In the first database right case to be decided by the English High Court, Mr Justice Laddie found in favour of the Claimant holding that the Defendant had infringed its database right. The case in question was British Horseracing Board v William Hill.
The case concerned a relatively new type of intellectual property right introduced in to English law by means of the Copyright and Rights in Databases Regulations 1997 which itself implemented the European Directive on the Legal Protection of Databases ("the Directive").
The Claimant, the British Horseracing Board ("BHB") is the governing authority for the British horseracing industry. Part of the BHB's function is to compile data relating to horseracing. This is a major undertaking for the BHB, which is a reflection of the amount of horseracing in this country. For example in the year 2001, there are scheduled to be about 7,800 races, held at 59 racecourses and scheduled to take place on 327 days of the year. In addition, at any one time there are 15,000 horses in training, 9,000 active owners (each with their own racing colours) and 1,000 trainers. The BHB takes 4-5 months each year to compile, grant and publish the annual fixture list for racing, which is constantly updated. In order to be able to process all of this information the BHB maintains a computerised collection of this information (the "BHB Database"). It is this database that was the subject of the litigation.
The BHB database contains a huge number of records that have to be accurately stored and processed each day. It is essential to the integrity of the horseracing industry that the BHB database is accurate. The BHB database is the only official source of information relating to races to be run in the UK and is made available in advance of the race. The information provided includes the place and date of the meeting, the distance of the individual races, the entry requirements for each race, the entry date, the fees payable, the initial amount of prize money, the initial name of the race and so on. The process of updating and maintaining the BHB database is estimated to result in 800,000 new records or changes to existing records each year.
In this case it was important that the BHB did more than just enter the information into a computer. It went to considerable lengths to ensure that the information contained in the BHB Database was accurate. It was estimated that the cost of maintaining the BHB database was £4 million per annum. The BHB is self-financing and approximately £1 million per annum was derived from fees charged to third parties for the use of information contained in the BHB Database. Two such third parties were relevant to this case. The first was a company called Racing Pages Limited. This company forwards data to various subscribers which include some bookmakers. In particular Racing Pages makes available in electronic form, usually the day before a race, accurate and up-to-the minute information in what is called a Declarations Feed. Secondly a company called Satellite Information Services Limited ("SIS") is allowed to transmit information from the BHB database to its subscribers in what is called a raw data feed ("RDF").
William Hill is one of the leading bookmakers in the UK. Its two main areas of business are a nation-wide network of Licensed Betting Offices ("LBO") and telephone betting operations.
SIS supplies William Hill with live audio and video coverage of horseracing to the LBOs. The LBOs also display copies of a publication called the Racing Post which provides detailed information on the runners and riders, derived from the BHB database, each day. It was not disputed that most of this information displayed or used by William Hill in the horseracing related business came directly or indirectly from the BHB Database.
This dispute related to a new form of business commenced by William Hill, namely providing betting services over the internet. Members of the public can access William Hill's internet sites and see what horses are running, the odds for each horse and place bets electronically. It was not disputed that the information contained on these websites was found in and came from the RDF received by William Hill from SIS and that the information supplied to SIS is from the data stored in the BHB Database. It was also not in dispute that SIS had no right to sub-licence the use of any of BHB's data on William Hill's website nor was SIS purported to have done so. William Hill maintained that the SIS information it used had not originated from the information supplied to SIS from the BHB database, even though it was identical to it.
BHB s case was that it owned database right in the BHB Database and that William Hill was making unlicensed use of that data in its internet business. BHB alleged infringement of its database right in two ways. First it claimed that each day's use by William Hill of data taken from the RDF was an extraction or re-utilization of a substantial part of the contents of its database contrary to art 7(1) of the Directive. Second, it claimed that, even if the individual extracts are not substantial, nevertheless the totality of William Hill's actions amount to repeated and systematic extraction or re-utilization or insubstantial parts of the contents of the database contrary to art 7(5).
The Directive came about because of the need to harmonise the law in relation to databases across the EU. First it required Member States to implement certain features in their national copyright law insofar as they deal with databases. Secondly it created an entirely new kind of right, namely database right.
Database rights are independent of any copyright or other intellectual property rights which may exist in the database or in any of the individual pieces of data or information collected together within the database. Mr Justice Laddie emphasised that database rights should not be construed as a mere continuation or development of copyright.
Article 1(2) of the Directive defines a "database" as:
"For the purposes of this Directive, 'database' shall mean a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means."
The Judge believed that this definition was extremely wide and was supported by the wording in Recital 17 of the Directive. Consequently, any two or more pieces of data put side by side could be said to be a collection and therefore a database. However, the Directive does specifically exclude recordings, audio visual, cinematographic, literary or musical works from database right protection. For example, a musical work may include an arrangement and juxtaposition of musical notes it is treated as a single work and therefore not a collection.
In order for database rights to exist there must be investment in the creation of a database and, in particular, that investment must be directed at obtaining, verifying or presenting the contents. Article 7(1) makes it clear that there must have been a substantial investment on a qualitative and/or quantitative basis. However, the Judge felt that, in light of Recital 19, that the qualifying level of investment is fairly low. There was no suggestion in this case that the investment in the BHB database fell below this qualifying level.
Obtaining, verifying and presenting
The type of investment involved is also significant, for example, effort put into creating the actual data which is subsequently collected together in the database is irrelevant. Therefore, the costs and effort involved in BHB fixing the date of a racing fixture did not count towards the relevant investment. On the other hand, the efforts which go into gathering all of the data together, including the dates of the fixtures, is relevant. The Judge did think that, where the same person was responsible for creating the underlying data and for gathering it together, it may be difficult to clearly divide the two activities.
The investment in verification of the database is also relevant to the subsistence and protection of database right. Therefore, even if the contents of a database do not substantially changed, effort put into ensuring the accuracy or continuing accuracy is relevant and is to be protected.
The Judge believed that the effort in making the data more readily accessible by the user also counts. The Judge noted the potential difficulty in determining where the line should be drawn between investment put into presentation and investment put into computer programs which make the data more readily searchable.
Infringement of database rights
It is important to note that Articles 7(1) or (5) require the claimant to prove that the defendant is misusing in a relevant manner parts of its database rather than data obtained from another source. In this case William Hill argued that BHB had failed to prove this derivation. Although William Hill admitted that the information used on its websites was the same as that from SIS, it stated that it could not be assumed that the information it obtained from SIS was derived from the information supplied to SIS by BHB. Their argument was that it was possible that SIS obtained the information from another source. William Hill argued that at least some of the information it took from the RDF was obtained by SIS directly from racecourses and BHB could not prove otherwise. SIS has an agreement with racecourses whereby they are required to provide SIS with information about races up to 3 months in advance of a race taking place so that SIS could arrange for broadcasting units to be there to cover the race.
The Judge rejected William Hill's argument. He reasoned that there was no requirement on the racecourses to provide SIS with the details of the runners and riders nor the precise times of the races. Furthermore, all of the information in the racing calendar eventually is derived from the BHB database. Evidence given by an officer of SIS supported this view.
Infringement by extraction or re-utilisation of a substantial part
Article 7(1) provides that one of the purposes of database rights is "to prevent extraction and/or reutilization of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of" the database.
William Hill argued that; (1) they had not used, in the relevant sense, part of the BHB Database, (2) even if it was a part, it was not a substantial part, (3) the use did not amount to an 'extraction' from the BHB Database and (4) it was not 're-utilization' of the BHB Database.
William Hill argued that the database right did not act to prevent them or anyone else from making use of the facts contained within the BHB Database. It argued that acts amounting to infringement of database right must take unfair advantage of the arrangement of the database or the way in which the maker had rendered the contents individually accessible. However, the Judge ruled that the Recitals made it clear that infringement of database right was not avoided by taking the contents of the database and rearranging them. He went on to say that what was actually protected was not primarily the form but the investment which went into "obtaining, verifying or presenting the contents" of the database. Consequently, an infringer takes advantage of the relevant investment if he makes use of the accuracy of the data in the database and not because it is taken in a particular form. Recital 42 also makes it clear that infringement is not limited to activities which create competing databases.
William Hill went on to argue that, given the size of the BHB Database, the amount of information used in their internet operation could not be viewed as a substantial part. In determining what was a substantial part of a database, the Judge held that it was important to determine the importance of the information to the alleged infringer. The importance of the information to the infringer, as in this case, may throw light on whether it is an important or significant part of the database. Given that one of the major purposes of the BHB Database was to ensure that all of the relevant data relating to horseracing was accurately stored and readily available, the Judge held that there was use of a substantial part of the BHB Database.
However, the court still had to consider whether William Hill's activities amounted to "extraction" or "re-utilization" of a substantial part. BHB submitted that extraction meant copying and re-utilization amounted to making the material available in one form or another to the public. The Judge agreed with this interpretation and rejected William Hill's submissions that a much more restrictive meaning for each expression should be applied. Applying these interpretations to the facts, the Judge held that William Hill had infringed BHB's rights in both ways.
Infringement by repeated use of insubstantial parts
BHB also claimed that William Hill infringed their database right by virtue of Article 7(5). BHB claimed that William Hill's extraction of the details of runners and riders and other information day by day and week by week clearly and unreasonably prejudiced its legitimate interests.
William Hill argued that, in order for there to be infringement, there had to repeated use of data from the same database and that the amount of work done by BHB gave rise to a new database at least from week to week. Therefore, William Hill were not repeatedly and systematically using parts of one database but actually taking insubstantial parts of different, though inter-related, databases.
Whilst appreciating the attractiveness of this argument, the Judge held that it could not be right. He held that the BHB Database is a single database in a constant state of refinement. This constant refinement also gave rise to the term of protection being constantly renewed. Accordingly, the Judge held that William Hill also breached BHB s rights under Article 7(5).
The Judge was asked to consider one other issue, namely that William Hill proposed certain modifications to its website if it lost the case. Having considered these modifications Mr Justice Laddie held that there would still be infringement of BHB's database right as substantially the same information would be made available on the website.
This case clearly sets out the current approach of the English courts to this new intellectual property right and provides valuable guidance to those wishing to protect their databases as well as those who may be concerned that they could be infringing a third partys rights.
First published in International Law Office in May 2001.