Carriage of passengers – two recent decisions

Two recent English Court of Appeal decisions consider the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea 1974. Hamblen LJ in November 2017 decided the two cases Lawrence v NCL (Bahamas) Ltd (The “Norwegian Jade”) [2017] EWCA Civ 2222 and Collins v Lawrence [2017] EWCA Civ 2268. What does disembarkation mean? And what are the roles of the contractual carrier and the performing carrier under the Convention?

Collins v Lawrence

Mr Collins had been for a fishing trip. Disembarkation was by a set of semi-permanent steps down onto a shingle beach. Was Mr Collins still in the process of disembarkation, or had he completed that process when he slipped on a wooden plank at the foot of the steps? If he injured himself in the process of disembarkation, the short Athens Convention time bar applied, but if he injured himself afterwards, the general civil liability time bar, which was longer, applied and the claim would be within time.

The key provision in the Athens Convention 1974 was the following, article 1.8:

“‘Carriage’ covers the following periods:

(a) With regard to the passenger and his cabin luggage, the period during which the passenger and/or his cabin luggage are on board the ship or in the course of embarkation or disembarkation and the period during which the passenger and his cabin luggage are transported by water from land to the ship or vice versa, if the cost of such transport is included in the fare or if the vessel used for the purpose or auxiliary transport has been put at the disposal of the passenger by the carrier. However, with regard to the passenger, carriage does not include the period during which he is in a marine terminal or station or on a quay or in or on any other port installation.”

In the view of the judge, the process of disembarkation covered the whole period of moving from the vessel to a safe position on the shore while a person was still using equipment which facilitated disembarkation, such as the steps and wooden board in this case. Therefore Mr Collins was still in the process of disembarking. Disembarkation had not been completed until the claimant was ashore, which meant safely on the shingle beach. The claim was time-barred.

The Norwegian Jade

In The Norwegian Jade, the cruise passenger had made a contract through a travel agent to travel from London to Venice, join a cruise around the Mediterranean with disembarkation in Venice and then a return flight to London. At Santorini, he fell and injured himself, not on board, but on a smaller boat which was to take him from the cruise ship to the island.

The cruise ship operator first of all argued that it was not the contractual carrier, and that it was the travel agent who had contracted with the passenger as contractual carrier. This argument was unsuccessful: it was the cruise ship operator who provided booking confirmations, in copy to the travel agent and the guest. The booking conditions stated that for a booking made through a travel agent, a binding contract came into existence with the defendant when the travel agent received confirmation of the booking and a reservation number.

Secondly, the cruise ship operator argued that article 1.8 of the Athens Convention did not apply when Mr Lawrence left the ship only for a day trip. ‘Embarkation’ and ‘disembarkation,’ the cruise ship operator argued, meant the passenger and their luggage being moved simultaneously at the beginning and end of the cruise. This argument too was unsuccessful. It appear to be the first time it has been considered by a court.

Thirdly, the judge held that the operator of the smaller boat at Santorini, which was acting as ‘performing carriers,’ was at fault or in neglect in that they should have placed an additional sign at eye level warning passengers of the potentially hazardous step that caused Mr Lawrence to trip and fall. Since the performing carrier was at fault or in neglect, so was the contractual carrier, namely the cruise ship operator, either because it had taken no action itself or because it was answerable for the fault or neglect of the performing carrier.

Comment

Personal injuries and small passenger claims are most frequently brought in the county courts. Such decisions are often not reported, meaning that it is difficult to find decisions on how the Athens Convention is applied in practice. These decisions should help achieve some uniformity in passenger carriage claims.

Dr Johanna Hjalmarsson
Southampton Law School
The full article was published in Lloyd’s Shipping & Trade Law on 9 February and is available on www.i-law.com and on www.shippingandtradelaw.com

What is the UK limit of liability for wreck?

Surprisingly, a shipowner’s rights to limit liability in respect of claims against a wreck are not clear under UK law. Although the ambiguities in question were pointed out at an early stage, the position remains unresolved. This article considers the applicable treaties, legislation and views of eminent authors to demonstrate that the position is unresolved.

The treaties

The position is ultimately defined by the treaties to which the UK is a party, namely the conventions on shipowners’ limitation of liability generally and the wreck convention.

The UK is currently a party to the 1996 Protocol to the International Convention on Limitation of Liability for Maritime Claims 1976. In becoming a party, the UK denounced the 1976 Convention to which it had previously been a party since 1 December 1986. The 1996 Protocol entered into force in the UK on 13 May 2004.

In connection with the ratification of both the 1976 Convention and the 1996 Protocol, the UK notified the depositary, the International Maritime Organization, that it reserved its right not to apply rights to limit liability to claims falling under article 2(1)(d) of the Convention. There has been no withdrawal of that notification. Article 2 is in identical form in both Conventions, and reads, with emphasis added:

“Claims subject to limitation

1. Subject to Articles 3 and 4 the following claims, whatever the basis of liability may be, shall be subject to limitation of liability:

[(a) – (c)] 


(d) claims in respect of the raising, removal, destruction or the rendering harmless of a ship which is sunk, wrecked, stranded or abandoned, including anything that is or has been on board such ship;

(e) claims in respect of the removal, destruction or the rendering harmless of the cargo of the ship 
”

Reservations are permitted against the Convention. Article 18 reads:

“Article 18. Reservations

1. Any State may, at the time of signature, ratification, acceptance, approval or accession, reserve the right to exclude the application of Article 2, paragraph 1(d) and (e). 
”

The amending Protocol also permits this same reservation. The UK has availed itself of this option. As a result of this reservation, it is not bound by international law to ensure by domestic legislation that claims such as under article 2(1)(d) are subject to limitation. The reservation was made both under the original Convention and when ratifying the Protocol.

As for the Nairobi International Convention on the Removal of Wrecks 2007, it entered into force in the UK on 14 April 2015. This Convention does not contain any provisions on limitation of liability, except to recognise that states may wish to apply other Conventions on limitation of liability to claims in respect of wreck:

“Article 10. Liability of the owner

1. Subject to Article 11, the registered owner shall be liable for the costs of locating, marking and removing the wreck under Articles 7, 8 and 9, respectively, unless the registered owner proves that the maritime casualty that caused the wreck:

(a) resulted from an act of war, hostilities, civil war, insurrection, or a natural phenomenon of an exceptional, inevitable and irresistible character;

(b) was wholly caused by an act or omission done with intent to cause damage by a third party; or

(c) was wholly caused by the negligence or other wrongful act of any Government or other authority responsible for the maintenance of lights or other navigational aids in the exercise of that function.

2. Nothing in this Convention shall affect the right of the registered owner to limit liability under any applicable national or international regime , such as the Convention on Limitation of Liability for Maritime Claims, 1976, as amended.” [Emphasis added.]

The right to limit liability for claims against wreck under UK law therefore depends on whether the enabling legislation giving force to the 1996 Protocol has given effect to the reservation against article 2(1)(d).

The legislation

The relevant provisions are contained in the Merchant Shipping Act 1995. Section 185(1) of that Act provides:

“The provisions of the Convention on Limitation of Liability for Maritime Claims 1976 as set out in Part I of Schedule 7 (in this section and Part II of that Schedule referred to as ‘the Convention’) shall have the force of law in the United Kingdom.”

Part I contains the text of the 1996 text of the Convention in full, without omission of article 2(1)(d). In principle, the full Convention therefore has the force of law. However, section 185(2) of the Merchant Shipping Act states that Part I of the Schedule is subject to Part II.

Part II, para 3, headed “Claims subject to limitation” reads as follows:

“(1) Paragraph 1(d) of article 2 shall not apply unless provision has been made by an order of the Secretary of State for the setting up and management of a fund to be used for the making to harbour or conservancy authorities of payments needed to compensate them for the reduction, in consequence of the said paragraph 1(d), of amounts recoverable by them in claims of the kind there mentioned, and to be maintained by contributions from such authorities raised and collected by them in respect of vessels in like manner as other sums so raised by them.

(2) Any order under sub-paragraph (1) above may contain such incidental and supplemental provisions as appear to the Secretary of State to be necessary or expedient.” [Emphasis added.]

There appears to be no such order at present. The conclusion must therefore be that the provision does not apply, and that wreck claims are not currently subject to limitation in the UK. This contradicts the Explanatory notes to the Wreck Removal Convention Bill as introduced in the House of Commons on 30 June 2010 [Bill 18], where para 24 reads:

“The right to limit liability under section 185 (limitation of liability for marine claims), which gives effect to the Convention on Liability for Marine Claims, is preserved.”

To confuse matters, the header “Claims subject to limitation” in Part II of Schedule 7 is followed by another header, “Claims excluded from limitation” above para 4, which deals with claims for damages related to the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea 1996 (the HNS Convention). Considering the combination of headers (“Claims subject to limitation” and “Claims excluded from limitation”), it appears clear that the intention of the legislator was that HNS claims should be excluded from, but wreck claims should be subject to limitation.

Other sources: comments on the provisions

These observations are not new: the discrepancy has been pointed out by others. A letter from the British Maritime Law Association dated 24 July 2008 and signed by the association’s then Secretary/Treasurer Andrew Taylor is available online. 1 In the letter, it is noted a propos para 3(1) of part II of Schedule 7 to the Merchant Shipping Act 1995:

“The effect of this provision is that the owner of a ship is not in English Law entitled to limit its liability under the Merchant Shipping Act for the cost of wreck removal.”

The BMLA letter goes on to offer a solution:

“However it is, in the view of the BMLA working group, arguable that the provisions relating to compulsory insurance and direct action for the recovery of such costs are equivalent to the setting up of a fund envisaged by the above paragraph.”

If additional support were needed, other authors have noted the same discrepancy. Aengus Fogarty, the author of Merchant Shipping Legislation, 3rd Edition, 2017, Informa Law, makes a similar observation at para 15.171:

“Article 2(1)(d) of the Convention is not yet applicable as no fund has yet been established under paragraph 3 of Part II of Schedule 7. Accordingly, statutory claims by harbour and conservancy authorities for wreck removal expenses are not yet subject to limitation of liability. It is arguable that non-statutory claims for wreck removal expenses in circumstances similar to those in The Putbus, 2 supra, and The Arabet, 3 supra, are excluded from limitation by virtue of this paragraph: see Limitation of Liability for Maritime Claims 
” (Footnotes with references added.)

The work referenced at the end of the quote is Griggs et al, Limitation of Liability for Maritime Claims, 4th Edition, 2005, Informa Law. This work, best known as Griggs, contains a commentary to the Limitation Convention. The Commentary to article 2(1)(d) of the Convention posits – undoubtedly correctly – that the government’s policy behind the reservation to the Convention was that harbours and other facilities should not shoulder the costs for wreck removal. That concern pertains particularly to wreck removal undertaken pursuant to statutory powers. The authors of Griggs go on to say:

“it appears that as a result of the wording in the introductory paragraph to Article 2, to the effect that the listed claims are to be the subject of limitation ‘whatever the basis of liability’, the reservation exercised by the United Kingdom may have inadvertently taken out of limitation in the United Kingdom any claims (whether statutory or otherwise) relating to wreck removal, including claims for recourse, provided that the liability does not relate to remuneration under a contract with the person liable).” 4

The apparent effect that claims for wreck removal expenses against other parties are not subject to limitation as a result of the legislation is confirmed by these eminent authors, and described as “inadvertent”.

Comment

The effects for insurers are important: they are said in the Wreck Removal Convention Act 2011, section 255P, sub-section (5) to have the same rights to limit liability as their insured:

“The insurer may limit liability in respect of claims made under this section to the same extent as the registered owner may limit liability by virtue of section 185 (or would be able to limit liability by virtue of that section if it were not for paragraph 3 of Part 2 of Schedule 7).” (Emphasis added.)

But what does “to the same extent” mean? The position appears to be a door to litigation, waiting to be knocked down.

Dr Johanna Hjalmarsson

Informa Associate Professor in Maritime and Commercial Law

This article was first published in Shipping & Trade Law 2017 (17) 10 pp 3-5 and is reproduced here by kind permission of the publisher.

Available at: https://www.shippingandtradelaw.com/shipping/liability/what-is-the-uk-limit-of-liability-for-wreck-127949.htm (registration required) and https://www.i-law.com/ilaw/doc/view.htm?id=385574 (paywall)

Footnotes

1 The letter is available at www.bmla.org.uk/documents/2011/ltr_DfT_re_Nairobi_Convention_Wreck_Removal.doc (accessed on 20 December 2017).

2 [1969] 1 Lloyd’s Rep 253.
3 [1963] P 102.
4 Griggs, chapter 3, commentary to article 2(1)(d).

Brands and ecommerce platforms: a tainted relationship?

What has happened to online ecommerce platforms? Over the past few months news reports have multiplied – or, perhaps, their underlying issues have acquired greater visibility – that brand owners have been increasingly voicing criticisms against, sued, or discontinued sales on ecommerce sites. In particular, after the criticisms made against Alibaba, it seems that Amazon is now making the headlines.

Let’s have a quick look at what has happened over the past few months.

Court actions

First, there have been legal proceedings being brought by trade mark owners, claiming a direct responsibility of Amazon in the sale of counterfeits or invoking a right to prevent sales on such platform.

An example of the former is the lawsuit filed by Daimler against Amazon in late 2017 in the US District Court for the Western District of Washington at Seattle. The well-known German car manufacturer argues that Amazon is directly responsible for the “offer for sale, sale and distribution of wheels which blatantly copy issued design patents in various distinctive and artistic wheel designs owned by Daimler” under the Lanham Act (§ 1051 ff), the US Patent Act (§ 1 ff), and Washington State statutory and common law.

As explained on Forbes here, this is not the first time that a trade mark owner is seeking to have the direct liability of Amazon established. However, back in 2015 a 9-member jury in the same court that has now been asked to rule on the lawsuit filed by Daimler held that Amazon was not liable for the sale of counterfeit Milo & Gabby (now JoliMoli) animal-shaped pillows.

If the case brought by Daimler ended with a finding of liability for Amazon, that would likely have a significant impact on the liability of platforms allowing third-party listings, and set a different approach to platform liability in the US.

As readers knows, the particular issues surrounding platform liability have been at the centre of attention also in Europe.

Reference in the online trade mark realm goes instinctively to the landmark decision of the Court of Justice of the European Union (CJEU) in eBay, C-324/09, in which the highest EU court clarified that the safe harbour for hosting providers within Article 14 of the E-Commerce Directive does not apply to “an information society service [which is] aware of facts or circumstances on the basis of which a diligent economic operator should have identified the illegality in question and acted in accordance with Article 14(1)(b) of Directive 2000/31.” [para 120]

More recently, the CJEU appears to have pushed the liability of platforms even further than the realm of safe harbours (hence, scenarios of secondary liability) by holding that a platform may be even directly (primarily) liable for third-party infringements. It has done so in the copyright context, especially in the recent Filmspeler decision [here] and – even more clearly – in the Ziggo ruling [here].

If we remain in the EU context, the issue of platform liability is not the only aspect that has been touched upon in relation to ecommerce platforms. Readers will in fact remember the recent judgment in Coty Prestige, C-230/16 [here], in which the CJEU tackled the compatibility with EU competition rules of selective distribution agreements for luxury brands, including clauses that would prevent resellers from distributing branded products via Amazon. The CJEU provided an interpretation of relevant EU provisions that allows – at certain conditions – trade mark holders from preventing distribution of their goods via platforms of this kind.

Discontinued sales

In parallel with court actions, other brands have recently announced their intention to discontinue sales on Amazon, over issues of counterfeiting and allegedly excessive discounts.

In a timeframe of just a few weeks, this has been for instance the case of Birkenstock and Italian publisher E/O, respectively.

Shoe producer Birkenstock announced that as of 1 January 2018 it would terminate its business relations with Amazon, on grounds that

“there have been a series of violations of the law on the Marketplace platform operated by Amazon which the platform operator has failed to prevent of its own accord. On a number of occasions, BIRKENSTOCK lodged a complaint that counterfeit products of poor quality which infringed BIRKENSTOCK’s trademark rights and misled the consumers regarding the origins of goods were being made available on the platform.

Putting the issue of legal obligations aside, BIRKENSTOCK is of the opinion that an integral part of a trusting business relationship is that, upon being first notified as the operator of the Marketplace platform of such a breach of the law, Amazon would, of its own accord, do everything within its power to prevent this type of and similar infringements. To this day, no binding statement has been made to the effect that no more counterfeit BIRKENSTOCK products would be offered for sale through the platform.”

A couple of weeks ago also E/O [the Italian publisher of Elena Ferrante’s books, amongst others] announced that it would no longer sell on Amazon, on consideration that the discounts requested by the ecommerce provider would be excessive. It is not the first time that a complaint of this kind is made by the publishing industry.

What’s next?

In all this, what does the future hold?

On the one hand, it appears that brand owners’ complaints may result in the adoption of new approaches towards responsibilization and liability of online platforms.

This could occur not just at the court level, but also by means of initiatives of policy- and law-makers. In Europe, for instance, the issue of platform liability, notice-and-stay down obligations (including filtering), as well improved enforcement tools are currently central items to the agenda of the EU Commission and legislature. In the first half of 2018 it is expected that the Commission will unveil further legislative proposals in this area, under the umbrella of its Digital Single Market Strategy.

On the other hand, platforms like Amazon may not rely just on partnerships with brand owners or the making available third-party offerings but, rather, increasingly invest on the making available of their own offerings. In this sense, the trend in fashion seems to be already reality. As noted by The Fashion Law, Amazon has in fact been working on and launched a number of in-house collections that have been already finding success among consumers, “particularly in light of the current retail environment, when brand loyalty is low, consumers are overly price/value conscious, and branding is simply not as significant a player as it used to be.”

In this sense, the general trend seems to be towards a configuration of platforms’ activity as no longer – or just – passive hosts of third-party offerings but, rather, active providers of own offerings. What should the legal treatment of this evolving and evolved scenario be? While the functioning of the internet must be safeguarded [as was also recently stressed by the German Federal Court of Justice, here and here] the questions that lie ahead and require a response are whether new rules are needed, existing rules should be applied differently … or what else?

[This post was originally published on The IPKat on 4 January 2018]

Irish housing law violates tenant’s human rights

Mark Jordan , 2 January 2018 — 8 mins read

On the 23 October 2017, the European Committee of Social Rights handed down its decision in International Federation for Human Rights (FIDH) v. Ireland Complaint No. 110/2014. The decision is available here. On the main ground, the Committee found that Irish housing law violates the right of families to adequate housing under Article 16 of the Revised European Social Charter. The declaration is notable in several respects and is significant, both nationally and internationally. This blog post will engage with some of the issues raised by the complaint however it will also offer some insight into the way this complaint came about and how back in 2012, as a recent graduate, I came to be involved in the complaint.

The Revised European Social Charter

The collective complaint system relates to the Revised European Social Charter, which was established in 1961, and revised in 1996, by the Council of Europe to support the (more famous) European Convention of Human Rights (ECHR). Broadly speaking, while the ECHR enshrines civil and political rights, the European Social Charter enumerates social and economic rights. The logic behind the Social Charter can be explained by borrowing a line from Franklin Delano Roosevelt. In 1944, Roosevelt outlined, in relation to the proposed second Bill of Rights which sought to enumerate economic and social rights in the United States, that “individual freedom cannot exist without economic security and independence”. The European Social Charter sets out human rights to education, health, housing, etc. While 43 out of the 47-member States of the Council of Europe are parties to either the Charter or the Revised Charter, it has not been incorporated into domestic law in the way that the ECHR has been. The rights are not directly justiciable, however the considerable jurisprudence of the Social Charter is nonetheless of growing influence in informing the development of European human rights norms.

The collective complaint process

By international standards, the rights enumerated by the European Social Charter are remarkably sophisticated. Much of this can be attributed to the system of enforcement which through a system of national reports by ratifying states and, in particular, a novel collective complaint system, generates a growing corpus of human rights standards. Certain national and international bodies including national tenants/landlord’s associations, international human rights agencies, etc. have locus standi to bring a collective complaint alleging that some aspect of national law violates the human rights of a collection of individuals in that country. Once a complaint is submitted, it must be deemed admissible (a relatively straightforward threshold) and then it proceeds to the European Committee of Social Rights which, after a hearing, makes a decision on the merits of the case. There is no national tenant’s association in the Republic of Ireland, instead this complaint was brought via the FIDH (International Federation for Human Rights). The moving force behind the whole effort was a group of local authority tenants who were concerned at the conditions of local authority housing and the lack of effective legal remedies governing housing condition and repair. The complaint was organised by Community Action Network (CAN) with the support of Ballymun Community Law Centre, and The Centre for Housing Law, Rights and Policy at NUI Galway. The complaint was funded by the Free Legal Aid Clinic and the Irish Human Rights & Equality Commission.

Getting involved in co-operative research projects

My involvement stems from my work with Dr Padraic Kenna at The Centre for Housing Law, Rights and Policy. I had graduated from the LLB programme at NUI Galway in the summer of 2011 and had taken Dr Kenna’s Housing Law, Rights and Policy module in my final year. This module combined cutting edge research led teaching with a real practical edge and really spurred my academic interest in this area of the law. This experience was exceptionally useful in putting together a successful application when a graduate position opened up on a housing law and policy human rights project in 2012. I was responsible for working with colleagues in Dublin and Galway to identify areas of Irish housing law which were potentially in violation of the Charter and to collect and organise materials which would support the development of a collective complaint. The main issues including the poor housing conditions of local authority housing and in particular the tenant’s lack of effective rights in relation to housing condition, repair, security, dispute resolution etc.

The difficulties in making a complaint

Part of the difficulty for tenants in bringing the complaint was the lack of meaningful statistics. The last state survey of local authority housing condition was in 2002. The complaint was only made possible by tenants systematically collecting and cataloguing evidence of poor housing for years. This was a huge effort but was vital to the ultimate success of the complaint on the main ground. The achievement of CAN is even more remarkable given that there is no state support of tenants’ associations in Ireland, unlike most of the countries of the EU where national tenants’ associations play a vital role in developing renting law & policy e.g. Sweden, Italy, etc. At the end, I had helped put together a skeleton draft which focused on a wide range of areas including local authority housing, as well as homeless legislation, and the housing law governing traveller accommodation. This was the end of my involvement at this stage and I then took up a Tenlaw research fellowship at the University of Southampton. However, I became involved once again in 2016, after the complaint had been deemed admissible and the state had responded by making a submission on its merits. Together with Dr Padraic Kenna, I helped draft the response to the State’s arguments.

The decision on the merits

In 2017 the Committee issued a decision finding that Irish housing law violates the right of families to adequate housing under Article 16 of the European Social Charter. While the Committee found a violation on the main ground i.e. inadequate housing conditions, the decision was disappointing in some respects, most notably in relation to the lack of effective legal remedies available to tenants. The difficulties facing local authority tenants are acute. For local authority tenants, their landlord is also the regulator of housing standards. Because the local authority is legally incapable of serving enforcement notices on itself, it is effectively impossible for local authority tenants to seek enforcement of the statutory housing quality standards. This puts local authority tenants at a remarkable disadvantage relative to private tenants who not only can seek enforcement of these standards by the local authority, they also have access to the low cost and relatively quick dispute resolution framework of the residential tenancies board. Because local authority tenants are in theory able to take their landlord to court over poor housing conditions, the Committee were prepared to reject the argument that local authority tenants were denied effective remedies. However, given the high costs involved in pursuing legal action and the general lack of legal aid available to tenants, this reasoning is somewhat unreal and the highly disappointing. Following the decision, the State must submit a report outlining what actions have been taken to address the violations identified in this complaint.

Comment

Throughout my time working on the complaint, I had the opportunity to meet with local authority tenants and listen to their views and contributions. This was remarkably insightful, and the contributions of tenants played a major role in directing the arguments made and also supporting those arguments. One of the recurring themes of the meetings I attended, was the sense of how disempowered local authority tenants were made to feel by Irish housing law in various respects. While the collective complaint system is imperfect, it can provide a valuable means for drawing attention to, and forcing recognition, of the real difficulties experienced by many households. The European Social Charter provides an exceptionally useful framework for evaluating national legal standards and seeking to develop best practice. Looking back on my experience working on the project, I feel incredible fortunate to have worked with such an exceptional team of tenants, community organisers, housing professionals and academics. My advice to recent graduates, or those interested in working in this field, is to get involved in these types of co-operative projects wherever possible. While not essential, it can be extremely helpful to have studied modules in the field of housing law, renting law, human rights etc. Exploring the modules options available and making contact with academics involved in those modules can be exceptionally helpful in identifying research opportunities which are off the beaten track.

The features required for a TV format to be protected by copyright

Sebastian Vogg

What is it required for a TV format to be protected by copyright under UK law? The High Court of England and Wales answered this question in its recent decision in Banner Universal Motion Pictures Limited v Endemol Shine Group Limited, Friday TV AB and NBC Universal Global Networks UK Limited [2017] EWHC 2600 (Ch) (19 October 2017).

Southampton Law School visiting student Sebastian Vogg explains it all.

Here’s what Sebastian writes:

“In its decision of 19 October 2017, the High Court of England and Wales dismissed the claim of Banner Universal Motion Pictures Limited (‘BUMP’) for subsistence and infringement of copyright of the television game show format ‘Minute Winner’ because it was lacking the features required to be qualified as a dramatic work within the meaning of sections 1(1)(a) and 3(1) of the Copyright Designs and Patents Act 1988 (‘CDPA’).

Background

Mr Banner, the founder of the claiming company BUMP, devised a television game show format called Minute Winner. The information concerning this format was written down in a document (‘the Minute Winner Document’) and allegedly disclosed to the defendants by Mr Banner in circumstances that gave rise to an obligation of confidence.

According to BUMP, the defendants misused this information by broadcasting a game show called ‘Minute to Win It’ eight years later without Mr. Banner’s consent. BUMP claimed that this show was derived in substantial part from the Minute Winner format. The plaintiff argued that the Minute Winner Document was protected by copyright as a dramatic work and that the defendant’s unauthorized use amounted to copyright infringement. The format was not alleged to be a literary work, because dramatic and literary works are mutually exclusive categories. Hence, it is not possible to claim that a work falls within the scope of both categories. BUMP also claimed for breach of confidence and passing off. It should be mentioned that Mr. Banner had already tried similar claims before the Swedish courts and could not succeed.

Analysis

The Court had to decide upon the defendant’s appeal for summary determination of the claim and/or for it to be struck out, among others, because the contents of the Minute Winner Document did not qualify for protection as a copyright work. In terms of the summary determination, according to Part 24 (2) Civil Court Rules, the Court had to answer the question if there was a real prospect of succeeding. To do so, the Court had to assert if there was a real prospect of qualifying the format contained in the Minute Winner Document as a dramatic work.

The Court first determined what a dramatic work is. The CDPA provides no definition of dramatic work but in Norowzian v Arks Limited (No 2) [2000] EMLR 67 (at 73) it was held that a dramatic work is ‘a work of action (
) which is capable of being performed before an audience’. It should be borne in mind that no episode of the Minute Winner had ever been produced. Therefore, the question was if a television format is separately capable of being performed. The Court considered, among others, the decision of the Privy Council of New Zealand in Green v Broadcasting Corporation of New Zealand [1989] RPC 700 (‘Green’) as leading authority. In this decision, the format of a talent television show was not qualified as a dramatic work because it was lacking sufficient certainty of subject matter and unity to be capable of being performed (Green, at 40).

In the present case, the Court held that the relevant authorities indicate that qualifying a television format as dramatic work is, principally, at least arguable. The fact that there are spontaneous elements and changing events in every show, derived from the format, was not necessarily seen as a barrier to copyright protection.

In consideration of former authorities, the Court listed two minimum requirements for copyright protection. Firstly, the format must contain a number of clearly identified features which, taken together, distinguish the show from others of a similar type. Secondly, those distinguishing features must be connected with each other in a coherent framework which can be repeatedly applied so as to enable the show to be reproduced in recognisable form. So, if a show was produced by using the Minute Winner format, it must have been possible to distinguish the outcome from any other game show. As well, it must have been possible to recognise all episodes derived from this format as belonging to one concept.

The features of the format in the present case were basically: the title Minute Winner, the catchphrase ‘one minute to win (something)’, and the idea to give people the chance to win prizes by fulfilling tasks within one minute. Four examples of possible tasks and prizes were listed in the Minute Winner Document. The Court qualified these features as not capable of making a show distinguishable because they were part of the basic concept of almost every television game show. Furthermore, it was held that there was a lack of determining where the show should take place, how the contestants should be chosen, what type of one-minute tasks should be played, how long the show should take, and what kind of prizes should be winnable. Due to the lack of such elements, the Court couldn’t see any recognisable or repeatable structure of the format. According to the Court, the four examples of the document were too inconsistent to derive any structure of the show from them.

Therefore, the format had no realistic chance to be qualified as a dramatic work. For the case that this conclusion was wrong, the Court also held that the Minute Winner format and the show broadcasted by the defendants were different in almost all aspects and that there would have been no infringement anyway. The claims for breach of confidence and for passing off were also dismissed. The former mainly for reasons of jurisdiction rules, the latter due to BUMP’s missing goodwill.

Implications of the decision

In Green (at 25-45) there was some scepticism that a television show format could be qualified as a dramatic work. Anyway, it did not say that it was generally impossible. The possibility to qualify a format as a dramatic work was indicated in Meakin v BBC [2010] EWHC 2065 (Ch) (para 31) where it was assumed that copyright subsisted in specific television show formats. In the present case, the Court explicitly held that it can be possible for such a format to be protected by copyright as a dramatic work.

The arguments why the Minute Winner Document was not a dramatic work demonstrate which requirements could increase the chance of a format to be qualified as copyright protected. It seems hard for a Court to deny the copyright protection of such a format in a future case if it fulfils the requirements that were missed in the Minute Winner format. According to the present decision, criteria to take the threshold of the minimum requirements for copyright protection are: giving exact information about the possible contestants, the winnable prizes, the duration of the show, the kind of games, and where these games take place.

Like in Green (at 40) the Court explained its reluctance to qualify the format as a dramatic work with the argument that copyright creates a monopoly. This demonstrates again that the features of a format should be described as precisely as possible. The more exact these features are described, the less a monopoly would affect the rest of the world and the less it could be an argument against granting copyright protection. The Court held that BUMP could not claim a monopoly on games being played against the clock for one minute. In contrast, there could hardly be seen any problem if people were, for example, just kept from playing certain games, in certain places, to win certain prizes in a television show.

The Court pointed out, that there would have been no infringement anyway, because the format and the show broadcasted by the defendants were different in almost all aspects. One could say that this statement is kind of paradox because the Court first qualified the features of the format as not distinguishable and then used these features to make a precise distinction between the format and the defendant’s show. Of course, this conclusion was just made for the case that the Court was wrong in not qualifying the format as a dramatic work. But the mere possibility of reaching this conclusion implies that the features are distinguishable. A similar problem was, in terms of Green, already mentioned in David Rose, ‘Format rights: a never-ending drama (or not)’ (1999) 10(6) Ent. L.R. 170 (page 171).

The present decision brings no radical change in the assessment of television formats in terms of copyright law. But it probably provides a useful guideline how to draft a format that is likely to be qualified as being protected. The Court also emphasized that the relevant assessment is heavily fact-specific. Thus, if someone devises a format by following this guideline and lodges a similar claim in the future, there could be a different outcome than in the present case.”

The VCAST decision: how to turn a private copying case into a case about communication/making available to the public

A few months after Advocate General (AG) Szpunar released his Opinion in VCAST, C-265/16 [here], the Court of Justice of the European Union (CJEU) has now released its decision in this case.

This was a reference from Italy (Turin Court of First Instance) that one would have thought [as the questions were indeed about it!] to concern the understanding and application of the private copying exception within Article 5(2)(b) of the InfoSoc Directive to cloud-based video-recording services.

Well, although the AG Opinion is indeed about this, the CJEU judgment is not.

The Court, in fact, made the case about the right of communication/making available to the public within Article 3 of the InfoSoc Directive.

Let’s start then and see why VCAST is not really – or at least is no longer – a case about the private copying exception.

Background

The facts of the case are rather simple: basically, the Italian litigation revolves around the lawfulness of a cloud-based recording service, provided by VCAST, that allows its customers to make copies of terrestrial TV programmes broadcasts including, among other things, those of RTI.

Importantly, the possibility to make such recording is granted irrespective of whether customers can lawfully access the programmes terrestrially, ie offline. A clear instance is, as well explained by the AG in his Opinion, that for RTI programmes it is generally required that the user happens to be on the Italian territory.

Under Italian law it would appear that VCAST activity might be lawful, although the CJEU did not consider this a given. Nonetheless, the Court deemed it helpful to base its analysis on the assumption that Italian private copying exception applies to VCAST’s activities.

The question became therefore whether a national law of this kind is compliant with what Article 5(2)(b) of the InfoSoc Directive (read in combination with the three-step test in Article 5(5) therein) provides.

Private copying 
 but is VCAST’s service only about the making of copies?

After recalling that exceptions should be interpreted strictly, the Court confirmed the finding of the AG – which follows from the seminal Padawan decision – that for the private copying exception to apply it is not required that the beneficiary is the one who directly makes the copy of the copyright work at issue.

However – and this is the interesting part of the Court’s analysis – VCAST’s activity is not about reproductions or, at least, is not just about reproductions. Hence, the discussion around the private copying exception is not the whole story.

More fundamentally, in fact, VCAST does not only organize the recording of TV programmes for its customers but, instead, makes them available to them in the first place. It follows that VCAST’s activity cannot be assessed exclusively under the binary distinction reproduction/private copying. It is also necessary to take into account the making available part and, with it, Article 3 of the InfoSoc Directive.

What does all this lead to?

“[A]lthough the private copy exception means that the rightholder must abstain from exercising his exclusive right to authorise or prohibit private copies made by natural persons under the conditions provided for in Article 5(2)(b) of Directive 2001/29, the requirement for a strict interpretation of that exception implies that that rightholder is not deprived of his right to prohibit or authorise access to the works or the subject matter of which those same natural persons wish to make private copies.

It follows from Article 3 of Directive 2001/29 that any communication to the public, including the making available of a protected work or subject matter, requires the rightholder’s consent, given that, as is apparent from recital 23 of that directive, the right of communication of works to the public should be understood in a broad sense covering any transmission or retransmission of a work to the public by wire or wireless means, including broadcasting.” [39-40]

So, again, communication/making available to the public

The Court thus moved on to recall the requirements for an act of communication (or, rather, making available in this case) to the public [the judgment refers extensively to Reha Training, which – despite being a Grand Chamber ruling – has been quite neglected in decisions like GS Media, Filmspeler and Ziggo].

Interestingly, the CJEU stated that to have an ‘act of communication’ a transmission of a copyright work is required. The Court noted that there would be a transmission made by the broadcasting organisation, on the one hand, and a transmission made by VCAST, on the other hand. Both are done using a different means of transmission for the protected works, and are intended for different publics.

The result?

“without the rightholder’s consent, the making of copies of works by means of a service such as that at issue in the main proceedings could undermine the rights of that rightholder.

Accordingly, such a remote recording service cannot fall within the scope of Article 5(2)(b) of Directive 2001/29.” [51-52]

This means that VCAST’s service cannot be provided without the prior authorization of the relevant rightholders, in that its activity also amounts to communication/making available to the public within Article 3 of the InfoSoc Directive.

Comment

The outcome of the VCAST case is not surprising, nor is the fact that the CJEU answered the questions referred by the national judge rephrasing them and considering issues other than those raised.

More generally, the decision highlights once again the absolute centrality of the right of communication/making available to the public, especially in the online environment.

While cloud-based video recording services per se are not to be regarded as unlawful, certainly the CJEU decision sets precise boundaries for designing a service that would be compatible with EU law.

The first condition, stressed in particular by the AG, is that users of a cloud-based recording service must have lawful access to the terrestrial programmes that they wish to record in the first place.

The second condition is that the provider of a video-recording service cannot elude the authorization of the relevant rightholders when what it wishes to provide is a service that allows the recording of content by making it available for recording in the first place. But is this a probatio diabolica? Possibly. If so, then cloud-based video recording services would likely need to be licensed to operate under EU copyright law without the risk of infringing third-party rights.

[Originally published on The IPKat on 29 November 2017]

The author: Dr Eleonora Rosati is an Associate Professor in Intellectual Property Law. Find out more here.

Florence court prohibits unauthorized commercial use of David’s image

Earlier this week the Florence Court of First Instance (Tribunale di Firenze) issued an important and interesting decision [not yet available], which has been widely reported by newspapers in Italy [eg here, here, here, here] and abroad [eg here].

The Avvocatura dello Stato, this being the body responsible for advising and representing the Italian state (including in legal proceedings), sued a company, Visit Today, before the Florence Court of First Instance, seeking to obtain a decision that would prohibit this from selling unofficial tickets for the Galleria dell’Accademia in Florence, also using brochures and materials depicting what is probably the most famous guest of this beautiful museum: Michelangelo’s David.

The Florence court sided with Avvocatura dello Stato, and prohibited Visit Today from using the David’s image for commercial purposes.

On what grounds?

I have received several messages asking what the possible grounds for a decision of this kind would be, since copyright protection in this artwork has clearly lapsed … well, at least economic rights.

It is in fact worth recalling that in Italy moral rights protection is perpetual and also the State [or rather, the Head of Italian Government: see Article 23 of the Copyright Act] can enforce an author’s own moral rights. Similarly to other droit d’auteur jurisdictions, Italian courts have interpreted moral rights provisions generously, with the result that the scope of the right of integrity is rather broad.

This said, the main ground for the decision appears to have been [as I mentioned, the decision has not been published yet] the Italian Cultural Heritage Code, also known as Codice Urbani [see here for a recent discussion of Italian freedom of panorama and its relationship with the Code; see also here for an analysis of the decision].

Article 106 of the Code sets the general principle that for cultural heritage items subject to their own control, the State, the various Italian regions and local public bodies may allow individual applicants to use such items for purposes compatible with their own cultural value.

This means that for-profit uses of cultural heritage under the responsibility of Italian public administration are not generally free: instead, they are subject to preventive authorization.

Articles 107 and 108 of the Code provide that the competent public administration may allow third-party uses of an item – including an artwork – belonging to Italian cultural heritage, subject to the payment of royalties to be determined on the basis of – among other things – the type of use requested and the possible economic gain that the user would obtain from the use of the item.

This said, authorization is not required in each and every case. Article 108(3-bis) clarifies in fact that non-profit uses of cultural heritage items for purposes of study, research, freedom of expression or creative expression, and promotion of the knowledge of culturalheritage do not require authorization.

A surprising decision? Not really

The Florence court’s decision, therefore, is not surprising. It is not the first time, in fact, that improper and unauthorized commercial use of Italian cultural heritage has been at the centre of litigation or … threats of litigation. With specific regard to Michelangelo’s David, readers will for instance remember the rather recent case of the ‘armed David’ [here].

Similarly, lawyers who advise clients in the advertising business regularly remind them that the Cultural Heritage Code may prevent them from using works that, otherwise, would be in the public domain from a copyright standpoint.

What is at stake

When visiting Italian cities like Florence, Rome, and Venice it is very frequent to see long queues outside museums and monuments. Invariably frequent is also the sight of vendors (known as ‘bagarini‘) offering tickets – at prices higher than the official ones – to people standing in the queue, alleging great bargains and promising to let them skip the queue (admittedly a rather attractive perspective when you are queuing under the sun and facing a temperature of 38°C).

However, visitors are also often victims of scams.

The reason why the Avvocatura dello Stato brought the present proceedings was indeed also to set a ‘precedent’ and reduce, and possibly eliminate, the problem of bagarini.

Commenting on the Florence decision, Italian Minister of Culture stated that the decision is a good step in the direction of repressing the unauthorized sale – including over the internet – of tickets for Italian cultural heritage sites and the improper use of cultural heritage items. Headded that this decision “is an important step forward for the protection of consumers and the protection of masterpieces held in Italian museums.” The Cultural Heritage Ministry – he added – will continue to monitor improper uses and take action in all cases that infringe relevant provisions in the Cultural Heritage Code.

Although the decision is of course limited to the defendant’s activities, according to the director of Galleria dell’Accademia, Cecilie Hollberg, the outcome will serve as a model for all the museums that face the problem of unofficial ticket vendors who sell tickets at a higher price, thus scamming wannabe visitors.

[Originally published on The IPKat on 25 November 2017]

The author: Dr Eleonora Rosati is an Associate Professor in Intellectual Property Law. Find out more here.