The Court of Appeal's judgment in Football Dataco v Sportradar has implications for claims against Pinterest, Tumblr and other social media sites. There may be more to come, with a further appeal in prospect. Akash Sachdeva and Gareth Dickson explain.
In its judgment of 6 February 2013, the Court of Appeal confirmed what many had predicted and many more had feared: that 'the owner of any website anywhere in the world will be a joint tortfeasor with a UK user of that website if the inevitable consequence of access to that site by the user is infringement by that user'. This will be of particular concern to any sites displaying third party content since the UK has much narrower defences to copyright infringement than the USA and much of the rest of Europe.
The Court also found that the unauthorised re-utilisation of a qualitatively substantial part of a database whose owner has made a substantial investment in the obtaining, verification or presentation of its contents, was an infringement of that owner's sui generis database right under the Database Directive.
The Court of Appeal's decision in Football Dataco v Stan James and Sportradar  EWCA Civ 27 concerns the subsistence and infringement of the sui generis database right provided by Articles 1 and 7 of the Database Directive (96/9/EC, available here). It is in their findings on the question of infringement, however, that the court had to consider important issues of jurisdiction and joint tortfeasorship in the online environment.
The facts of this dispute are set out in our earlier article on the CJEU's October 2012 ruling on various jurisdictional aspects of this case. In its judgment, the CJEU found that the English courts could exercise jurisdiction over a non-domiciled defendant in respect of certain uses of a database, provided that those uses have been targeted at users in England. For present purposes, it is sufficient to note that:
Subsistence of the sui generis database right
What is a 'database'?
The Court of Appeal was quick to find that Football Live was a database within the meaning of Article 1 of the Database Directive. It pointed out that the CJEU has already held that the term 'database' should be construed widely, with particular regard to the functions of storing and processing individually accessible materials which are arranged in a systematic or methodical way. It also took the opportunity to confirm that, in addition to including an index or a table of contents, a 'database' can exist within a copyright work without limiting the protection of either the database right or the copyright. An example might be a site map within a web site.
Qualification of a database for the sui generis database right
The sui generis database right under Article 7 of the Database Directive is afforded only to databases in which there has been 'qualitatively or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents'. In Case C-203/02 BHB v William Hill, the CJEU held that investment in the creation of content (in that case it was approved lists of runners and riders in horseracing) must be disregarded in this analysis.
The defendants argued that, when Football Dataco inserted into Football Live the various statistics provided via phone calls from employees attending football matches, it too was investing in the creation of the contents of Football Live. The Court of Appeal described this argument as 'absurd' and 'silly'. First, Football Dataco does not need to record a goal as a goal in order for it to be a goal: the fact of a goal is not data created by Football Dataco. Second, if the defendants were correct then even the inputting of pre-existing data into Football Live by a human would be creation of data in the form of that person's expression of his interpretation of the existing record. The result would be that the database right would almost never apply: it would be 'a mere mouse of a right'.
The Court therefore held that Football Dataco's investment in Football Live (approximately £600,000 per annum) related to the obtaining, verification or presentation of its contents, and was sufficient to qualify it for the sui generis database right.
Infringement of Football Live by UK users
Having found that Live Scores had extracted data from a substantial portion of matches in Football Live, the Court then assessed the investment in that data by Football Dataco to determine whether the defendants' UK users had, through their use of Live Scores, extracted and/or re-utilised a 'substantial' portion of Football Live.
On quantitative substantiality, the Court appears to have been willing to hear evidence that only 2% of Football Live had been copied, suggesting that such a figure had some relevance to the issue. In the event, however, the defendants did not adduce sufficient evidence to support the claim.
Regarding qualitative substantiality, the Court assessed how much of Football Dataco's investment into Football Live had been extracted or re-utilised. Again, the Court found for Football Dataco. Although users of the Live Scores database might view only a small portion of it, in order to do so they had to download the entirety of the database. Therefore infringement by UK users was made out.
Infringement of Football Live by the defendants as joint tortfeasors
The Court then turned to the issue of joint tortfeasorship, a common-law concept under which each party who makes an act his own is liable for it. In contrast to secondary liability, where a party is liable for someone else's infringing act because of his level of knowledge of and assistance towards it, joint tortfeasorship has no knowledge requirement.
The Court acknowledged that whether a web site operator is jointly liable for infringements which occur by virtue of the mere accessing of their site is an 'important' question (to put it mildly), not least because the answer applies equally to claims of copyright infringement. It is worth setting out Sir Robin Jacob's words (at -) in full:
'So the question boils down to this: if A has a website containing infringing material which will inevitably be copied into the computer of B if he enters that website, is A a joint tortfeasor with B? I am conscious that this question is important. The answer would seem to apply equally to copyright as to database rights. If the answer is yes, then the owner of any website anywhere in the world will be a joint tortfeasor with a UK user of that website if the inevitable consequence of access to that site by the user is infringement by that user.
I would hold the answer to be yes. The provider of such a website is causing each and every UK user who accesses his site to infringe.'
The result of this conclusion is that a court can exercise jurisdiction over, and, more importantly, order injunctions and damages awards against, almost any web site operator in the world. An analysis of this complex and developing area of law is beyond the scope of this article.
Existing CJEU case law on the database aspects of this dispute meant that the Court of Appeal was either going to have to ask the CJEU to clarify that case law or to find for the claimant. The fact that it did not refer more questions to the CJEU, having already stayed proceedings for almost two years in order to do so in 2011, is not surprising.
The Court's comments in relation to joint tortfeasorship, however, are broad and arguably significantly change the legal landscape for social media sites and others that host and display third-party content, especially in light of the UK's limited defences to copyright infringement. In particular, image-based sites such as Pinterest, which encourages users to 'pin' images found all over the Internet onto virtual notice-boards, and re-blogging sites such as Tumblr, which encourages users to re-blog online content, will have to look very closely at whether they can avail themselves of the hosting exemption safe harbour under the E-Commerce Directive (2000/31/EC, available here).
The defendants are expected to appeal the decision to the Supreme Court. It has also been suggested that they will ask the Supreme Court to refer questions on the common law doctrine of joint tortfeasorship to the CJEU, although it is unclear on what basis the CJEU would have jurisdiction to answer any such questions. Although Arnold J referred numerous questions to the CJEU in L'Oréal SA & Ors v eBay International AG & Ors  EWHC 1094 (Ch), he considered joint tortfeasorship to be a matter of domestic law alone.
Akash Sachdeva joined Edwards Wildman in 2011 as a Partner. He is a qualified barrister.
Gareth Dickson is a litigator in the Litigation practice in Edwards Wildman's London office. He is a UK qualified solicitor and New York admitted attorney whose practice focuses on the resolution of technology and intellectual property disputes.