Free wi-fi providers unlikely to be liable for copyright infringement

Maciej Szpunar, an Advocate General of the Court of Justice of the European Union (CJEU), has recommended to the Court that providers of free wi-fi should not be held responsible for copyright infringement committed over their networks.

The recommendation comes midway through the case of Tobias McFadden -v- Sony Music Entertainment Germany GmbH C-484/14, which will determine whether a German shop owner, Tobias McFadden, is responsible for a record uploaded to a pirate music site over his store’s free wi-fi network.  Sony Music Entertainment Germany were unable to bring an action against persons’ unknown and subsequently fined Mr McFadden €800.

First instance hearing

The case was initially heard in the Landgericht München regional court in Germany where there are, in comparison to England and Wales, far stricter laws governing usage of free wi-fi.  Businesses in Germany are liable for any illegal activity committed on their network which has significantly restricted provision of such service in the country.  This case was subsequently referred to the CJEU in Luxembourg for a decision on liability to be made and any remedial action that could be pursued.

CJEU hearing

Szpunar, following the EU e-commerce Directive 2000/31/EC, made a recommendation on 16 March 2016 to the Court that McFadden should not be held liable for third party infringement on a wi-fi service he provides.  The Directive itself exempts third-parties, such as Internet Service Providers, from copyright liability if they can demonstrate that they did not initiate the communication of unauthorised materials and/or select the recipient of the materials and/or alter the information contained within the transmission.  Szpunar’s approach is pragmatic, taking into account the impact a judgment averse to his opinion would have on the freedom to conduct business and the provision of wi-fi to entice customers into stores.

Szpunar also stated that suppliers of free wi-fi should not be liable for costs pre-action or for obtaining an injunction.

As for remedial action, Szpunar suggested that injunctions could be imposed against providers of free wi-fi, however these would have to be proportionate and targeted at specific infringement.  He advised that providers of free wi-fi should not be compelled to password protect their connections or extensively monitor the activity carried out upon them. He stated that any injunctive relief would have to uphold the balance between intellectual property rights and the Article 10 right of freedom of expression.

Other relevant case law

A notable case at the time of this recommendation is Cartier International Ltd and another -v- British Telecommunications PLC and others in which an injunction was made against Internet Service Providers requiring that they blocked access to websites that were infringing trademarks belonging to high-end goods manufactures. In that case the Claimants stated that the third-parties were, although not infringing themselves, providing a platform to access the infringing material. An appeal is currently pending.

Comment

Although Szpunar’s view is not legally binding, it is considered an indication of the likely outcome of the full Court's decision.  If this opinion is followed it has the potential to make free wi-fi more commonly available all over Europe with less risk to businesses who are providing the service.