ECJ (Grand Chamber) Legal protection of computer programs – Marketing of used licences for computer programs downloaded from the internet – Directive 2009/24/EC – Articles 4(2) and 5(1) – Exhaustion of the distribution right – Concept of lawful acquirer
The Court considerd the concept of a ‘sale’ in the Directive rproviding that the first ‘sale’ in the Community of a copy of the program by the rightholder exhausted the distribution rights within the Community of that copy. The first question addressed by the Court was whether the downloading of a program over the internet gave rise to an exhaustion of rights, and in order to consider that the Court embarked on a consideration of whether that was a ‘first sale’ of a copy of the program.
Held: ‘sale’ in the Directive was an autonomous concept and it recorded the submission of Oracle that what it entered into was a licence not a sale. This point was decided against Oracle: ‘As regards the question whether, in a situation such as that at issue in the main proceedings, the commercial transactions concerned involve a transfer of the right of ownership of the copy of the computer program, it must be stated that, according to the order for reference, a customer of Oracle who downloads the copy of the program and concludes with that company a user licence agreement relating to that copy receives, in return for payment of a fee, a right to use that copy for an unlimited period. The making available by Oracle of a copy of its computer program and the conclusion of a user licence agreement for that copy are thus intended to make the copy usable by the customer, permanently, in return for payment of a fee designed to enable the copyright holder to obtain a remuneration corresponding to the economic value of the copy of the work of which it is the proprietor.
In those circumstance, the operations . . examined as a whole, involve the transfer of the right of ownership of the copy of the computer program in question.’
There was no difference between the supply over the internet and supply via a physical medium such as a CD-ROM: ‘It makes no difference, in a situation such as that at issue in the main proceedings, whether the copy of the computer program was made available to the customer by the rightholder concerned by means of a download from the rightholder’s website or by means of a material medium such as a CD-ROM or DVD . . an acquirer who downloads a copy of the programme concerned by means of a material medium such as a CD-ROM or DVD and concludes a licence agreement for that copy receives the right to use the copy for an unlimited period in return for payment of a fee, it must be considered that those two operations likewise involved, in the case of the making available of a copy of the computer programme concerned by means of a material medium, the transfer of the right of ownership of that copy.
Consequently, in a situation such as that at issue in the main proceedings, the transfer by the copyright holder to a customer of a copy of a computer program, accompanied by the conclusion between the same parties of a user license agreement, constitutes a ‘first sale . . of a copy of a program’ within the meaning of art.4(2) of Directive 2009/24.
As the AG observes . . if the term ‘sale’ within the meaning of art.4(2) of Directive 2009/24 were not given a broad interpretation as encompassing all forms of product marketing characterised by the grant of a right to use a copy of a computer program, for an unlimited period, in return for payment of a fee designed to enable the copyright holder to obtain a remuneration corresponding to the economic value of the copy of the work of which he is the proprietor, the effectiveness of that provision would be undermined, since suppliers would merely have to call the contract a ‘license’ rather than a ‘sale’ in order to circumvent the rule of exhaustion and divest it of all scope.’
Skouris P
[2012] EUECJ C-128/11, C-128/11, [2012] ECDR 19, [2013] BUS LR 911, [2013] RPC 6, [2012] 3 CMLR 44, [2013] CEC 323, [2012] WLR(D) 192, [2012] All ER (EC) 1220
Bailii, WLRD
Directive 2009/24/EC 4(2) 5(1)
European
Citing:
Opinion – Usedsoft Gmbh v Oracle International Corp ECJ 24-Apr-2012
ECJ Opinion – Legal protection of computer programs – Directive 2009/24/EC – Marketing of used software downloaded from the internet – Exhaustion of the distribution right . .
Lists of cited by and citing cases may be incomplete.
Intellectual Property
Updated: 02 November 2021; Ref: scu.463500