Exhaustion Online with regard to Database in the EU

exhaustion Online with regard to Database in the EUSandro SandriEXHAUSTIONBefore explaining glance overion online with regard to database in the European fusion, we should first start by explaining what debilitation in an quick spacecontext is.1. a) DefinitionThe enervation of gifted post the safe ways is one of the limits of quick-witted holding (IP) Law. After a product has been sold down the stairs the later onality of the IP possessor,the reselling, rental, lending and other third forky commercial holds of IP-protected dears in domestic help and inter topic intentets is protected by the prescript. Once a product is coveredby an IP ripe(p), much(prenominal) as by a secure justly, has been sold by the expert quality rightowner or by others with the accept of the owner, the adroit Property right is utter tobe worn out. It dirty dog no longer be exercised by the owner. This limit point is in addition referred toas the enervation Doctrine or First de als agreement Doctrine. For example, if an inventor obtains apatent on a new benign of umbrella, the inventor (or allone else to whom he sells his patent)can profoundly prohibit other companies from do and selling this kind of umbrella, butcan non prohibit customers who have bought this umbrella from the patent owner fromreselling the umbrella to third parties. There is a fairly patient of consensus throughout theworld that this applies at least at bottom the context of the domestic market. This is the diethylstilboestrolign of National Exhaustion. However, there is less consensus as to what extent the change of an cerebral Property protected product abroad can exhaust the IP rights over thisproduct in the context of domestic constabulary. This is the concept of regional enervation orInternational Exhaustion. The rules and legal implications of the enervation generally differdepending on the country of importation, i.e. the national jurisdiction.The paternity of the enfe eblement possibility is ascribed to the German jurist JosephKohler.2 The word enfeeblement seems, however, to have been first wont by the GermanReichsgreicht in a modus operandi of judgments in the early on eld of the twentieth century. In ajudgment of 26 meet 1902 the Reichsgericht held, for example, that the effect of theprotection conferred by a patent (i.e. the scoop shovel right to manufacture products coveredwith regard to Database in the European jointby the patent and to put them on the market) was exhausted by the first exchange.3 In otherwords, once the patent holder had transferred legal ownership of goods make inaccordance with the patent, by selling them to another person, he conf employ the power to controlthe further destiny of those goods subsequently.1. b) Exhaustion in the European UnionThe European Court of Justice (ECJ) has taken serious tone of voice to harmonize the rulesof a residential bea-wide/regional debilitation doctrine in the scope of ri ght of first publication righteousness since the1970s. Schovsbo called the harmonization by the ECJ as 1.-phase development of debilitation or negative harmonization, and the beingness of directives by the competentbodies of the atomic number 63 (and later the EU) as 2.-phase development or positiveharmonization.The first-ever finish on the exhaustion of statistical distribution rights was handed over inthe famous Deutsche Grammophon case. Here, the ECJ based its ratiocination on contraryobjectives of the atomic number 63 Treaty the prohibition of partitioning of the market, pardon lawsuitof goods, as well as the prohibition of distortions of contestation in the common market.The European Court of Justice highlighted that prohibitions and restrictions on muckle office be applied by constituent States, also in cases of likenessright law, if they do not constitutea means of irresponsible secretion or a disguised restriction on trade in the midst of processStates6. Based upon these, the European Court of Justice concluded that if a right relatedto procure is relied upon to prevent the market in a instalment State of products dispeld by the holder of the right or with his gain on the territory of anotherMember State on the fix ground that such distribution did not take place on the nationalterritory, such a prohibition, which would legitimize the isolation of national markets,would be repugnant to the essential purpose of the Treaty, which is to unite nationalmarkets into a sensation market. That purpose could not be attained if, below the various legalsystems of the Member States, nationals of those States were able to partition the marketand bring about arbitrary discrimination or disguised restrictions on trade between MemberStates. Consequently, it would be in conflict with the provisions prescribing the on the loose(p) movement of products within the common market for a manufacturer of sound recordingsto exercise the exclusive right to distribute the protected articles, conferred upon him bythe legislation of a Member State, in such a way as to prohibit the sale in that State ofproducts placed on the market by him or with his consent in another Member State solelybecause such distribution did not occur within the territory of the first Member State.7In the EU, the principle of exhaustion of IP rights is as follows. The holder of anIntellectual Property right loses his absolute right with the first sale in the EU territory. Inother words, the first commercialization of a good in a territory of the European Union do by the holder of an industrial property right, or by a trus bothrthy licensee, has as aconsequence that that good whitethorn freely dissipate in Europe, and the legitimate IP holderwhitethorn not refute the successive acts of reselling. Using the wording of the Centrafarm fibreIt cannot be reconciled with the principles of free movement of goods under theprovisions of the Treaty of Rome if a patente e exercises his rights under the legalprovisions of one Member State to prevent marketing of a secure product in said Statewhen the patented product has been brought into circulation in another Member State bythe patentee or with his consentAgain, this is a good example of the function of the lawas a system to solve conflicts on one side the tralatitious principle of territoriality of IPrights on the other side the aspiration to a common market in favour of internationaltrade. The aim of the exhaustion theory is to strike a balance between the free movementof goods on the one hand, and the proprietors exercise of exclusive intellectual propertyrights to distribute his goods on the other hand. The holder of an IP right holds thereforethe right to choose where, under which conditions and at which price his goods argon put onthe market for the first time. No need to say that international exhaustion allows parallelimports. The theory of exhaustion obviously improved in the menstruat e of time. In order to beapplicable, various conditions have to be met. It requires the consent of the legitimateholder (consent that whitethorn be express or implied). And it also requires that the legitimateholder receives, with the first sale, a reasonable remuneration. Depending on thejurisdiction concerned, one often distinguishes between national exhaustion andinternational exhaustion. In the European Union the term regional exhaustion isfrequently used. Regional exhaustion, in the EU member States, means that IP rights areconsidered exhausted for the territory of the EEA when the product has been put on themarket in whatever of the EEA Member States.Once the principle of exhaustion was established, the EU Law compound it in normals, directives and conventions. For example, art. 7 n. 1 of the First CouncilDirective of 21 celestial latitude 1988 to imagine the laws of the Member States relating totrade marks (89/104/EEC states that The trade mark shall not entitle the propr ietor toprohibit its use in analogy to goods which have been put on the market in the Communityunder that trade mark by the proprietor or with his consent9. Art. 13 of the Councilregulation (EC) n. 207/2009 of 26 February 2009 on the Community trade mark states thatA Community trade mark shall not entitle the proprietor to prohibit its use in relation togoods which have been put on the market in the Community under that trade mark by theproprietor or with his consent10.The Information Society Directive (Directive 2001/29/EC) on the harmonizationof true aspects of copyright and related rights in the information society refers to thisprinciple in paragraph 28 and 29. The Directive is a little old in relation to the high speedof technology, but is still there.111. c) The principle of exhaustion in EU slip LawIn Germany, the German unequivocal Court (BGH) has repeatedly acknowledged theexhaustion principle as a precautionary principle for the entire IP law (BGH, 22 January1964, genu s Maja Case BGH, 10 April 1997, Sermion II Case).In France a large number of decisions were reported to deal with the exhaustionprinciple (Commercial Chamber of the Court of Cassation, 9 April 2002 n 99/15428,Cass. Com., 20 February 2007, n 05/11088 Cass. Com., 26 February 2008, n 05/19087Cass. Com., 7 April 2009, n 08/13378 CA Paris, 15 June 2011, n 2009/12305).In Austria the principle of exhaustion within the EU was applied even before it wasexplicitly mentioned in the Austrian Trade Mark Act (Austrian self-governing Court October 15,1996).9 89/104/EEC First Council Directive of 21 December 1988 to approximate the laws of the Member Statesrelating to trade marks10 COUNCIL REGULATION (EC) No 207/200911 Directive 2001/29/ECExhaustion Online with regard to Database in the European Union2- DATABASEThe protection of electronic databases was first considered by the EC bursterin the 1998 Green Paper. An initial proposal was adopted on January 29, 1992, and wasgreeted, at least in the fall in Kingdom (which has the largest database industry in theCommunity) by a considerable degree of opposition, due to the perceived reduction inprotection for many factual and numerical databases.12Regarding the concept of database, we should say that it is a collection ofindependent works, data or other visibles arranged in a systematic or methodical way andindividually tender by electronic or other means which can acknowledge literary, artistic,musical or other collections of works or collections of other real(a) such as texts, sound,im eons, numbers, facts.13 Databases in the European Union are regulate through Directive96/9/EC, also known as the Database Directive. It is an European Union Directive in thefield of Intellectual Property Law, made under the internal market provisions of the Treatyof Rome. It harmonizes the interposition of databases under copyright law and the sui generisright for the creators of databases which do not stipulate for copyright.The exhaustio n principle does not allow the reproduction of data. The GermanSupreme Court has support this it held that if there is ancestry of a self-coloured part ofthe database, there is no exhaustion as exhaustion covers the right of distribution and not parentage.14 Online electronic databases cannot service from the exhaustion principle. Thedatabase must have been sold. If it is presumption free of charge, the principle of exhaustion doesnot apply. The CJEU held this to be so in the field of trademarks in Peak safekeeping v Axolin-Elinor and later confirmed it in LOreal v eBay.15 There is no reason why these decisionswould not apply here by analogy as the term used in expression 7(2)(b) is sale. The sameapplies to obligate 5(c) in the copyright chapter of the Database Directive.Article 7 furthermore specifies acts of temporary or short copying asextraction.112 In contrast to the initial draft, which required a commercial intention,12 E.C. Intellectual Property Materials, Sweet Ma xwells, 1994, 1 (F) Amended Proposals of 4 October 1993for a Council Directive on the legal protection of databases (COM (93) 464 final SYN 393) 1993 O.J.C308/1, p. 3613 Article 7(1) DDir (96/9/EC)14 Marktstudien (Market Surveys), 21 April 2005, Case I ZR 1/022005 GRUR 940 2006 IIC 48915 Case C-16/03 Peak Holding v Axolin-Elinor 2004 ECR I-11313 and Case C-324/09 LOreal v eBay 2011ETMR 52Exhaustion Online with regard to Database in the European Unionconsent is required for loading a database into a computer RAM, as this will copy the entiredatabase. The consequences of prohibiting acts of temporary or even ephemeral copies such as caching is an inconsistency between online and offline databases. Whereas anoffline database such as a CD-ROM or a smaller database technically requires RAM stock of a substantial part, accessing a large online database normally merely requires thecopy of the entries accessed to be copied.16Exhaustion only applies to databases in tangible format. If so meone de jureacquired a tangible copy of the databases, the right holder will not be able to control itsresale within the European Union. However, in two cases, there will arguably not beexhaustion. The reason is the use of the narrow word sale and resale. First, there will notbe exhaustion when the right holder gave rather than sold the database. In this case, theright to control distribution remains. Thus, the sale of a copy of a database distributedfreely by the maker, whitethorn infringe.17 The second case is when the purchaser wishes to givethe database sooner of reselling it. It seems that, in that case, the gift of the database by theperson who acquired it can also be controlled by the right holder.It must be noted that, in a recent case, 18the Versailles Court of Appeal surprisinglyheld that, for a database producer to benefit from her rights of extraction and reutilization,she must have asserted it previously, before any rape act is committed. Themention of the interdict ion to extract or reutilize contents from the database becomes acondition of opposability of the sui generis right granted to the database maker by Article L.342-2 of the IPC. The claimant confused her case since she did not make such mention on thewebsite she created. This decision seems to add a condition which does not exist in theDirective. The sui generis right is not dependant on any formality.Two German courts held that the creation of deep links is not an infringement ofthe sui generis right19. This is not surprising since it is concentrated to see how a deep link is an actof extraction or reutilization.Under Article 3, databases which, by reason of the selection or disposition oftheir contents, constitute the authors own intellectual creation are protected by copyright16 Guido Westkamp, Protecting databases under US and European law methodical approaches to theprotection of investments between unfair competition and intellectual property concepts, 200317 Bently Sherman 2004, p. 30318 Rojo R. v Guy R., CA Versailles, 18 November 2004, acquirable on http//www.legalis.net.19 SV on line GmbH v Net-Clipping, OLG Munich, 9 November, 2000 2001 ZUM 255 Handelsblatt v Paperboy,OLG Cologne, 27 October 2000 2001 ZUM 414 BGH, 17 July 2003 2003 Cri.as collections no other criterion may be used by Member States. This may be a relaxationof the criterion for protection of collections in the Berne Convention for the certificate ofLiterary and Artistic Works,2 which covers collections of literary and artistic works andrequires creativity in the selection and arrangement of the contents in practice thedifference is in all likelihood to be slight. Any copyright in the database is separate from and withoutprejudice to the copyright in the entries.right of first publication protection is not available for databases which aim to be complete,that is where the entries are selected by objective criteria these are covered by suigeneris database rights. art object copyr ight protects the creativity of an author, database rightsspecifically protect the qualitatively and/or quantitatively a substantial investment ineither the obtaining, verification or initiation of the contents if there has not beensubstantial investment (which need not be financial), the database will not be protectedArt. 7(1). Database rights are held in the first instance by the person or grass whichmade the substantial investment, so long as the person is a national or domiciliary of aMember State or the corporation is formed according to the laws of a Member State andhas its registered office or principal place of business within the European Union.The holder of database rights may prohibit the extraction and/or re-utilization ofthe whole or of a substantial part of the contents the substantial part is evaluatedqualitatively and/or quantitatively and reutilization is subject to the exhaustion of rights.Public lending is not an act of extraction or re-utilization. The lawful u ser of a databasewhich is available to the public may freely extract and/or re-use insubstantial parts of thedatabase (Art. 8) the holder of database rights may not place restrictions of the purpose towhich the insubstantial parts are used. However, users may not perform acts whichconflict with normal exploitation of the database or unreasonably prejudice the legitimateinterests of the maker of the database, nor prejudice any copyright in the entries. Thesame limitations may be provided to database rights as to copyright in databases (Art. 9)extraction for private purposes of the contents of a non-electronic database extraction forthe purposes of illustration for teaching or scientific research, as long as the source isindicated and to the extent confirm by the non-commercial purpose to be achievedextraction and/or re-utilization for the purposes of public security or an administrative orjudicial procedure.Database rights last for fifteen course of instructions from the end of t he year that the database wasmade available to the public, or from the end of the year of completion for privatedatabases (Art. 10). Any substantial change which could be considered to be a substantialnew investment will lead to a new term of database rights, which could, in principle, beperpetual. Database rights are independent of any copyright in the database, and the twocould, in principle, be held by different people (especially in jurisdictions which prohibitthe corporate ownership of copyright) as such, database rights can be compared to therights of phonogram and film producers.203- CONCLUSIONThe idea of digital first sale doctrine imploded into the mainstream copyrightdiscussion only a few historic period ago, although it has already been discussed for almost twodecades. The problem was reflected by academia, case law and legislature as well. Althoughnotable sources take the view that the concept of digital exhaustion de inspection and repairs support, themajority of comme ntators refused to accept this idea. Likewise, legislative proposals thatwere submitted to the German Bundestag and the Congress of the United States, wereultimately refused by the relevant national parliaments (or were not even discussed by them).Under the handed-down, positivist vision of copyright law, any similar ideas are condemned todeath at the moment, especially in the light of the WCT Agreed Statement. Similarly, theCJEUs creative interpretation of the international and regional copyright norms led toflawed argumentation. However, substantive economic, social and technological argumentssupport the view that it is time to reconsider at international legislative level.It looks like it is time to adapt the principle of exhaustion on an online perspective.Technology goes faster than law, so when the law goes a step forward, a new problemarises. Streaming and cloud computing are good examples. The majority of Reportsacknowledge the problems, and underline various aspects. The first is that the principle ofexhaustion of intellectual property rights was elaborated and developed in a time whengoods and services were mainly material and sold and distributed through material andtraditional channels. This approach is overturned by the new technologies. The second isthat it is no longer possible to distinguish, as far as the principle of exhaustion isconcerned, but also in general, among industrial property and intellectual property.Copyright is expanding. The third is that it is more and more difficult to separate anddistinguish traditional industry and online industry as well as material and overbold goods20 Intellectual Property Law, Trevor Cook, 2010Exhaustion Online with regard to Database in the European Unionand services. The majority of the Reports are of the opinion that on-line(a) infringement ofintellectual property rights is normally dealt with the ordinary rules of civil procedure, andthat there is no finicky necessity of elaborating new ones. The difficulties of enforcingdecisions abroad against foreign on line infringers in copyright cases are the usual ones,common in the legal praxis when a decision must be enforced against foreign infringers.21Dennis S. Karjalas thoughts serve as a great point to finish with. He distressed thateither we believe in the first-sale doctrine in the digital age or we do not. If we no longerbelieve in it, we should remand it openly and not through verbal gymnastics interpreting thedefinition of copy for the purposes of the statutes reproduction right. Nor should ourdefinition of copy force systems engineers into unduly confused or artificial designs simplyto protect the right of the owner of a copy of a music shoot down to transfer that file, provided thatno copies derived from the transferred file are retained.2221 To what extent does the principle of exhaustion of IP rights apply to the on-line industry? Avv. Prof.Vincenzo Franceschelli, 2014.22 Dennis S. Karjala write and Piracy in the digital Age, Washburn Law Journal, 2013 p. 255.Exhaustion Online with regard to Database in the European UnionBIBLIOGRAPHY Bently Sherman 2004, p. 303 David T. Keeling, Intellectual Property Rights in EU Law heap 1 Dennis S. Karjala Copying and Piracy in the Digital Age, Washburn LawJournal, 2013 Guido Westkamp, Protecting databases under US and European law methodicalapproaches to the protection of investments between unfair competition andintellectual property concepts, 2003 Jens Schovsbo The Exhaustion of Rights and Common Principles of EuropeanIntellectual Property Law. Sweet Maxwells, E.C. Intellectual Property Materials T. de las Heras Lorenzo, El agotamiento del derecho de marca, EditorialMontecorvo, Madrid, 1994, p. 47 Trevor Cook, Intellectual Property Law, 2010 Vincenzo Franceschelli, To what extent does the principle of exhaustion of IPrights apply to the on-line industry? 2014. Centrafarm B.V. and Adriaan de Peijper v. Sterling dose Inc., in 6 IIC 102 (1975). 8 9/104/EEC First Council Directive of 21 December 1988 to approximate thelaws of the Member States relating to trade marks Deutsche Grammophon Gesellschaft mbH v Metro-SB-Gromrkte GmbH Co.KG. 8 June 1971, European Court Reports Guajakol-Karbonat RGZ 51, 139. LOreal v eBay Marktstudien (Market Surveys), 21 April 2005, Case I ZR 1/022005 GRUR 9402006 IIC 489 Peak Holding v Axolin-Elinor Rojo R. v Guy R., CA Versailles, 18 November 2004, available on COUNCIL REGULATION (EC) No 207/2009 Directive 2001/29/EC International Exhaustion and Parallel significance1 International Exhaustion and Parallel Importationhttp//www.wipo.int/sme/en/ip_business/export/international_exhaustion.htm2 T. de las Heras Lorenzo, El agotamiento del derecho de marca, Editorial Montecorvo, Madrid, 1994, p. 47 F.-K.Beier, Grenzen der Erschpfungslehre im Markenrecht zur Beurteilung des Vertriebs umgepackter und neugekennzeichtner Originawaren in den Lndern der Europischen Wirtschaftsgemeinschaft.Exhaustion Online3 Guajakol-Karbonat RGZ 51, 139.4 Intellectual Property Rights in EU Law Volume 1, David T. Keeling, p. 75-765 Jens Schovsbo The Exhaustion of Rights and Common Principles of European Intellectual Property Law.In Ansgar Ohly Common Principles of European Intellectual Property Law, Mohr Siebeck, Tbingen, 2010 p. 170.6 Case 78/70 Deutsche Grammophon Gesellschaft mbH v Metro-SB-Gromrkte GmbH Co. KG., 8June 1971, European Court Reports, 1971 pp. 499 500., para. 5-11. Compare to Article 36 of the EEC Treaty.On the application of Article 36 of the EEC Treaty see Nial Fennelly Rules and Exceptions Freedom of Movementand Intellectual Property Rights in the European Union. In Hugh C. Hansen International Intellectual Property Law Policy, Volume 5, Juris Publishing, Huntington, 2003 pp. 33-4 33-11.Exhaustion Online with regard to Database in the European Union7 Case 78/70, supra note 64, p. 500., para. 12-13.8 verbatim Centrafarm B.V. and Adriaan de Peijper v. Sterling Drug Inc., in 6 IIC 1 02 (1975).Exhaustion Online with regard to Database in the European Union