operator which installs such apparatus and such phonograms in the bedrooms of its hotel thereby provides its customers with the two elements necessary to enjoy the works in question, it follows that, without its intervention, the customers would not have access to those works. The role of that hotel operator is thus indispensable.

68 In the absence of any other specific evidence requiring examination, it must be concluded that, in a situation like that at issue in the main proceedings, there has been an act of ‘communication to the public’ of a phonogram, for the purposes of Article 8(2) of Directive 2006/115.

69 Having regard to the foregoing, the answer to the fourth question is that a hotel operator which provides in guest bedrooms, not televisions and/or radios to which it distributes a broadcast signal, but other apparatus and phonograms in physical or digital form which may be played on or heard from such apparatus, is a ‘user’ making a ‘communication to the public’ of a phonogram within the meaning of Article 8(2) of Directive 2006/115/EC. It is therefore obliged to pay ‘equitable remuneration’ under that provision for the transmission of those phonograms.

The third and fifth questions

70 By its third and fifth questions, which should be examined together, the referring court asks, essentially, whether Article 10(1)(a) of Directive 2006/115, which provides for a limitation of the right to equitable remuneration in the case of ‘private use’, allows the Member States to exempt a hotel operator who makes a ‘communication to the public’ of a phonogram, within the meaning of Article 8(2) of that directive, from the obligation to pay such remuneration.

71 As a preliminary point, it must be made clear that, as the Advocate General observed in point 153 of her Opinion, it is not the private nature or otherwise of the use of the work by guests of a hotel which is relevant in order to determine whether a hotel operator may rely on the limitation based on ‘private use’ within the meaning of Article 10(1)(a) of Directive 2006/115, but whether the use made of the work by the operator himself is private or not.

72 However, the ‘private use’ of a protected work communicated to the public by its user constitutes a contradiction in terms, since ‘public’ is, by definition, ‘not private’.

73 Accordingly, in the case of a communication to the public within the meaning of Article 8(2) of Directive 2006/115, the limitation based on ‘private use’ within the meaning of Article 10(1)(a) of that directive, cannot apply.

74 However, that interpretation is not such as to deprive that provision of all practical effect. Rather, that provision retains a wider scope by covering uses other than communication to the public, such as ‘fixation’ within the meaning of Article 7 of that directive.

75 Moreover, to allow the user to benefit from the limitation referred to in Article 10(1)(e) of Directive 2006/115, when he makes a communication such as that at issue in the case in the main proceedings, would run counter to the provisions of Article 10(3) of that directive under which that limitation is applicable only in certain special cases which do not prejudice the normal exploitation of the work or other protected object or cause unjustified harm to the legitimate interests of the rightholder.

76 Such an interpretation would allow the user to evade the obligation to pay equitable remuneration for forms of use of the work which amount to commercial exploitation of it, which would cause unjustified harm to the legitimate interests of protected artists or performers precisely as a result of the right to equitable remuneration.

77 Having regard to the foregoing, the answer to the third and fifth questions is that Article 10(1)(a) of Directive 2006/115, which provides for a limitation to the right to equitable remuneration provided for by Article 8(2) of that directive in the case of ‘private use’, does not allow Member States to exempt a hotel operator which makes a ‘communication to the public’ of a phonogram, within the meaning of Article 8(2) of that directive, from the obligation to pay such remuneration.

Costs

78 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) hereby rules:

1. A hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is a ‘user’ making a ‘communication to the public’ of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property.

2. A hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is obliged to pay equitable remuneration under Article 8(2) of Directive 2006/115 for the broadcast of a phonogram, in addition to that paid by the broadcaster.

3. A hotel operator which provides in guest bedrooms, not televisions and/or radios to which it distributes a broadcast signal, but other apparatus and phonograms in physical or digital form which may be played on or heard from such apparatus, is a ‘user’ making a ‘communication to the public’ of a phonogram within the meaning of Article 8(2) of Directive 2006/115/EC. It is therefore obliged to pay ‘equitable remuneration’ under that provision for the transmission of those phonograms.

4. Article 10(1)(a) of Directive 2006/115, which provides for a limitation to the right to equitable remuneration provided for by Article 8(2) of that directive in the case of ‘private use’, does not allow Member States to exempt a hotel operator which makes a ‘communication to the public’ of a phonogram, within the meaning of Article 8(2) of that directive, from the obligation to pay such remuneration.

4.1.2.3 Società Consortile Fonografici (SCF) v Marco Del Corso, C-135/10, March 15, 2012 (ECJ) (communication to the public) 4.1.2.3 Società Consortile Fonografici (SCF) v Marco Del Corso, C-135/10, March 15, 2012 (ECJ) (communication to the public)

JUDGMENT OF THE COURT (Third Chamber)

15 March 2012 (*)

(Copyright and related rights in the information society — Direct applicability of the Rome Convention, the TRIPS Agreement and the WPPT in the European Union legal order — Directive 92/100/EC — Article 8(2) — Directive 2001/29/EC — Concept of ‘communication to the public’– Communication to the public of phonograms broadcast by radio in a dental practice)

In Case C‑135/10,

REFERENCE for a preliminary ruling under Article 267 TFEU, from the Corte d’appello di Torino (Italy), made by decision of 10 February 2010, received at the Court on 15 March 2010, in the proceedings

Società Consortile Fonografici (SCF)

Marco Del Corso,

intervening party:

Procuratore generale della Repubblica,

THE COURT (Third Chamber),

composed of K. Lenaerts, President of the Chamber, J. Malenovský (Rapporteur), E. Juhász, G. Arestis and T. von Danwitz, Judges,

Advocate General: V. Trstenjak,

Registrar: A. Impellizzeri, Administrator,

having regard to the written procedure and further to the hearing on 7 April 2011,

after considering the observations submitted on behalf of:

– Società Consortile Fonografici (SCF), by L. Ubertazzi, F. Pocar and B. Ubertazzi, avvocati,

– Marco Del Corso, by R. Longhin, A. Tigani Sava, L. Bontempi and V. Vaccaro, avvocati,

– the Italian Government, by G. Palmieri, acting as Agent, and P. Gentili, avvocato dello Stato,

– Ireland, by D. O’Hagan, acting as Agent, assisted by E. Fitzsimons and J. Jeffers, barristers,

– the Greek Government, by G. Papadaki, acting as Agent,

– the French Government, by J. Gstalter, acting as Agent,

– the European Commission, by J. Samnadda and S. La Pergola, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 29 June 2011

gives the following

Judgment

1 This reference for a preliminary ruling concerns the interpretation of Article 8(2) of Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 1992 L 346, p. 61), and of Article 3 of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 1992 L 167, p. 10).

2 The reference has been made in proceedings between Società Consortile Fonografici (‘SCF’) and Mr Del Corso, a dental surgeon, concerning the broadcasting in his dental practice of protected phonograms.

Legal context

International law

3 The Agreement on Trade-Related Aspects of Intellectual Property Rights (‘TRIPS Agreement’), which constitutes Annex 1C to the Agreement establishing the World Trade Organisation (WTO) signed at Marrakesh on 15 April 1994 and approved by Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994) (OJ 1994 L 336, p. 1), contains a Part II entitled ‘Standards concerning the availability, scope and use of intellectual property rights’. Part II includes Article 14(1), (2) and (6) which provides:

‘1. In respect of a fixation of their performance on a phonogram, performers shall have the possibility of preventing the following acts when undertaken without their authorisation: the fixation of their unfixed performance and the reproduction of such fixation. Performers shall also have the possibility of preventing the following acts when undertaken without their authorisation: the broadcasting by wireless means and the communication to the public of their live performance.

2. Producers of phonograms shall enjoy the right to authorise or prohibit the direct or indirect reproduction of their phonograms.

…

6. Any Member may, in relation to the rights conferred under paragraphs 1, 2 and 3, provide for conditions, limitations, exceptions and reservations to the extent permitted by [the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, adopted at Rome on 26 October 1961 (‘Rome Convention’)]. However, the provisions of Article 18 of the Berne Convention (1971) shall also apply, mutatis mutandis, to the rights of performers and producers of phonograms in phonograms.’

4 The World Intellectual Property Organisation (WIPO) adopted, on 20 December 1996, the WIPO Performances and Phonograms Treaty (‘WPPT’) and the WIPO Copyright Treaty (‘WCT’). The two treaties were approved on behalf of the European Community by Council Decision 2000/278/EC of 16 March 2000 (OJ 2000 L 89, p. 6).

5 Article 1 of the WPPT provides:

‘1. Nothing in this Treaty shall derogate from existing obligations that Contracting Parties have to each other under the [Rome Convention].

2. Protection granted under this Treaty shall leave intact and shall in no way affect the protection of copyright in literary and artistic works. Consequently, no provision of this Treaty may be interpreted as prejudicing such protection.

3. This Treaty shall not have any connection with, nor shall it prejudice any rights and obligations under, any other treaties.’

6 Under Article 2(b) of the WPPT, for the purposes of that treaty, ‘phonogram’ means the fixation of the sounds of a performance or of other sounds, or of a representation of sounds, other than in the form of a fixation incorporated in a cinematographic or other audiovisual work.

7 Article 2(d) of the WPPT provides that ‘producer of a phonogram’ means the person, or the legal entity, who or which takes the initiative and has the responsibility for the first fixation of the sounds of a performance or other sounds, or the representations of sounds.

8 Article 2(g) of the WPPT states that ‘communication to the public’ of a performance or a phonogram means the transmission to the public by any medium, otherwise than by broadcasting, of sounds of a performance or the sounds or the representations of sounds fixed in a phonogram. For the purposes of Article 15, ‘communication to the public’ includes making the sounds or representations of sounds fixed in a phonogram audible to the public.

9 Under the heading ‘Right of making available of fixed performances’, Article 10 of the WPPT provides:

‘Performers shall enjoy the exclusive right of authorising the making available to the public of their performances fixed in phonograms, by wire or wireless means, in such a way that members of the public may access them from a place at a time individually chosen by them.’

10 Article 14 of the WPPT, headed ‘Right of making available of phonograms’, provides:

‘Producers of phonograms shall enjoy the exclusive right of authorising the making available to the public of their phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.’

11 Article 15 of the WPPT, headed ‘Right to remuneration for broadcasting and communication to the public’ is worded as follows:

‘1. Performers and producers of phonograms shall enjoy the right to a single equitable remuneration for the direct or indirect use of phonograms published for commercial purposes for broadcasting or for any communication to the public.

2. Contracting Parties may establish in their national legislation that the single equitable remuneration shall be claimed from the user by the performer or by the producer of a phonogram or by both. Contracting Parties may enact national legislation that, in the absence of an agreement between the performer and the producer of a phonogram, sets the terms according to which performers and producers of phonograms shall share the single equitable remuneration.

3. Any Contracting Party may, in a notification deposited with the Director-General of WIPO, declare that it will apply the provisions of paragraph 1 only in respect of certain uses, or that it will limit their application in some other way, or that it will not apply these provisions at all.

4. For the purposes of this Article, phonograms made available to the public by wire or wireless means in such a way that members of the public may access them from a place and at a time individually chosen by them shall be considered as if they had been published for commercial purposes.’

12 Under Article 23(1) of theWPPT:

‘Contracting Parties undertake to adopt, in accordance with their legal systems, the measures necessary to ensure the application of this Treaty.’

13 Article 8 of the WCT, headed ‘Right of communication to the public’:

14 The European Union is not a Contracting Party to the Rome Convention, unlike all the Member States of the European Union except Malta.

15 Under Article 12 of the Rome Convention, which concerns the secondary use of phonograms:

‘If a phonogram published for commercial purposes, or a reproduction of such phonogram, is used directly for broadcasting or for any communication to the public, a single equitable remuneration shall be paid by the user to the performers, or to the producers of the phonograms, or to both. …’

European Union law

16 The last recital of the preamble to Decision 94/800 reads as follows:

‘Whereas, by its nature, the Agreement establishing the World Trade Organisation, including the Annexes thereto, is not susceptible to being directly invoked in Community or Member State courts’.

17 Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 2006 L 376, p. 28), which entered into force on 16 January 2007, codified and repealed Directive 92/100.

18 However, in view of the dates of the facts of the dispute in the main proceedings, Directive 92/100 still applies to it.

19 The seventh recital of the preamble to Directive 92/100 reads:

‘Whereas the creative and artistic work of authors and performers necessitates an adequate income as a basis for further creative and artistic work, and the investments required particularly for the production of phonograms and films are especially high and risky; whereas the possibility for securing that income and recouping that investment can only effectively be guaranteed through adequate legal protection of the rightholders concerned’.

20 The tenth recital of the preamble to that directive reads:

‘Whereas the legislation of the Member States should be approximated in such a way so as not to conflict with the international conventions on which many Member States’ copyright and related rights laws are based’.

21 Article 8(2) and (3) of Directive 92/100 provides:

‘2. Member States shall provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public, and to ensure that this remuneration is shared between the relevant performers and phonogram producers. Member States may, in the absence of agreement between the performers and phonogram producers, lay down the conditions as to the sharing of this remuneration between them.

3. Member States shall provide for broadcasting organisations the exclusive right to authorise or prohibit the rebroadcasting of their broadcasts by wireless means, as well as the communication to the public of their broadcasts if such communication is made in places accessible to the public against payment of an entrance fee.’

22 Article 8(2) of Directive 2006/115 provides:

23 Recitals 15 and 25 of the preamble to Directive 2001/29 read as follows:

‘15 The Diplomatic Conference held under the auspices of the [WIPO] in December 1996 led to the adoption of two new Treaties, the [WCT] and the [WPPT] … This Directive also serves to implement a number of the new international obligations.

…

25 The legal uncertainty regarding the nature and the level of protection of acts of on-demand transmission of copyright works and subject-matter protected by related rights over networks should be overcome by providing for harmonised protection at Community level. It should be made clear that all rightholders recognised by this Directive should have an exclusive right to make available to the public copyright works or any other subject-matter by way of interactive on-demand transmissions. Such interactive on-demand transmissions are characterised by the fact that members of the public may access them from a place and at a time individually chosen by them’.

24 Article 3 of Directive 2001/29 provides:

(a) for performers, of fixations of their performances;

(b) for phonogram producers, of their phonograms;

(d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.

The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article’.

National law

25 Article 72 of Italian Law No 633 of 22 April 1941 on the protection of copyright and other rights relating to its exercise (legge n° 633 recante protezione del diritto d’autore e di altri diritti connessi al suo esercizio), as replaced by Article 11 of Legislative Decree No 68 implementing Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (decreto legislativo n° 68, attuazione della direttiva 2001/29/CE sull’armonizzazione di taluni aspetti del diritto d’autore e dei diritti connessi nella società dell’informazione), of 9 April 2003 (Ordinary Supplement to GURI No 87, of 14 April 2003), in the version applicable to the dispute in the main proceedings (‘the Law on copyright’), provides:

‘Without prejudice to the rights conferred on the author under Title I, the producer of phonograms shall have the exclusive right, for the period and under the conditions laid down in the articles that follow:

(a) to authorise the direct or indirect, temporary or permanent reproduction, by any means and in any form, in whole or in part, of his phonograms, and by any process of duplication;

(b) to authorise the distribution of copies of his phonograms. The exclusive distribution right shall not be exhausted within the territory of the European Community, except in relation to the first sale of the medium containing the phonogram by the producer or with his consent in a Member State;

(c) to authorise the rental or lending of copies of his phonograms. That right shall not be exhausted by the sale of the copies or their distribution in any form; and

(d) to authorise the making available to the public of his phonograms in such a way that members of the public may access them from a place and at a time individually chosen by them. That right shall not be exhausted by any act making them available to the public.’

26 Article 73(1) of the Law on copyright, as replaced by Article 12 of Legislative Decree No 68 provides:

‘Irrespective of the royalties for distribution, rental and lending to which they are entitled, producers of phonograms, as well as performers whose performance has been fixed or reproduced on phonograms, shall be entitled to receive remuneration for the use for profit of the phonograms, by means of cinematography, radio and television broadcasting, including communication to the public, via satellite, at public dances, in public establishments and on the occasion of any other public use of the phonograms themselves. It is for the producer to exercise that right, sharing the remuneration with the performers concerned.’

27 Article 73a of the Law on copyright as introduced by Article 9 of Legislative Decree No 685 (decreto legislativo n° 685, attuazione della direttiva 92/100/CEE concernente il diritto di noleggio, il diritto di prestito e taluni diritti connessi al diritto d’autore in materia di proprieta intellettuale), of 16 November 1994 (GURI No 293 of 16 December 1994), provides:

‘1. The performers and producer of the phonogram of which use has been made shall be entitled to equitable remuneration even where the use to which Article 73 refers was not for profit.

2. In the absence of agreement to the contrary between the parties, such remuneration is determined, paid out and distributed according to the provisions of the [implementing rules for the amended Law on copyright].’

The dispute in the main proceedings and the questions referred for a preliminary ruling

28 SCF acts as a collecting agency, both within and outside Italy, and manages, collects and distributes the royalties of its associated phonogram producers.

29 In the exercise of its activity as agent, SCF conducted negotiations with the Associazione Dentisti Italiani (Association of Italian Dentists) with a view to concluding a collective agreement quantifying the relevant equitable remuneration within the meaning of Articles 73 or 73a of the Law on copyright for any ‘communication to the public’ of phonograms, including such communication in private professional practices.

30 As those negotiations were unsuccessful, on 16 June 2006 SCF brought an action before the Turin district court against Mr Marco Del Corso, seeking a declaration that he was broadcasting, by way of background music, in his private dental practice in Turin phonograms protected by property rights, and that, since it constituted ‘communication to the public’ within the meaning of the Law on copyright, international law and European Union law, such activity gave rise to the payment of equitable remuneration.

31 In his defence, Mr Del Corso argued, among other things, that, in his practice, the music was being broadcast by radio and that SCF could claim copyright only if the medium on which the phonogram had been fixed was used, whereas remuneration for listening to the broadcast was payable not by the listener, but by the radio or television broadcaster. The Law on copyright expressly made a distinction between remuneration due for a disk and that due for use of broadcasting equipment.

32 In any event, Mr Del Corso argued that Articles 73 and 73a of the amended Law on copyright were not applicable to the present case, as they referred to communication to the public in public places and on the occasion of any other public use of phonograms. A private dental practice could not be classified as a public place, unlike public health facilities.

33 By judgment of 20 March 2008, amended by order of 16 May 2008, the Turin district court dismissed the application by SCF, finding that in this case there was no communication for profit, the type of music played in the practice did not influence the patients’ choice of dentist, and the situation did not fall within those provided for in Article 73a of the Law on copyright, since the dental practice was private and, as such, could not be equated with a public place or place open to the public, given that the patients were not a random public but were individually identified and could normally attend the practice only if they had an appointment and, in any event, with the dentist’s consent

34 SCF appealed against that judgment to the Corte d’appello di Torino.

35 As it considered that there was some doubt over the question whether the broadcasting of phonograms in private professional practices such as dental practices, was included in the definition of ‘communication to the public’ for the purposes of international law and European Union law, the Corte d’appello decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘1. Are the [Rome Convention], the [TRIPs Agreement] and the [WPPT] directly applicable within the Community legal order?

2. Are the abovementioned sources of uniform international law also directly effective within the context of private-law relationships?

3. Do the concepts of ‘communication to the public’ contained in the abovementioned treaty-law texts mirror the Community concepts contained in Directives 92/100 and 2001/29 and, if not, which source should take precedence?

4. Does the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, for the benefit of patients of those practices and enjoyed by them without any active choice on their part, constitute ‘communication to the public’ or ‘making available to the public’ for the purposes of the application of Article 3(2)(b) of Directive 2001/29?

5. Does such an act of transmission entitle the phonogram producers to the payment of remuneration?’

The questions referred for a preliminary ruling

The first to third questions

36 By its first to third questions, which should be examined together, the referring court asks, essentially, first, whether the Rome Convention, the TRIPS Agreement and the WPPT are directly applicable in the legal order of the European Union and whether individuals may rely on them directly. Next, it wishes to know whether the definition of ‘communication to the public’ in those international conventions is the same as that in Directives 92/100 and 2001/29 and, finally, in the event that the last question is answered in the negative, which source of law should prevail.

37 First, as regards the question whether the Rome Convention, the TRIPS Agreement and the WPPT are directly applicable in the legal order of the European Union, it must be recalled at the outset that, under Article 216(2) of the TFEU, ‘[a]greements concluded by the Union are binding upon the institutions of the Union and on its Member States’.

38 The TRIPS Agreement and the WPPT were signed by the European Union and approved by Decisions 94/800 and 2000/278 respectively. Consequently, that agreement and treaty bind the institutions of the European Union and the Member States.

39 Moreover, according to the settled case‑law of the Court, the provisions of agreements concluded by the Union form an integral part of the Union legal order (Case 181/73 Haegeman [1974] ECR 449, paragraph 5; Case 12/86 Demirel [1987] ECR 3719, paragraph 7, and Case C‑301/08 Bogiatzi [2009] ECR I‑10185, paragraph 23) and are therefore applicable in the Union.

40 The TRIPS Agreement and the WPPT are such agreements.

41 As regards the Rome Convention, it must be pointed out, first, that the European Union is not a contracting party to that convention and, second, that it cannot be regarded as having taken the place of its Member States as regards its application, if only because not all of those States are parties to that convention (see, by analogy, Case C‑188/07 Commune de Mesquer [2008] ECR I‑4501, paragraph 85).

42 Consequently, the provisions of the Rome Convention do not form part of the legal order of the European Union.

43 As regards, second, the question whether individuals are entitled to rely directly on the provisions of the TRIPS Agreement and the WPPT, it must be observed that, according to the case‑law of the Court of Justice, it is not sufficient that they are part of the legal order of the Union. Those provisions must also appear, as regards their content, to be unconditional and sufficiently precise and their nature and broad logic must not preclude their being so relied on (see, to that effect, Demirel, paragraph 14; Case C‑162/96 Racke [1998] ECR I‑3655, paragraph 31, and Case C‑344/04 IATA and ELFAA [2006] ECR I‑403, paragraph 39).

44 The first condition is met where the provisions relied on contain clear and precise obligations which are not subject, in their implementation or effects, to the adoption of any subsequent measure (see, to that effect, Case C‑213/03 Pêcheurs de l’étang de Berre [2004] ECR I‑7357, paragraph 39 and the case‑law cited, and Case C‑240/09 Lesoochranárske zoskupenie [2011] ECR I‑1255, paragraph 44 and the case‑law cited).

45 As regards the TRIPS Agreement, it must be recalled that, according to the last recital in the preamble to Decision 94/800, the Agreement establishing the World Trade Organisation, including its Annexes is not susceptible to being directly invoked in European Union or Member State courts.

46 Moreover, the Court has already held that, having regard to their nature and structure, the provisions of the TRIPs Agreement do not have direct effect. Those provisions are not, in principle, among the rules in the light of which the Court is to review the legality of measures of the Community institutions under the first paragraph of Article 230 EC and are not such as to create rights upon which individuals may rely directly before the courts by virtue of European Union law (see, to that effect, Case C‑149/96 Portugal v Council [1999] ECR I‑8395, paragraphs 42 to 48; Joined Cases C‑300/98 and C‑392/98 Dior and Others [2000] ECR I‑11307, paragraph 44, and Case C‑245/02 Anheuser-Busch [2004] ECR I‑10989, paragraph 54).

47 Article 23(1) of the WPPT provides that the Contracting Parties undertake to adopt, in accordance with their legal systems, the measures necessary to ensure the application of that Treaty.

48 It follows that the application of the provisions of the WPPT, in their implementation or effects, is subject to the adoption of subsequent measures. Therefore, such provisions have no direct effect in the law of the European Union and are not such as to create rights for individuals which they may rely on before the courts by virtue of that law.

49 As regards the Rome Convention, it must be recalled that, under Article 1(1) of the WPPT, nothing in that treaty is to derogate from existing obligations that Contracting Parties have to each other under the Rome Convention.

50 Accordingly, although the European Union is not a contracting party to the Rome Convention, it is none the less required, under Article 1(1) of the WPPT, not to stand in the way of the obligations of the Member States under that convention. Accordingly, that convention has indirect effects within the European Union.

51 Third, as regards the question of the relationship between the concept of ‘communication to the public’ in the TRIPS Agreement, the WPPT and the Rome Convention and that in Directives 92/100 and 2001/29, it must be recalled that, according to settled case‑law, European Union legislation must, so far as possible, be interpreted in a manner that is consistent with international law, in particular where its provisions are intended specifically to give effect to an international agreement concluded by the European Union (see, inter alia, Case C‑341/95Bettati [1998] ECR I‑4355, paragraph 20, and Case C‑306/05 SGAE [2006] ECR I‑11519, paragraph 35).

52 In that regard, it is common ground that, as recital 15 in the preamble to Directive 2001/29 makes clear, that directive is intended to implement a number of the Union’s new obligations under the WCT and the WPPT, which are considered, according to the same recital, to update the international protection for copyright and related rights significantly. In those circumstances, the concepts contained in that directive must be interpreted, as far as is possible, in the light of those two Treaties (see, to that effect, Case C‑456/06 Peek & Cloppenburg[2008] ECR I‑2731, paragraph 31).

53 Moreover, it follows from recital 10 of Directive 92/100 that the legislation of the Member States should be approximated in such a way as not to conflict with the international conventions on which many Member States’ laws on copyright and related rights are based.

54 As that directive is intended to harmonise certain aspects of the law on copyright and related rights in the field of intellectual property in compliance with the relevant international agreements such as, inter alia, the Rome Convention, the TRIPS Agreement and the WPPT, it is supposed to establish a set of rules compatible with those contained in those agreements.

55 It follows from all those considerations that the concepts appearing in Directives 92/100 and 2001/29, such as ‘communication to the public’ must be interpreted in the light of the equivalent concepts contained in those international agreements and in such a way that they are compatible with those agreements, taking account of the context in which those concepts are found and the purpose of the relevant provisions of the agreements as regards intellectual property.

56 Having regard to the foregoing considerations, the answer to the first to third questions is:

– the provisions of the TRIPS Agreement and the WPPT are applicable in the legal order of the European Union,

– as the Rome Convention does not form part of the legal order of the European Union it is not applicable there; however, it has indirect effects within the European Union

– individuals may not rely directly either on that convention or on the TRIPS Agreement or the WPPT;

– the concept of ‘communication to the public’ must be interpreted in the light of the equivalent concepts contained in the Rome Convention, the TRIPS Agreement and the WPPT and in such a way that it is compatible with those agreements, taking account of the context in which those concepts are found and the purpose of the relevant provisions of the agreements as regards intellectual property.

The fourth and fifth questions

Preliminary observations

57 By its fourth and fifth questions, the referring court asks whether the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, for the benefit of patients of those practices and enjoyed by them without any active choice on their part, constitutes ‘communication to the public’ or ‘making available to the public’ for the purposes of the application of Article 3(2)(b) of Directive 2001/29 and whether such an act of transmission entitles the phonogram producers to the payment of remuneration?

58 In that regard, it must be observed at the outset that the referring court refers, in the wording of those questions, to Article 3(2)(b) of Directive 2001/29 concerning the exclusive right of phonogram producers to authorise or prohibit the making available to the public of their phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.

59 As is clear from the explanatory memorandum to the Proposal for Directive 2001/29 (COM(97) 628), confirmed by recital 25 of that directive, making available to the public, for the purposes of that provision, is intended to refer to ‘interactive on-demand transmissions’ characterised by the fact that members of the public may access them from a place and at a time individually chosen by them.

60 According to the decision for reference, the issue in the main proceedings is the broadcasting of music in a dental practice for the benefit of the patients present and not interactive on-demand transmission.

61 However, according to case‑law, in order to provide the national court with an answer which will be of use to it and enable it to determine the case before it, it is for the Court of Justice, if necessary, to reformulate the questions referred to it (Case C‑286/05 Haug [2006] ECR I‑4121, paragraph 17, and Case C‑420/06 Jager [2008] ECR I‑1315, paragraph 46).

62 Moreover, in order to provide the national court with an answer which will be of use to it and enable it to determine the case before it, the Court may find it necessary to consider provisions of European Union law which the national court has not referred to in its questions (C‑329/06 and C‑343/06 Wiedemann and Funk [2008] ECR I‑4635, paragraph 45, and Case C‑145/09 Tsakouridis [2010] ECR I‑11979, paragraph 36).

63 In that connection, it must be observed that Article 8(2) of Directive 92/100 is intended to ensure that a single equitable remuneration is paid by the user to performers and phonogram producers, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public.

64 In those circumstances, the fourth and fifth questions of the referring court must be interpreted as asking, in essence, whether the concept of ‘communication to the public’ for the purposes of Article 8(2) of Directive 92/100 must be interpreted as meaning that it covers the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, for the benefit of patients of those practices and enjoyed by them without any active choice on their part, and whether such an act of transmission entitles the phonogram producers to the payment of remuneration

Admissibility

65 Mr Del Corso considers that the fourth and fifth questions are inadmissible since he has never acknowledged that he was broadcasting protected phonograms to his patients by means of his radio-broadcast receiver in his private dental practice, particularly as such broadcasts were not made in exchange for the payment of an entrance fee by those patients.

66 In that regard, it must be recalled that it is not for the Court of Justice but for the national court to ascertain the facts which have given rise to the dispute before it and to establish the consequences which they have for the judgment which it is required to deliver (Case C‑435/97 WWF and Others [1999] ECR I‑5613, paragraph 32, and Case C‑232/09 Danosa [2010] ECR I‑11405, paragraph 33).

67 As regards the division of jurisdiction between the European Union judicature and national courts, it is in principle for the national court to determine whether the factual conditions triggering the application of a European Union rule are fulfilled in the case pending before it, while the Court, when giving a preliminary ruling, may, where appropriate, provide clarification to guide the national court in its interpretation (see, to that effect, Case C‑424/97 Haim [2000] ECR I‑5123, paragraph 58, and Joined Cases C‑22/08 and C‑23/08 Vatsouras and Koupatantze [2009] ECR I‑4585, paragraph 23).

68 In the present case, as is clear from the decision for reference, the fourth and fifth questions are based on the factual premiss that Mr Del Corso broadcast protected phonograms to his patients.

69 Accordingly, those questions must be considered to be admissible and must be examined in the factual framework defined by the referring court.

Merits

70 As regards the concept of ‘communication to the public’, it must be observed at the outset that it appears not only in Article 8(2) of Directive 92/100, a provision which is relevant to the main proceedings, but also in Article 3(1) of Directive 2001/29 and, inter alia, in Article 12 of the Rome Convention, Article 15 of the WPPT and Article 14(1) of the TRIPS agreement.

71 As is clear from paragraph 55 of the present judgment, the concept of ‘communication to the public’ must be interpreted in the light of the equivalent concepts contained in the Rome Convention, the TRIPS agreement and the WPPT and in such a way that it is compatible with those agreements, taking account of the context in which those concepts are found and the purpose of the provisions of those agreements.

72 It must be recalled that, under Article 3(1) of Directive 2001/29, Member States are to provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them. That provision is inspired by Article 8 of the WCT, the wording of which it reproduces almost verbatim.

73 Article 8(2) of Directive 92/100 requires Member States to provide a right in order to ensure that a single equitable remuneration is paid by the user if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public and to ensure that this remuneration is shared between the relevant performers and phonogram producers. That provision is inspired by Article 12 of the Rome Convention the wording of which it likewise reproduces almost verbatim (Case C‑245/00 SENA [2003] ECR I‑1251, paragraph 35).

74 It is clear from a comparison of Article 3(1) of Directive 2001/29 and Article 8(2) of Directive 92/100 that the concept of communication to the public appearing in those provisions is used in contexts which are not the same and pursue objectives which, while similar, are none the less different to some extent.

75 Under Article 3(1) of Directive 2001/29, authors have a right which is preventive in nature and allows them to intervene, between possible users of their work and the communication to the public which such users might contemplate making, in order to prohibit such use. On the other hand, under Article 8(2) of Directive 92/100, performers and producers of phonograms have a right which is compensatory in nature, which is not liable to be exercised before a phonogram published for commercial purposes, or a reproduction of such a phonogram, has been used for communication to the public by a user.

76 It follows that Article 8(2) of Directive 92/100, on the one hand, requires an individual interpretation of the concept of communication to the public. The same applies as regards the identity of the user and the question of the use of the phonogram at issue.

77 On the other hand, as the right under Article 8(2) of Directive 92/100 is exercised in the event of the use of a work, that right is clearly a right which is essentially financial in nature.

78 Thus, in order to assess whether a user is making a communication to the public within the meaning of Article 8(2) of Directive 92/100, in accordance with the need for an individual approach noted in paragraph 76 of the present judgment, the situation of a specific user and of all the persons to whom he communicates the protected phonograms must be assessed.

79 For the purposes of such an assessment, account must be taken of several complementary criteria, which are not autonomous and are interdependent. Consequently, they must be applied individually and in the light of their interaction with one another, given that in different specific situations, they may be met to varying degrees.

80 Thus, it is for the national court to make an overall assessment of a given situation.

81 In that connection, it should be pointed out that the Court has already identified certain criteria in the rather different context of Article 3(1) of Directive 2001/29.

82 First, the Court has already stressed the indispensable role of the user. Thus, the Court has held that the operator of a hotel or public house makes a communication to the public within the meaning of Article 3(1) of Directive 2001/29 when it intervenes, in full knowledge of the consequences of its action, to give access to a broadcast containing the protected work to its customers. Without its intervention the customers cannot enjoy the works broadcast, even though they are physically within the broadcast’s catchment area (see, to that effect,SGAE, paragraph 42, and Joined Cases C‑403/08 and C‑429/08 Football Association Premier League and Others [2011] ECR I‑9083, paragraph 195).

83 Second, the Court has already identified certain aspects of the concept of public.

84 In that regard, the Court has held that the term ‘public’ within the meaning of Article 3(1) of Directive 2001/29 refers to an indeterminate number of potential listeners, and, in addition, implies a fairly large number of persons (see, to that effect, Case C‑89/04 Mediakabel[2005] ECR I‑4891, paragraph 30; Case C‑192/04 Lagardère Active Broadcast [2005] ECR I‑7199, paragraph 31, and SGAE, paragraphs 37 and 38).

85 As regards, to begin with, the ‘indeterminate’ nature of the public, the Court has observed that, according to the definition of the concept of ‘communication to the public’ given by the WIPO glossary, which, while not legally binding, none the less sheds light on the interpretation of the concept of public, it means ‘making a work … perceptible in any appropriate manner to persons in general, that is, not restricted to specific individuals belonging to a private group’.

86 Next, as regards, the criterion of ‘a fairly large number of people’, this is intended to indicate that the concept of public encompasses a certain de minimis threshold, which excludes from the concept groups of persons which are too small, or insignificant.

87 In order to determine that number, the Court took account of the cumulative effects of making works available to potential audiences (SGAE, paragraph 39). In that connection, not only is it relevant to know how many persons have access to the same work at the same time but it is also necessary to know how many of them have access to it in succession.

88 Third, in paragraph 204 of the judgment in Football Association Premier League and Others, the Court held that it is not irrelevant that a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29 is of a profit-making nature.

89 It follows that this must be all the more true in the case of the right to equitable remuneration provided for in Article 8(2) of directive 92/100 given its essentially financial nature.

90 More specifically, the Court has held that the action by a hotel operator by which it gives access to a broadcast work to its customers must be considered an additional service performed with the aim of obtaining some benefit, since the provision of that service has an influence on the hotel’s standing and, therefore, on the price of rooms. Similarly, the Court has held that the transmission of broadcast works by the operator of a public house is made with the intention that it should, and is likely to, have an effect upon the number of people going to that establishment and, ultimately, on its financial results (see, to that effect, SGAE, paragraph 44, and Football Association Premier League and Others, paragraph 205).

91 It is thus understood that the public which is the subject of the communication is both targeted by the user and receptive, in one way or another, to that communication, and not merely ‘caught’ by chance.

92 It is in the light of those criteria in particular that it must be determined whether, in a case such as that at issue in the main proceedings, a dentist who broadcasts phonograms to his patients, by way of background music, is making a communication to the public within the meaning of Article 8(2) of Directive 92/100.

93 Although, as was pointed out in paragraph 80 of the present judgment, it is, in principle, for the national courts to determine whether that is the situation in a particular case and to make all definitive findings of fact in that regard, it must none the less be held that the Court has all the evidence necessary in relation to the case in the main proceedings to assess whether there is such an act of communication to the public.

94 It must be observed, first, that, as in the cases leading to the judgments in SGAE and Football Association Premier League and Others, although the patients of a dentist are in the area covered by the signal conveying the phonograms, they are able to listen to those phonograms only as a result of the deliberate intervention of that dentist. Therefore such a dentist must be considered to be intervening deliberately in the broadcasting of those phonograms.

95 Next, as regards the patients of a dentist such as the one in the case in the main proceedings, it must be observed that they generally form a very consistent group of persons and thus constitute a determinate circle of potential recipients, as other people do not, as a rule, have access to treatment by that dentist. Consequently, they are not ‘persons in general’ as defined in paragraph 85 of the present judgment.

96 As regards, further, having regard to paragraph 84 of the present judgment, the number of persons to whom the same broadcast phonogram is made audible by the dentist, it must be held that, in the case of the patients of a dentist, the number of persons is not large, indeed it is insignificant, given that the number of persons present in his practice at the same time is, in general, very limited. Moreover, although there are a number of patients in succession, the fact remains that, as those patients attend one at a time, they do not generally hear the same phonograms, or the broadcast phonograms, in particular.

97 Finally, it cannot be disputed that, in a situation such as that in the main proceedings, a dentist who broadcasts phonograms, by way of background music, in the presence of his patients cannot reasonably either expect a rise in the number of patients because of that broadcast alone or increase the price of the treatment he provides. Therefore, such a broadcast is not liable, in itself, to have an impact on the income of that dentist.

98 The patients of a dentist visit a dental practice with the sole objective of receiving treatment, as the broadcasting of phonograms is in no way a part of dental treatment. They have access to certain phonograms by chance and without any active choice on their part, according to the time of their arrival at the practice and the length of time they wait and the nature of the treatment they undergo. Accordingly, it cannot be presumed that the usual customers of a dentist are receptive as regards the broadcast in question.

99 Consequently such a broadcast is not of a profit-making nature, and thus does not fulfil the criterion set out in paragraph 90 of the present judgment.

100 It follows from all the foregoing considerations that a dentist such as the one in question in the case in the main proceedings who broadcasts phonograms free of charge in his dental practice, for the benefit of his clients and enjoyed by them without any active choice on their part, is not making a ‘communication to the public’ for the purposes of the application of Article 8(2) of Directive 92/100.

101 It follows that the requirement set out in Article 8(2) of Directive 92/100 for the payment of equitable remuneration by the user, namely that the user makes a ‘communication to the public’ within the meaning of that provision, is not met in a situation such as that in the main proceedings.

102 Accordingly, the answer to the fourth and fifth questions is that the concept of ‘communication to the public’ for the purposes of Article 8(2) of Directive 92/100 must be interpreted as meaning that it does not cover the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, such as the one at issue in the main proceedings, for the benefit of patients of those practices and enjoyed by them without any active choice on their part. Therefore such an act of transmission does not entitle the phonogram producers to the payment of remuneration.

Costs

103 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) hereby rules:

1. The provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights, which constitutes Annex 1C to the Agreement establishing the World Trade Organisation (WTO) signed at Marrakesh on 15 April 1994 and approved by Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994) and of the World Intellectual Property Organisation (WIPO) Performances and Phonograms Treaty of 20 December 1996 are applicable in the legal order of the European Union.

As the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, adopted at Rome on 26 October 1961, does not form part of the legal order of the European Union it is not applicable there; however, it has indirect effects within the European Union.

Individuals may not rely directly either on that convention or on the agreement or the treaty mentioned above.

The concept of ‘communication to the public’ which appears in Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property and Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted in the light of the equivalent concepts contained in the convention, the agreement and the treaty mentioned above and in such a way that it is compatible with those agreements, taking account of the context in which those concepts are found and the purpose of the relevant provisions of the agreements as regards intellectual property.

2. The concept of ‘communication to the public’ for the purposes of Article 8(2) of Directive 92/100 must be interpreted as meaning that it does not cover the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, such as the one at issue in the main proceedings, for the benefit of patients of those practices and enjoyed by them without any active choice on their part. Therefore such an act of transmission does not entitle the phonogram producers to the payment of remuneration.

4.1.2.4 ITV Broadcasting et al v TV Catchup, C-607/11, March 7, 2013 (ECJ) (live streaming) (OPTIONAL) 4.1.2.4 ITV Broadcasting et al v TV Catchup, C-607/11, March 7, 2013 (ECJ) (live streaming) (OPTIONAL)

JUDGMENT OF THE COURT (Fourth Chamber)

7 March 2013 (*)

(Directive 2001/29/EC — Article 3(1) — Broadcasting by a third party over the internet of signals of commercial television broadcasters — ‘Live streaming’ — Communication to the public)

In Case C‰ЫФ607/11,

REQUEST for a preliminary ruling under Article 267 TFEU from the High Court of Justice (England and Wales) (Chancery Division) (United Kingdom), made by decision of 17 November 2011, received at the Court on 28 November 2011, in the proceedings

ITV Broadcasting Ltd,

ITV 2 Ltd,

ITV Digital Channels Ltd,

Channel 4 Television Corporation,

4 Ventures Ltd,

Channel 5 Broadcasting Ltd,

ITV Studios Ltd

TVCatchup Ltd,

THE COURT (Fourth Chamber),

composed of L. Bay Larsen, President of the Chamber, K. Lenaerts, Vice-President of the Court, acting as Judge of the Fourth Chamber, J. Malenovský (Rapporteur), U. Lõhmus and M. Safjan, Judges,

Advocate General: Y. Bot,

Registrar: K. Malacek, Administrator,

having regard to the written procedure and further to the hearing on 19 November 2012,

after considering the observations submitted on behalf of:

– ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd and ITV Studios Ltd, by J. Mellor, QC, J. Bowhill, Barrister, and P. Stevens and J. Vertes, Solicitors,

– TVCatchup Ltd, by L. Gilmore, Solicitor, and M. Howe, QC,

– the United Kingdom Government, by S. Ossowski and L. Christie, acting as Agents, and by C. May, Barrister,

– the French Government, by G. de Bergues and M. Perrot, acting as Agents,

– the Italian Government, by G. Palmieri, acting as Agent, and by M. Russo, avvocato dello Stato,

– the Polish Government, by M. Szpunar and B. Majczyna, acting as Agents,

– the Portuguese Government, by L. Inez Fernandes and N. Conde, acting as Agents,

– the European Commission, by J. Samnadda and F. Wilman, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1 This request for a preliminary ruling concerns the interpretation of Article 3(1) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 2001 L 167, p. 10).

2 The request has been made in proceedings between, on the one hand, ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd and ITV Studios Ltd and, on the other, TVCatchup Ltd (‘TVC’) concerning the distribution by TVC over the internet, substantially in real time, of television broadcasts transmitted by the claimants in the main proceedings.

Legal context

European Union law

3 Recitals 23 and 27 in the preamble to Directive 2001/29 state:

‘(23) This Directive should harmonise further the author’s right of communication to the public. This right should be understood in a broad sense covering all communication to the public not present at the place where the communication originates. This right should cover any such transmission or retransmission of a work to the public by wire or wireless means, including broadcasting. This right should not cover any other acts.

...

(27) The mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of this Directive.’

4 Article 3 of that directive, entitled ‘Right of communication to the public of works and right of making available to the public other subject-matter’, provides:

...

3. The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.’

5 Article 2 of Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission (OJ 1993 L 248, p. 15) provides:

‘Member States shall provide an exclusive right for the author to authorise the communication to the public by satellite of copyright works ...’.

6 Article 8(1) of that directive states:

‘Member States shall ensure that when programmes from other Member States are retransmitted by cable in their territory the applicable copyright and related rights are observed and that such retransmission takes place on the basis of individual or collective contractual agreements between copyright owners, holders of related rights and cable operators.’

English law

7 Section 20 of the Copyright, Designs and Patents Act 1988, in the version applicable to the facts in the main proceedings, entitled ‘Infringement by communication to the public’, provides:

‘1. The communication to the public of the work is an act restricted by the copyright in –

(a) a literary, dramatic, musical or artistic work,

(b) a sound recording or film, or

2. References in this Part to communication to the public are to communication to the public by electronic transmission, and in relation to a work include –

(a) the broadcasting of the work;

(b) the making available to the public of the work by electronic transmission in such a way that members of the public may access it from a place and at a time individually chosen by them.’

The dispute in the main proceedings and the questions referred for a preliminary ruling

8 The claimants in the main proceedings are commercial television broadcasters who own copyright under national law in the television broadcasts themselves and in films and other items which are included in their broadcasts. They are funded by advertising carried in their broadcasts.

9 TVC offers an internet television broadcasting service. The service permits its users to receive, via the internet, ‘live’ streams of free-to-air television broadcasts, including television broadcasts transmitted by the claimants in the main proceedings.

10 TVC ensures that those using its service can obtain access only to content which they are already legally entitled to watch in the United Kingdom by virtue of their television licence. The terms to which users must agree thus include the possession of a valid TV licence and a restriction of use of TVC services to the United Kingdom. The TVC website has the facility to authenticate the user’s location and to refuse access where the conditions imposed on users are not satisfied.

11 The TVC service is funded by advertising. Audiovisual advertising is shown before the user is able to view the live stream. The advertisements already contained in the original broadcasts are left unchanged and sent to the user as part of the stream. There is also ‘in-skin’ advertising, which appears on the user’s computer or other equipment.

12 For its activities, TVC uses four groups of servers, namely, (i) acquisition, (ii) encoding, (iii) origin and (iv) edge servers.

13 The input signals used by TVC are the normal terrestrial and satellite broadcast signals transmitted by the claimants in the main proceedings. The signals are captured via an aerial and then passed to the acquisition servers, which extract individual video streams from the received signal without altering them. The encoding servers then convert the incoming streams into a different compression standard. Next, the origin servers prepare streams of video for sending over the internet in a variety of formats. Beyond that point, the channels offered by TVC are processed further only if at least one TVC subscriber has requested that channel. If there is no request for a given channel, the signal is discarded.

14 Edge servers connect with a user’s computer or mobile telephone using the internet. When an edge server receives a request for a channel from a user, then, unless it is already streaming that channel to a different user, the edge server connects to the origin server which streams that channel. The software on the edge server creates a separate stream for each user who requests a channel through it. An individual packet of data leaving the edge server is thus addressed to an individual user, not to a class of users.

15 The streams provided by the edge servers can be in a variety of different formats. The formats used are: Adobe Flash streams (for computers), HTTP streams (for Apple mobile devices) and RTSP streams (for Android and Blackberry mobile telephones).

16 The claimants in the main proceedings instituted proceedings against TVC before the High Court of Justice (England and Wales) (Chancery Division) for breach of their copyright in their broadcasts and films, alleging, inter alia, that there is a communication of the works to the public prohibited by section 20 of the Copyright, Designs and Patents Act 1988, in the version applicable to the facts in the main proceedings, and by Article 3(1) of Directive 2001/29.

17 The High Court takes the view that it is not clear from the judgments in Case C‰ЫФ306/05 SGAE [2006] ECR I‰ЫФ11519 and in Joined Cases C‰ЫФ431/09 and C‰ЫФ432/09 Airfield NV and Canal Digitaal [2011] ECR I‰ЫФ9363 whether there is a ‘communication to the public’ within the meaning of Article 3(1) of Directive 2001/29 in the case where an organisation such as TVC, in full knowledge of the consequences of its acts and in order to attract an audience to its own transmissions and advertisements, streams over the internet broadcasts to members of the public who would have been entitled to access the original broadcast signal using their own television sets or laptops in their own homes.

18 In those circumstances the High Court of Justice (England and Wales) (Chancery Division) decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:

‘1. Does the right to authorise or prohibit a “communication to the public of their works by wire or wireless means” in Article 3(1) of [Directive 2001/29] extend to a case where:

(a) Authors authorise the inclusion of their works in a terrestrial free-to-air television broadcast which is intended for reception either throughout the territory of a Member State or within a geographical area within a Member State;

(b) A third party ([that is to say,] an organisation other than the original broadcaster) provides a service whereby individual subscribers within the intended area of reception of the broadcast who could lawfully receive the broadcast on a television receiver in their own homes may log on to the third party’s server and receive the content of the broadcast by means of an internet stream?

2. Does it make any difference to the answer to the above question if:

(a) The third party’s server allows only a “one-to-one” connection for each subscriber whereby each individual subscriber establishes his or her own internet connection to the server and every data packet sent by the server onto the internet is addressed to only one individual subscriber?

(b) The third party’s service is funded by advertising which is presented “pre-roll” ([that is to say,] during the period of time after a subscriber logs on but before he or she begins to receive the broadcast content) or “in-skin” ([that is to say,] within the frame of the viewing software which displays the received programme on the subscriber’s viewing device but outside the programme picture) but the original advertisements contained within the broadcast are presented to the subscriber at the point where they are inserted in the programme by the broadcaster?

(i) providing an alternative service to that of the original broadcaster, thereby acting in direct competition with the original broadcaster for viewers; or

(ii) acting in direct competition with the original broadcaster for advertising revenues?’

Consideration of the questions referred

Question 1 and Question 2(a)

19 By Question 1 and Question 2(a), the referring court asks, in essence, whether the concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29, must be interpreted as meaning that it covers a retransmission of the works included in a terrestrial television broadcast:

– where the retransmission is made by an organisation other than the original broadcaster,

– by means of an internet stream made available to the subscribers of that other organisation who may receive the retransmission by logging on to its server,

– on the assumption that those subscribers are within the area of reception of the terrestrial television broadcast and may lawfully receive the broadcast on a television receiver.

20 First of all, it is to be noted that the principal objective of Directive 2001/29

is to establish a high level of protection of authors, allowing them to obtain an appropriate reward for the use of their works, including on the occasion of communication to the public. It follows that ‘communication to the public’ must be interpreted broadly, as recital 23 in the preamble to the directive indeed expressly states (SGAE, paragraph 36, and Joined Cases C-403/08 and C-429/08 Football Association Premier League and Others [2011] ECR I-9083, paragraph 186).

21 In the first place, it is necessary to determine the meaning of the concept of ‘communication’ and reply to the question whether the activity at issue in the main proceedings comes within its scope.

22 In that connection, the Court notes that Directive 2001/29 does not define the concept of ‘communication’ exhaustively. Thus, the meaning and scope of that concept must be defined in the light of the context in which it occurs and also in the light of the objective referred to in paragraph 20 above.

23 It follows, in particular, from recital 23 in the preamble to Directive 2001/29 that the author’s right of communication to the public covers any transmission or retransmission of a work to the public not present at the place where the communication originates, by wire or wireless means, including broadcasting. In addition, it is apparent from Article 3(3) of that directive that authorising the inclusion of protected works in a communication to the public does not exhaust the right to authorise or prohibit other communications of those works to the public.

24 If follows that, by regulating the situations in which a given work is put to multiple use, the European Union legislature intended that each transmission or retransmission of a work which uses a specific technical means must, as a rule, be individually authorised by the author of the work in question.

25 Those findings are, moreover, supported by Articles 2 and 8 of Directive 93/83, which require fresh authorisation for a simultaneous, unaltered and unabridged retransmission by satellite or cable of an initial transmission of television or radio programmes containing protected works, even though those programmes may already be received in their catchment area by other technical means, such as by wireless means or terrestrial networks.

26 Given that the making of works available through the retransmission of a terrestrial television broadcast over the internet uses a specific technical means different from that of the original communication, that retransmission must be considered to be a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29. Consequently, such a retransmission cannot be exempt from authorisation by the authors of the retransmitted works when these are communicated to the public.

27 That conclusion cannot be undermined by TVC’s objection that the making of the works available over the internet, as was done in the case in the main proceedings, is merely a technical means to ensure or improve reception of the terrestrial television broadcast in its catchment area.

28 Admittedly, it follows from the case-law of the Court that a mere technical means to ensure or improve reception of the original transmission in its catchment area does not constitute a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29 (see, to that effect, Football Association Premier League and Others, paragraph 194, and Airfield and Canal Digitaal, paragraphs 74 and 79).

29 Thus, the intervention of such a technical means must be limited to maintaining or improving the quality of the reception of a pre-existing transmission and cannot be used for any other transmission.

30 In the present case, however, the intervention by TVC consists in a transmission of the protected works at issue which is different from that of the broadcasting organisation concerned. TVC’s intervention is in no way intended to maintain or improve the quality of the transmission by that other broadcasting organisation. In those circumstances, that intervention cannot be considered to be a mere technical means within the meaning specified in paragraph 28 above.

31 In the second place, in order to be categorised as a ‘communication to the public’ within the meaning of Article 3(1) of Directive 2001/29, the protected works must also in fact be communicated to a ‘public’.

32 In that connection, it follows from the case-law of the Court that the term ‘public’ in Article 3(1) of Directive 2001/29 refers to an indeterminate number of potential recipients and implies, moreover, a fairly large number of persons (see, to that effect, SGAE, paragraphs 37 and 38 and the case‑law cited).

33 As regards that last criterion specifically, the cumulative effect of making the works available to potential recipients should be taken into account. In that connection, it is in particular relevant to ascertain the number of persons who have access to the same work at the same time and successively (SGAE, paragraph 39).

34 In that context, it is irrelevant whether the potential recipients access the communicated works through a one-to-one connection. That technique does not prevent a large number of persons having access to the same work at the same time.

35 In the present case, it should be noted that the retransmission of the works over the internet at issue in the main proceedings is aimed at all persons resident in the United Kingdom who have an internet connection and who claim to hold a television licence in that State. Those people may access the protected works at the same time, in the context of the ‘live streaming’ of television programmes on the internet.

36 Thus, the retransmission in question is aimed at an indeterminate number of potential recipients and implies a large number of persons. Consequently, it must be held that, by the retransmission in question, the protected works are indeed communicated to a ‘public’ within the meaning of Article 3(1) of Directive 2001/29.

37 However, TVC contends that the retransmission at issue in the main proceedings does not satisfy the requirement that there must be a new public, which is none the less necessary within the meaning of the judgments in SGAE (paragraph 40), Football Association Premier League and Others (paragraph 197), and Airfield and Canal Digitaal (paragraph 72). The recipients of the retransmission effected by TVC are, it submits, entitled to follow the televised broadcast, identical in content, using their own television sets.

38 In that connection, it should be noted that the situations examined in the cases which gave rise to the abovementioned judgments differ clearly from the situation at issue in the case in the main proceedings. In those cases, the Court examined situations in which an operator had made accessible, by its deliberate intervention, a broadcast containing protected works to a new public which was not considered by the authors concerned when they authorised the broadcast in question.

39 By contrast, the main proceedings in the present case concern the transmission of works included in a terrestrial broadcast and the making available of those works over the internet. As is apparent from paragraphs 24 to 26 above, each of those two transmissions must be authorised individually and separately by the authors concerned given that each is made under specific technical conditions, using a different means of transmission for the protected works, and each is intended for a public. In those circumstances, it is no longer necessary to examine below the requirement that there must be a new public, which is relevant only in the situations on which the Court of Justice had to rule in the cases giving rise to the judgments in SGAE, Football Association Premier League and Others and Airfield and Canal Digitaal.

40 In the light of the foregoing, the answer to Question 1 and Question 2(a) is that the concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29, must be interpreted as meaning that it covers a retransmission of the works included in a terrestrial television broadcast

– where the retransmission is made by an organisation other than the original broadcaster,

– by means of an internet stream made available to the subscribers of that other organisation who may receive that retransmission by logging on to its server,

– even though those subscribers are within the area of reception of that terrestrial television broadcast and may lawfully receive the broadcast on a television receiver.

Question 2(b)

41 By Question 2(b), the referring court asks, in essence, whether the answer to Question 1 is influenced by the fact that a retransmission, such as that at issue in the main proceedings, is funded by advertising and is therefore of a profit-making nature.

42 In that connection, the Court has indeed held that it is not irrelevant that a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29 is of a profit-making nature (Football Association Premier League and Others, paragraph 204). However, it has acknowledged that a profit-making nature is not necessarily an essential condition for the existence of a communication to the public (see, to that effect, SGAE, paragraph 44).

43 Consequently, a profit-making nature does not determine conclusively whether a retransmission, such as that at issue in the main proceedings, is to be categorised as a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29.

44 The answer to Question 2(b) is therefore that the answer to Question 1 is not influenced by the fact that a retransmission, such as that at issue in the main proceedings, is funded by advertising and is therefore of a profit-making nature.

Question 2(c)

45 By Question 2(c), the referring court asks in, essence, whether the answer to Question 1 is influenced by the fact that a retransmission, such as that at issue in the main proceedings, is made by an organisation which is acting in direct competition with the original broadcaster.

46 In that connection, it suffices to note that it follows neither from Directive 2001/29 nor from the case-law of the Court that a competitive relationship between the organisations making real-time broadcasts of works protected by copyright or subsequent retransmissions of those works is relevant for the purpose of categorising a transmission as a ‘communication to the public’ within the meaning of Article 3(1) of Directive 2001/29.

47 Consequently, the answer to Question 2(c) is that the answer to Question 1 is not influenced by the fact that a retransmission, such as that at issue in the main proceedings, is made by an organisation which is acting in direct competition with the original broadcaster.

Costs

48 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Fourth Chamber) hereby rules:

1. The concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, must be interpreted as meaning that it covers a retransmission of the works included in a terrestrial television broadcast

– where the retransmission is made by an organisation other than the original broadcaster,

– by means of an internet stream made available to the subscribers of that other organisation who may receive that retransmission by logging on to its server,

– even though those subscribers are within the area of reception of that terrestrial television broadcast and may lawfully receive the broadcast on a television receiver.

2. The answer to Question 1 is not influenced by the fact that a retransmission, such as that at issue in the main proceedings, is funded by advertising and is therefore of a profit-making nature.

3. The answer to Question 1 is not influenced by the fact that a retransmission, such as that at issue in the main proceedings, is made by an organisation which is acting in direct competition with the original broadcaster.

4.1.2.5. VCAST Limited v. RTI SpA, Case C265/16 (29 November 2017)

VCAST Limited v. RTI SpA, Case C265/16 (29 November 2017)

4.1.3 Linking 4.1.3 Linking

4.1.3.1 Nils Svensson et al v Retriever Sverige AB, C-466/12, February 13, 2014 (ECJ) (communication to the public, linking) 4.1.3.1 Nils Svensson et al v Retriever Sverige AB, C-466/12, February 13, 2014 (ECJ) (communication to the public, linking)

JUDGMENT OF THE COURT (Fourth Chamber)

13 February 2014 (*)

(Reference for a preliminary ruling – Approximation of laws – Copyright and related rights – Directive 2001/29/EC – Information society – Harmonisation of certain aspects of copyright and related rights – Article 3(1) – Communication to the public – Meaning – Internet links (‘clickable links’) giving access to protected works)

In Case C‰ЫФ466/12,

REQUEST for a preliminary ruling under Article 267 TFEU from the Svea hovrätt (Sweden), made by decision of 18 September 2012, received at the Court on 18 October 2012, in the proceedings

Nils Svensson,

Sten Sjögren,

Madelaine Sahlman,

Pia Gadd

Retriever Sverige AB,

THE COURT (Fourth Chamber),

composed of L. Bay Larsen, President of the Chamber, M. Safjan, J. Malenovský (Rapporteur), A. Prechal and S. Rodin, Judges,

Advocate General: E. Sharpston,

Registrar: C. Strömholm, Administrator,

having regard to the written procedure and further to the hearing on 7 November 2013,

after considering the observations submitted on behalf of:

– Mr Svensson, Mr Sjögren and Ms Sahlman, by O. Wilöf, förbundsjurist,

– Ms Gadd, by R. Gómez Cabaleiro, abogado, and M. Wadsted, advokat,

– Retriever Sverige AB, by J. Åberg, M. Bruder and C. Rockström, advokater,

– the French Government, by D. Colas, F.-X. Bréchot and B. Beaupère-Manokha, acting as Agents,

– the Italian Government, by G. Palmieri, acting as Agent, and by S. Fiorentino, avvocato dello Stato,

– the United Kingdom Government, by J. Beeko, acting as Agent, and by N. Saunders, Barrister,

– the European Commission, by J. Samnadda and J. Enegren, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

2 The request has been made in proceedings between Mr Svensson, Mr Sjögren, Ms Sahlman and Ms Gadd, the applicants in the main proceedings, and Retriever Sverige AB (‘Retriever Sverige’) concerning compensation allegedly payable to them for the harm they consider they have suffered as a result of the inclusion on that company’s website of clickable Internet links (hyperlinks) redirecting users to press articles in which the applicants hold the copyright.

Legal context

International law

The WIPO Copyright Treaty

3 The World Intellectual Property Organisation (WIPO) adopted the WIPO Copyright Treaty (‘the WIPO Copyright Treaty’) in Geneva on 20 December 1996. It was approved on behalf of the European Community by Council Decision 2000/278/EC of 16 March 2000 (OJ 2000 L 89, p. 6).

4 Article 1(4) of the WIPO Copyright Treaty provides that the contracting parties are to comply with Articles 1 to 21 of the Convention for the Protection of Literary and Artistic Works, signed at Berne on 9 September 1886 (Paris Act of 24 July 1971), as amended on 28 September 1979 (‘the Berne Convention’).

The Berne Convention

5 Article 20 of the Berne Convention, entitled ‘Special Agreements Among Countries of the Union’, states:

‘The Governments of the countries of the Union reserve the right to enter into special agreements among themselves, in so far as such agreements grant to authors more extensive rights than those granted by the Convention, or contain other provisions not contrary to this Convention. The provisions of existing agreements which satisfy these conditions shall remain applicable.’

European Union law

6 Recitals 1, 4, 6, 7, 9 and 19 in the preamble to Directive 2001/29 state:

‘(1) The Treaty provides for the establishment of an internal market and the institution of a system ensuring that competition in the internal market is not distorted. Harmonisation of the laws of the Member States on copyright and related rights contributes to the achievement of these objectives.

…

(4) A harmonised legal framework on copyright and related rights, through increased legal certainty and while providing for a high level of protection of intellectual property, will foster substantial investment in creativity and innovation, including network infrastructure, and lead in turn to growth and increased competitiveness of European industry, both in the area of content provision and information technology and more generally across a wide range of industrial and cultural sectors. …

…

(6) Without harmonisation at Community level, legislative activities at national level which have already been initiated in a number of Member States in order to respond to the technological challenges might result in significant differences in protection and thereby in restrictions on the free movement of services and products incorporating, or based on, intellectual property, leading to a refragmentation of the internal market and legislative inconsistency. The impact of such legislative differences and uncertainties will become more significant with the further development of the information society, which has already greatly increased transborder exploitation of intellectual property. This development will and should further increase. Significant legal differences and uncertainties in protection may hinder economies of scale for new products and services containing copyright and related rights.

(7) The Community legal framework for the protection of copyright and related rights must, therefore, also be adapted and supplemented as far as is necessary for the smooth functioning of the internal market. To that end, those national provisions on copyright and related rights which vary considerably from one Member State to another or which cause legal uncertainties hindering the smooth functioning of the internal market and the proper development of the information society in Europe should be adjusted, and inconsistent national responses to the technological developments should be avoided, whilst differences not adversely affecting the functioning of the internal market need not be removed or prevented.

…

(9) Any harmonisation of copyright and related rights must take as a basis a high level of protection, since such rights are crucial to intellectual creation. Their protection helps to ensure the maintenance and development of creativity in the interests of authors, performers, producers, consumers, culture, industry and the public at large. …

(19) The moral rights of rightholders should be exercised according to the legislation of the Member States and the provisions of the Berne Convention …[,] the WIPO Copyright Treaty and of the WIPO Performances and Phonograms Treaty. …’

7 Article 3 of Directive 2001/29 provides:

…

3. The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.’

The dispute in the main proceedings and the questions referred for a preliminary ruling

8 The applicants in the main proceedings, all journalists, wrote press articles that were published in the Göteborgs-Posten newspaper and on the Göteborgs-Posten website. Retriever Sverige operates a website that provides its clients, according to their needs, with lists of clickable Internet links to articles published by other websites. It is common ground between the parties that those articles were freely accessible on the Göteborgs-Posten newspaper site. According to the applicants in the main proceedings, if a client clicks on one of those links, it is not apparent to him that he has been redirected to another site in order to access the work in which he is interested. By contrast, according to Retriever Sverige, it is clear to the client that, when he clicks on one of those links, he is redirected to another site.

9 The applicants in the main proceedings brought an action against Retriever Sverige before the Stockholms tingsrätt (Stockholm District Court) in order to obtain compensation on the ground that that company had made use, without their authorisation, of certain articles by them, by making them available to its clients.

10 By judgment of 11 June 2010, the Stockholms tingsrätt rejected their application. The applicants in the main proceedings then brought an appeal against that judgment before the Svea hovrätt (Svea Court of Appeal).

11 Before that court, the applicants in the main proceedings claimed, inter alia, that Retriever Sverige had infringed their exclusive right to make their respective works available to the public, in that as a result of the services offered on its website, Retriever Sverige’s clients had access to the applicants’ works.

12 Retriever Sverige contends, in defence, that the provision of lists of Internet links to works communicated to the public on other websites does not constitute an act liable to affect the copyright in those works. Retriever Sverige also contends that it did not carry out any transmission of any protected work; its action is limited to indicating to its clients the websites on which the works that are of interest to them are to be found.

13 In those circumstances, the Svea hovrätt decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) If anyone other than the holder of copyright in a certain work supplies a clickable link to the work on his website, does that constitute communication to the public within the meaning of Article 3(1) of Directive [2001/29]?

(2) Is the assessment under question 1 affected if the work to which the link refers is on a website on the Internet which can be accessed by anyone without restrictions or if access is restricted in some way?

(3) When making the assessment under question 1, should any distinction be drawn between a case where the work, after the user has clicked on the link, is shown on another website and one where the work, after the user has clicked on the link, is shown in such a way as to give the impression that it is appearing on the same website?

(4) Is it possible for a Member State to give wider protection to authors’ exclusive right by enabling communication to the public to cover a greater range of acts than provided for in Article 3(1) of Directive 2001/29?’

Consideration of the questions referred

The first three questions

14 By its first three questions, which it is appropriate to examine together, the referring court asks, in essence, whether Article 3(1) of Directive 2001/29 must be interpreted as meaning that the provision, on a website, of clickable links to protected works available on another website constitutes an act of communication to the public as referred to in that provision, where, on that other site, the works concerned are freely accessible.

15 In this connection, it follows from Article 3(1) of Directive 2001/29 that every act of communication of a work to the public has to be authorised by the copyright holder.

16 It is thus apparent from that provision that the concept of communication to the public includes two cumulative criteria, namely, an ‘act of communication’ of a work and the communication of that work to a ‘public’ (see, to that effect, Case C‰ЫФ607/11 ITV Broadcasting and Others [2013] ECR, paragraphs 21 and 31).

17 As regards the first of those criteria, that is, the existence of an ‘act of communication’, this must be construed broadly (see, to that effect, Joined Cases C‰ЫФ403/08 and C‰ЫФ429/08 Football Association Premier League and Others [2011] ECR I‰ЫФ9083, paragraph 193), in order to ensure, in accordance with, inter alia, recitals 4 and 9 in the preamble to Directive 2001/29, a high level of protection for copyright holders.

18 In the circumstances of this case, it must be observed that the provision, on a website, of clickable links to protected works published without any access restrictions on another site, affords users of the first site direct access to those works.

19 As is apparent from Article 3(1) of Directive 2001/29, for there to be an ‘act of communication’, it is sufficient, in particular, that a work is made available to a public in such a way that the persons forming that public may access it, irrespective of whether they avail themselves of that opportunity (see, by analogy, Case C‰ЫФ306/05 SGAE [2006] ECR I‰ЫФ11519, paragraph 43).

20 It follows that, in circumstances such as those in the case in the main proceedings, the provision of clickable links to protected works must be considered to be ‘making available’ and, therefore, an ‘act of communication’, within the meaning of that provision.

21 So far as concerns the second of the abovementioned criteria, that is, that the protected work must in fact be communicated to a ‘public’, it follows from Article 3(1) of Directive 2001/29 that, by the term ‘public’, that provision refers to an indeterminate number of potential recipients and implies, moreover, a fairly large number of persons (SGAE, paragraphs 37 and 38, and ITV Broadcasting and Others, paragraph 32).

22 An act of communication such as that made by the manager of a website by means of clickable links is aimed at all potential users of the site managed by that person, that is to say, an indeterminate and fairly large number of recipients.

23 In those circumstances, it must be held that the manager is making a communication to a public.

24 None the less, according to settled case-law, in order to be covered by the concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29, a communication, such as that at issue in the main proceedings, concerning the same works as those covered by the initial communication and made, as in the case of the initial communication, on the Internet, and therefore by the same technical means, must also be directed at a new public, that is to say, at a public that was not taken into account by the copyright holders when they authorised the initial communication to the public (see, by analogy, SGAE, paragraphs 40 and 42; order of 18 March 2010 in Case C‑136/09 Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon, paragraph 38; and ITV Broadcasting and Others, paragraph 39).

25 In the circumstances of this case, it must be observed that making available the works concerned by means of a clickable link, such as that in the main proceedings, does not lead to the works in question being communicated to a new public.

26 The public targeted by the initial communication consisted of all potential visitors to the site concerned, since, given that access to the works on that site was not subject to any restrictive measures, all Internet users could therefore have free access to them.

27 In those circumstances, it must be held that, where all the users of another site to whom the works at issue have been communicated by means of a clickable link could access those works directly on the site on which they were initially communicated, without the involvement of the manager of that other site, the users of the site managed by the latter must be deemed to be potential recipients of the initial communication and, therefore, as being part of the public taken into account by the copyright holders when they authorised the initial communication.

28 Therefore, since there is no new public, the authorisation of the copyright holders is not required for a communication to the public such as that in the main proceedings.

29 Such a finding cannot be called in question were the referring court to find, although this is not clear from the documents before the Court, that when Internet users click on the link at issue, the work appears in such a way as to give the impression that it is appearing on the site on which that link is found, whereas in fact that work comes from another site.

30 That additional circumstance in no way alters the conclusion that the provision on a site of a clickable link to a protected work published and freely accessible on another site has the effect of making that work available to users of the first site and that it therefore constitutes a communication to the public. However, since there is no new public, the authorisation of the copyright holders is in any event not required for such a communication to the public.

31 On the other hand, where a clickable link makes it possible for users of the site on which that link appears to circumvent restrictions put in place by the site on which the protected work appears in order to restrict public access to that work to the latter site’s subscribers only, and the link accordingly constitutes an intervention without which those users would not be able to access the works transmitted, all those users must be deemed to be a new public, which was not taken into account by the copyright holders when they authorised the initial communication, and accordingly the holders’ authorisation is required for such a communication to the public. This is the case, in particular, where the work is no longer available to the public on the site on which it was initially communicated or where it is henceforth available on that site only to a restricted public, while being accessible on another Internet site without the copyright holders’ authorisation.

32 In those circumstances, the answer to the first three questions referred is that Article 3(1) of Directive 2001/29 must be interpreted as meaning that the provision on a website of clickable links to works freely available on another website does not constitute an act of communication to the public, as referred to in that provision.

The fourth question

33 By its fourth question, the referring court asks, in essence, whether Article 3(1) of Directive 2001/29 must be interpreted as precluding a Member State from giving wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

34 In this connection, it is apparent, in particular, from recitals 1, 6 and 7 in the preamble to Directive 2001/29 that the objectives of the directive are, inter alia, to remedy the legislative differences and legal uncertainty that exist in relation to copyright protection. Acceptance of the proposition that a Member State may give wider protection to copyright holders by laying down that the concept of communication to the public also includes activities other than those referred to in Article 3(1) of Directive 2001/29 would have the effect of creating legislative differences and thus, for third parties, legal uncertainty.

35 Consequently, the objective pursued by Directive 2001/29 would inevitably be undermined if the concept of communication to the public were to be construed in different Member States as including a wider range of activities than those referred to in Article 3(1) of that directive.

36 It is true that recital 7 in the preamble to the directive indicates that the directive does not have the objective of removing or preventing differences that do not adversely affect the functioning of the internal market. Nevertheless, it must be observed that, if the Member States were to be afforded the possibility of laying down that the concept of communication to the public includes a wider range of activities than those referred to in Article 3(1) of the directive, the functioning of the internal market would be bound to be adversely affected.

37 It follows that Article 3(1) of Directive 2001/29 cannot be construed as allowing Member States to give wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

38 Such a conclusion is not affected by the fact, highlighted by the applicants in the main proceedings in their written observations, that Article 20 of the Berne Convention stipulates that the signatory countries may enter into ‘special agreements’ among themselves with a view to granting copyright holders more extensive rights than those laid down in that Convention.

39 In this connection, suffice it to recall that, when an agreement allows, but does not require, a Member State to adopt a measure which appears to be contrary to Union law, the Member State must refrain from adopting such a measure (Case C‑277/10 Luksan [2012] ECR, paragraph 62).

40 Since the objective of Directive 2001/29 would inevitably be undermined if the concept of communication to the public were construed as including a wider range of activities than those referred to in Article 3(1) of that directive, a Member State must refrain from exercising the right granted to it by Article 20 of the Berne Convention.

41 Therefore, the answer to the fourth question is that Article 3(1) of Directive 2001/29 must be interpreted as precluding a Member State from giving wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

Costs

42 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Fourth Chamber) hereby rules:

1. Article 3(1) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, must be interpreted as meaning that the provision on a website of clickable links to works freely available on another website does not constitute an ‘act of communication to the public’, as referred to in that provision.

2. Article 3(1) of Directive 2001/29 must be interpreted as precluding a Member State from giving wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

4.1.3.2. Svensson (SUMMARY) - Giancarlo F. Frosio, Freedom of Linking in Europe?, CIS Blog, March 10, 2014

Svensson (SUMMARY) - Giancarlo F. Frosio, Freedom of Linking in Europe?, CIS Blog, March 10, 2014

4.1.3.3. ECS, Opinion on the Reference to the CJEU in Case C-466/12 Svensson (15 February 2013)

ECS, Opinion on the Reference to the CJEU in Case C-466/12 Svensson (15 February 2013)

4.1.3.4 Svensson (SUMMARY) 4.1.3.4 Svensson (SUMMARY)

Case C‰ЫФ466/12

Nils Svensson and Others

Retriever Sverige AB

(Request for a preliminary ruling from the Svea hovrätt)

(Reference for a preliminary ruling — Approximation of laws — Copyright and related rights — Directive 2001/29/EC — Information society — Harmonisation of certain aspects of copyright and related rights — Article 3(1) — Communication to the public — Meaning — Internet links (‘clickable links’) giving access to protected works)

Summary — Judgment of the Court (Fourth Chamber), 13 February 2014

1. Approximation of laws — Copyright and related rights — Directive 2001/29 — Harmonisation of certain aspects of copyright and related rights in the information society — Communication to the public — Meaning — Making available to the public, on a website, of clickable links to works freely available on another website — Not included

(European Parliament and Council Directive 2001/29, Art. 3(1))

2. Approximation of laws — Copyright and related rights — Directive 2001/29 — Harmonisation of certain aspects of copyright and related rights in the information society — Communication to the public — Meaning — Not permissible for Member States to give wider protection to copyright holders by including within the concept of communication to the public a wider range of activities than those referred to in Article 3(1) of Directive 2001/29

(European Parliament and Council Directive 2001/29, Art. 3(1))

3. International agreements — Agreements concluded by the Member States — Agreements preceding a Member State’s accession to the European Union — Agreement allowing a Member State to adopt a measure contrary to EU law — Obligation on the Member State to refrain from adopting such a measure

(Art. 351 TFEU)

1. Article 3(1) of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as meaning that the provision on a website of clickable links to works freely available on another website does not constitute an ‘act of communication to the public’, as referred to in that provision.

In this connection, the concept of communication to the public includes two cumulative criteria, namely, an ‘act of communication’ of a work and the communication of that work to a ‘public’.

The provision, on a website, of clickable links to protected works published without any access restrictions on another site, affords users of the first site direct access to those works and must be considered to be ‘making available’ and, therefore, an ‘act of communication’, within the meaning of Article 3(1) of Directive 2001/29. Such an act of communication is aimed at all potential users of the website, that is to say, an indeterminate and fairly large number of recipients.

None the less, in order to be covered by the concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29, a communication concerning the same works as those covered by the initial communication and made, as in the case of the initial communication, on the Internet, and therefore by the same technical means, must also be directed at a new public, that is to say, at a public that was not taken into account by the copyright holders when they authorised the initial communication to the public. Making available the works concerned by means of a clickable link does not lead to the works in question being communicated to a new public.

In those circumstances, where all the users of another site to whom the works at issue have been communicated by means of a clickable link could access those works directly on the site on which they were initially communicated, without the involvement of the manager of that other site, the users of the site managed by the latter must be deemed to be potential recipients of the initial communication and, therefore, as being part of the public taken into account by the copyright holders when they authorised the initial communication.

Therefore, since there is no new public, the authorisation of the copyright holders is not required for such a communication to the public.

(see paras 16, 18, 20, 22, 24, 25, 27, 28, 32, operative part 1)

2. Article 3(1) of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as precluding a Member State from giving wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

It is apparent, in particular, from recitals 1, 6 and 7 in the preamble to Directive 2001/29 that the objectives of the directive are, inter alia, to remedy the legislative differences and legal uncertainty that exist in relation to copyright protection. Acceptance of the proposition that a Member State may give wider protection to copyright holders by laying down that the concept of communication to the public also includes activities other than those referred to in Article 3(1) of Directive 2001/29 would have the effect of creating legislative differences and thus, for third parties, legal uncertainty. Consequently, the objective pursued by Directive 2001/29 would inevitably be undermined if the concept of communication to the public were to be construed in different Member States as including a wider range of activities than those referred to in Article 3(1) of that directive.

Furthermore, it must be observed that, if the Member States were to be afforded the possibility of laying down that the concept of communication to the public includes a wider range of activities than those referred to in Article 3(1) of the directive, the functioning of the internal market would be bound to be adversely affected.

(see paras 34-36, 41, operative part 2)

3. See the text of the decision.

(see para. 39)

4.1.3.5. ALAI, Opinion on the criterion думNew Publicдуќ, developed CJEU, put in the context of making available and communication to the public (17 September 2014)

ALAI, Opinion on the criterion думNew Publicдуќ, developed CJEU, put in the context of making available and communication to the public (17 September 2014)

4.1.3.6. GS Media BV v Sanoma Media Netherlands BV and Others, C-160/15, 8 September 2016

GS Media BV v Sanoma Media Netherlands BV and Others, C-160/15, 8 September 2016

4.1.3.7 C More Entertainment AB v. Linus Sandberg, C-279/12, March 26, 2015 (OPTIONAL) 4.1.3.7 C More Entertainment AB v. Linus Sandberg, C-279/12, March 26, 2015 (OPTIONAL)

JUDGMENT OF THE COURT (Ninth Chamber)

26 March 2015 (*)

(Reference for a preliminary ruling — Approximation of laws — Copyright and related rights — Directive 2001/29/EC — Information society — Harmonisation of certain aspects of copyright and related rights — Article 3(2) — Direct broadcast of a sporting fixture on an internet site)

In Case C‑279/13,

REQUEST for a preliminary ruling under Article 267 TFEU from the Högsta domstolen (Sweden), made by decision of 15 May 2013, received at the Court on 22 May 2013, in the proceedings

C More Entertainment AB

Linus Sandberg,

THE COURT (Ninth Chamber),

composed of K. Jürimäe, President of the Chamber, J. Malenovský (Rapporteur) and A. Prechal, Judges,

Advocate General: E. Sharpston,

Registrar: A. Calot Escobar,

having regard to the written procedure,

after considering the observations submitted on behalf of:

– C More Entertainment AB, by P. Bratt and S. Feinsilber, advokater,

– Mr Sandberg, by L. Häggström, advokat,

– the Finnish Government, by S. Hartikainen, acting as Agent,

– the European Commission, by J. Enegren and J. Samnadda, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1 This request for a preliminary ruling concerns the interpretation of Article 3(2) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 2001 L 167, p. 10).

2 The request has been made in proceedings between C More Entertainment AB (‘C More Entertainment’) and Mr Sandberg concerning the placing by him on an internet site of clickable links by means of which internet users can gain access to the live broadcast, on another site, of ice hockey games without having to pay the sum asked by the operator of the other site.

Legal context

Directive 2001/29

3 Recitals 1, 7, 20, 23 and 25 of Directive 2001/29 state:

‘(1) The [EC] Treaty provides for the establishment of an internal market and the institution of a system ensuring that competition in the internal market is not distorted. Harmonisation of the laws of the Member States on copyright and related rights contributes to the achievement of these objectives.

…

(20) This Directive is based on principles and rules already laid down in the Directives currently in force in this area, in particular [Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 1992 L 346, p. 61), as amended by Council Directive 93/83/EEC of 29 October 1993 (OJ 1993 L 290, p. 9; ‘Directive 92/100’). It] develops those principles and rules and places them in the context of the information society. The provisions of this Directive should be without prejudice to the provisions of those Directives, unless otherwise provided in this Directive.

…

(23) This Directive should harmonise further the author’s right of communication to the public. This right should be understood in a broad sense covering all communication to the public not present at the place where the communication originates. This right should cover any such transmission or retransmission of a work to the public by wire or wireless means, including broadcasting. This right should not cover any other acts.

…

(25) The legal uncertainty regarding the nature and the level of protection of acts of on-demand transmission of copyright works and subject-matter protected by related rights over networks should be overcome by providing for harmonised protection at Community level. It should be made clear that all rightholders recognised by this Directive should have an exclusive right to make available to the public copyright works or any other subject-matter by way of interactive on-demand transmissions. Such interactive on-demand transmissions are characterised by the fact that members of the public may access them from a place and at a time individually chosen by them.’

4 Article 1 of Directive 2001/29, entitled ‘Scope’, provides in paragraph 2:

‘Except in the cases referred to in Article 11, this Directive shall leave intact and shall in no way affect existing Community provisions relating to:

…

(b) rental right, lending right and certain rights related to copyright in the field of intellectual property;

…’

5 Article 3 of that directive, entitled ‘Right of communication to the public of works and right of making available to the public other subject-matter’, states:

…

(d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.’

Directive 2006/115/EC

6 Directive 92/100, in force at the time of the adoption of Directive 2001/29, was repealed and replaced by Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ 2006 L 376, p. 28). Directive 2006/115 codifies and reiterates, in terms analogous to those of Directive 92/100, the provisions of that directive.

7 Under recital 16 in the preamble to Directive 2006/115:

‘Member States should be able to provide for more far-reaching protection for owners of rights related to copyright than that required by the provisions laid down in this Directive in respect of broadcasting and communication to the public.’

8 Article 8 of that directive, entitled ‘Broadcasting and communication to the public’, provides in paragraph 3:

‘Member States shall provide for broadcasting organisations the exclusive right to authorise or prohibit the rebroadcasting of their broadcasts by wireless means, as well as the communication to the public of their broadcasts if such communication is made in places accessible to the public against payment of an entrance fee.’

9 Article 12 of Directive 2006/115, entitled ‘Relation between copyright and related rights’, states:

‘Protection of copyright-related rights under this Directive shall leave intact and shall in no way affect the protection of copyright.’

The dispute in the main proceedings and the question referred

10 C More Entertainment is a pay-TV station which, inter alia, broadcasts live on its internet site, for payment of a fee, ice hockey matches.

11 In autumn 2007, C More Entertainment broadcast on that internet site a number of ice hockey matches, to which persons interested could have access by paying the sum of SEK 89 (approximately EUR 9.70) per match.

12 On his internet site, Mr Sandberg created links enabling the paywall put in place by C More Entertainment to be circumvented. Via those links, internet users could thus access the live broadcasts of two ice hockey matches by C More Entertainment on 20 October and 1 November 2007 for free.

13 Before the first of those matches, C More Entertainment had contacted Mr Sandberg by telephone and asked him to remove the link without success. After that match, C More Entertainment warned Mr Sandberg in a letter that it regarded the placing of those links as an infringement of the company’s rights.

14 During the second ice hockey match, C More Entertainment equipped the webcast with a technical protection which prevented any access to that broadcast via the links created by Mr Sandberg.

15 Mr Sandberg was prosecuted before the Hudiksvalls tingsrätt (District Court, Hudiksvall) for offences against the Law (1960:729) on Copyright in Literary and Artistic Works (lagen (1960:729) om upphovsrätt till litterära och konstnärliga verk (‘upphovsrättslagen’)). On 10 November 2010, the accused was found guilty of an infringement of the copyright of which, in the view of that court, C More Entertainment was the holder and was fined and ordered to pay damages and interest to that company.

16 Both Mr Sandberg and C More Entertainment appealed against that judgment before the Hovrätten för Nedre Norrland (Court of Appeal of Nedre Norrland).

17 By a decision of 20 June 2011, that court found that no part of the commentators’, cameramen’s or picture producers’ work on the broadcasts of the ice hockey matches, taken on its own merits or some or all of those parts taken together, reached the level of originality required for copyright protection under the upphovsrättslagen. Next, it held that, as regards the broadcasts at issue in the main proceedings, C More Entertainment was not the holder of a copyright, but of related rights, which had been infringed. Consequently, that court ordered Mr Sandberg to pay fines higher than those imposed at first instance, but slightly reduced the compensation awarded to C More Entertainment.

18 C More Entertainment brought an appeal against that judgment before the Högsta domstolen (Supreme Court), seeking a declaration that it is the holder of copyright and to have the amount of damages due to it reviewed and increased.

19 That court took the view that it does not follow from either the wording of Directive 2001/29 or the case-law of the Court that the insertion of a hypertext link on an internet site constitutes an act of communication to the public. In addition, that court noted that the relevant national legislation provides for wider related rights than those set out in Article 3(2) of Directive 2001/29 since, unlike that provision, the protection conferred by Swedish law is not restricted to acts of making works available ‘on demand’. In those circumstances, the Högsta domstolen decided to stay the proceedings and to refer five questions to the Court for a preliminary ruling.

20 By a letter of 26 March 2014, the Registry of the Court sent to the Högsta domstolen a copy of the judgment in Svensson and Others (C‑466/12, EU:C:2014:76), in which a number of questions concerning whether the placing, on an internet site, of a clickable link may be classified as an act of communication to the public were examined, requesting that court to inform it whether, having regard to that judgment, it wished to maintain its request for a preliminary ruling.

21 By a decision of 20 October 2014, the Högsta domstolen decided to withdraw the first four questions referred for a preliminary ruling and to maintain only the fifth question, which reads as follows:

‘May the Member States give wider protection to the exclusive right of authors by enabling “communication to the public” to cover a greater range of acts than provided for in Article 3(2) of [Directive 2001/29]?’

The question referred for a preliminary ruling

22 It is apparent from the file that the main proceedings concern the provision, on an internet site, of links enabling internet users to access, on the site of a broadcasting organisation, live broadcasts of ice hockey matches, without having to pay the fee required by that organisation for that access. In those circumstances, the question referred by the referring court must be understood as relating, in essence, to whether Article 3(2) of Directive 2001/29 must be interpreted as precluding national legislation extending the exclusive right of the broadcasting organisations referred to in Article 3(2)(d) as regards acts of communication to the public which broadcasts of sporting fixtures made live on internet, such as those at issue in the main proceedings, may constitute.

23 As a preliminary point, it must be noted that, in accordance with Article 3(2)(d) of Directive 2001/29, Member States are to provide for the exclusive right for broadcasting organisations to authorise or prohibit the making available of fixations of their broadcasts to the public, in such a way that members of the public may access them from a place and at a time individually chosen by them.

24 Firstly, as follows from the wording of Article 3(1) of Directive 2001/29, and in particular from the terms ‘any communication to the public of their works, … including the making available to the public’, the concept of ‘making available to the public’, also used in Article 3(2) of that directive, forms part of the wider ‘communication to the public’.

25 Secondly, it is apparent from Article 3(2) of that directive that, in order to be classified as an act of ‘making available to the public’ within the meaning of that article, an act must meet, cumulatively, both conditions set out in that provision, namely that members of the public may access the protected work from a place and at a time individually chosen by them.

26 As is clear from the explanatory memorandum to the Commission Proposal of 10 December 1997 (COM(97) 628), which led to the adoption of Directive 2001/29, confirmed by recital 25 in the preamble to that directive, ‘making available to the public’, for the purposes of Article 3 of the directive, is intended to refer to ‘interactive on-demand transmissions’ characterised by the fact that members of the public may access them from a place and at a time individually chosen by them (see, to that effect, judgment in SCF, C‑135/10, EU:C:2012:140, paragraph 59).

27 That is not the case of transmissions broadcast live on internet, such as those at issue in the main proceedings.

28 The referring court asks none the less whether Article 3(2) of Directive 2001/29 is to be understood as precluding the Member States also granting the broadcasting organisations referred to in Article 3(2)(d) an exclusive right as regards acts which, such as those at issue in the main proceedings, could be classified as acts of communication to the public but which do not constitute acts of making available to the public the fixations of their broadcasts in such a way that members of the public may access them from a place and at a time individually chosen by them.

29 In that regard, first of all, as is apparent from recital 7 in the preamble to Directive 2001/29, the objective of that directive is to harmonise copyright and related rights as far as is necessary for the smooth functioning of the internal market. It follows from that recital that the objective of that directive is not to remove or prevent differences between the national legislations which do not adversely affect the functioning of the internal market. Thus, and as is also clear from the heading of that directive, the EU legislature has harmonised copyright and related rights only in part.

30 It follows from recitals 23 and 25 in the preamble to that directive that the EU legislature sought, firstly, to harmonise further the author’s right of communication to the public and, secondly, to overcome the legal uncertainty regarding the nature and the level of protection of acts of on-demand transmission by providing for harmonised protection at Community level for that type of act.

31 However, neither Article 3(2) of Directive 2001/29 nor any other provision thereof states that the EU legislature sought to harmonise and, in consequence, prevent or remove any differences between the national legislations as regards the extent of the protection which the Member States may grant to the holders of the rights referred to in Article 3(2)(d) with regard to certain acts, such as those at issue in the main proceedings, which are not expressly referred to in that provision.

32 Furthermore, in accordance with recital 20 in the preamble to Directive 2001/29, that directive is based on principles and rules already laid down in the directives in force in the area of intellectual property, including Directive 92/100 (see judgment in Football Association Premier League and Others, C‑403/08 and C‑429/08, EU:C:2011:631, paragraph 187).

33 It is apparent from recital 16 in the preamble to Directive 2006/115, which replaced Directive 92/100, that the Member States should be able to provide for more far-reaching protection for owners of rights related to copyright than that required by the provisions laid down in that directive in respect of broadcasting and communication to the public.

34 Article 8 of that directive, entitled ‘Broadcasting and communication to the public’, states in paragraph 3, in particular, that Member States are to provide for broadcasting organisations the exclusive right to authorise or prohibit the rebroadcasting of their broadcasts by wireless means, as well as the communication to the public of their broadcasts if such communication is made in places accessible to the public against payment of an entrance fee.

35 Thus, it must be held that Directive 2006/115 gives the Member States the option of providing for more protective provisions with regard to the broadcasting and communication to the public of transmissions made by broadcasting organisations than those which must be instituted in accordance with Article 8(3) of that directive. Such an option implies that the Member States may grant broadcasting organisations an exclusive right to authorise or prohibit acts of communication to the public of their transmissions on conditions different from those laid down in Article 8(3) and in particular transmissions to which members of the public may obtain access from a place individually chosen by them, it still being understood that, as provided for in Article 12 of Directive 2006/115, such a right must not affect the protection of copyright in any way.

36 It follows that Article 3(2) of Directive 2001/29 must be interpreted as not affecting the option open to the Member States, set out in Article 8(3) of Directive 2006/115, read in conjunction with recital 16 to that directive to grant broadcasting organisations the exclusive right to authorise or prohibit acts of communication to the public of their transmissions provided that such protection does not undermine that of copyright.

37 Having regard to all the foregoing considerations, the answer to the question referred is that Article 3(2) of Directive 2001/29 must be interpreted as not precluding national legislation extending the exclusive right of the broadcasting organisations referred to in Article 3(2)(d) as regards acts of communication to the public which broadcasts of sporting fixtures made live on internet, such as those at issue in the main proceedings, may constitute, provided that such an extension does not undermine the protection of copyright.

Costs

38 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court hereby rules:

Article 3(2) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as not precluding national legislation extending the exclusive right of the broadcasting organisations referred to in Article 3(2)(d) as regards acts of communication to the public which broadcasts of sporting fixtures made live on internet, such as those at issue in the main proceedings, may constitute, provided that such an extension does not undermine the protection of copyright.

4.1.3.8. C More Entertainment (SUMMARY) - Giancarlo F. Frosio, (C) More Entertainment for Broadcasters: The European Court of Justice on Linking to Live Streams of Sport Events, CIS Blog, March 31, 2015

C More Entertainment (SUMMARY) - Giancarlo F. Frosio, (C) More Entertainment for Broadcasters: The European Court of Justice on Linking to Live Streams of Sport Events, CIS Blog, March 31, 2015

4.1.3.9. Stichting Brein v Jack Frederik Wullems, Case C-527/15 (26 April 2017)

Stichting Brein v Jack Frederik Wullems, Case C-527/15 (26 April 2017)

4.1.3.10. Stichting Brein v Ziggo BV and XS4All Internet BV, Case C-610/15 (14 June 2017)

Stichting Brein v Ziggo BV and XS4All Internet BV, Case C-610/15 (14 June 2017)

4.2 United States 4.2 United States

4.2.1 Perfect 10 v. Amazon.com 4.2.1 Perfect 10 v. Amazon.com

United States Court of Appeals for the Ninth Circuit

508 F.3d 1146

Nos. 06-55405, 06-55406, 06-55425, 06-55759, 06-55854, 06-55877

2007-12-03

508 F.3d 1146

PERFECT 10, INC., a California corporation, Plaintiff-Appellant,
v.
AMAZON.COM, INC., a corporation; A9.Com Inc., a corporation, Defendants-Appellees.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant,
v.
Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee,
v.
Google Inc., a corporation, Defendant-Appellant.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant,
v.
Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee,
v.
Google Inc., a corporation, Defendant-Appellant.

No. 06-55405.No. 06-55406.No. 06-55425.No. 06-55759.No. 06-55854.No. 06-55877.United States Court of Appeals, Ninth Circuit.Argued and Submitted November 15, 2006.Filed May 16, 2007.Amended December 3, 2007.

[1153] Russell J. Frackman and Jeffrey D. Goldman, Mitchell, Silberberg & Knupp LLP, Los Angeles, CA, Jeffrey N. Mausner, Berman, Mausner & Resser, Los Angeles, CA, Daniel J. Cooper, Perfect 10, Inc., Beverly Hills, CA, for plaintiff-appellant Perfect 10, Inc.

Andrew P. Bridges and Jennifer A. Golinveaux, Winston & Strawn LLP, San Francisco, CA, Gene C. Schaerr, Winston & Strawn LLP, Washington, DC, for defendant-appellee and cross-appellant Google Inc.

Mark T. Jansen & Anthony J. Malutta, Townsend and Townsend and Crew LLP, San Francisco, CA, for defendants-appellees Amazon.com and A9.com, Inc.

Fred von Lohmann, Electronic Frontier Foundation, San Francisco, CA, for amicus curiae Electronic Frontier Foundation, American Library Association, Medical Library [1154] Association, American Association of Law Libraries, Association of Research Libraries, and Special Libraries Association in support of Google Inc.

Victor S. Perlman, of counsel, American Society of Media Photographers; Nancy E. Wolff, of counsel, Cowan, DeBaets, Abrahams & Sheppard, LLP; Robert W. Clarida and Jason D. Sanders, Cowan, Liebowitz & Latman, P.C., New York, NY, for amicus curiae American Society of Media Photographers, Inc., Picture Archive Council of America, Inc., British Association of Picture Libraries and Agencies, Inc., Stock Artists Alliance, The Graphic Artists Guild, American Society of Picture Professionals and National Press Photographers, in support of Perfect 10 on issue of Google's liability for the display of full-size images.

Eric J. Schwartz and Steven J. Metalitz, Smith & Metalitz LLP, Washington, DC, for amicus curiae Motion Picture Association of America, Inc. in support of Perfect 10.

Jonathan Band, Jonathan Band PLLC, Washington, DC, for amicus curiae Net-Coalition, Computer and Communications Industry Association, U.S. Internet Service Provider Association, Consumer Electronics Association, Home Recording Rights Coalition, Information Technology Association of America, and Internet Commerce Coalition in support of Google Inc.

Kenneth L. Doroshow and Linda J. Zirkelbach, Recording Industry Association of America, Washington, DC; Jacqueline C. Charlesworth, National Music Publishers' Association, Washington, DC; Robert W. Clarida, Richard S. Mandel and Jonathan Z. King, Cowan, Liebowitz & Latman, P.C., New York, NY, for amicus curiae Recording Industry Association of America and National Music Publishers' Association in support of neither party.

Appeal from the United States District Court for the Central District of California; A. Howard Matz, District Judge, Presiding. D.C. Nos. CV-05-04753-AHM, CV-04-09484-AHM.

Before: CYNTHIA HOLCOMB HALL, HAWKINS, and SANDRA S. IKUTA, Circuit Judges.

IKUTA, Circuit Judge:

In this appeal, we consider a copyright owner's efforts to stop an Internet search engine from facilitating access to infringing images. Perfect 10, Inc. sued Google Inc., for infringing Perfect 10's copyrighted photographs of nude models, among other claims. Perfect 10 brought a similar action against Amazon.com and its subsidiary A9.com (collectively, "Amazon.com"). The district court preliminarily enjoined Google from creating and publicly displaying thumbnail versions of Perfect 10's images, Perfect 10 v. Google, Inc., 416 F.Supp.2d 828 (C.D.Cal.2006), but did not enjoin Google from linking to third-party websites that display infringing full-size versions of Perfect 10's images. Nor did the district court preliminarily enjoin Amazon.com from giving users access to information provided by Google. Perfect 10 and Google both appeal the district court's order. We have jurisdiction pursuant to 28 U.S.C. § 1292(a)(1).^[1]

[1155] The district court handled this complex case in a particularly thoughtful and skillful manner. Nonetheless, the district court erred on certain issues, as we will further explain below. We affirm in part, reverse in part, and remand.

I

Background

Google's computers, along with millions of others, are connected to networks known collectively as the "Internet." "The Internet is a world-wide network of networks ... all sharing a common communications technology." Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 923 F.Supp. 1231, 1238 n. 1 (N.D.Cal.1995). Computer owners can provide information stored on their computers to other users connected to the Internet through a medium called a webpage. A webpage consists of text interspersed with instructions written in Hypertext Markup Language ("HTML") that is stored in a computer. No images are stored on a webpage; rather, the HTML instructions on the webpage provide an address for where the images are stored, whether in the webpage publisher's computer or some other computer. In general, webpages are publicly available and can be accessed by computers connected to the Internet through the use of a web browser.

Google operates a search engine, a software program that automatically accesses thousands of websites (collections of webpages) and indexes them within a database stored on Google's computers. When a Google user accesses the Google website and types in a search query, Google's software searches its database for websites responsive to that search query. Google then sends relevant information from its index of websites to the user's computer. Google's search engines can provide results in the form of text, images, or videos.

The Google search engine that provides responses in the form of images is called "Google Image Search." In response to a search query, Google Image Search identifies text in its database responsive to the query and then communicates to users the images associated with the relevant text. Google's software cannot recognize and index the images themselves. Google Image Search provides search results as a webpage of small images called "thumbnails," which are stored in Google's servers. The thumbnail images are reduced, lower-resolution versions of full-sized images stored on third-party computers.

When a user clicks on a thumbnail image, the user's browser program interprets HTML instructions on Google's webpage. These HTML instructions direct the user's browser to cause a rectangular area (a "window") to appear on the user's computer screen. The window has two separate areas of information. The browser fills the top section of the screen with information from the Google webpage, including the thumbnail image and text. The HTML instructions also give the user's browser the address of the website publisher's computer that stores the full-size version of the thumbnail.^[2] By following [1156] the HTML instructions to access the third-party webpage, the user's browser connects to the website publisher's computer, downloads the full-size image, and makes the image appear at the bottom of the window on the user's screen. Google does not store the images that fill this lower part of the window and does not communicate the images to the user; Google simply provides HTML instructions directing a user's browser to access a third-party website. However, the top part of the window (containing the information from the Google webpage) appears to frame and comment on the bottom part of the window. Thus, the user's window appears to be filled with a single integrated presentation of the full-size image, but it is actually an image from a third-party website framed by information from Google's website. The process by which the webpage directs a user's browser to incorporate content from different computers into a single window is referred to as "in-line linking." Kelly v. Arriba Soft Corp., 336 F.3d 811, 816 (9th Cir.2003). The term "framing" refers to the process by which information from one computer appears to frame and annotate the in-line linked content from another computer. Perfect 10, 416 F.Supp.2d at 833-34.

Google also stores webpage content in its cache.^[3] For each cached webpage, Google's cache contains the text of the webpage as it appeared at the time Google indexed the page, but does not store images from the webpage. Id. at 833. Google may provide a link to a cached webpage in response to a user's search query. However, Google's cache version of the webpage is not automatically updated when the webpage is revised by its owner. So if the webpage owner updates its webpage to remove the HTML instructions for finding an infringing image, a browser communicating directly with the webpage would not be able to access that image. However, Google's cache copy of the webpage would still have the old HTML instructions for the infringing image. Unless the owner of the computer changed the HTML address of the infringing image, or otherwise rendered the image unavailable, a browser accessing Google's cache copy of the website could still access the image where it is stored on the website publisher's computer. In other words, Google's cache copy could provide a user's browser with valid directions to an infringing image even though the updated webpage no longer includes that infringing image.

In addition to its search engine operations, Google generates revenue through a business program called "AdSense." Under this program, the owner of a website can register with Google to become an AdSense "partner." The website owner then places HTML instructions on its webpages that signal Google's server to place advertising on the webpages that is relevant to the webpages' content. Google's computer program selects the advertising automatically by means of an algorithm. AdSense participants agree to share the revenues that flow from such advertising with Google.

[1157] Google also generated revenues through an agreement with Amazon.com that allowed Amazon.com to in-line link to Google's search results. Amazon.com gave its users the impression that Amazon.com was providing search results, but Google communicated the search results directly to Amazon.com's users. Amazon.com routed users' search queries to Google and automatically transmitted Google's responses (i.e., HTML instructions for linking to Google's search results) back to its users.

Perfect 10 markets and sells copyrighted images of nude models. Among other enterprises, it operates a subscription website on the Internet. Subscribers pay a monthly fee to view Perfect 10 images in a "members' area" of the site. Subscribers must use a password to log into the members' area. Google does not include these password-protected images from the members' area in Google's index or database. Perfect 10 has also licensed Fonestarz Media Limited to sell and distribute Perfect 10's reduced-size copyrighted images for download and use on cell phones.

Some website publishers republish Perfect 10's images on the Internet without authorization. Once this occurs, Google's search engine may automatically index the webpages containing these images and provide thumbnail versions of images in response to user inquiries. When a user clicks on the thumbnail image returned by Google's search engine, the user's browser accesses the third-party webpage and in-line links to the full-sized infringing image stored on the website publisher's computer. This image appears, in its original context, on the lower portion of the window on the user's computer screen framed by information from Google's webpage.

Procedural History. In May 2001, Perfect 10 began notifying Google that its thumbnail images and in-line linking to the full-size images infringed Perfect 10's copyright. Perfect 10 continued to send these notices through 2005.

On November 19, 2004, Perfect 10 filed an action against Google that included copyright infringement claims. This was followed by a similar action against Amazon.com on June 29, 2005. On July 1, 2005 and August 24, 2005, Perfect 10 sought a preliminary injunction to prevent Amazon.com and Google, respectively, from "copying, reproducing, distributing, publicly displaying, adapting or otherwise infringing, or contributing to the infringement" of Perfect 10's photographs; linking to websites that provide full-size infringing versions of Perfect 10's photographs; and infringing Perfect 10's username/password combinations.

The district court consolidated the two actions and heard both preliminary injunction motions on November 7, 2005. The district court issued orders granting in part and denying in part the preliminary injunction against Google and denying the preliminary injunction against Amazon.com. Perfect 10 and Google cross-appealed the partial grant and partial denial of the preliminary injunction motion, and Perfect 10 appealed the denial of the preliminary injunction against Amazon.com. On June 15, 2006, the district court temporarily stayed the preliminary injunction.

II

Standard of Review

We review the district court's grant or denial of a preliminary injunction for an abuse of discretion. A & M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013 (9th Cir.2001). The district court must support a preliminary injunction with findings of fact, which we review for clear error. Earth Island Inst. v. U.S. Forest Serv., 442 F.3d 1147, 1156 (9th Cir.2006). We review the district court's conclusions of law de novo. Napster, 239 F.3d at 1013.

[1158] Section 502(a) of the Copyright Act authorizes a court to grant injunctive relief "on such terms as it may deem reasonable to prevent or restrain infringement of a copyright." 17 U.S.C. § 502(a). "Preliminary injunctive relief is available to a party who demonstrates either: (1) a combination of probable success on the merits and the possibility of irreparable harm; or (2) that serious questions are raised and the balance of hardships tips in its favor. These two formulations represent two points on a sliding scale in which the required degree of irreparable harm increases as the probability of success decreases." Napster, 239 F.3d at 1013 (internal quotation and citation omitted).

Because Perfect 10 has the burden of showing a likelihood of success on the merits, the district court held that Perfect 10 also had the burden of demonstrating a likelihood of overcoming Google's fair use defense under 17 U.S.C. § 107. Perfect 10, 416 F.Supp.2d at 836-37. This ruling was erroneous. At trial, the defendant in an infringement action bears the burden of proving fair use. See Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 590, 114 S.Ct. 1164, 127 L.Ed.2d 500 (1994). Because "the burdens at the preliminary injunction stage track the burdens at trial," once the moving party has carried its burden of showing a likelihood of success on the merits, the burden shifts to the non-moving party to show a likelihood that its affirmative defense will succeed. Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal, 546 U.S. 418, 429, 126 S.Ct. 1211, 163 L.Ed.2d 1017 (2006); see also Abbott Labs. v. Andrx Pharms., Inc., 473 F.3d 1196, 1201 (Fed. Cir.2007) (to defeat a motion for preliminary injunctive relief in a patent infringement case, the non-moving party must establish a likelihood of success in proving its defenses of invalidity or unenforceability); PHG Techs., LLC v. St. John Cos., 469 F.3d 1361, 1365 (Fed.Cir.2006). Accordingly, once Perfect 10 has shown a likelihood of success on the merits, the burden shifts to Google to show a likelihood that its affirmative defenses will succeed.

In addition to its fair use defense, Google also raises an affirmative defense under title II of the Digital Millennium Copyright Act ("DMCA"), 17 U.S.C. § 512. Congress enacted title II of the DMCA "to provide greater certainty to service providers concerning their legal exposure for infringements that may occur in the course of their activities." Ellison v. Robertson, 357 F.3d 1072, 1076 (9th Cir. 2004) (internal quotation omitted). Sections 512(a) through (d) limit liability for (respectively): "(1) transitory digital network communications; (2) system caching; (3) information residing on systems or networks at the direction of users; and (4) information location tools." Id. at 1077. A service provider that qualifies for such protection is not liable for monetary relief and may be subject only to the narrow injunctive relief set forth in section 512(j). 17 U.S.C. § 512(a). If Perfect 10 demonstrates a likelihood of success on the merits, Google must show a likelihood of succeeding in its claim that it qualifies for protection under title II of the DMCA.^[4][1159]

III

Direct Infringement

Perfect 10 claims that Google's search engine program directly infringes two exclusive rights granted to copyright holders: its display rights and its distribution rights.^[5] "Plaintiffs must satisfy two requirements to present a prima facie case of direct infringement: (1) they must show ownership of the allegedly infringed material and (2) they must demonstrate that the alleged infringers violate at least one exclusive right granted to copyright holders under 17 U.S.C. § 106." Napster, 239 F.3d at 1013; see 17 U.S.C. § 501(a). Even if a plaintiff satisfies these two requirements and makes a prima facie case of direct infringement, the defendant may avoid liability if it can establish that its use of the images is a "fair use" as set forth in 17 U.S.C. § 107. See Kelly, 336 F.3d at 817.

Perfect 10's ownership of at least some of the images at issue is not disputed. See Perfect 10, 416 F.Supp.2d at 836.

The district court held that Perfect 10 was likely to prevail in its claim that Google violated Perfect 10's display right with respect to the infringing thumbnails. Id. at 844. However, the district court concluded that Perfect 10 was not likely to prevail on its claim that Google violated either Perfect 10's display or distribution right with respect to its full-size infringing images. Id. at 844-45. We review these rulings for an abuse of discretion. Napster, 239 F.3d at 1013.

A. Display Right

In considering whether Perfect 10 made a prima facie case of violation of its display right, the district court reasoned that a computer owner that stores an image as electronic information and serves that electronic information directly to the user ("i.e., physically sending ones and zeroes over the [I]nternet to the user's browser," Perfect 10, 416 F.Supp.2d at 839) is displaying the electronic information in violation of a copyright holder's exclusive display right. Id. at 843-45; see 17 U.S.C. § 106(5). Conversely, the owner of a computer that does not store and serve the electronic information to a user is not displaying that information, even if such owner in-line links to or frames the electronic information. Perfect 10, 416 F.Supp.2d at 843-45. The district court referred to this test as the "server test." Id. at 838-39.

Applying the server test, the district court concluded that Perfect 10 was likely to succeed in its claim that Google's thumbnails constituted direct infringement but was unlikely to succeed in its claim that Google's in-line linking to full-size infringing images constituted a direct infringement. [1160] Id. at 843-45. As explained below, because this analysis comports with the language of the Copyright Act, we agree with the district court's resolution of both these issues.

We have not previously addressed the question when a computer displays a copyrighted work for purposes of section 106(5). Section 106(5) states that a copyright owner has the exclusive right "to display the copyrighted work publicly." The Copyright Act explains that "display" means "to show a copy of it, either directly or by means of a film, slide, television image, or any other device or process...." 17 U.S.C. § 101. Section 101 defines "copies" as "material objects, other than phonorecords, in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device." Id. Finally, the Copyright Act provides that "[a] work is `fixed' in a tangible medium of expression when its embodiment in a copy or phonorecord, by or under the authority of the author, is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration." Id.

We must now apply these definitions to the facts of this case. A photographic image is a work that is "`fixed' in a tangible medium of expression," for purposes of the Copyright Act, when embodied (i.e., stored) in a computer's server (or hard disk, or other storage device). The image stored in the computer is the "copy" of the work for purposes of copyright law. See MAI Sys. Corp. v. Peak Computer, Inc., 991 F.2d 511, 517-18 (9th Cir.1993) (a computer makes a "copy" of a software program when it transfers the program from a third party's computer (or other storage device) into its own memory, because the copy of the program recorded in the computer is "fixed" in a manner that is "sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration" (quoting 17 U.S.C. § 101)). The computer owner shows a copy "by means of a ... device or process" when the owner uses the computer to fill the computer screen with the photographic image stored on that computer, or by communicating the stored image electronically to another person's computer. 17 U.S.C. § 101. In sum, based on the plain language of the statute, a person displays a photographic image by using a computer to fill a computer screen with a copy of the photographic image fixed in the computer's memory. There is no dispute that Google's computers store thumbnail versions of Perfect 10's copyrighted images and communicate copies of those thumbnails to Google's users.^[6] Therefore, Perfect 10 has made a prima facie case that Google's communication of its stored thumbnail images directly infringes Perfect 10's display right.

Google does not, however, display a copy of full-size infringing photographic images for purposes of the Copyright Act when Google frames in-line linked images that appear on a user's computer screen. Because Google's computers do not store the photographic images, Google does not have a copy of the images for purposes of the Copyright Act. In other words, Google does not have any "material objects ... in [1161] which a work is fixed ... and from which the work can be perceived, reproduced, or otherwise communicated" and thus cannot communicate a copy. 17 U.S.C. § 101.

Instead of communicating a copy of the image, Google provides HTML instructions that direct a user's browser to a website publisher's computer that stores the full-size photographic image. Providing these HTML instructions is not equivalent to showing a copy. First, the HTML instructions are lines of text, not a photographic image. Second, HTML instructions do not themselves cause infringing images to appear on the user's computer screen. The HTML merely gives the address of the image to the user's browser. The browser then interacts with the computer that stores the infringing image. It is this interaction that causes an infringing image to appear on the user's computer screen. Google may facilitate the user's access to infringing images. However, such assistance raises only contributory liability issues, see Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 929-30, 125 S.Ct. 2764, 162 L.Ed.2d 781 (2005), Napster, 239 F.3d at 1019, and does not constitute direct infringement of the copyright owner's display rights.

Perfect 10 argues that Google displays a copy of the full-size images by framing the full-size images, which gives the impression that Google is showing the image within a single Google webpage. While in-line linking and framing may cause some computer users to believe they are viewing a single Google webpage, the Copyright Act, unlike the Trademark Act, does not protect a copyright holder against acts that cause consumer confusion. Cf. 15 U.S.C. § 1114(1) (providing that a person who uses a trademark in a manner likely to cause confusion shall be liable in a civil action to the trademark registrant).^[7]

Nor does our ruling that a computer owner does not display a copy of an image when it communicates only the HTML address of the copy erroneously collapse the display right in section 106(5) into the reproduction right set forth in section 106(1). Nothing in the Copyright Act prevents the various rights protected in section 106 from overlapping. Indeed, under some circumstances, more than one right must be infringed in order for an infringement claim to arise. For example, a "Game Genie" device that allowed a player to alter features of a Nintendo computer game did not infringe Nintendo's right to prepare derivative works because the Game Genie did not incorporate any portion of the game itself. See Lewis Galoob Toys, Inc. v. Nintendo of Am., Inc., 964 F.2d 965, 967 (9th Cir.1992). We held that a copyright holder's right to create derivative works is not infringed unless the alleged derivative work "incorporate[s] a protected work in some concrete or permanent `form.'" Id. In other words, in some contexts, the claimant must be able to claim infringement of its reproduction right in order to claim infringement of its right to prepare derivative works.

[1162] Because Google's cache merely stores the text of webpages, our analysis of whether Google's search engine program potentially infringes Perfect 10's display and distribution rights is equally applicable to Google's cache. Perfect 10 is not likely to succeed in showing that a cached webpage that in-line links to full-size infringing images violates such rights. For purposes of this analysis, it is irrelevant whether cache copies direct a user's browser to third-party images that are no longer available on the third party's website, because it is the website publisher's computer, rather than Google's computer, that stores and displays the infringing image.

B. Distribution Right

The district court also concluded that Perfect 10 would not likely prevail on its claim that Google directly infringed Perfect 10's right to distribute its full-size images. Perfect 10, 416 F.Supp.2d at 844-45. The district court reasoned that distribution requires an "actual dissemination" of a copy. Id. at 844. Because Google did not communicate the full-size images to the user's computer, Google did not distribute these images. Id.

Again, the district court's conclusion on this point is consistent with the language of the Copyright Act. Section 106(3) provides that the copyright owner has the exclusive right "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." 17 U.S.C. § 106(3). As noted, "copies" means "material objects ... in which a work is fixed." 17 U.S.C. § 101. The Supreme Court has indicated that in the electronic context, copies may be distributed electronically. See N.Y. Times Co. v. Tasini, 533 U.S. 483, 498, 121 S.Ct. 2381, 150 L.Ed.2d 500 (2001) (a computer database program distributed copies of newspaper articles stored in its computerized database by selling copies of those articles through its database service). Google's search engine communicates HTML instructions that tell a user's browser where to find full-size images on a website publisher's computer, but Google does not itself distribute copies of the infringing photographs. It is the website publisher's computer that distributes copies of the images by transmitting the photographic image electronically to the user's computer. As in Tasini, the user can then obtain copies by downloading the photo or printing it.

Perfect 10 incorrectly relies on Hotaling v. Church of Jesus Christ of Latter-Day Saints and Napster for the proposition that merely making images "available" violates the copyright owner's distribution right. Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir.1997); Napster, 239 F.3d 1004. Hotaling held that the owner of a collection of works who makes them available to the public may be deemed to have distributed copies of the works. Hotaling, 118 F.3d at 203. Similarly, the distribution rights of the plaintiff copyright owners were infringed by Napster users (private individuals with collections of music files stored on their home computers) when they used the Napster software to make their collections available to all other Napster users. Napster, 239 F.3d at 1011-14.

This "deemed distribution" rule does not apply to Google. Unlike the participants in the Napster system or the library in Hotaling, Google does not own a collection of Perfect 10's full-size images and does not communicate these images to the computers of people using Google's search engine. Though Google indexes these images, it does not have a collection of stored full-size images it makes available to the public. Google therefore cannot be deemed to distribute copies of these images under the reasoning of Napster or [1163] Hotaling. Accordingly, the district court correctly concluded that Perfect 10 does not have a likelihood of success in proving that Google violates Perfect 10's distribution rights with respect to full-size images.

C. Fair Use Defense

Because Perfect 10 has succeeded in showing it would prevail in its prima facie case that Google's thumbnail images infringe Perfect 10's display rights, the burden shifts to Google to show that it will likely succeed in establishing an affirmative defense. Google contends that its use of thumbnails is a fair use of the images and therefore does not constitute an infringement of Perfect 10's copyright. See 17 U.S.C. § 107.

The fair use defense permits the use of copyrighted works without the copyright owner's consent under certain situations. The defense encourages and allows the development of new ideas that build on earlier ones, thus providing a necessary counterbalance to the copyright law's goal of protecting creators' work product. "From the infancy of copyright protection, some opportunity for fair use of copyrighted materials has been thought necessary to fulfill copyright's very purpose...." Campbell, 510 U.S. at 575, 114 S.Ct. 1164. "The fair use doctrine thus `permits [and requires] courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster.'" Id. at 577, 114 S.Ct. 1164 (quoting Stewart v. Abend, 495 U.S. 207, 236, 110 S.Ct. 1750, 109 L.Ed.2d 184 (1990)) (alteration in original).

Congress codified the common law of fair use in 17 U.S.C. § 107, which provides:

Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.
The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

17 U.S.C. § 107.

We must be flexible in applying a fair use analysis; it "is not to be simplified with bright-line rules, for the statute, like the doctrine it recognizes, calls for case-by-case analysis.... Nor may the four statutory factors be treated in isolation, one from another. All are to be explored, and the results weighed together, in light of the purposes of copyright." Campbell, 510 U.S. at 577-78, 114 S.Ct. 1164; see also Kelly, 336 F.3d at 817-18. The purpose of copyright law is "[t]o promote the Progress of Science and useful Arts," U.S. CONST. art. I, § 8, cl. 8, and to serve "`the welfare of the public.'" Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 429 n. 10, 104 S.Ct. 774, 78 L.Ed.2d 574 (quoting H.R.Rep. No. 2222, 60th Cong., 2d Sess. 7 (1909)).

[1164] In applying the fair use analysis in this case, we are guided by Kelly v. Arriba Soft Corp., which considered substantially the same use of copyrighted photographic images as is at issue here. See 336 F.3d 811. In Kelly, a photographer brought a direct infringement claim against Arriba, the operator of an Internet search engine. The search engine provided thumbnail versions of the photographer's images in response to search queries. Id. at 815-16. We held that Arriba's use of thumbnail images was a fair use primarily based on the transformative nature of a search engine and its benefit to the public. Id. at 818-22. We also concluded that Arriba's use of the thumbnail images did not harm the photographer's market for his image. Id. at 821-22.

In this case, the district court determined that Google's use of thumbnails was not a fair use and distinguished Kelly. Perfect 10, 416 F.Supp.2d at 845-51. We consider these distinctions in the context of the four-factor fair use analysis.

Purpose and character of the use. The first factor, 17 U.S.C. § 107(1), requires a court to consider "the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes." The central purpose of this inquiry is to determine whether and to what extent the new work is "transformative." Campbell, 510 U.S. at 579, 114 S.Ct. 1164. A work is "transformative" when the new work does not "merely supersede the objects of the original creation" but rather "adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message." Id. (internal quotation and alteration omitted). Conversely, if the new work "supersede[s] the use of the original," the use is likely not a fair use. Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 539, 550-51, 105 S.Ct. 2218, 85 L.Ed.2d 588 (1985) (internal quotation omitted) (publishing the "heart" of an unpublished work and thus supplanting the copyright holder's first publication right was not a fair use); see also Wall Data Inc. v. L.A. County Sheriff's Dep't, 447 F.3d 769, 778-82 (9th Cir.2006) (using a copy to save the cost of buying additional copies of a computer program was not a fair use).^[8]

As noted in Campbell, a "transformative work" is one that alters the original work [1165] "with new expression, meaning, or message." Campbell, 510 U.S. at 579, 114 S.Ct. 1164. "A use is considered transformative only where a defendant changes a plaintiff's copyrighted work or uses the plaintiff's copyrighted work in a different context such that the plaintiff's work is transformed into a new creation." Wall Data, 447 F.3d at 778.

Google's use of thumbnails is highly transformative. In Kelly, we concluded that Arriba's use of thumbnails was transformative because "Arriba's use of the images serve[d] a different function than Kelly's use—improving access to information on the [I]nternet versus artistic expression." Kelly, 336 F.3d at 819. Although an image may have been created originally to serve an entertainment, aesthetic, or informative function, a search engine transforms the image into a pointer directing a user to a source of information. Just as a "parody has an obvious claim to transformative value" because "it can provide social benefit, by shedding light on an earlier work, and, in the process, creating a new one," Campbell, 510 U.S. at 579, 114 S.Ct. 1164, a search engine provides social benefit by incorporating an original work into a new work, namely, an electronic reference tool. Indeed, a search engine may be more transformative than a parody because a search engine provides an entirely new use for the original work, while a parody typically has the same entertainment purpose as the original work. See, e.g., id. at 594-96, 114 S.Ct. 1164 (holding that 2 Live Crew's parody of "Oh, Pretty Woman" using the words "hairy woman" or "bald headed woman" was a transformative work, and thus constituted a fair use); Mattel, Inc. v. Walking Mountain Prods., 353 F.3d 792, 796-98, 800-06 (9th Cir.2003) (concluding that photos parodying Barbie by depicting "nude Barbie dolls juxtaposed with vintage kitchen appliances" was a fair use). In other words, a search engine puts images "in a different context" so that they are "transformed into a new creation." Wall Data, 447 F.3d at 778.

The fact that Google incorporates the entire Perfect 10 image into the search engine results does not diminish the transformative nature of Google's use. As the district court correctly noted, Perfect 10, 416 F.Supp.2d at 848-49, we determined in Kelly that even making an exact copy of a work may be transformative so long as the copy serves a different function than the original work, Kelly, 336 F.3d at 818-19. For example, the First Circuit has held that the republication of photos taken for a modeling portfolio in a newspaper was transformative because the photos served to inform, as well as entertain. See Nunez v. Caribbean Int'l News Corp., 235 F.3d 18, 22-23 (1st Cir.2000). In contrast, duplicating a church's religious book for use by a different church was not transformative. See Worldwide Church of God v. Phila. Church of God, Inc., 227 F.3d 1110, 1117 (9th Cir.2000). Nor was a broadcaster's simple retransmission of a radio broadcast over telephone lines transformative, where the original radio shows were given no "new expression, meaning, or message." Infinity Broad. Corp. v. Kirkwood, 150 F.3d 104, 108 (2d Cir.1998). Here, Google uses Perfect 10's images in a new context to serve a different purpose.

The district court nevertheless determined that Google's use of thumbnail images was less transformative than Arriba's use of thumbnails in Kelly because Google's use of thumbnails superseded Perfect 10's right to sell its reduced-size images for use on cell phones. See Perfect 10, 416 F.Supp.2d at 849. The district court stated that "mobile users can download and save the thumbnails displayed by Google Image Search onto their phones," and concluded "to the extent that users may choose to download free images to their [1166] phone rather than purchase [Perfect 10's] reduced-size images, Google's use supersedes [Perfect 10's]." Id.

Additionally, the district court determined that the commercial nature of Google's use weighed against its transformative nature. Id. Although Kelly held that the commercial use of the photographer's images by Arriba's search engine was less exploitative than typical commercial use, and thus weighed only slightly against a finding of fair use, Kelly, 336 F.3d at 818-20, the district court here distinguished Kelly on the ground that some website owners in the AdSense program had infringing Perfect 10 images on their websites, Perfect 10, 416 F.Supp.2d at 846-47. The district court held that because Google's thumbnails "lead users to sites that directly benefit Google's bottom line," the AdSense program increased the commercial nature of Google's use of Perfect 10's images. Id. at 847.

In conducting our case-specific analysis of fair use in light of the purposes of copyright, Campbell, 510 U.S. at 581, 114 S.Ct. 1164, we must weigh Google's superseding and commercial uses of thumbnail images against Google's significant transformative use, as well as the extent to which Google's search engine promotes the purposes of copyright and serves the interests of the public. Although the district court acknowledged the "truism that search engines such as Google Image Search provide great value to the public," Perfect 10, 416 F.Supp.2d at 848-49, the district court did not expressly consider whether this value outweighed the significance of Google's superseding use or the commercial nature of Google's use. Id. at 849. The Supreme Court, however, has directed us to be mindful of the extent to which a use promotes the purposes of copyright and serves the interests of the public. See Campbell, 510 U.S. at 579, 114 S.Ct. 1164; Harper & Row, 471 U.S. at 556-57, 105 S.Ct. 2218; Sony, 464 U.S. at 431-32, 104 S.Ct. 774.

We note that the superseding use in this case is not significant at present: the district court did not find that any downloads for mobile phone use had taken place. See Perfect 10, 416 F.Supp.2d at 849. Moreover, while Google's use of thumbnails to direct users to AdSense partners containing infringing content adds a commercial dimension that did not exist in Kelly, the district court did not determine that this commercial element was significant. See id. at 848-49. The district court stated that Google's AdSense programs as a whole contributed "$630 million, or 46% of total revenues" to Google's bottom line, but noted that this figure did not "break down the much smaller amount attributable to websites that contain infringing content." Id. at 847 & n. 12 (internal quotation omitted).

We conclude that the significantly transformative nature of Google's search engine, particularly in light of its public benefit, outweighs Google's superseding and commercial uses of the thumbnails in this case. In reaching this conclusion, we note the importance of analyzing fair use flexibly in light of new circumstances. Sony, 464 U.S. at 431-32, 104 S.Ct. 774; id. at 448 n. 31, 104 S.Ct. 774 ("`[Section 107] endorses the purpose and general scope of the judicial doctrine of fair use, but there is no disposition to freeze the doctrine in the statute, especially during a period of rapid technological change.'" (quoting H.R.Rep. No. 94-1476, p. 65-66 (1976), U.S.Code Cong. & Admin. News 1976, p. 5680)). We are also mindful of the Supreme Court's direction that "the more transformative the new work, the less will be the significance of other factors, like commercialism, that may weigh against a finding of fair use." Campbell, 510 U.S. at 579, 114 S.Ct. 1164.

[1167] Accordingly, we disagree with the district court's conclusion that because Google's use of the thumbnails could supersede Perfect 10's cell phone download use and because the use was more commercial than Arriba's, this fair use factor weighed "slightly" in favor of Perfect 10. Perfect 10, 416 F.Supp.2d at 849. Instead, we conclude that the transformative nature of Google's use is more significant than any incidental superseding use or the minor commercial aspects of Google's search engine and website. Therefore, this factor weighs heavily in favor of Google.

The nature of the copyrighted work. With respect to the second factor, "the nature of the copyrighted work," 17 U.S.C. § 107(2), our decision in Kelly is directly on point. There we held that the photographer's images were "creative in nature" and thus "closer to the core of intended copyright protection than are more fact-based works." Kelly, 336 F.3d at 820 (internal quotation omitted). However, because the photos appeared on the Internet before Arriba used thumbnail versions in its search engine results, this factor weighed only slightly in favor of the photographer. Id.

Here, the district court found that Perfect 10's images were creative but also previously published. Perfect 10, 416 F.Supp.2d at 850. The right of first publication is "the author's right to control the first public appearance of his expression." Harper & Row, 471 U.S. at 564, 105 S.Ct. 2218. Because this right encompasses "the choices of when, where, and in what form first to publish a work," id., an author exercises and exhausts this one-time right by publishing the work in any medium. See, e.g., Batjac Prods. Inc. v. Good-Times Home Video Corp., 160 F.3d 1223, 1235 (9th Cir.1998) (noting, in the context of the common law right of first publication, that such a right "does not entail multiple first publication rights in every available medium"). Once Perfect 10 has exploited this commercially valuable right of first publication by putting its images on the Internet for paid subscribers, Perfect 10 is no longer entitled to the enhanced protection available for an unpublished work. Accordingly the district court did not err in holding that this factor weighed only slightly in favor of Perfect 10.^[9] See Perfect 10, 416 F.Supp.2d at 849-50.

The amount and substantiality of the portion used. "The third factor asks whether the amount and substantiality of the portion used in relation to the copyrighted work as a whole ... are reasonable in relation to the purpose of the copying." Campbell, 510 U.S. at 586, 114 S.Ct. 1164 (internal quotation omitted); see also 17 U.S.C. § 107(3). In Kelly, we held Arriba's use of the entire photographic image was reasonable in light of the purpose of a search engine. Kelly, 336 F.3d at 821. Specifically, we noted, "[i]t was necessary for Arriba to copy the entire image to allow users to recognize the image and decide whether to pursue more information about the image or the originating [website]. If Arriba only copied part of the image, it would be more difficult to identify it, thereby reducing the usefulness of the visual search engine." Id. Accordingly, we concluded that this factor did not weigh in favor of either [1168] party. Id. Because the same analysis applies to Google's use of Perfect 10's image, the district court did not err in finding that this factor favored neither party.

Effect of use on the market. The fourth factor is "the effect of the use upon the potential market for or value of the copyrighted work." 17 U.S.C. § 107(4). In Kelly, we concluded that Arriba's use of the thumbnail images did not harm the market for the photographer's full-size images. See Kelly, 336 F.3d at 821-22. We reasoned that because thumbnails were not a substitute for the full-sized images, they did not harm the photographer's ability to sell or license his full-sized images. Id. The district court here followed Kelly's reasoning, holding that Google's use of thumbnails did not hurt Perfect 10's market for full-size images. See Perfect 10, 416 F.Supp.2d at 850-51. We agree.

Perfect 10 argues that the district court erred because the likelihood of market harm may be presumed if the intended use of an image is for commercial gain. However, this presumption does not arise when a work is transformative because "market substitution is at least less certain, and market harm may not be so readily inferred." Campbell, 510 U.S. at 591, 114 S.Ct. 1164. As previously discussed, Google's use of thumbnails for search engine purposes is highly transformative, and so market harm cannot be presumed.

Perfect 10 also has a market for reduced-size images, an issue not considered in Kelly. The district court held that "Google's use of thumbnails likely does harm the potential market for the downloading of [Perfect 10's] reduced-size images onto cell phones." Perfect 10, 416 F.Supp.2d at 851 (emphasis omitted). The district court reasoned that persons who can obtain Perfect 10 images free of charge from Google are less likely to pay for a download, and the availability of Google's thumbnail images would harm Perfect 10's market for cell phone downloads. Id. As we discussed above, the district court did not make a finding that Google users have downloaded thumbnail images for cell phone use. This potential harm to Perfect 10's market remains hypothetical. We conclude that this factor favors neither party.

Having undertaken a case-specific analysis of all four factors, we now weigh these factors together "in light of the purposes of copyright." Campbell, 510 U.S. at 578, 114 S.Ct. 1164; see also Kelly, 336 F.3d at 818 ("We must balance[the section 107] factors in light of the objectives of copyright law, rather than view them as definitive or determinative tests."). In this case, Google has put Perfect 10's thumbnail images (along with millions of other thumbnail images) to a use fundamentally different than the use intended by Perfect 10. In doing so, Google has provided a significant benefit to the public. Weighing this significant transformative use against the unproven use of Google's thumbnails for cell phone downloads, and considering the other fair use factors, all in light of the purpose of copyright, we conclude that Google's use of Perfect 10's thumbnails is a fair use. Because the district court here "found facts sufficient to evaluate each of the statutory factors ... [we] need not remand for further factfinding." Harper & Row, 471 U.S. at 560, 105 S.Ct. 2218 (internal quotation omitted). We conclude that Google is likely to succeed in proving its fair use defense and, accordingly, we vacate the preliminary injunction regarding Google's use of thumbnail images.

IV

Secondary Liability for Copyright Infringement

We now turn to the district court's ruling that Google is unlikely to be secondarily [1169] liable for its in-line linking to infringing full-size images under the doctrines of contributory and vicarious infringement.^[10] The district court ruled that Perfect 10 did not have a likelihood of proving success on the merits of either its contributory infringement or vicarious infringement claims with respect to the full-size images. See Perfect 10, 416 F.Supp.2d at 856, 858. In reviewing the district court's conclusions, we are guided by the Supreme Court's recent interpretation of secondary liability, namely: "[o]ne infringes contributorily by intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it." Grokster, 545 U.S. at 930, 125 S.Ct. 2764 (internal citations omitted).

Direct Infringement by Third Parties. As a threshold matter, before we examine Perfect 10's claims that Google is secondarily liable, Perfect 10 must establish that there has been direct infringement by third parties. See Napster, 239 F.3d at 1013 n. 2 ("Secondary liability for copyright infringement does not exist in the absence of direct infringement by a third party.").

Perfect 10 alleges that third parties directly infringed its images in three ways. First, Perfect 10 claims that third-party websites directly infringed its copyright by reproducing, displaying, and distributing unauthorized copies of Perfect 10's images. Google does not dispute this claim on appeal.

Second, Perfect 10 claims that individual users of Google's search engine directly infringed Perfect 10's copyrights by storing full-size infringing images on their computers. We agree with the district court's conclusion that Perfect 10 failed to provide sufficient evidence to support this claim. See Perfect 10, 416 F.Supp.2d at 852. There is no evidence in the record directly establishing that users of Google's search engine have stored infringing images on their computers, and the district court did not err in declining to infer the existence of such evidence.

Finally, Perfect 10 contends that users who link to infringing websites automatically make "cache" copies of full-size images and thereby directly infringe Perfect 10's reproduction right. The district court rejected this argument, holding that any such reproduction was likely a "fair use." Id. at 852 n. 17. The district court reasoned that "[l]ocal caching by the browsers of individual users is noncommercial, transformative, and no more than necessary to achieve the objectives of decreasing network latency and minimizing unnecessary bandwidth usage (essential to the [I]nternet). It has a minimal impact on the potential market for the original work...." Id. We agree; even assuming such automatic copying could constitute direct infringement, it is a fair use in this context. The copying function performed automatically by a user's computer to assist in accessing the Internet is a transformative use. Moreover, as noted by the district court, a cache copies no more than is necessary to assist the user in Internet use. It is designed to enhance an individual's computer use, not to supersede the copyright holders' exploitation of their works. Such automatic background copying has no more than a minimal effect on Perfect 10's rights, but a considerable public benefit. Because the four fair use factors weigh in favor of concluding that [1170] cache copying constitutes a fair use, Google has established a likelihood of success on this issue. Accordingly, Perfect 10 has not carried its burden of showing that users' cache copies of Perfect 10's full-size images constitute direct infringement.

Therefore, we must assess Perfect 10's arguments that Google is secondarily liable in light of the direct infringement that is undisputed by the parties: third-party websites' reproducing, displaying, and distributing unauthorized copies of Perfect 10's images on the Internet. Id. at 852.

A. Contributory Infringement

In order for Perfect 10 to show it will likely succeed in its contributory liability claim against Google, it must establish that Google's activities meet the definition of contributory liability recently enunciated in Grokster. Within the general rule that "[o]ne infringes contributorily by intentionally inducing or encouraging direct infringement," Grokster, 545 U.S. at 930, 125 S.Ct. 2764, the Court has defined two categories of contributory liability: "Liability under our jurisprudence may be predicated on actively encouraging (or inducing) infringement through specific acts (as the Court's opinion develops) or on distributing a product distributees use to infringe copyrights, if the product is not capable of `substantial' or `commercially significant' noninfringing uses." Id. at 942, 125 S.Ct. 2764 (Ginsburg, J., concurring) (quoting Sony, 464 U.S. at 442, 104 S.Ct. 774); see also id. at 936-37, 125 S.Ct. 2764.

Looking at the second category of liability identified by the Supreme Court (distributing products), Google relies on Sony, 464 U.S. at 442, 104 S.Ct. 774, to argue that it cannot be held liable for contributory infringement because liability does not arise from the mere sale of a product (even with knowledge that consumers would use the product to infringe) if the product is capable of substantial non-infringing use. Google argues that its search engine service is such a product. Assuming the principle enunciated in Sony is applicable to the operation of Google's search engine, then Google cannot be held liable for contributory infringement solely because the design of its search engine facilitates such infringement. Grokster, 545 U.S. at 931-32, 125 S.Ct. 2764 (discussing Sony, 464 U.S. 417, 104 S.Ct. 774, 78 L.Ed.2d 574). Nor can Google be held liable solely because it did not develop technology that would enable its search engine to automatically avoid infringing images. See id. at 939 n. 12, 125 S.Ct. 2764. However, Perfect 10 has not based its claim of infringement on the design of Google's search engine and the Sony rule does not immunize Google from other sources of contributory liability. See id. at 933-34, 125 S.Ct. 2764.

We must next consider whether Google could be held liable under the first category of contributory liability identified by the Supreme Court, that is, the liability that may be imposed for intentionally encouraging infringement through specific acts.^[11] Grokster tells us that contribution to infringement must be intentional for liability to arise. Grokster, 545 U.S. at 930, 125 S.Ct. 2764. However, Grokster also directs us to analyze contributory liability in light of "rules of fault-based liability derived from the common law," id. at 934-35, 125 S.Ct. 2764, and [1171] common law principles establish that intent may be imputed. "Tort law ordinarily imputes to an actor the intention to cause the natural and probable consequences of his conduct." DeVoto v. Pac. Fid. Life Ins. Co., 618 F.2d 1340, 1347 (9th Cir. 1980); RESTATEMENT (SECOND) OF TORTS § 8A cmt. b (1965) ("If the actor knows that the consequences are certain, or substantially certain, to result from his act, and still goes ahead, he is treated by the law as if he had in fact desired to produce the result."). When the Supreme Court imported patent law's "staple article of commerce doctrine" into the copyright context, it also adopted these principles of imputed intent. Grokster, 545 U.S. at 932, 125 S.Ct. 2764 ("The [staple article of commerce] doctrine was devised to identify instances in which it may be presumed from distribution of an article in commerce that the distributor intended the article to be used to infringe another's patent, and so may justly be held liable for that infringement."). Therefore, under Grokster, an actor may be contributorily liable for intentionally encouraging direct infringement if the actor knowingly takes steps that are substantially certain to result in such direct infringement.

Our tests for contributory liability are consistent with the rule set forth in Grokster. We have adopted the general rule set forth in Gershwin Publishing Corp. v. Columbia Artists Management, Inc., namely: "one who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may be held liable as a `contributory' infringer," 443 F.2d 1159, 1162 (2d Cir.1971). See Ellison, 357 F.3d at 1076; Napster, 239 F.3d at 1019; Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir.1996).

We have further refined this test in the context of cyberspace^[12] to determine when contributory liability can be imposed on a provider of Internet access or services. See Napster, 239 F.3d at 1019-20. In Napster, we considered claims that the operator of an electronic file sharing system was contributorily liable for assisting individual users to swap copyrighted music files stored on their home computers with other users of the system. Napster, 239 F.3d at 1011-13, 1019-22. We stated that "if a computer system operator learns of specific infringing material available on his system and fails to purge such material from the system, the operator knows of and contributes to direct infringement." Id. at 1021. Because Napster knew of the availability of infringing music files, assisted users in accessing such files, and failed to block access to such files, we concluded that Napster materially contributed to infringement. Id. at 1022.

The Napster test for contributory liability was modeled on the influential district court decision in Religious Technology Center v. Netcom On-Line Communication Services, Inc. (Netcom), 907 F.Supp. 1361, 1365-66 (N.D.Cal.1995). See Napster, 239 F.3d at 1021. In Netcom, a disgruntled former Scientology minister posted allegedly infringing copies of Scientological works on an electronic bulletin board service. Netcom, 907 F.Supp. at 1365-66. The messages were stored on the bulletin board operator's computer, then automatically copied onto Netcom's computer, and from there copied onto other computers comprising "a worldwide community" of electronic bulletin board systems. Id. at 1366-67 & n. 4 (internal quotation omitted). Netcom held that if plaintiffs [1172] could prove that Netcom knew or should have known that the minister infringed plaintiffs' copyrights, "Netcom [would] be liable for contributory infringement since its failure to simply cancel [the former minister's] infringing message and thereby stop an infringing copy from being distributed worldwide constitute[d] substantial participation in [the former minister's] public distribution of the message." Id. at 1374.

Although neither Napster nor Netcom expressly required a finding of intent, those cases are consistent with Grokster because both decisions ruled that a service provider's knowing failure to prevent infringing actions could be the basis for imposing contributory liability. Under such circumstances, intent may be imputed. In addition, Napster and Netcom are consistent with the longstanding requirement that an actor's contribution to infringement must be material to warrant the imposition of contributory liability. Gershwin, 443 F.2d at 1162. Both Napster and Netcom acknowledge that services or products that facilitate access to websites throughout the world can significantly magnify the effects of otherwise immaterial infringing activities. See Napster, 239 F.3d at 1022; Netcom, 907 F.Supp. at 1375. The Supreme Court has acknowledged that "[t]he argument for imposing indirect liability" is particularly "powerful" when individuals using the defendant's software could make a huge number of infringing downloads every day. Grokster, 545 U.S. at 929, 125 S.Ct. 2764. Moreover, copyright holders cannot protect their rights in a meaningful way unless they can hold providers of such services or products accountable for their actions pursuant to a test such as that enunciated in Napster. See id. at 929-30, 125 S.Ct. 2764 ("When a widely shared service or product is used to commit infringement, it may be impossible to enforce rights in the protected work effectively against all direct infringers, the only practical alternative being to go against the distributor of the copying device for secondary liability on a theory of contributory or vicarious infringement."). Accordingly, we hold that a computer system operator can be held contributorily liable if it "has actual knowledge that specific infringing material is available using its system," Napster, 239 F.3d at 1022, and can "take simple measures to prevent further damage" to copyrighted works, Netcom, 907 F.Supp. at 1375, yet continues to provide access to infringing works.

Here, the district court held that even assuming Google had actual knowledge of infringing material available on its system, Google did not materially contribute to infringing conduct because it did not undertake any substantial promotional or advertising efforts to encourage visits to infringing websites, nor provide a significant revenue stream to the infringing websites. Perfect 10, 416 F.Supp.2d at 854-56. This analysis is erroneous. There is no dispute that Google substantially assists websites to distribute their infringing copies to a worldwide market and assists a worldwide audience of users to access infringing materials. We cannot discount the effect of such a service on copyright owners, even though Google's assistance is available to all websites, not just infringing ones. Applying our test, Google could be held contributorily liable if it had knowledge that infringing Perfect 10 images were available using its search engine, could take simple measures to prevent further damage to Perfect 10's copyrighted works, and failed to take such steps.

The district court did not resolve the factual disputes over the adequacy of Perfect 10's notices to Google and Google's responses to these notices. Moreover, there are factual disputes over whether there are reasonable and feasible means for Google to refrain from providing access [1173] to infringing images. Therefore, we must remand this claim to the district court for further consideration whether Perfect 10 would likely succeed in establishing that Google was contributorily liable for in-line linking to full-size infringing images under the test enunciated today.^[13]

B. Vicarious Infringement

Perfect 10 also challenges the district court's conclusion that it is not likely to prevail on a theory of vicarious liability against Google. Perfect 10, 416 F.Supp.2d at 856-58. Grokster states that one "infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it." Grokster, 545 U.S. at 930, 125 S.Ct. 2764. As this formulation indicates, to succeed in imposing vicarious liability, a plaintiff must establish that the defendant exercises the requisite control over the direct infringer and that the defendant derives a direct financial benefit from the direct infringement. See id. Grokster further explains the "control" element of the vicarious liability test as the defendant's "right and ability to supervise the direct infringer." Id. at 930 n. 9, 125 S.Ct. 2764. Thus, under Grokster, a defendant exercises control over a direct infringer when he has both a legal right to stop or limit the directly infringing conduct, as well as the practical ability to do so.

We evaluate Perfect 10's arguments that Google is vicariously liable in light of the direct infringement that is undisputed by the parties, namely, the third-party websites' reproduction, display, and distribution of unauthorized copies of Perfect 10's images on the Internet. Perfect 10, 416 F.Supp.2d at 852; see supra Section IV.A. In order to prevail at this preliminary injunction stage, Perfect 10 must demonstrate a likelihood of success in establishing that Google has the right and ability to stop or limit the infringing activities of third party websites. In addition, Perfect 10 must establish a likelihood of proving that Google derives a direct financial benefit from such activities. Perfect 10 has not met this burden.

With respect to the "control" element set forth in Grokster, Perfect 10 has not demonstrated a likelihood of showing that Google has the legal right to stop or limit the direct infringement of third-party websites. See Grokster, 545 U.S. at 930, 125 S.Ct. 2764. Unlike Fonovisa, where by virtue of a "broad contract" with its vendors the defendant swap meet operators had the right to stop the vendors from selling counterfeit recordings on its premises, Fonovisa, 76 F.3d at 263, Perfect 10 has not shown that Google has contracts with third-party websites that empower Google to stop or limit them from reproducing, displaying, and distributing infringing copies of Perfect 10's images on the Internet. Perfect 10 does point to Google's AdSense agreement, which states that Google reserves "the right to monitor and terminate partnerships with entities that violate others' copyright[s]." Perfect 10, 416 F.Supp.2d at 858. However, Google's right to terminate an AdSense partnership does not give Google the right to [1174] stop direct infringement by third-party websites. An infringing third-party website can continue to reproduce, display, and distribute its infringing copies of Perfect 10 images after its participation in the AdSense program has ended.

Nor is Google similarly situated to Napster. Napster users infringed the plaintiffs' reproduction and distribution rights through their use of Napster's proprietary music-file sharing system. Napster, 239 F.3d at 1011-14. There, the infringing conduct was the use of Napster's "service to download and upload copyrighted music." Id. at 1014 (internal quotation omitted). Because Napster had a closed system requiring user registration, and could terminate its users' accounts and block their access to the Napster system, Napster had the right and ability to prevent its users from engaging in the infringing activity of uploading file names and downloading Napster users' music files through the Napster system.^[14] Id. at 1023-24. By contrast, Google cannot stop any of the third-party websites from reproducing, displaying, and distributing unauthorized copies of Perfect 10's images because that infringing conduct takes place on the third-party websites. Google cannot terminate those third-party websites or block their ability to "host and serve infringing full-size images" on the Internet. Perfect 10, 416 F.Supp.2d at 831.

Moreover, the district court found that Google lacks the practical ability to police the third-party websites' infringing conduct. Id. at 857-58. Specifically, the court found that Google's supervisory power is limited because "Google's software lacks the ability to analyze every image on the [I]nternet, compare each image to all the other copyrighted images that exist in the world ... and determine whether a certain image on the web infringes someone's copyright." Id. at 858. The district court also concluded that Perfect 10's suggestions regarding measures Google could implement to prevent its web crawler from indexing infringing websites and to block access to infringing images were not workable. Id. at 858 n. 25. Rather, the suggestions suffered from both "imprecision and overbreadth." Id. We hold that these findings are not clearly erroneous. Without image-recognition technology, Google lacks the practical ability to police the infringing activities of third-party websites. This distinguishes Google from the defendants held liable in Napster and Fonovisa. See Napster, 239 F.3d at 1023-24 (Napster had the ability to identify and police infringing conduct by searching its index for song titles); Fonovisa, 76 F.3d at 262 (swap meet operator had the ability to identify and police infringing activity by patrolling its premises).

Perfect 10 argues that Google could manage its own operations to avoid [1175] indexing websites with infringing content and linking to third-party infringing sites. This is a claim of contributory liability, not vicarious liability. Although "the lines between direct infringement, contributory infringement, and vicarious liability are not clearly drawn," Sony, 464 U.S. at 435 n. 17, 104 S.Ct. 774 (internal quotation omitted), in general, contributory liability is based on the defendant's failure to stop its own actions which facilitate third-party infringement, while vicarious liability is based on the defendant's failure to cause a third party to stop its directly infringing activities. See, e.g., Ellison, 357 F.3d at 1077-78; Fonovisa, 76 F.3d at 261-64. Google's failure to change its operations to avoid assisting websites to distribute their infringing content may constitute contributory liability, see supra Section IV.A. However, this failure is not the same as declining to exercise a right and ability to make third-party websites stop their direct infringement. We reject Perfect 10's efforts to blur this distinction.

Because we conclude that Perfect 10 has not shown a likelihood of establishing Google's right and ability to stop or limit the directly infringing conduct of third-party websites, we agree with the district court's conclusion that Perfect 10 "has not established a likelihood of proving the [control] prong necessary for vicarious liability." Perfect 10, 416 F.Supp.2d at 858.^[15]

C. Digital Millennium Copyright Act

Google claims that it qualifies for the limitations on liability set forth in title II of the DMCA, 17 U.S.C. § 512. In particular, section 512(d) limits the liability of a service provider "for infringement of copyright by reason of the provider referring or linking users to an online location containing infringing material or infringing activity, by using information location tools, including a directory, index, reference, pointer, or hypertext link" if the service provider meets certain criteria. We have held that the limitations on liability contained in 17 U.S.C. § 512 protect secondary infringers as well as direct infringers. Napster, 239 F.3d at 1025.

The parties dispute whether Google meets the specified criteria. Perfect 10 claims that it sent qualifying notices to Google and Google did not act expeditiously to remove the infringing material. Google claims that Perfect 10's notices did not comply with the notice provisions of section 512 and were not adequate to inform Google of the location of the infringing images on the Internet or identify the underlying copyrighted work. Google also claims that it responded to all notices it received by investigating the webpages identified by Perfect 10 and suppressing links to any webpages that Google confirmed were infringing.

Because the district court determined that Perfect 10 was unlikely to succeed on its contributory and vicarious liability claims, it did not reach Google's arguments under section 512. In revisiting the question of Perfect 10's likelihood of success on its contributory infringement claims, the district court should also consider whether Google would likely succeed in showing that it was entitled to the limitations on injunctive relief provided by title II of the DMCA.

V

Amazon.com

Perfect 10 claims that Amazon.com displays and distributes Perfect 10's copyrighted images and is also secondarily [1176] liable for the infringements of third-party websites and Amazon.com users. The district court concluded that Perfect 10 was unlikely to succeed in proving that Amazon.com was a direct infringer, because it merely in-line linked to the thumbnails on Google's servers and to the full-size images on third-party websites.^[16] Perfect 10 v. Amazon, No. 05-4753, consolidated with 04-9484 (C.D.Cal. February 21, 2006) (order denying preliminary injunction). In addition, the district court concluded that Perfect 10's secondary infringement claims against Amazon.com were likely to fail because Amazon.com had no program analogous to AdSense, and thus did not provide any revenues to infringing sites. Id. Finally, the district court determined that Amazon.com's right and ability to control the infringing conduct of third-party websites was substantially less than Google's. Id. Therefore, the district court denied Perfect 10's motion for a preliminary injunction against Amazon.com. Id.

We agree that Perfect 10 has not shown a likelihood that it would prevail on the merits of its claim that Amazon.com directly infringed its images. Amazon.com communicates to its users only the HTML instructions that direct the users' browsers to Google's computers (for thumbnail images) or to a third party's computer (for full-size infringing images). Therefore, Amazon.com does not display or distribute a copy of the thumbnails or full-size images to its users.

We also agree with the district court's conclusion that Amazon.com does not have "the right and ability to supervise the infringing activity" of Google or third parties. The district court did not clearly err in concluding that Amazon.com lacked a direct financial interest in such activities. Therefore, Perfect 10's claim that Amazon.com is vicariously liable for third-party infringement is unlikely to succeed.

However, the district court did not consider whether Amazon.com had "actual knowledge that specific infringing material is available using its system," Napster, 239 F.3d at 1022 (emphasis in original), and could have "take[n] simple measures to prevent further damage" to copyrighted works, Netcom, 907 F.Supp. at 1375, yet continued to provide access to infringing works. Perfect 10 has presented evidence that it notified Amazon.com that it was facilitating its users' access to infringing material. It is disputed whether the notices gave Amazon.com actual knowledge of specific infringing activities available using its system, and whether Amazon.com could have taken reasonable and feasible steps to refrain from providing access to such images, but failed to do so. Nor did the district court consider whether Amazon.com is entitled to limit its liability under title II of the DMCA. On remand, the district court should consider Amazon.com's potential contributory liability, as well as possible limitations on the scope of injunctive relief, in light of our rulings today.

VI

We conclude that Google's fair use defense is likely to succeed at trial, and therefore we reverse the district court's determination that Google's thumbnail versions of Perfect 10's images likely constituted a direct infringement. The district court also erred in its secondary liability [1177] analysis because it failed to consider whether Google and Amazon.com knew of infringing activities yet failed to take reasonable and feasible steps to refrain from providing access to infringing images. Therefore we must also reverse the district court's holding that Perfect 10 was unlikely to succeed on the merits of its secondary liability claims. Due to this error, the district court did not consider whether Google and Amazon.com are entitled to the limitations on liability set forth in title II of the DMCA. The question whether Google and Amazon.com are secondarily liable, and whether they can limit that liability pursuant to title II of the DMCA, raise fact-intensive inquiries, potentially requiring further fact finding, and thus can best be resolved by the district court on remand. We therefore remand this matter to the district court for further proceedings consistent with this decision.

Because the district court will need to reconsider the appropriate scope of injunctive relief after addressing these secondary liability issues, we do not address the parties' arguments regarding the scope of the injunction issued by the district court. For the same reason, we do not address the parties' dispute over whether the district court abused its discretion in determining that Perfect 10 satisfied the irreparable harm element of a preliminary injunction.

Therefore, we reverse the district court's ruling and vacate the preliminary injunction regarding Google's use of thumbnail versions of Perfect 10's images.^[17] We reverse the district court's rejection of the claims that Google and Amazon.com are secondarily liable for infringement of Perfect 10's full-size images. We otherwise affirm the rulings of the district court. We remand this matter for further proceedings consistent with this opinion. Each party shall bear its own costs on appeal. See FED. R. APP. P. 39(a)(4).

AFFIRMED IN PART; REVERSED IN PART; REMANDED.

[1] Google argues that we lack jurisdiction over the preliminary injunction to the extent it enforces unregistered copyrights. Registration is generally a jurisdictional prerequisite to a suit for copyright infringement. See 17 U.S.C. § 411. But section 411 does not limit the remedies a court can grant. Rather, the Copyright Act gives courts broad authority to issue injunctive relief. See 17 U.S.C. § 502(a). Once a court has jurisdiction over an action for copyright infringement under section 411, the court may grant injunctive relief to restrain infringement of any copyright, whether registered or unregistered. See, e.g., Olan Mills, Inc. v. Linn Photo Co., 23 F.3d 1345, 1349 (8th Cir.1994); Pac. & S. Co., Inc. v. Duncan, 744 F.2d 1490, 1499 n. 17 (11th Cir.1984). Because at least some of the Perfect 10 images at issue were registered, the district court did not err in determining that it could issue an order that covers unregistered works. Therefore, we have jurisdiction over the district court's decision and order.

[2] The website publisher may not actually store the photographic images used on its webpages in its own computer, but may provide HTML instructions directing the user's browser to some further computer that stores the image. Because this distinction does not affect our analysis, for convenience, we will assume that the website publisher stores all images used on its webpages in the website publisher's own computer.

[3] Generally, a "cache" is "a computer memory with very short access time used for storage of frequently or recently used instructions or data." United States v. Ziegler, 474 F.3d 1184, 1186 n. 3 (9th Cir.2007) (quoting MERRIAM-WEBSTER'S COLLEGIATE DICTIONARY 171 (11th ed.2003)). There are two types of caches at issue in this case. A user's personal computer has an internal cache that saves copies of webpages and images that the user has recently viewed so that the user can more rapidly revisit these webpages and images. Google's computers also have a cache which serves a variety of purposes. Among other things, Google's cache saves copies of a large number of webpages so that Google's search engine can efficiently organize and index these webpages.

[4] Perfect 10 argues that we are bound by the language and structure of title II of the DMCA in determining Google's liability for copyright infringement. We have noted that the DMCA does not change copyright law; rather, "Congress provided that [the DMCA's] limitations of liability apply if the provider is found to be liable under existing principles of law." Ellison, 357 F.3d at 1077 (emphasis and internal quotation omitted). As a result, "[c]laims against service providers for direct, contributory, or vicarious copyright infringement, therefore, are generally evaluated just as they would be in the non-online world." Id.; see also 17 U.S.C. § 512(l) ("The failure of a service provider's conduct to qualify for limitation of liability under this section shall not bear adversely upon the consideration of a defense by the service provider that the service provider's conduct is not infringing under this title or any other defense."). Therefore, we must consider Google's potential liability under the Copyright Act without reference to title II of the DMCA.

[5] 17 U.S.C. § 106 states, in pertinent part:

Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following:
(1) to reproduce the copyrighted work in copies or phonorecords;
....
(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;
....
(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly....

[6] Because Google initiates and controls the storage and communication of these thumbnail images, we do not address whether an entity that merely passively owns and manages an Internet bulletin board or similar system violates a copyright owner's display and distribution rights when the users of the bulletin board or similar system post infringing works. Cf. CoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544 (4th Cir.2004).

[7] Perfect 10 also argues that Google violates Perfect 10's right to display full-size images because Google's in-line linking meets the Copyright Act's definition of "to perform or display a work `publicly.'" 17 U.S.C. § 101. This phrase means "to transmit or otherwise communicate a performance or display of the work to ... the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times." Id. Perfect 10 is mistaken. Google's activities do not meet this definition because Google transmits or communicates only an address which directs a user's browser to the location where a copy of the full-size image is displayed. Google does not communicate a display of the work itself.

[8] We reject at the outset Perfect 10's argument that providing access to infringing websites cannot be deemed transformative and is inherently not fair use. Perfect 10 relies on Video Pipeline, Inc. v. Buena Vista Home Entm't, Inc., 342 F.3d 191 (3d Cir.2003), and Atari Games Corp. v. Nintendo of Am. Inc., 975 F.2d 832, 843 (Fed.Cir.1992). But these cases, in essence, simply apply the general rule that a party claiming fair use must act in a manner generally compatible with principles of good faith and fair dealing. See Harper & Row, 471 U.S. at 562-63, 105 S.Ct. 2218. For this reason, a company whose business is based on providing scenes from copyrighted movies without authorization could not claim that it provided the same public benefit as the search engine in Kelly. See Video Pipeline, 342 F.3d at 198-200. Similarly, a company whose overriding desire to replicate a competitor's computer game led it to obtain a copy of the competitor's source code from the Copyright Office under false pretenses could not claim fair use with respect to its purloined copy. Atari Games, 975 F.2d at 843.

Unlike the alleged infringers in Video Pipeline and Atari Games, who intentionally misappropriated the copyright owners' works for the purpose of commercial exploitation, Google is operating a comprehensive search engine that only incidentally indexes infringing websites. This incidental impact does not amount to an abuse of the good faith and fair dealing underpinnings of the fair use doctrine. Accordingly, we conclude that Google's inclusion of thumbnail images derived from infringing websites in its Internet-wide search engine activities does not preclude Google from raising a fair use defense.

[9] Google contends that Perfect 10's photographic images are less creative and less deserving of protection than the images of the American West in Kelly because Perfect 10 boasts of its un-retouched photos showing the natural beauty of its models. Having reviewed the record, we conclude that the district court's finding that Perfect 10's photographs "consistently reflect professional, skillful, and sometimes tasteful artistry" is not clearly erroneous. Perfect 10, 416 F.Supp.2d at 849 n. 15. We agree with the district court that there is no basis for concluding that photos of the American West are more deserving of protection than photos of nude models. See id.

[10] Because the district court concluded that Perfect 10 was likely to prevail on its direct infringement claim with respect to Google's use of thumbnails, but not with respect to its in-line linking to full-size images, the district court considered Google's potential secondary liability only on the second issue.

[11] Google's activities do not meet the "inducement" test explained in Grokster because Google has not promoted the use of its search engine specifically to infringe copyrights. See Grokster, 545 U.S. at 935-37, 125 S.Ct. 2764. However, the Supreme Court in Grokster did not suggest that a court must find inducement in order to impose contributory liability under common law principles.

[12] "Cyberspace is a popular term for the world of electronic communications over computer networks." Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 907 F.Supp. 1361, 1365 n. 1 (N.D.Cal.1995).

[13] Perfect 10 claims that Google materially contributed to infringement by linking to websites containing unauthorized passwords, which enabled Google users to access Perfect 10's website and make infringing copies of images. However, Perfect 10 points to no evidence that users logging onto the Perfect 10 site with unauthorized passwords infringed Perfect 10's exclusive rights under section 106. In the absence of evidence that Google's actions led to any direct infringement, this argument does not assist Perfect 10 in establishing that it would prevail on the merits of its contributory liability claim. See Napster, 239 F.3d at 1013 n. 2 ("Secondary liability for copyright infringement does not exist in the absence of direct infringement by a third party.").

[14] Napster's system included "Napster's MusicShare software, available free of charge from Napster's Internet site, and Napster's network servers and server-side software." Napster, 239 F.3d at 1011. By downloading Napster's MusicShare software to the user's personal computer, and registering with the Napster system, a user could both upload and download music files. Id. at 1011-13. If the Napster user uploaded a list of music files stored on the user's personal computer to the Napster system, such music files would be automatically available to other Napster users whenever the user was logged on to the Napster system. Id. at 1012. In addition, the Napster user could download music files directly from other users' personal computers. Id. We explained the infringing conduct as "Napster users who upload file names to the [Napster] search index for others to copy violate plaintiffs' distribution rights. Napster users who download files [through the Napster system] containing copyrighted music violate plaintiffs' reproduction rights." Id. at 1014.

[15] Having so concluded, we need not reach Perfect 10's argument that Google received a direct financial benefit.

[16] Amazon.com states that it ended its relationship with Google on April 30, 2006. Perfect 10's action for preliminary injunction against Amazon.com is not moot, however, because Amazon.com has not established "that the allegedly wrongful behavior cannot reasonably be expected to recur." F.T.C. v. Affordable Media, LLC, 179 F.3d 1228, 1238 (9th Cir.1999) (internal quotation omitted).

[17] Because we vacate the injunction, Google's motion for stay of the injunction is moot.

4.2.2. Flava Works v. Gunter (7th Cir. 2012)

Flava Works v. Gunter (7th Cir. 2012)

4.2.3. Jane C. Ginsburg, U.S. Compliance With the International Right of Communication to the Public After Aereo: Who Is the Public? (Columbia University School of Law, August 21, 2014)

Jane C. Ginsburg, U.S. Compliance With the International Right of Communication to the Public After Aereo: Who Is the Public? (Columbia University School of Law, August 21, 2014)

4 Module 2 - Copyright Infringement: Communication to the Public and Linking 4 Module 2 - Copyright Infringement: Communication to the Public and Linking

4.1 European Union 4.1 European Union

4.1.1. European Commission Communication, Towards a modern, more European copyright framework, 9 December 2015, COM(2015) 626 final

4.1.2 Communication and Making Available to the Public 4.1.2 Communication and Making Available to the Public

4.1.2.2 Phonographic Performance (Ireland) Limited v Ireland, Attorney General, C-162/10, March 15, 2012 (ECJ) (communication to the public) 4.1.2.2 Phonographic Performance (Ireland) Limited v Ireland, Attorney General, C-162/10, March 15, 2012 (ECJ) (communication to the public)

4.1.2.3 Società Consortile Fonografici (SCF) v Marco Del Corso, C-135/10, March 15, 2012 (ECJ) (communication to the public) 4.1.2.3 Società Consortile Fonografici (SCF) v Marco Del Corso, C-135/10, March 15, 2012 (ECJ) (communication to the public)

4.1.2.4 ITV Broadcasting et al v TV Catchup, C-607/11, March 7, 2013 (ECJ) (live streaming) (OPTIONAL) 4.1.2.4 ITV Broadcasting et al v TV Catchup, C-607/11, March 7, 2013 (ECJ) (live streaming) (OPTIONAL)

4.1.2.5. VCAST Limited v. RTI SpA, Case C265/16 (29 November 2017)

4.1.3 Linking 4.1.3 Linking

4.1.3.1 Nils Svensson et al v Retriever Sverige AB, C-466/12, February 13, 2014 (ECJ) (communication to the public, linking) 4.1.3.1 Nils Svensson et al v Retriever Sverige AB, C-466/12, February 13, 2014 (ECJ) (communication to the public, linking)

4.1.3.2. Svensson (SUMMARY) - Giancarlo F. Frosio, Freedom of Linking in Europe?, CIS Blog, March 10, 2014

4.1.3.3. ECS, Opinion on the Reference to the CJEU in Case C-466/12 Svensson (15 February 2013)

4.1.3.4 Svensson (SUMMARY) 4.1.3.4 Svensson (SUMMARY)

4.1.3.5. ALAI, Opinion on the criterion думNew Publicдуќ, developed CJEU, put in the context of making available and communication to the public (17 September 2014)

4.1.3.6. GS Media BV v Sanoma Media Netherlands BV and Others, C-160/15, 8 September 2016

4.1.3.7 C More Entertainment AB v. Linus Sandberg, C-279/12, March 26, 2015 (OPTIONAL) 4.1.3.7 C More Entertainment AB v. Linus Sandberg, C-279/12, March 26, 2015 (OPTIONAL)

4.1.3.8. C More Entertainment (SUMMARY) - Giancarlo F. Frosio, (C) More Entertainment for Broadcasters: The European Court of Justice on Linking to Live Streams of Sport Events, CIS Blog, March 31, 2015

4.1.3.9. Stichting Brein v Jack Frederik Wullems, Case C-527/15 (26 April 2017)

4.1.3.10. Stichting Brein v Ziggo BV and XS4All Internet BV, Case C-610/15 (14 June 2017)

4.2 United States 4.2 United States

4.2.1 Perfect 10 v. Amazon.com 4.2.1 Perfect 10 v. Amazon.com

PERFECT 10, INC., a California corporation, Plaintiff-Appellant, v. AMAZON.COM, INC., a corporation; A9.Com Inc., a corporation, Defendants-Appellees.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant, v. Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee, v. Google Inc., a corporation, Defendant-Appellant.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant, v. Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee, v. Google Inc., a corporation, Defendant-Appellant.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee, v. Google Inc., a corporation, Defendant-Appellant.

I

Background

II

Standard of Review

III

Direct Infringement

A. Display Right

B. Distribution Right

C. Fair Use Defense

IV

Secondary Liability for Copyright Infringement

A. Contributory Infringement

B. Vicarious Infringement

C. Digital Millennium Copyright Act

V

Amazon.com

VI

4.2.2. Flava Works v. Gunter (7th Cir. 2012)

4.2.3. Jane C. Ginsburg, U.S. Compliance With the International Right of Communication to the Public After Aereo: Who Is the Public? (Columbia University School of Law, August 21, 2014)

PERFECT 10, INC., a California corporation, Plaintiff-Appellant,
v.
AMAZON.COM, INC., a corporation; A9.Com Inc., a corporation, Defendants-Appellees.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant,
v.
Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee,
v.
Google Inc., a corporation, Defendant-Appellant.

Perfect 10, Inc., a California corporation, Plaintiff-Appellant,
v.
Google Inc., a corporation, Defendant-Appellee.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee,
v.
Google Inc., a corporation, Defendant-Appellant.

Perfect 10, Inc., a California corporation, Plaintiff-Appellee,
v.
Google Inc., a corporation, Defendant-Appellant.