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Copylawyers.. Copyright Rulings.. ECJ-Sony vs Falcon..

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Copyright Rulings
ECJ-Sony vs Falcon
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JUDGMENT OF THE COURT (Grand Chamber) of 20 January 2009 C240/07 - Sony vs Falcon

(Rights related to copyright – Rights of phonogram producers – Reproduction right – Distribution right – Term of protection – Directive 2006/116/EC – Rights of nationals of nonMember States)

1.      The term of protection laid down by Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights is also applicable, pursuant to Article 10(2) thereof, where the subjectmatter at issue has at no time been protected in the Member State in which the protection is sought.

 

2.      Article 10(2) of Directive 2006/116 is to be interpreted as meaning that the terms of protection provided for by that directive apply in a situation where the work or subjectmatter at issue was, on 1 July 1995, protected as such in at least one Member State under that Member State’s national legislation on copyright and related rights and where the holder of such rights in respect of that work or subjectmatter, who is a national of a nonMember State, benefited, at that date, from the protection provided for by those national provisions.

In Case C240/07,

REFERENCE for a preliminary ruling under Article 234 EC from the Bundesgerichtshof (Germany), made by decision of 29 March 2007, received at the Court on 16 May 2007, in the proceedings

Sony Music Entertainment (Germany) GmbH

v

Falcon Neue Medien Vertrieb GmbH,

THE COURT (Grand Chamber),

composed of V. Skouris, President, P. Jann, C.W.A. Timmermans, A. Rosas, K. Lenaerts, J.C. Bonichot and T. von Danwitz, Presidents of Chambers, J. Makarczyk, P. Kūris, E. Juhßsz, G. Arestis (Rapporteur), L. Bay Larsen and P. Lindh, Judges,

Advocate General: D. RuizJarabo Colomer,

Registrar: B. FŘl÷p, Administrator,

having regard to the written procedure and further to the hearing on 15 April 2008,

after considering the observations submitted on behalf of:

    –        Sony Music Entertainment (Germany) GmbH, by M. Schaefer, Rechtsanwalt,

    –        Falcon Neue Medien Vertrieb GmbH, by R. Nirk and E. Schott, Rechtsanwńlte,

    –        the Commission of the European Communities, by W. Wils and H. Krńmer, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 22 May 2008,

gives the following

Judgment

1        This reference for a preliminary ruling concerns the interpretation of Article 10 of Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (OJ 2006 L 372, p. 12).

2        The reference has been made in the context of proceedings between Sony Music Entertainment (Germany) GmbH (‘Sony’) and Falcon Neue Medien Vertrieb GmbH (‘Falcon’) concerning the protection of certain rights related to copyright.

 Legal context

 Community legislation

3        Article 12 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), provided:

‘Without prejudice to further harmonisation, the rights referred to in this Directive of performers, phonogram producers and broadcasting organisations shall not expire before the end of the respective terms provided by the … [International] Convention [for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, done at Rome on October 26, 1961]. The rights referred to in this Directive for producers of the first fixations of films shall not expire before the end of a period of 20 years computed from the end of the year in which the fixation was made.’

4        The term of protection referred to in Article 12 of Directive 92/100 was extended to 50 years by Article 3 of Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights (OJ 1993 L 290, p. 9).

5        Directive 2006/116 codified Directive 93/98. Article 3(2) of Directive 2006/116 provides that:

‘The rights of producers of phonograms shall expire 50 years after the fixation is made …

However, this paragraph shall not have the effect of protecting anew the rights of producers of phonograms where, through the expiry of the term of protection granted them pursuant to Article 3(2) of Directive 93/98/EEC in its version before amendment by Directive 2001/29/EEC [of the European Parliament and of the Council of 22 May 2001 (OJ 2001 L 167, p. 10)], they were no longer protected on 22 December 2002.’

6        Article 7(1) and (2) of Directive 2006/116 provides that:

‘1.      Where the country of origin of a work, within the meaning of the Berne Convention [for the Protection of Literary and Artistic Works, revised at Paris on July 24, 1971], is a third country, and the author of the work is not a Community national, the term of protection granted by the Member States shall expire on the date of expiry of the protection granted in the country of origin of the work, but may not exceed the term laid down in Article 1.

2.      The terms of protection laid down in Article 3 shall also apply in the case of rightholders who are not Community nationals, provided Member States grant them protection. However, without prejudice to the international obligations of the Member States, the term of protection granted by Member States shall expire no later than the date of expiry of the protection granted in the country of which the rightholder is a national and may not exceed the term laid down in Article 3.’

7        Article 10(1) to (3) of Directive 2006/116, headed ‘Application in time’, is worded as follows:

‘1.      Where a term of protection which is longer than the corresponding term provided for by this Directive was already running in a Member State on 1 July 1995, this Directive shall not have the effect of shortening that term of protection in that Member State.

2.      The terms of protection provided for in this Directive shall apply to all works and subjectmatter which were protected in at least one Member State on the date referred to in paragraph 1, pursuant to national provisions on copyright or related rights, or which meet the criteria for protection under … Directive 92/100 ...

3.      This Directive shall be without prejudice to any acts of exploitation performed before the date referred to in paragraph 1. Member States shall adopt the necessary provisions to protect in particular acquired rights of third parties.’

 National legislation

8        Paragraph 137f of the Law on copyright and related rights (Gesetz Řber Urheberrecht und verwandte Schutzrechte) of 9 September 1965 (BGBl. 1965 I, p. 1273), as amended by the Law of 23 June 1995 (BGBl. 1995 I, p. 842, ‘UrhG’), constitutes the transitional rule in respect of the transposition of Directive 93/98.

9        Paragraph 137f(2) and (3) of the UrhG is worded as follows:

‘(2)      The provisions of this Law in the version applicable as of 1 July 1995 shall apply equally to works for which protection pursuant to this Law expired prior to 1 July 1995, but which continued to be protected on that date under the law of another Member State of the European Union or a Contracting Party to the Agreement on the European Economic Area. The first sentence applies, mutatis mutandis, to the related rights of the publisher of posthumous works (Paragraph 71), performers (Paragraph 73), producers of phonograms (Paragraph 85), broadcasting organisations (Paragraph 87) and film producers (Paragraphs 94 and 95).

(3)      If protection for a work in the territory to which this Law applies is revived pursuant to subparagraph 2, the revived rights belong to the author. Exploitation of the rights commenced prior to 1 July 1995 can nevertheless continue, in the context envisaged. Appropriate compensation must be paid for exploitation performed after 1 July 1995. Sentences 1 to 3 apply, mutatis mutandis, to related rights.’

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

10      According to the order for reference, Falcon distributes two phonograms containing recordings of performances by the artist Bob Dylan. The first CD is entitled ‘Bob Dylan – Blowin’ in the Wind’, the second ‘Bob Dylan – Gates of Eden’.

11      Those phonograms include songs which feature on the albums ‘Bob Dylan – Bringing It All Back Home’, ‘The Times They Are AChangin’’ and ‘Highway 61 Revisited’. Those albums were released in the USA before 1 January 1966.

12      Sony, the applicant in the main proceedings, is the German subsidiary of the Japanese multinational of the same name.

13      Sony applied to the competent Landgericht (Regional Court) for an injunction prohibiting Falcon from copying and distributing the phonograms ‘Bob Dylan – Blowin’ in the Wind’ and ‘Bob Dylan – Gates of Eden’, or from having others copy and distribute them on its behalf. Further, Sony asked the court to make an order for discovery against Falcon and to determine Falcon’s liability for damages.

14      Falcon submitted that no phonogram producer owns the rights in Germany to Bob Dylan albums recorded prior to 1 January 1966.

15      The Landgericht dismissed Sony’s application. Upon appeal by Sony, the appellate court stated that there was no doubt that the rights in the recordings at issue in the main proceedings belonging to the producer of the phonograms had been effectively transferred to Sony. Nevertheless, that court dismissed Sony’s appeal, considering that, under the Convention for the Protection of Producers of Phonograms against Unauthorised Duplication of their Phonograms, signed at Geneva on 29 October 1971, in force both in Germany and the United States, such producers of phonograms are entitled to copyright protection pursuant to Paragraph 85 of the UrhG only in relation to activities which took place after 1 January 1966. Moreover, the appellate court considered that music recordings produced prior to that date were also not entitled to protection under Paragraph 137f of the UrhG, a transitional provision drawn up to bring national law into line with Directive 93/98. Paragraph 137f(2) of the UrhG did not apply to phonograms produced prior to 1 January 1966, as these had at no time been protected in Germany.

16      It was in those circumstances that Sony applied for ‘Revision’ of the judgment of the appellate court to the Bundesgerichtshof (Federal Court of Justice) which, taking the view that the outcome of the proceedings before it depended on the interpretation of Article 10(2) of Directive 2006/116, decided to stay proceedings and to refer the following questions to the Court for a preliminary ruling:

    ‘(1)  Does the term of protection granted by Directive 2006/116 … under the conditions set out in Article 10(2) thereof apply also in the case of subject-matter that has not at any time been protected in the Member State in which protection is sought?

    (2)       If Question 1 is to be answered in the affirmative:

    (a)      Do national provisions governing the protection of rightholders who are not Community nationals constitute national provisions within the meaning of Article 10(2) of Directive 2006/116?

    (b)      Does the term of protection granted pursuant to Article 10(2) of Directive 2006/116 also apply to subject-matter that, on 1 July 1995, fulfilled the criteria set out in Council Directive 92/100 …, but whose rightholder is not a Community national?’

 The questions referred

17      It should be noted at the outset that the copyrightrelated rights at issue in the case in the main proceedings are rights concerning the reproduction and distribution of phonograms. It is not disputed that the rights were validly transferred to Sony.

18      It is, furthermore, clear from the order for reference that, pursuant to Paragraph 126 of the UrhG, companies based in the United States are entitled in Germany to the protection provided for in the Convention referred to in paragraph 15 of this judgment only in respect of activities from 1 January 1966, which is not the case of the phonograms at issue in the main proceedings. Nor does the application of Paragraph 137f(2) of the UrhG grant protection to those phonograms on German territory, since that provision presupposes that the work at issue was protected on that territory before 1 July 1995, which was never the case of the phonograms at issue.

19      It should also be stated that, as is apparent from its wording, the order for reference is based on the assertion that United Kingdom legislation affords protection to phonograms fixated before 1 January 1966 and this was extended to phonograms of American producers which were released in the United States.

 Question 1

20      By its first question, the national court asks whether the term of protection provided for under Article 10(2) of Directive 2006/116 should be applied to subjectmatter that has never been protected in the Member State in which that protection is sought.

21      According to Article 10(2) of Directive 2006/116, the terms of protection of phonogram producers, provided for in Article 3(2) of that directive, are to apply to the subjectmatter at issue if, on 1 July 1995, it was protected in the territory of at least one Member State, pursuant to national provisions on copyright or related rights, or if it met the criteria for protection provided for in Directive 92/100.

22      Thus, according to the wording of Article 10(2), the first alternative requirement under that provision concerns the prior existence of protection for the subjectmatter at issue in at least one Member State. That provision does not require that Member State to be the State in which the protection for which Directive 2006/116 provides is sought.

23      Moreover, it should be pointed out that recital 3 in the preamble to Directive 2006/116 states that differences between national laws are liable to impede the free movement of goods and freedom to provide services and to distort competition in the common market. With a view to the smooth operation of the internal market, that directive is intended to harmonise the laws of the Member States so as to make terms of protection identical throughout the Community.

24      In those circumstances, to interpret Article 10(2) of Directive 2006/116 as meaning that application of the first alternative requirement of that provision is conditional on the prior existence of protection under the national legislation of the Member State in which the protection for which the directive provides is sought, even though such prior protection has been granted in another Member State, would comply neither with the terms of the provision at issue nor with the purpose of that directive.

25      Accordingly, the answer to the first question is that the term of protection laid down in Directive 2006/116 is also applicable, pursuant to Article 10(2) of that directive, where the subjectmatter at issue has at no time been protected in the Member State in which the protection is sought.

 Question 2(a)

26      By this question, the national court asks whether national provisions governing the protection of holders of copyrightrelated rights who are not Community nationals constitute national provisions within the meaning of Article 10(2) of Directive 2006/116.

27      It must be borne in mind that, as the Advocate General stated at point 64 of his Opinion, the provisions of Article 10(2) of Directive 2006/116 pursue the objective of protection and apply to all works and subjectmatter which on 1 July 1995 were protected under the provisions of at least one Member State on copyright or related rights.

28      In that regard, it is not apparent from its wording that Article 10(2) concerns only national provisions on copyright or related rights for the protection of holders of such rights who are Community nationals. Under the terms of that provision, Member States must grant the terms of protection for which Directive 2006/116 provides for all works and subjectmatter which on 1 July 1995 were protected as such in at least one Member State.

29      In the context of the application of Article 10(2) of Directive 2006/116, it is thus necessary to examine whether it is possible to regard a work or subjectmatter as being protected on 1 July 1995 in at least one Member State without consideration of the nationality of the holder of the copyrightrelated rights in that work or subjectmatter.

30      According to the order for reference, the Bundesgerichtshof is uncertain whether an interpretation of Article 10(2) of Directive 2006/116 which recognised holders of copyrightrelated rights who are not Community nationals as entitled to the benefit of that provision would be compatible with Article 7(2) of that directive.

31      In that regard, it should be pointed out that the objective of Article 10(2) of Directive 2006/116 is to specify the conditions in which the terms of protection of copyrightrelated rights laid down by that directive are to apply, on a transitional basis, to existing situations. That provision provides for the application of those terms in respect of works and subjectmatter which benefited on 1 July 1995 from the protection granted by national provisions on copyright or related rights in at least one Member State.

32      The intention of Article 10(2) is not to rule out the solution laid down by Article 7(2) of Directive 2006/116 in all cases where the terms of protection provided for by the directive are sought by holders of copyrightrelated rights who are not Community nationals in relation to a work or subjectmatter which does not satisfy either of the two alternative conditions of the transitional provision of Article 10(2) of that directive.

33      The objective of Article 7(2) is to regulate the protection of copyrightrelated rights with regard to holders of such rights who are not Community nationals and the Article provides, to that end, for the terms of protection indicated in Article 3 of the directive to apply in respect of such rightholders, provided that Member States grant them protection.

34      In view of the foregoing, the question whether, in the context of Article 10(2) of Directive 2006/116, a holder of copyrightrelated rights in a work or subjectmatter who is a national of a nonMember State was protected on 1 July 1995 in at least one Member State must be assessed in the light of the national provisions of that Member State and not in the light of the national provisions of the Member State in which the protection for which that directive provides is sought. Such a conclusion is, moreover, supported by recitals 3 and 17 in the preamble to the directive, which explain the objective of harmonisation pursued and, in particular, that of providing for the same starting point for the calculation of the term of protection for copyrightrelated rights as well as the same term of protection for those rights throughout the Community with a view to ensuring the smooth operation of the internal market.

35      It follows that, in respect of a work or subjectmatter protected on 1 July 1995 in at least one Member State according to the national provisions of that Member State, the fact that the rightholder thus protected is a national of a nonMember State and is not entitled, in the Member State in which the term of protection provided for by Directive 2006/116 is sought, to protection under the national law of that Member State, is not decisive for the application of Article 10(2) of the directive. What matters is whether the work or the subjectmatter at issue was covered by protection on 1 July 1995, under the national provisions of at least one Member State.

36      According to the order for reference, in the United Kingdom the protection provided for by national law applies to phonograms fixated before 1 January 1966 and the phonograms at issue in the main proceedings already benefited from protection in that Member State on 1 July 1995. In those circumstances, Article 7(2) of Directive 2006/116 cannot govern the situation at issue in the case in the main proceedings.

37      Consequently, the answer to Question 2(a) is that Article 10(2) of Directive 2006/116 is to be interpreted as meaning that the terms of protection provided for by that directive apply in a situation where the work or subjectmatter at issue was, on 1 July 1995, protected as such in at least one Member State under that Member State’s national legislation on copyright and related rights and where the holder of such rights in respect of that work or subjectmatter, who is a national of a nonMember State, benefited, at that date, from the protection provided for by those national provisions.

 Question 2(b)

38      In view of that answer, and the assertion on which the order for reference is based, as referred to in paragraph 19 above, it is no longer necessary to answer Question 2(b).

 Costs

39      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 (Grand Chamber) hereby rules:

    1.      The term of protection laid down by Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights is also applicable, pursuant to Article 10(2) thereof, where the subjectmatter at issue has at no time been protected in the Member State in which the protection is sought.

    2.      Article 10(2) of Directive 2006/116 is to be interpreted as meaning that the terms of protection provided for by that directive apply in a situation where the work or subjectmatter at issue was, on 1 July 1995, protected as such in at least one Member State under that Member State’s national legislation on copyright and related rights and where the holder of such rights in respect of that work or subjectmatter, who is a national of a nonMember State, benefited, at that date, from the protection provided for by those national provisions.

german-copyright-law drafting and revising licensing contracts, contractual agreements, as well as book publishing contracts, edition contracts and publishing administration agreements, including drafting contracts for the production of sound storage media, film bases and data processing media (transfer agreements for artists and bands, distribution agreements, performance agreements, live performance agreements);  general media law, including publishing law, law of the press,  deutsch english-lawyer-copyright-copyrights-attorney-court internet, music, film, television and events, as well as drafting agreements for film and television productions (screenwriter contracts, product placement agreements, producer contracts);  management contracts, agency contracts, promotion agreements, media cooperation agreements and merchandising agreements;  protection of domain names english

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