November 6, 2019

Summary

Warner Music Group and Sony Music Entertainment have been successful in copyright infringement claims brought against TuneIn Inc., the provider of a radio aggregation service.  The High Court judgment, which was handed down today, confirms that:

• The inclusion of radio stations in the TuneIn service that were not licensed for reception in the UK infringed the claimants’ communication to the public right under s.20 of the Copyright, Designs and Patents Act 1988.
• The inclusion of radio stations in TuneIn’s ‘Pro app’, when its recording functionality was enabled for UK users, infringed the claimants’ copyright under s.20 of the CDPA.
• Users of the Pro app who made recordings of sound recordings in the claimants’ repertoire will themselves have committed infringing acts of copying under s.17 of the CDPA (to the extent that those recordings will have fallen outside the time shifting defence in s.70 CDPA).
• The providers of sample stations that were not licensed for reception in the UK will (or did) infringe when their station was targeted at the UK by TuneIn.
• TuneIn is liable for infringement by authorisation and as a joint tortfeasor.
• TuneIn cannot rely on the safe harbour defences under Articles 12, 13 or 14 of the E-Commerce Directive.

Described as a ‘test’ case, the judgment considers the relationship between copyright and the internet.  Importantly, the judgment recognises the need to afford a high level of protection to copyright owners – and that doing so is not fatal to the functioning of the internet.

Background

TuneIn Inc. operates a global online radio service, providing its users with access to tens of thousands of music radio stations from around the world.  TuneIn essentially acts as a ‘one-stop shop’ for users wishing to browse, search for and listen to radio stations.  It aggregates links to radio station streams, categorises and curates station lists, and recommends stations to users based on their location and other factors.

The TuneIn Radio service is available through the TuneIn website and via associated mobile apps.  It is also available on over 200 platform connected devices, including smart phones, tablets, televisions, car audio systems, smart speakers and wearable technologies.  The service is monetised through subscriptions and advertising.

The claimants own or hold the exclusive licences to copyright in music sound recordings.  A traditional radio station which wishes to play recorded music within the claimants’ repertoire needs a licence from the claimants.  Internet radio stations (whether ‘simulcasters’, which operate a traditional radio station and simultaneously transmit its signal over the internet, or ‘webcasters’, which simply provide an internet radio service) require a licence if they are going to play the claimants’ sound recordings in the UK.

The claimants contended that TuneIn itself requires a licence where it includes in its service radio stations that play sound recordings within the claimants’ repertoire.  This was disputed by TuneIn on the basis that it does not transmit or host any music content and merely provides hyperlinks to radio streams which are freely available on the internet.

Judgment

In view of the large number of stations accessible via TuneIn Radio, the trial was conducted by reference to a sample of stations selected by the claimants and TuneIn in the following four categories:

• music radio stations which are licensed in the UK (Category 1);
• music radio stations which are not licensed in the UK or elsewhere (Category 2);
• music radio stations which are licensed for a territory other than the UK (Category 3); and
• “Premium” music radio stations (Category 4).

Targeting

Before considering the claims in respect of each category, the Judge considered whether the TuneIn service is targeted at the UK.  Following a review of the applicable legal principles, Birss J concluded that it was “manifest that TuneIn’s service – as a whole – provided by the website and the apps, is targeted at the UK.”  Evidence in support of that conclusion included the large number of UK users of the TuneIn service, the inclusion on the service of UK-targeted advertisements, the provision of UK-focussed categorisation and search options and the availability of subscriptions offered to UK-based users priced in sterling.  The fact that users were unlikely to appreciate that the content is transmitted by the station operator rather than by TuneIn was also relevant.  The impact of this conclusion was that internet radio stations based overseas that are not themselves targeted at the UK become targeted at the UK as a result of their inclusion in the TuneIn service.

Communication to the Public

Category 3 stations

The Category 3 stations, which were each licensed in their ‘home’ territory under statutory regimes, gave rise to a factual position that was not considered by the CJEU in the linking cases of either Svensson (Case C-466/12) or GSMedia (Case C-160/15).  As the judgment observes, Svensson was a case in which the rightholders were taken to have authorised the communication of the works in question to the general internet public.  Hyperlinking to those works was not an infringement because the hyperlink did not have the effect of communicating the works to any ‘new public’ (i.e., a public that was not already in the rightholders’ contemplation when the initial authorisation was granted).  By contrast, GSMedia was a case in which the initial posting of the copyright work was without the copyright owner’s consent.

Birss J approached the Category 3 stations on the basis that the obligation on the station operators to pay royalties under the applicable local law should be treated as a form of deemed consent by the claimants to their works appearing on the internet in a manner that was aimed at users of the operator’s local website or otherwise at users in the locality in question.

The impact of TuneIn’s intervention was to target the Category 3 stations at users in the UK, who constituted a ‘new public’ not taken into account in the initial communication.  Accordingly, TuneIn’s act of communication in relation to the Category 3 stations amounted to an unlawful act unless licensed by the UK rightholder.

Category 2 stations

Given that the Category 2 stations were either unlicensed, or otherwise not licensed in accordance with the local rights regime, the Judge’s starting point was that they “cannot be in a better position than Category 3 stations”.  They therefore either fell to be treated in the same way as the Category 3 stations (at best) or fell to be analysed in accordance with the approach taken in GSMedia.  Following GSMedia, TuneIn would therefore commit an act of infringement where it “links with knowledge, actual or presumed, that the works were placed on the internet without permission.”

On the facts, the Judge considered that it would be reasonable to expect TuneIn to carry out the necessary checks; that the linking in issue was the core of TuneIn’s commercial operation; that it was not unreasonable to expect TuneIn to pay particular attention to rights clearance issues; and that, accordingly, the knowledge presumption established by the CJEU in GSMedia applied.  The Judge found that TuneIn was unable to rebut that presumption.  To the extent that TuneIn sought to rely on warranties given by the indexed stations, TuneIn did not take the warranties sufficiently seriously for them to be relevant to the state of TuneIn’s knowledge.

Category 4 (Premium stations)

These stations were created exclusively for TuneIn and made available to TuneIn’s premium (subscription-paying) users.  There was no prior act of making them available to the public.  TuneIn’s provision of the station streams therefore amounted to an act of communication which was targeted at the UK and, given the absence of any applicable licence, was an act of infringement.

Category 1 stations

Whilst the Judge acknowledged that “there is scope for a different view”, he differentiated the Category 1 stations from the Category 3 stations on the basis that territorial issues did not apply.  In essence, his view was that, by linking to the Category 1 stations, TuneIn was not communicating works in the station streams to any ‘new public’ because the UK public had already been taken into account by the rightholders when the stations were licensed.

TuneIn Radio Pro app – Recording Function

The recording function on the Pro app, when it was enabled for UK users, allowed users to record, replay, pause and fast forward content from station streams indexed by TuneIn.  It also included an ‘intelligent skip’ function.  In providing this integrated functionality, the Judge considered that TuneIn “converted the internet radio station’s streaming service into a permanent download on demand service.”  This amounted to a different technical means to that provided by the original internet radio station.  Accordingly, when the record function was enabled, TuneIn’s Pro app infringed the claimants’ copyright in so far as it included sample stations in any of the categories.

Authorisation and Joint Tortfeasorship

The Judge considered that there “can be no real doubt that a significant number of recordings will have been made by users of TuneIn’s Pro app in the UK” which would not have fallen within the ‘time shifting’ exception in s.70 of the CDPA.

The Judge also considered that the operators of the Category 2, 3 and 4 sample stations committed an act of infringement under s.20 CDPA when the station stream is played to a UK user through the TuneIn service.

In both cases, TuneIn was found to have authorised the infringement and acted as a joint tortfeasor: it had requisite control; it could have taken steps to prevent the infringement but did not; it directly intervened to provide streams to users in the UK and played an indispensable role in the way that UK users experienced the streams; and, in relation to its knowledge of infringement, TuneIn knew all it needed to know about the sample stations in Categories 3 and 4.

Safe harbour defences

None of the safe harbours relied on by TuneIn – namely the caching, mere conduit and hosting safe harbours – were held to be relevant.

Comment

This judgment is clearly good news for copyright owners operating both in the music industry and in the wider creative industries.  It acknowledges that a balancing exercise is required between the rights of copyright owners on the one hand and the interests of the public in freedom of access to the internet on the other. That will, of course, always be a fact-sensitive exercise, but in this case, the balance has clearly been found to lie in favour of the claimant companies.  The judgment recognises that affording copyright owners a high level of protection, and respecting the territorial nature of copyright, is not detrimental to the functioning of the internet.