Ryanair v P R Aviation, Court of Justice of the European Union, C-30/14, ECLI:EU:C:2015:10
Journal of Intellectual Property Law & Practice (2015) doi: 10.1093/jiplp/jpv127, first published online: July 28, 2015
The Court of Justice of the European Union has held that Article 15 of the Database Directive, which bars contract clauses that limit users' rights, is not applicable when a database is protected under neither copyright nor database right.
Legal context
Protection under the Directive exists only if the data set falls within the ambit of Article 1(2), which defines database as ‘a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means’. While in Fixtures Marketing Ltd v Organismos Prognostikon Agnon Podosfairou (C-444/02, ECLI:EU:C:2004:697) the CJEU previously held that the definition of database enjoyed a broad scope under the Directive. It is difficult to ascertain precisely what may come under this definition, although the use of the words ‘any form’ in Article 1(1) suggests that electronic and non-electronic databases are covered by it. Recital 14 of the Directive in clear terms extends the definition to databases in non-electronic forms.
Further, the scope of the Directive seeks to protect databases under either copyright or sui generis right. To extend copyright protection the creator must demonstrate his own intellectual creation towards the production of a database. Thus the originality criterion plays a vital role to ensure copyright protection for databases; the threshold for such originality is largely based on selection and arrangement of the data rather than the resources deployed to gather the data. In order to enjoy sui generis database right the creator must show that there has been ‘qualitatively and/or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents to prevent extraction and/or re-utilization of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database’. The scope of the two-tier protection under Articles 3 and 7 was elucidated in British Horse Racing Board Ltd and Others v William Hill Organization Ltd (C-203/02, ECLI:EU:C:2004:695) (‘BHB’) and Football Dataco Ltd v Yahoo! UK Ltd (C-604/10, ECLI:EU:C:2012:115). In BHB, with respect to the words ‘obtaining’ and ‘verification’, the Court of Justice of the European Union (CJEU) concluded that the protection offered under Article 7 is limited to investment made towards obtaining and verification of existing materials, but not investment in the creation of such materials. Said the CJEU, investment must be understood within the context of creation of databases, ie from the perspective of using existing material as opposed to creation of independent materials. The purpose of the Directive is largely to protect qualitative and quantitative resources used for the storage and processing of existing information. In Football Dataco, the CJEU affirmed that the intellectual effort that goes into creation of data is not counted, while deciding on the issue of overall creativity, which is required under Article 3 to protect a database under copyright.
Facts
This dispute related to use by PR Aviation of a dataset available from the website of Ryanair. PR Aviation provided online services to customers about air travel and airfares, which involved comparison of flight data relating to low cost airlines. This enabled customers to compare flight data of various airlines and also to book flight tickets. A small commission was paid to PR Aviation upon the booking of a flight through their website.
Ryanair alleged that the services provided by PR Aviation resulted in automated ‘screen scraping’ of the dataset from its website whenever an individual initiated an online query on PR Aviation's website. According to Ryanair, this breached the terms and conditions specified on its website, which clearly stated that Ryanair was the exclusive distributor of its services and that other websites were not authorized to sell its flight tickets. The terms and conditions listed on the Ryanair website restricted use of the dataset to private non-commercial use alone. Ryanair alleged that PR Aviation acted in breach of the terms and conditions they had accepted, claiming that the unauthorized use of the dataset infringed its rights.
The local court in Utrecht dismissed Ryanair's claim to dataset infringement, since the claim related to infringement under Directive 96/9 and national database law. However, PR Aviation was ordered to refrain from infringing Ryanair's copyright in flight data and to pay compensation for the harm caused due to unauthorized use of the data.
On appeal, the Court of Appeal, Amsterdam set aside the decision of the Utrecht local court, holding that PR Aviation had not infringed any rights as its use of Ryanair's flight data came under the purview of legitimate use under the Dutch Copyright Act. As for breach of the terms and conditions specified on the Ryanair website, which sought to exclude third parties from using the flight data, their effect was contrary to the legitimate use exception provided under Articles 24(a)(1) and (2) of the Dutch Copyright Act. The court added that Ryanair had not established the existence of ‘substantial investment’ in the creation of a dataset, so protection under the sui generis database right could not be claimed.
Ryanair appealed to the Supreme Court of Netherlands on the ground that the dataset on its website did not come within the purview of works protected by copyright. Alternatively, the Court of Appeal had wrongly decided the issue relating to enforcement the terms and conditions specified on its website since the dataset used by PR Aviation did not come within the purview of either copyright or sui generis right under the Database Directive 96/9. The Supreme Court of Netherlands asked the CJEU whether Directive 96/9 also applied to online databases that were not protected by copyright or sui generis rights, and whether freedom to use such databases can be limited contractually.
The decision
The CJEU ruled that PR Aviation's argument that the dataset fell within the definition of database in Article 1(2) of the Directive could only be satisfied if it that database was either protected by copyright or by sui generis database right. In the context of copyright protection offered under Article 3, Article 5 authorizes the author of the database to carry out certain restricted acts. However, Article 6(1) provides the conditions under which a lawful user can perform the restricted acts stated under Article 5 so as to have access to the content of a database without the authorization of its author. In the context of databases protected by the sui generis database right, Article 8(1) under certain conditions allows the lawful user of a database to make insubstantial use of the contents.
As a prohibitory measure, a database producer under Article 15 cannot by contract deprive a lawful user of the rights granted under either Article 6(1) or Article 8(1); such terms were null and void. The purpose of the Directive was to protect the creator of the database either under copyright or sui generis rights. However, in order to ensure that there is a balance between the creator of database and its lawful user, the Directive seeks to create exceptions to the rights provided to creator of database. Any effort by the creator of database to circumvent these exceptions through contractual provisions is disregarded.
In this case, the CJEU said, the application of Article 15 depends on whether the database in question is either protected by Article 3 or 7 and it is limited for the ‘purposes of this Directive’. Accordingly, the use of a database may be restricted through contractual means when it is protected neither by copyright nor by sui generis database right.
Analysis
Since its inception, the Database Directive has not been free from controversies surrounding its utility and effectiveness. It was evaluated after nearly 10 years from its passage. The Commission of the European Communities' evaluation report assessed whether the policy goals pertaining to the enactment of the Directive had been fulfilled especially in the context of enacting the novel sui generis database right (‘First evaluation of Directive 96/9 on the legal protection of databases’, December 2005). This assessment was in furtherance to the overall idea of creating a legal framework with the objective of protecting a wide range of databases in the information age. Besides the unproven economic impact, the report suggested that the sui generis part of the Directive should either be repealed or amended. This suggestion was based not solely on the claim of economic impact but also on the inherent ambiguities present in the Directive. Specific concern was raised in relation to the expectations surrounding the meaning of the words ‘substantial investment’, which is one of the foremost requirements under Article 7. The concerns have been exacerbated by the fact that there is no comparable jurisdiction where sui generis right has been used as a legal instrument. Further, BHB meant that the scope of the Directive as envisaged at the time of enactment might have been curtailed. The evaluation report indicates that there are possible difficulties when it comes to balancing the Directive. This is more so with the sui generis part. The exceptions contained in the Directive are there to balance any eventualities.
Given that there is ambiguity in terms of determining whether a database is protected by copyright or sui generis right, there may be an unfair situation in which its creator will in most instances use contractual terms to restrict the use of the data by third-party users. This could encourage all creators of databases to deliberately use restrictive contractual terms to prevent users from utilizing and extracting data. Excessive reliance on contractual terms would defeat the purpose of the database Directive and tilt the balance in favour of database creators. Going by the previous experiences of BHB and Football Dataco, database producers might already have a slight edge when it comes to protecting single source databases.
Practical significance
Websites that provide price comparison services may be deterred by this decision from providing such services. Such websites tend to scrape information from various data-rich websites and their business model relies largely on unpaid scraping of content, which is relied upon by its customers. This practice may have to stop if website operators use restrictive contractual terms instead of relying on database protection. The burden of proving that databases fall within the scope of the Directive would be upon the unauthorized data user, since the creator in all likelihood would prefer to show that the data is neither copyright-protected nor protected under sui generis rights.
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