The Appeal: Warner Music UK Ltd and others v Tuneii Inc

The Internet Messenger

Author Buky Schwartz Licence CC BY-2,5 Source  Wikimedia Commons

 

Jane Lambert

Court of Appeal (Sir Geoffrey Vos MR, Lady Justice Rose and Lord Justice Arnold) Warner Music UK Ltd and others v TuneIn Inc,  [2021] EWCA Civ 441 (26 March 2021)

This was an appeal by Tunein Inc. against Mr Justice Birss judgment in Warner Music UK Ltd and others v TuneIn Inc [2019] EWHC 2923 (Ch) (1 Nov 2019) which I discussed in Copyright - Warner Music UK Ltd and Others v TuneIn Inc. 4 Nov 2019.  The claimants, who between them, account for more than half of the market for digital sales of recorded music in the UK and about 43% globally, sued Tunein Ltd for copyright infringement. TuneIn does not collect, transmit or store any third party audio content but it does connect users to third party radio stations' streams and earns money from advertising and subscriptions.  Mr Justice Birss found that TuneIn had infringed the claimants' copyrights by communicating their works to the public, by authorizing infringement and as joint tortfeasors.

The Grounds of Appeal

Most appeal court judgments list the grounds of appeal.  There is nothing like that in the transcript of this judgment.  That may have been because TuneIn's grounds were unusually long and numerous and perhaps not as clear as they might have been.  Lord Justice Arnold, who gave the lead judgment in Warner Music UK Ltd and another v TuneIn Inc. [2021] EWCA Civ 441 (26 March 2021) said at para [3]:

"The appeal raises significant issues of copyright law, in particular as to the scope of the right of communication to the public."

In the next paragraph, he complained that:

"It is therefore regrettable that the clarity of those issues has been blurred by the approach adopted by TuneIn in its grounds of appeal. On 4 June 2020, Floyd LJ made an order that TuneIn's original grounds of appeal be struck out unless amended so as to comply with Practice Direction 52C paragraph 5. On 17 June 2020 TuneIn served amended grounds of appeal in purported compliance with Floyd LJ's order running to no less than 44 paragraphs. Even that was not the end of the matter, since one ground was subsequently elaborated by re-amendment as explained below."

Targeting the UK

TuneIn's first 4 grounds of appeal challenged the trial judge's reasoning and conclusions with respect to targeting.   Lord Justice Arnold explained what was meant by targeting and why it was important in para [60] of his judgment:

"As the judge explained, the internet is global and users in the UK can, in the absence of geo-restriction, access websites hosted, and content posted on or streamed from such websites, from anywhere in the world. Intellectual property rights, however, are territorial. At least in the case of copyright and similar rights and trade marks, the CJEU has held that accessibility of a website from a Member State is not sufficient to give rise to an infringement of rights conferred by the law of that State and that the relevant act must be targeted at that State: see Case C-324/09 L'Oréal SA v eBay International AG [2011] ECR I-6011 (trade marks), Case 5-/11 Donner [EU: C:2012:370] (copyright) and Case C-173/11 Football Dataco Ltd v Sportradar GmbH [EU: C:2012:642] (database right). This case law has been applied in this jurisdiction to communication to the public: EMI Records Ltd v British Sky Broadcasting Ltd [2013] EWHC 379 (Ch), [2013] Bus LR 884 ("EMI v BSkyB"). The law has twice been reviewed by this Court in the trade mark context: Merck KGaA v Merck Sharp & Dohme Corp [2017] EWCA Civ 1834, [2018] ETMR 10 and Argos Ltd v Argos Systems Inc [2018] EWCA Civ 2211, [2019] Bus LR 1728.

Mr Justice Birss found that TuneIn and the radio stations that played the claimants' records had targeted the UK.   

TuneIn contended that those stations did not target the UK merely because TuneIn had targeted the UK. Lord Justice Arnold disagreed.  He acknowledged that the correct question was whether the foreign internet radio stations available on TuneIn's app - and more specifically the streams emanating from those stations to which TuneIn provided links - were targeted at users in the UK.  That did not mean that the judge had conflated that question with whether TuneIn had targeted the UK. In Lord Justice Arnold's view, Mr Justice Birss had correctly focussed on the consequence of TuneIn's being targeted at the UK.  The foreign stations presented to UK users by TuneIn Radio had therefore become targeted at the UK by reason of TuneIn's targeting at this country.

Lord Justice Arnold also rejected TuneIn's alternative argument that Mr Justice Birss had been wrong to say that it was not necessary to consider the position at the level of individual sound recordings in the claimants' repertoire and also wrong to say that the analysis would be the same if one did. He agreed with Mr Justice Birss that it was not necessary to consider the question of targeting at the level of individual sound recordings. Whether the foreign internet radio stations are targeted at the UK could not depend on whether a sound recording in the claimants' repertoire was being played at a particular moment. He also agreed with the judge that, even if one did descend to the level of individual sound recordings, it would make no difference to the analysis. The consequence of TuneIn Radio being targeted at the UK was that, as and when sound recordings in the claimants' repertoire were played on a foreign station to whose stream UK users had linked using TuneIn, any broadcasting of those sound recordings even to a local audience would have been targeted at the UK.

Communication to the Public

The next 31 grounds were on communication to the public.  At para [92] of his judgment, Lord Justice Arnold said:

"Some of TuneIn's grounds of appeal (grounds 5-10) are general in nature while others relate specifically to the judge's reasoning in relation to categories 1, 2 and 3 of the sample stations (grounds 11-20 and 22-35), although there is some duplication between the latter and the former."

Reg 6 (2) of The Copyright and Related Rights Regulations 2003 SI 2003 No. 2498 which implemented 
Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society replaced "to broadcast the work or include it in a cable programme service" with "to communicate the work to the public" in s.16 (d) of the Copyright Designs and Patents Act 1988.  Reg 6 (1) of the same statutory instrument replaced the previous s.20 with the following:

"(1) The communication to the public of the work is an act restricted by the copyright in-- 

(a) a literary, dramatic, musical or artistic work, 

(b) a sound recording or film, or 

(c) a broadcast. 

(2) References in this Part to communication to the public are to communication to the public by electronic transmission, and in relation to a work include-- 

(a) the broadcasting of the work; 

(b) the making available to the public of the work by electronic transmission in such a way that members of the public may access it from a place and at a time individually chosen by them."

Lord Justice Arnold traced the legislative history of the new s.20 between paras [43] and [58] of his judgment.  His lordship also reviewed the decisions of the Court of Justice of the European Union ("CJEU") on the legislation between paras [67[ and [72].

Whether the CJEU's Case Law should still apply to the UK

S.6 of the European Union (Withdrawal) Act 2018  as amended by the European Union (Withdrawal Agreement) Act 2020 and reg 3 of The European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case Law) Regulations 2020 enables the Court of Appeal to depart from the judgments and orders of the CJEU but only on the same basis that the Supreme Court has power to depart from one of its own precedents or of one of the House of Lords.

TuneIn's primary contention was that the Court of Appeal should depart from the entire body of case law of the CJEU on communication to the public.  Alternatively, it argued that the Court of Appeal should depart from the European Court's decision in Case C‑160/15, GS Media BV v Sanoma Media Netherlands BV and others EU:C:2016:644, ECLI:EU:C:2016:644, [2016] WLR(D) 477, [2016] EUECJ C-160/15, [2016] Bus LR 1231.  

Lord Justice Arnold rejected that contention for the 8 reasons set out in paras [78] to [88] of his judgment.  The question whether TuneIn had infringed the claimants' copyrights by communication to the public had to be determined by the CJEU's case law including the CJEU's decision in Case C‑392/19, VG Bild-Kunst v Stiftung Preußischer Kulturbesitz, [2021] EUECJ C-392/19, ECLI:EU:C:2021:181, EU:C:2021:181, [2021] WLR(D) 157. That judgment had been delivered after the transitional or implementation period provided by art 126 of the Agreement on the withdrawal of theUnited Kingdom of Great Britain and Nothern Ireland from the EU and the Euratom had expired.

Sir Geoffrey Vos, Master of the Rolls,  thought that it would be both unnecessary and undesirable for the Court of Appeal to depart from retained EU law for the reasons set out in paras [196] to [201] of his judgment. To do so, in his judgment, would create legal uncertainty for no good reason.   Lady Justice Rose agreed at para [184]. 

Alleged Misappliance of the CJEU's Case Law

TuneIn's fallback position was that even if the applicable principles were those that had been stated by the CJEU, Mr Justice Birss had misapplied them. 

TuneIn's premise was that it was essentially a search engine like Google. The trial judge had rejected that contention and so did Lord Justice Arnold.  TuneIn was more than just a search engine. It was a platform that categorized and facilitated access to specific content.

Next, TuneIn criticized Mr Justice Birss's analysis of Case C-466/12 Svensson v Retriever Sverige AB  [2014] ECDR 9, EU:C:2014:76, [2014] WLR(D) 67, ECLI:EU:C:2014:76, [2014] Bus LR 259, [2014] EUECJ C-466/12, [2015] EMLR 5, [2014] 3 CMLR 4, GS Media BV v Sanoma Media Netherlands BV and Others,  Case C-301/15 Soulier v Premier Ministre ECLI:EU:C:2016:878, EU:C:2016:878, [2016] EUECJ C-301/15 and Case C-161/17 Land Nordrhein-Westfalen v Renckhoff [2018] Bus LR 1815, ECLI:EU:C:2018:634, [2018] EUECJ C-161/17, EU:C:2018:634, [2018] WLR(D) 522 between paras [49] and [111] of his judgment.  

TuneIn challenged Mr Justice Birss's reconciliation of Svensson with Renckhoff which appeared to be contradictory decisions.  He had concluded that the question of whether a work had been communicated to a new public could only be answered by considering whether the persons who had accessed the work through a third party's intervention would have been contemplated by the copyright owner when he or she originally posted the work. In TuneIn's submission, the law was correctly stated in Svenson.  When a work is posted on the internet the work it becomes available to all internet users.  TuneIn argued that Svenson had recently been endorsed by the CJEU in Bild and  Renckhoff should be disregarded. Lord Justice Arnold rejected that contention.  Mr Justice Birss's approach was consistent with Advocate General Szpunar's opinion in Bild  [2020] EUECJ C-392/19_O, EU:C:2020:696, ECLI:EU:C:2020:696.  Lord Justice Arnold therefore rejected TuneIn's criticism of Mr Justice Birss's approach. 

 TuneIn's second criticism was that the trial judge had elided the two limbs of "communication" and "to the public" arguing he should have considered them separately,   Lord Justice Arnold rejected that criticism observing that Mr Justice Birss's approach was consistent with the CJEU's case law.

Thirdly, TuneIn criticized the conflation of targeting and communicating to a new public.  Lord Justice Arnold replied that there was an inevitable relationship between the two concepts, especially in a case where the territoriality of the copyright is an issue.   

Finally, TuneIn contended that, in order to amount to an act of communication to the public, a hyperlink must afford direct access to the protected work. TuneIn argued that the hyperlinks that it provided did not provide direct access to the claimants' sound recordings, but only to radio stations' players.  The learned Lord Justice rejected that contention as a misreading of Svenson.

Whether there had been any Communication to the Public

Lord Justice Arnold noted at [137] that Mr Justce Birss had found that TuneIn's acts amounted to a "communication" which was to "the public.  In the trial judge's view:

"(i) TuneIn intervened [Lord Justice Arnold added, 'in a highly material way and with full knowledge of the consequences of its actions'] to give the UK users of TuneIn Radio access to foreign internet radio stations' streams incorporating the Claimants' repertoire [Lord Justice Arnold adding: 'which such users would otherwise find it more difficult to access']; and (ii) the UK users of TuneIn Radio constituted an indeterminate and fairly large number of persons."

TuneIn had not challenged (I) and its challenge to (ii) had been rejected above.   In the learned Lord Justice's view. the issue that remained was 

"whether TuneIn communicated the streams to a new public. As counsel for TuneIn accurately submitted, this depends on the scope of the authorisation by the right holders of the original communication."

The trial judge had divided the radio stations that could be accessed through TuneIn's app into the following categories:

• Category 1: radio stations licensed in the UK;
• Category 2: radio stations not licensed in the UK or anywhere else;
• Category 3: radio stations that are licensed for a territory other than the UK; and
• Category 4: Premium stations created for TuneIn and made available exclusively for TuneIn's subscribers that are based in the USA, are not licensed for the UK at all and do not pay the statutory US licence fee.

He considered what if any authorization had been given to each category of radio station and found that only the stations in Category 1 had been authorized to broadcast to the public in the UK. He held that apart from providing a recording facility, TuneIn's services did not infringe the claimants' copyrights since they do not make the music available to a new public. TuneIn's services in respect of all other categories of stations did infringe.

Lord Justice Arnold considered Mr Justice Birss's findings in respect of the Category 3 stations first. According to the learned Lord Justice, TuneIn had challenged Mr Justice Birss's analysis on several grounds but its core point was that the judge had been wrong to treat the right holders' authorization of the original communication as territorially restricted because that was contrary to Svensson,  Lord Justice Arnold disagreed at [142]:

"As the judge correctly stated, TuneIn Radio is a different kind of communication (in the sense that it has the features of aggregation, categorisation, etc discussed above) targeted at a different public in a different territory. Even assuming that the operation of a statutory scheme in a foreign territory amounts to a form of deemed consent on the part of the rights holders to the original communication to the public, including persons who access the streams via simple hyperlinks or conventional search engines, there is no reason to conclude that that authorisation extended to the UK public targeted by TuneIn Radio's communication. On the contrary, counsel for TuneIn accepted that TuneIn had never sought to defend this claim on the basis that targeting UK users (let alone targeting them by TuneIn Radio's communication) was licensed by virtue of the payments made by foreign internet radio stations in their local territories."

Lord Justice Arnold also dismissed two of TuneIn's subsidiary points. The first was that the judge below had wrongly reversed the burden of proof by his use of the phrase "absent evidence to the contrary".  Lord Justice Arnold regarded that as no more than an expression of caution lest a subsequent case with different facts should lead to a different conclusion.  TuneIn also complained that Mr Justice Birss had failed to balance the right to free expression against the claimants' property rights as required by the recitals to the Information Society Directive.  Lord Justice Arnold pointed out that the judge had applied principles expressed in  GS Media, Renckhoff and Bild where the CJEU had expressly carried out such a balancing exercise.  He added that "striking a fair balance does not involve giving freedom of expression precedence over copyright, which is the effect of TuneIn's argument."

The learned lord justice concluded at [145] that the trial judge had rightly held that TuneIn had infringed the claimants' copyrights with respect to the category 3 stations.

Turning to Category 2, the trial judge had said that he could not see how an unlicensed station could be in a better position than the stations in Category 3.   However, he also considered the position if his finding for Category 3 was wrong.  He held that the Category 2 stations were "either actually unlicensed, or at least … not in full compliance with the local rights regime[s]". He went on to hold that TuneIn was not able to rebut what he described as "the GS Media presumption", and therefore it had committed acts of communication to the public with respect to the category 2 stations.  TuneIn challenged the alternative finding on no less than 14 grounds  Many of those had already been answered by Lord Justice Arnold and he disposed of the rest peremptorily.  The principal argument was that Mr Justice Birss had misa[plied the CS Media test which criticism the learned lord justice rejected.

Mr Justice Birss has held that the provision of a recording facility in TuneIn's app infringed the claimants' copyrights even in respect of the Category I stations.   TuneIn had criticized that part of his lordship's judgment as confusing the communication to the public right with the reproduction right.  Lord Justice Arnold and the rest of the Court of Appeal agreed with that submission.  Lord Justice Arnold said at [162]:

"The starting point is the stream simulcast or webcast by the foreign station. The act of communication is the provision by the Pro app of the link to that stream (in the context described in paragraphs 17-20 above). That involves precisely the same technical means as the original communication. It makes no difference if the Pro app has the record function enabled. First, this cannot depend on whether the user activates the record function or not. Secondly, the mere potential for the user to record the stream does not affect the provision of the stream in any way. The communication remains the link to the stream."

The claimants tried to counter that point by arguing that the recording function created a new public. Lord Justice Arnold answered that argument at [162]:

"The presence or absence of the record function in the Pro app makes no difference to the public which was taken into account by the rights holders when they authorised the original communication by the category 1 stations: it remains the public in the UK."

Except for his finding with regard to the recording facility in relation to the Category 1 stations, the Court of Appeal upheld Mr Justice Birss's finding as to TuneIn's liability for communicating the claimants' works to the public.

Authorization and Joint Tortfeasance

The Court of Appeal upheld the trial judge's findings on authorization and joint tortfeasance and the liability of TuneIn users who used the app's recording facility.

Conclusion

Except for his finding of liability for communication to the public with regard to the Category 1 stations by providing a recording facility, the Court of Appeal endorsed the trial judge's judgment.  Lord Justice Arnold's analysis of the CJEU's case law on communication to the public is likely to make this case the leading authority on that restricted act at least in the UK.  The reliance on Bild which was decided after the expiry of the implementation or transitional period provided by art 126 of the Withdrawal Agreement means that the CJEU's judgments are likely to shape UK intellectual property law for a long time to come.

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