Madrid court of appeals upholds YouTube's liability safe harbor in Telecinco case
On 14 January 2014 the Madrid Court of Appeals issued its decision No 11/2014 on YouTube v Telecinco, dismissing Telecinco's claims and fully confirming the first instance decision. The original Spanish language version of the Court of Appeals decision appears here.
Telecinco, a Spanish broadcaster owned by the Italian Mediaset, brought an action in 2008 against YouTube LLC, alleging copyright infringement for video fragments apparently taken from Telecinco's TV programmes and uploaded to YouTube by the users of such hosting platform.
In 2010, the District Court of Madrid issued its decision dismissing Telecinco's claims. Pursuant to the Information Society Services and E-Commerce Act 34/2002, of 11 July 2002, which implemented the E-Commerce Directive 2000/31/EC (the “LSSI Act”, for its acronym in Spanish), the Court considered that YouTube, as an information society service provider in the meaning of the LSSI Act (“ISP”), was exempted from liability for user generated contents (“UGCs”). Telecinco appealed the first instance decision before the Madrid Court of Appeals, which has now dismissed Telecinco’s claims in the following terms.
First, Telecinco argued that YouTube’s approach was proactive based on the existence of (1) agreements with copyright collecting societies to acquire licences over the copyrights managed by those; (2) a policy over the contents binding users; (3) a licence required from users over the UGCs uploaded, and their acceptance of certain Terms and Conditions for their use, giving YouTube the right to take down certain contents; and (4) certain control and editorial tasks carried out by YouTube over the stored contents. Thus, according to Telecinco, YouTube could not benefit from the liability safe harbor provided by the LSSI Act. The Court of Appeals noted, following Google France (Joined Cases C-236/08 to C-238/08) and L’Oréal (Case C-324/09), that the approach towards the hosted contents has to be interpreted in terms of knowledge and control, and that the aforementioned activities could in no way mean that YouTube had active knowledge or proactive control over the UGCs.
Secondly, Telecinco argued that following the Spanish Supreme Court’s interpretation of the LSSI Act, and the E-Commerce Directive’s safe harbor regime, YouTube’s liability would have to be established in light of its “actual knowledge” of the infringing UGCs hosted. According to Telecinco, such knowledge existed due to (1) communications sent to YouTube in which Telecinco claimed the existence of infringing UGCs and (2) the presence of Telecinco’s logo in such UGCs. In this regard, the Court of Appeals pointed out that communications generically claiming infringement without identifying the infringing videos specifically was incapable of triggering YouTube’s actual knowledge. Furthermore, in accordance with the findings and evidence of the case, the presence of Telecinco’s logo on some UGCs hosted by YouTube was also irrelevant for this purpose.
Finally, Telecinco argued in favour of its rejected request for an injunction to prevent YouTube from using the allegedly infringing UGCs. In this regard Telecinco pointed out the CJEU’s interpretation of Article 11 of the Enforcement Directive as meaning that an ISP may be ordered “to take measures which contribute, not only to bringing to an end infringements of those rights by users of that marketplace, but also to preventing further infringements of that kind” (Case C-324/09, L’Oréal). However, the Madrid Court of Appeals pointed out that such Court also made clear that this rule “may not affect the provisions of Directive 2000/31 and, more specifically, Articles 12 to 15 thereof … which prohibits national authorities from adopting measures which would require a hosting service provider to carry out general monitoring of the information that it stores” (Case C‑360/10, Sabam and Case C- 70/10, Scarlet). According to the Madrid Court of Appeals, an injunction against future infringements would result in either an order to monitor UGCs proactively, which would violate the E-Commerce Directive, or in an obligation to implement a filtering system that, according to the CJEU, would seriously endanger “the freedom to conduct business enjoyed by operators such as ISPs”, also possibly infringing “the fundamental rights of that ISP’s customers, namely their right to protection of their personal data and their freedom to receive or impart information” (Case C‑360/10, Sabam).