The Newspaper Licensing Agency and others v Meltwater Holding BV and others  EWCA Civ 890
In a judgment handed down today the Court of Appeal upheld the High Court ruling of Proudman J in The Newspaper Licensing Agency and others v Meltwater Holding BV and others. The NLA sought declarations as to copyright infringement by commercial end users of Meltwater’s media monitoring service, which relied upon website ‘scraping’. The Court of Appeal confirmed, amongst other things, that copyright is capable of subsisting in newspaper headlines, and that short extracts of articles may be a “substantial part” of those articles for the purpose of copyright infringement. The Court found that the decision of the CJEU in Infopaq v Danske did not qualify the longstanding English test of originality; however it left open the question of whether Infopaq had imported a new definition of “substantial part” into English law.
Meltwater runs a service which, amongst other things, monitors the websites of the publishers who are the claimants in this action with a ‘spider’ computer programme which ‘scrapes’ or reads the contents of those sites. This is for the purpose of monitoring articles published online for keywords which are specified by the end users of Meltwater. The results are communicated to Meltwater’s end users through “Meltwater News” which can be accessed by email or by the end user visiting the Meltwater website. Meltwater News contains a hyperlink to each relevant article, the headline from the article, the opening words of the article after the headline and an extract from the article showing the context in which the keyword appears.
The Newspaper Licensing Agency (NLA) initiated a scheme for licensing media monitoring organisations such as Meltwater by the grant of a Web Database License (WDL). Under this scheme, the end users of the media monitoring organisations’ services are obliged to enter into a Web End User Licence (WEUL).
The claimants were the principal UK newspaper organisations. The defendants were Meltwater and the Public Relations Consultants Association Ltd (the PRCA) which represented the commercial end users of Meltwater’s service. However, the issue before the High Court and Court of Appeal was confined to whether Meltwater’s end users who did not hold a WEUL infringed the copyright in the publishers’ online articles by making copies on their computer of (1) Meltwater News (whether receiving it by email or accessing it on Meltwater’s website) or (2) the publishers’ articles themselves when clicking on the link to them provided in Meltwater News. The publishers’ websites contained terms and conditions permitting access for personal and/or non-commercial use only.
The Court of Appeal’s Decision
The Court of Appeal upheld the decision of Proudman J, finding in summary:
- Copyright is capable of subsisting in headlines as original literary works. Proudman J had accepted evidence that newspaper headlines can involve considerable skill in their devising. The Judge thus found that they were sometimes capable of being independent literary works as they may be original in the sense of being their author’s own intellectual creation (C-5/08 Infopaq v Danske). The Court of Appeal agreed, confirming that this test relates to the question of origin and is not a requirement of novelty or merit (and thus does not qualify the longstanding English case law on the test of originality).
- Extracts from articles may be a substantial part of an original literary work. Copyright is infringed by, amongst other things, the copying of a substantial part of an original literary work. Under the WDL, such an extract is limited to 256 characters. Proudman J found that in many cases such an extract could constitute a substantial part of the original article from which the extract was taken. This was true whether applying the test from Infopaq (which asks whether the extract contains elements which are the expression of the intellectual creation of the author of the original article), or applying the test from previous English case law (which asks whether there was unfair appropriation of the author’s labour and skill which went into the creation of the original article). The Court of Appeal agreed, leaving open the question of which test was appropriate, finding that it was inevitable that some of the extracts would constitute a substantial part of the original article from which they were taken.
- The end users cannot rely on the defence under s28A CDPA 1988 relating to transient or incidental temporary copies. The Court of Appeal found that the defence under s28A CDPA could only potentially apply to the acts of copying involved in the end users accessing the Meltwater website to view Meltwater News or when accessing the publishers’ website to view the original article. Proudman J found that the point of such copying was to enable the end user to read Meltwater News; the making of the copy was thus not an essential and integral part of a technological process but the end which the process was designed to achieve. Furthermore the copy clearly had independent economic significance as it is the product for which end users have paid. Therefore the conditions for a successful defence under s28A were not met. The Court of Appeal agreed with this finding.
- The end users cannot rely on the defence of fair dealing under s30 CDPA. The Court of Appeal affirmed the decision of Proudman J that end users cannot rely on the defence of fair dealing, characterising part of the PRCA’s argument as “absurd”. The court found that end users were neither criticising nor reviewing the parts of the article which were scraped by Meltwater. Furthermore, the court found that the scraped extracts were not made for the purpose of reporting current events but so that the end users may see the context in which the relevant keyword arose. The Court of Appeal also affirmed Proudman J’s finding that Meltwater’s dealings were not fair as the dealing was for commercial purposes and was encouraging end-users to infringe the publishers’ copyright.
- The Database Regulation. Proudman J found at first instance that there was no infringement of the arrangement or structure of publishers’ websites as a database; on the case as presented there was nothing to suggest that a text extract is a copy of the substantial part of the effort that went into the structure and arrangement of articles within the website. The Court of Appeal rejected the PRCA’s argument that s19(2) of the Copyright and Rights in Databases Regulations 1996 rendered the conditions of use of publishers’ websites void as they prevented lawful end users from extracting or reutilising insubstantial parts of the contents of a database. The court found that this section is concerned only with acts which would otherwise be an infringement of the database right (and not acts which are merely infringement of literary copyright); furthermore an end user who had not entered into a WEUL was not a ‘lawful user’ and thus could not in any event obtain the benefit of s19(2).
- Double Licensing. The PRCA argued that where an online news search service has a licence, its end users do not require a further licence on the basis that since the news search service is licensed to send the extracts to end users, by implication the act of receiving must be licensed. Proudman J rejected this argument and this was affirmed by the Court of Appeal, which stated that the copies created by the end user as a consequence of opening the Meltwater News email, searching the Meltwater website or accessing the Publisher’s website through Meltwater’s link are not the same copies as those sent by Meltwater. They were thus not the same acts of copying as undertaken by Meltwater and end users required a separate licence.
The Court of Appeal therefore affirmed the judgment of Proudman J. The court did, however clarify that the judgment did not mean that every recipient and/or user of Meltwater News would inevitably infringe copyright; it was more the case that “most, if not all” of such users would infringe copyright.
UK Supreme Court decision in Lucasfilm case
The Supreme Court today handed down its decision in Lucasfilm and others v Ainsworth and another  UKSC 39.
The court at first instance had found that the “Stormtrooper” helmets which were the subject of the action were a mixture of costume and prop and that their primary function was utilitarian, namely to express an idea as part of character portrayal in the film. Mann J had held that the helmets lacked the necessary quality of artistic creation required of a sculpture and thus the helmets did not fall within the definition of “sculpture” in the CDPA 1988. The Supreme Court upheld this decision. The appropriate test for whether an object fell within the definition of a sculpture was not an “elephant test” (knowing one when you see it) but what the Court of Appeal had termed a multi-factorial approach.
However, the appeal succeeded in relation to the second issue, which was whether an English court may exercise jurisdiction in a claim against persons domiciled in England for infringement of copyright committed in a country outside the European Union in breach of the copyright law of that country. Reversing the decision of the Court of Appeal, the Supreme Court found that an English court may exercise such jurisdiction provided there is a basis for in personam jurisdiction over the defendant.