AG Opinion brings music to the ears of phonogram producers
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We did not have a chance to post this before the Christmas break, but it is perhaps one of the most interesting and multifaceted copyright cases of 2018, in which Advocate General (AG) Szpunar has ruled that the unlicensed sampling from a phonogram (i.e. a sound recording) constitutes copyright infringement.
What is sampling?
If you're not into the latest rap and hip hop tracks, AG Szpunar helpfully opens his Opinion with a clear explanation of the sampling process which he describes as, "the process of taking, by means of electronic equipment, a portion or sample (hence the name of the technique) of a phonogram for the purpose of using it as an element in a new composition in another phonogram. When reused, those samples are often mixed, modified and repeated in a loop in such a way as to be more or less recognisable in the new work….. those samples may be of different lengths; of a duration of between less than a second and several tens of seconds". Although for many years, composers have been re-using elements of earlier works, sampling is a popular modern phenomenon, so the final decision in this will be hugely important to many in the music industry.
Background
Kraftwerk is a German band formed in 1970 by Ralf Hütter and Florian Schneider-Esleben who are considered by many in the music industry to be the pioneers of electronic music. In 1977, Hütter and Schneider-Esleben produced and performed a phonogram featuring the song 'Metall auf Metall'. Enter stage, music producer, Mr Moses Pelham, who allegedly copied, using a sampling technique, approximately two seconds of a rhythm sequence (in a continuous loop) from the song 'Metall auf Metall' to incorporate in his own song, 'Nur mir'.
The case made its way to the German Federal Court of Justice which decided to refer various questions to the CJEU on copyright and related rights and fundamental rights, including the following:
1) Is it an infringement of a phonogram producer's exclusive right (under Article 2(c) of the Copyright Directive) to reproduce that phonogram if someone takes very short audio snatches from the phonogram and transfers them to another phonogram?
2) Is a phonogram containing very short audio snatches from another phonogram a copy (under Article 9 of the Rental and Lending Directive) of that phonogram?
3) Can a work be said to be used for quotation purposes if it is not clear that another person's work is being used?
The Opinion
Is sampling an infringement of a phonogram producer's exclusive reproduction right?
Article 2(c) of the Copyright Directive provides that phonogram producers have the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part of their phonogram. This question is important in determining what precisely is meant by 'reproduction in part'.
From the outset in his Opinion, the AG was confident in his view that 'it goes without saying' that sampling is an infringement - "Sampling (generally) involves the direct and permanent reproduction, by digital means and in digital form, of a portion or sample of a phonogram'". However, Pelham, the Government and the Commission had put forward arguments as to why phonogram producers' rights should be limited so that sampling did not fall within the scope of the exclusive right of reproduction.
De minimis argument
One argument was that sampling rights should be subject to a 'de minimis' (i.e. quantitative) threshold. The reasoning behind that stemmed from the ruling in Infopaq in which the ECJ had found that the literary works in issue consisted of words, which when considered in isolation, did not attract copyright protection. The AG confirmed that it was true that individual words cannot be protected because they are not literary works and gave the helpful analogy, that 'the author of a literary work cannot appropriate common words or expressions, in the same way that a composer cannot claim an exclusive right over the notes or a painter a right over the colours'. However, that by no means constituted recognition of any de minimis threshold in copyright law. A part of a work could be protected provided it was sufficiently original in the sense of being the author's own intellectual creation.
In any case, the AG concluded that the reasoning in Infopaq did not apply to phonograms. A phonogram was not an intellectual creation but rather a fixation of sounds, protected as an indivisible whole. There is no originality requirement for a phonogram. It is not protected as a result of its creativeness, but because of the financial and organisational investment (akin to the EU database right). It was true that a sound or word could not be monopolised by an author. However, from the moment they are recorded, that same sound performed by a musician would fall within the scope of copyright and related rights. The fact that the right of a phonogram producer is aimed at protecting his legitimate financial investment (i.e. protecting against piracy) did not mean that the right did not also cover other exploitation, such as authorising or prohibiting sampling.
Pelham argued that because the right of phonogram producers protects their financial investment, that right should only protect extracts of phonograms which were long enough to represent that investment made by the producer. Taking or sampling very small extracts did not pose a threat to the financial interests of those producers and consequently, should not be protected as an exclusive right.
AG Szpunar, however, concluded that taking an extract of a phonogram to use in another phonogram (i.e. sampling) does infringe the exclusive right of the producer of the first phonogram to authorise or prohibit the reproduction of his phonogram, if it was taken without his permission.
Is a phonogram containing extracts from another phonogram a 'copy'?
The AG started by explaining that the main purpose of the distribution right under the Rental and Lending Directive is to protect against what is commonly known as 'piracy' (i.e. "the production and distribution of counterfeit copies of phonograms and counterfeit copies, which, by replacing lawful copies, significantly affects the revenue earned by phonogram producers"). Further a 'copy' means a copy that incorporates all or a substantial part of the sounds of a protected phonogram. He therefore concluded that, as sampling does not incorporate all or part of the sounds of the original phonogram and is not intended to produce a phonogram that replaces the original phonogram, but rather it creates a new independent work, such a phonogram cannot be said to be a copy of that phonogram.
Does the quotation exception apply?
The AG began his reasoning by saying that despite this exception ordinarily being used in relation to literary works, he saw no reason why it could not be applied to other categories of works, such as musical works.
The AG explained that in order to rely on the quotation exception, certain conditions had to be satisfied and three were particularly relevant to this case:
- The quotation must be 'for purposes such as criticism and review'. 'Such as' indicated that the purposes envisaged here are not confined just to criticism and review, these are simply an illustration. Many musical quotations are not for the purposes of criticism or review but pursue different objectives. According to the AG, however, they must still 'enter into some kind of dialogue with the work quoted…whether in confrontation, as a tribute to or in another way'.
- The quotation must be unaltered and must be incorporated in such a way that it may be easily distinguished as a foreign element.
- The quotation must indicate the source, including the author's name, unless it is not possible.
He concluded that the quotation exception did not apply in this situation, where an extract of a phonogram was incorporated into another phonogram but did not interact with the first phonogram and formed an indistinguishable part of it. The AG recognised that in the case of a musical work, it was difficult to indicate the source of a quotation, although it could have been done in the description of the quoting work or the title, which did not appear to be the case here in respect of the song 'Nur mir'.
Other questions
The AG explored the relationship between the exclusive right of phonogram producers and Article 13 of the EU Charter of Fundamental Rights which enshrines freedom of the arts and sciences. Essentially, the question was whether the need to preserve freedom of the arts could override the exclusive right of a phonogram producer. The AG gave short shrift to this point and confirmed that 'freedom of the arts cannot guarantee the possibility of free use of whatever is wanted for creative purposes'. He reasoned that it is necessary to strike a balance between restrictions to the exercise of fundamental rights, such as certain intellectual property monopoly rights, and freedom of expression and freedom of the arts. However, he did not consider obtaining a licence for sampling as restricting the freedom of the arts to a degree that extended beyond normal market constraints.
Pelham also tried to argue that it was possible to carry out unlicensed sampling by virtue of the 'free use' provision under German law, which allows an independent work to be created in the free use of another work without the author's consent. The AG, however, confirmed that the Copyright Directive did not allow for the German 'free use' provision, as it went beyond the scope of the existing exceptions and limitations laid down in the Copyright Directive.
Comment
Whilst this comes as a welcome Opinion to producers of phonograms, there are those in the music industry who consider the protection granted to phonogram producers as excessive, being equal to that of authors.
The hefty Opinion was particularly interesting in its analysis of the existing case law relating to the copyright protection of extracts of work (Infopaq). It is reassuring that the AG confirmed that the CJEU in that case did not set a quantitative threshold for what can and cannot be protected by copyright.
The Opinion is also interesting in its analysis of the scope of the quotation exception and its application to works other than the more usual literary works.
As a final word, it is important to highlight that AG Szpunar had a difficult task trying to reconcile the various different rights at play which were in conflict with one another. Interestingly, he even ventured so far as to say that he did not rule out in the future the introduction of an exception to the exclusive rights of authors and other rightsholders for uses such as sampling so watch this space for the final ruling!