Dr. Karolin Nelles LL.M. (Suffolk University Boston)

On April 22 2009 the Federal Court of Justice decided on an issue related to online video recording.

Facts

The plaintiff was the owner of the broadcasting station RTL. The defendants were the operators of Shift. TV, a website offering a personal internet-based video recorder service for recording television broadcasts.

The website operators receive television programmes – including the plaintiff’s programme – by satellite. Users registered on the defendants’ website select programmes to record, which are then stored on the Shift.TV servers. Each user has an exclusive storage space on the servers at his or her disposal. Using the Internet, users are able to watch recordings at any time, as often as they want and in any location. Users pay a fee for these services.

RTL argued that the service constituted an infringement of its right under copyright law to rebroadcast its programmes. Shift.TV’s operators filed for injunctive relief and the disclosure of information in order to prepare a civil damages claim.

Both the Leipzig District Court and the Dresden Court of Appeal decided that the action of plaintiff was well founded.

Federal Court of Justice Decision

The Federal Court of Justice repealed the ruling and referred the case back to the Dresden Court of Appeal.

However, it did so not as a result of a difference in legal opinion, but because the facts of the case were unclear. The earlier rulings had failed to ascertain whether, in providing the service: (i) the website operators record broadcasts on behalf of their users; or (ii) the recording takes place automatically by technical means and, thus, the users themselves record the programmes.

However, the court stated that both of these scenarios represent an infringement of the plaintiff’s usage rights.

In the first scenario, whereby the Shift.TV operators initiate the recording, in doing so they infringe the plaintiff’s right to record its programmes on an image or sound carrier. Since the Shift.TV operators do not offer this service free of charge, they cannot refer to their users’ right to record television broadcasts for private use only, which would be legal under copyright law.

In the second scenario, whereby the recording takes place automatically on the end user’s instruction, the recording itself can be regarded as a legal copy for private use. However, in transmitting the programmes to their users’ personal video recorders to be stored in the users’ exclusive storage space, the Shift.TV operators are infringing RTL’s right to make its programmes accessible to the public. This right is also protected by copyright law.

Comment

Although the Federal Court of Justice referred the case back to the Court of Appeal, it is already clear that the business model of Internet-based video recording can be operated legally only with the broadcasters’ prior permission. It is doubtful whether a service operated on this basis can be profitable.