A review of German case law on the GNU General Public License

17 December 2007

Dr Henriette Picot, Dr Alexander Duisberg

In a landmark decision of 2004, the District Court of Munich I was the first court worldwide to rule on and confirm the effectiveness of open-source license restrictions under the GNU General Public License. Over recent years, other German courts have confirmed the views initially taken by the District Court of Munich I and have established a reliable body of case law regarding the enforceability of the GPL version 2 under German law. GPL version 3 has now been introduced but many of the decisions will continue to be relevant. This review provides an overview of the substance of the German case law.

Effectiveness of GPLv2 and its core provisions

The German courts have held the GPLv2 license terms to be validly agreed as standard terms and conditions between software developers and users of GPLv2 licensed software. The courts found that the software developers - in making their public licensing offer - had waived the necessity to become aware of the individual end users' acceptance of such offer in order for the GPLv2 license terms to become a binding contractual agreement. Section 151 of the German Civil Code enshrines formation of contract by such means.

German courts have held that the obligations to disclose the source code, make it openly available and to license onward to any third party contained in sections 2 and 3 of the GPLv2 are valid and effective contractual obligations and conditions of using and licensing open source software. The courts have recognised that these provisions are effectively the core principles of the entire open source idea.

The courts have confirmed that section 4 of the GPLv2, according to which the license granted to a specific licensee automatically terminates where the licensee breaches the GPLv2, constitutes a valid licence restriction. Notably, this automatic license fall-back has not been regarded as an overly burdensome provision against the licensees. Such overly burdensome provisions would be invalid under the applicable German law on standard terms and conditions, of which the German courts have adopted a rather rigid interpretation in other circumstances. In contrast, the German courts have interpreted the fall-back mechanism to reflect the conditional nature of the licence grant, so that access to the software is only granted on condition of the user complying with the GPLv2 licence terms. In this context, the courts tend to underline that publishing software under the GPLv2 cannot be deemed as a general waiver of rights under German copyright or contract law.

Parties to claims under GPLv2

The fact that open-source software is typically the result of joint development work by a community of software developers raises the question of who is actually entitled to sue for infringements of the GPLv2. The cases decided by the German courts have been initiated by German individual Harald Welte, the founder of an organisation aiming at the enforcement of the GPL license terms (www.gpl-violations.org) and, in November 2007, Mr Welte has also commenced judicial proceedings in France against the French telecommunication provider Iliad. The developers of the core parts of certain open source software had granted fiduciary exclusive licences to Mr Welte, based on which German courts have held that Mr Welte has sufficient legitimate interest to sue for infringements of the GPL.

Open-source cases decided by the German courts

The first two cases judged by German courts involved the "classic" infringement scenario of the defendant breaching the GPLv2 licence terms through non-compliant distribution of GPLv2 licensed software.

However, going beyond this, the District Court of Munich I has held in a recent judgment against a Luxembourg-based company, Skype, that even the mere enabling of non-GPLv2 compliant distribution may justify infringement claims. On its website, Skype had offered a VoIP handset which runs with Linux. SMC Networks, the Spanish manufacturer, had violated the terms of the GPLv2 by shipping the handsets without including the source code and the GPLv2 licence text. Mr Welte sued Skype for this omission. Prior to Mr Welte filing his lawsuit, SMC Networks had responded to notification of the licence violation by including a leaflet referring to the telephone's GPLv2 and LGPL licensed software and mentioning URLs where the licence text and the source were available for download. The District Court of Munich I held that this move was inadequate to comply with the disclosure requirements under the GPLv2. The court held that making the source code available on the internet would only suffice in those cases where the software itself had been sold on the internet. In the court's view, such an approach failed in relation to all other forms of software distribution. In addition, the court criticised that the information on the GPLv2 and GPLv2 software provided in the handsets had not been sufficiently precise.

Although Skype itself was not the manufacturer of the handsets, the court’s opinion was that Skype, having been made aware that a violation had occurred, was obliged to check whether or not the subsequent distribution of the handsets via its website was compliant with the GPL. Another lawsuit on the same matter is pending against SMC Networks, the manufacturer of the handset.

Conclusion

Although the existing German case law has not yet been confirmed by the Federal Supreme Court, and although some legal writers have questioned it from a dogmatic point of view, the courts have taken a consistent and stabilising approach so far. It remains to be seen to what extent the changes under GPLv3 will raise new issues and be subject to further scrutiny by the German courts.