UK: customers of online media monitoring services require a licence from news publishers to avoid infringing copyright

Posted by Siobhan Doherty

On 27 July 2011, the Court of Appeal of England and Wales confirmed that customers of Meltwater, an online media monitoring organisation (MMO), require the consent of the online news publishers in order to avoid infringing copyright in the news content.

This case has implications for both providers and users of media monitoring services in the UK.

Background

An MMO provides a service whereby the customer nominates specific search terms and the MMO then produces regular reports of any articles in online publications that contain those terms. A report will generally include the article's headline (which hyperlinks to the article), the opening words of the article and an extract from the article showing the context in which the search term appears.

The basic position under both UK (and Australian) copyright law is that, subject to certain exceptions, if a person wishes to make a copy of a published work, the person requires the consent of the relevant copyright owner in order to do so.

In the case of copyrighted content published in a UK newspaper (print or electronic), this consent is granted either by the relevant publisher or by way of a licence issued by the UK's Newspaper Licensing Agency (NLA). The NLA has authority to license the copying of newspapers on behalf of the majority of the UK's national newspaper groups.

In January 2009, in response to the increasing number of MMOs drawing upon online news content, the NLA announced two new licensing schemes:

• the first requires MMOs to pay for a licence in order to be permitted to link to online news content (Web Database Licence or WDL); and
• the second requires customers of MMOs to hold a licence to view and use links included in MMO reports (End User Licence or EUL).

Both licensing regimes have come into force.

Meltwater's objections

Meltwater objected to the WDL and EUL regimes on the basis that:

• the terms of the WDL scheme were unreasonable in various ways (including the amount of the fee payable; the restriction against providing services to non-EUL holders; and the obligation to inform customers of their need to hold an EUL); and
• EULs were unnecessary because 'receiving' and 'using' copies of copyrighted works were (on Meltwater's interpretation) not restricted by copyright law.

Terms of the WDL scheme: Meltwater's proceedings in the Copyright Tribunal

In December 2009 Meltwater referred the WDL scheme to the Copyright Tribunal for adjudication on whether the terms of the scheme are reasonable. The Copyright Tribunal, the powers of which are established by statute, does not have jurisdiction in relation to whether end users require a licence.

The Public Relations Consultants Association Limited (PRCA) intervened in the Tribunal proceedings in support of Meltwater, as the PRCA's members are frequent users of MMO services.

These proceedings will be heard next month.

The end user issue: the NLA's proceedings in the Courts

The NLA took the end user licensing issue before the UK High Court and, in November 2010, obtained a declaration that users of Meltwater's MMO services (such as the PRCA and its members) require a licence from news publishers in order to avoid infringing copyright.

The reasons given by the first instance judge - which were endorsed by the Court of Appeal in its 27 July judgment - can be summarised as follows:

• The headlines of the articles reproduced by Meltwater News (Meltwater's media monitoring report) are capable of being literary works independently of the article to which they relate.
• The extracts from the articles reproduced in Meltwater News (with or without the headline) are capable of being a substantial part of the literary work consisting of the article as a whole.

Accordingly, the copies made by the end user's computer of:

• Meltwater News on (a) receipt of the email from Meltwater, (b) opening the email, and (c) accessing the Meltwater website by clicking on the link to the article; and
• the article itself when clicking on the link provided by Meltwater News,

are, prima facie, an infringement of the copyright in those works.

Copies of this kind are not permitted (a) by the 'temporary copy' provisions of the UK's copyright legislation; (b) as 'fair dealing' under that legislation; or (c) by the Copyright and Rights in Databases Regulations 1997.

Accordingly, the Court of Appeal affirmed that an end user requires a licence from the NLA (or the various news publishers) in order lawfully to receive and use the Meltwater News Service.

What next?

The PRCA has informally indicated an intention to appeal the Court of Appeal's decision on the end user issue, but it remains to be seen whether it will do so.

It is now for the Copyright Tribunal to determine if the current WDL terms are appropriate. In the High Court proceedings, Meltwater confirmed that it will enter into a WDL on such terms that the Tribunal determines are reasonable.

Among other things, Meltwater is contending that:

• WDL holders should not be restricted from supplying MMO services to customers that do not hold an EUL;
• WDL holders should not be required to inform users that they require an EUL to use MMO services;
• the circumstances in which the NLA may suspend a WDL are unreasonable;
• the fees in connection with the WDL are unreasonable, particularly given that only a small proportion of online news content is within the scope of the NLA; and
• WDL holders should not be required to disclose to the NLA the details of their customers, particularly given that NLA is in the process of establishing is own online MMO service.

The Tribunal will hear the matter next month.

Partner: Paul Kallenbach