Football Dataco Ltd & Ors v Sportradar GmbH & Anor

This appeal and cross-appeal is from a judgment of Floyd J of 17th November 2010, [2010] EWHC 2911 (Ch). Floyd J:

The parties each appeal the findings adverse to them. Having heard all he argument on point (i) and the claimants’ argument on point (ii) we decided to inform the parties of our decision. It was in part to allow and in part to refuse the defendants’ jurisdiction appeal. As to the claimants’ appeal we decided that the main point should be referred to the Court of Justice of the European Union. These are my reasons for these decisions.

The claimants between them say they own (a) UK copyright and (b) UK database rights in a database called Football Live. Football Live is a compilation of data about football matches in progress. It includes things like goals and when they were scored, the goalscorers, yellow and red cards and who and when they got them, penalties and when they were awarded, and substitutions (who was substituted, when and by whom). The data is said to be collected mainly by ex-professional footballers engaged by the claimants on a freelance basis who attend the relevant matches for this purpose. It is claimed that not only is there substantial investment in the obtaining and/or verification of the data but that the compilation of Football Live involves “considerable skill, effort, discretion and/or intellectual input by experienced personnel to generate, select and/or arrange its contents.”

There are two defendants, GmbH (German) and AG (Swiss). AG is the holding company of the Sportradar group of companies and is the parent company of GmbH. GmbH provides live scores, results and other statistics relating to football and other sports, including UK football matches to the public via the internet, although it appears that the betting companies actually contract with AG. The service is called “Sport Live Data.” The defendants have a website, betradar.com.

In particular the defendants have customers called bet365 (a UK company) and Stan James (a Gibralterian company) who provide betting services for and aimed at the UK market. If one goes to the website of either of these companies a link is provided to betrader.com. If you click on the “Live Score” option the data appears under a banner across the screen saying bet365 or Stan James as the case may be. Clearly therefore members of the public in the UK form an important target for the defendants.

The claimants say that GmbH and its parent, AG act in concert with each other. They point to the fact that AG is not a mere passive holding company, for it claims copyright in the context of the betradar.com website (and so by necessary implication licences GmbH to use the data on betradar.com), that betradar.com says that “Our Live Scores department is mainly operated from our office in Gera, Germany” and says that office is part of the First Defendant. The claimants intend to supplement this allegation by showing that the actual contracts with bet365 and Stan James are with AG rather than GmbH.

The claimants say that the defendants are getting their data not by the exercise of independent compilation but by taking it from Football Live. They say this can be proved by “telltales” - from time to time an error (or something like it) on Football Live has appeared on Sport Live Data and that this could only have happened by copying. The defendants deny copying: they say they generate the data on betradar.com independently without reference to Football Live. They say the “telltales” are explicable – as for instance coming from a common source such as an incorrect goal attribution by way of an announcement at the ground. Who is right will be an issue at any trial, whether that trial takes place in the courts of England and Wales or Germany. Copying will be a central issue. For obvious reasons it would be undesirable for it to be tried both here and in Germany.

On 23^rd April 2010 the claimants commenced the present proceedings. By way of retaliation and in an admittedly forum shopping exercise, on 14^th July 2010 GmbH alone commenced proceedings against the claimants in the Landgericht, Gera claiming negative declarations that its activities did not infringe any intellectual property rights of the claimants. The defendants contend that the April proceedings do not disclose a “good arguable case” against them and so the Landgericht is the court first seized with the dispute. Moreover they say, the proposed amendments to the claim would add a fresh “cause of action” (within the meaning of Art. 27 of the Brussels Regulation EC 44/2001) and thus would not be allowable (or at least would have to be stayed) pursuant to the provisions of that Article.

Before examining what the April proceedings did allege I should briefly set out the legal basis of the claimed rights. These are provided for by the Database Directive (96/9/EC).

Art. 3 provides for copyright. It says:

Object of protection

1.

In accordance with this Directive, databases which, by reason of the selection or arrangement of their contents, constitute the author's own intellectual creation shall be protected as such by copyright. No other criteria shall be applied to determine their eligibility for that protection.

2.

The copyright protection of databases provided for by this Directive shall not extend to their contents and shall be without prejudice to any rights subsisting in those contents themselves.

Chapter III provides for what the Directive inelegantly and rather unapproachably calls a “Sui Generis Right.” Informally people generally call it the “database right” and I shall use that word for it. Art 7 sets out what it is:

Object of protection

1.

Member States shall provide for a right for the maker of a database which shows that there has been qualitatively and/or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents to prevent extraction and/or re-utilization of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database.

The UK has implemented the Directive, amending the Copyright Designs and Patents Act 1988 by the Copyright and Rights in Database Regulations 1997 (SI 1997/3032). Both sides were agreed that nothing turns on the Act as amended: that it means exactly whatever is meant by the Directive, no more and no less. As is so depressingly common the draftsman has gone to a lot of trouble to re-phrase and re-write what he could and should have simply copied from the Directive. I do not bother with the re-write.

It is to be observed that the Directive does not create a Community wide right. Both copyright and database rights created by implementation of the Directive are national rights even though each right has the same scope in each Member State. Thus, for instance, in this case there is a UK database right and a corresponding German database right. We are concerned only with claims based on alleged infringement of the UK copyright and the UK database right.

I turn first to the copyright claim. The criteria for subsistence of copyright in a database are that “by reason of the selection or arrangement of their contents, it constitutes the author's own intellectual creation”. The defendants contend that the data collected by the claimants’ agents is not of that sort – it involves no intellectual creation. Therefore, they submit, there is no copyright right at all. Alternatively, they submit, the data alleged to have been copied (namely goals, goalscorers, own goals, penalties, yellow and red cards and substitutions) are matters of pure fact. Such data is merely the contents of the alleged copyright and is precluded from protection by way of copyright by virtue of Art. 3.2.

I accept the latter submission. The Judge was obviously sympathetic to it (and to the attack on copyright subsistence as a whole) for he said:

[49] Paragraph 22 of the particulars of claim alleges that the compilation of Football Live involves “considerable skill, effort and/or intellectual input by experienced personnel to generate, select and/or arrange its contents”. There is also an allegation that a substantial part has been used: see paragraph 37. In the light of the law as stated above, those combined allegations must include the allegation that what is taken is a substantial part of the intellectual input of the authors. Those allegations are supported by a statement of truth from each claimant. Mr Cuddigan’s argument that the part alleged to have been reproduced by his clients does not amount to an intellectual creation is not supported by any evidence. Whilst the court might have a view based on its own impressions, I do not think that it would be right to place those ahead of what is properly in evidence. In those circumstances, whilst there may ultimately prove to be force in the argument, I think the claimants have a good arguable case on this issue.

Unlike the Judge I think the point can be dealt with now. The statement of truth really adds nothing. It may be that some of the information collected for the claimants includes matter which involves intellectual creation. So there may be copyright in Football Live. But what is alleged to have been copied is mere data on any reasonable view. Its recording may sometimes involve some skill (who scored in a goalmouth scramble) but it is not creative skill.

Nor, speaking more technically, do I think it matters that there is no evidence saying that the matter taken does not amount to intellectual creation. For I cannot imagine any credible evidence to the effect that it does. And actually, although the particulars of claim are supported by a statement of truth (so are a sort of evidence) there is no assertion that what was taken amounted to the taking of work involving intellectual creation.

It follows that when the proceedings started the court was not seized of a claim in copyright to the necessary standard. From that it follows that the argument we heard about “authorising” an act restricted by copyright (which by s.16(2) of the Act constitutes an infringement) becomes irrelevant. I say no more about it other than I saw considerable force in it.

I turn to the database claim. The defendants do not contend that the claimants do not have database rights. Their point is that the claim as formulated in April does not properly identify any cause of action which is justiciable in the English Courts. They accept that their activities are carried out abroad, in Germany, Austria (where their server is located) and Holland (where their back-up server is) but, they say, none of that has anything to do with infringement of UK database rights in Football Live.

The claimants say not so, that their complaint in April contains sufficient allegations to amount to a claim that the defendants are joint-tortfeasors with people here. It is accepted that if there are sufficient such allegations then the court has got jurisdiction and to that extent at least the English Courts are first seised of the dispute.

So it all depends on what the claim was in April. To that I now turn. One must concentrate on what facts are actually alleged.

Subsistence and ownership of database rights in Football Live are alleged in the early part of the pleading. It then comes to the defendants. Paragraphs 32 and 33 identify the two defendants and states that AG is the parent of GmbH.

Paragraph 34 reads:

[34] The Defendants are engaged, inter alia, in the business of providing live scores, results, and statistics relating to football, to customers, including customers in the United Kingdom. Their customers include:

(i)

Bet365 Group Limited, trading as Bet365, a UK company. Bet365 provides online betting services, inter alia, to customers located in the UK, through a website at bet365.com ("the Bet365 Website"); and

(ii)

Stan James Plc, a company registered in Gibraltar, which provides online betting services, inter alia, to customers located in the UK, through a website at stanjames.com ("the Stan James Website")."

Paragraph 37 reads so far is material:

[37] From a date presently unknown to the Claimants but prior to the issue of the Claim Form in these proceedings, the Defendants have used the whole or a substantial part of Football Live, without the consent of the Claimants or any of them. Pending disclosure and/or evidence, the Claimants rely on the following facts and matters:

(i)

The reproduction of data from Football Live on pop-up windows hosted on the Defendants' Website which are linked to from the Bet365 Website and the Stan James Website, during the 2008/2009 and 2009/2010 seasons. These pop-up windows appear when the "Live Score" option on the Bet365 Website and the Stan James Website is clicked on. [Screen prints of the windows from the two websites are then attached and referred to]. These screen prints show examples of the data displayed (at the end of each game) in relation to all of the games played in each of the Leagues, on the relevant dates. The data which is displayed for each game is left on the Defendants' Website until the end of the day on which the game is played.

(ii)

By way of further illustration, attached as Annex 4 is a table showing the extent of types of live data displayed…

(iii)

By reason of the matter is aforesaid, it is to be inferred that the defendants reproduce and/or authorise the reproduction of the following events for every game in every League…(a) goals; (b) goalscorers (shown by the player’s name, and a football icon); (c) own goals (shown by the player's name followed by "(og)” and a football icon); (d) penalties (shown by the player's name followed by "(pen)"; (e) yellow cards (shown by the player's name, and a yellow card icon); (f) red cards (shown by the player's name and a red card icon); and (g) substitution (shown by the names of the players coming on and off, and an icon comprising two circular arrows). …

One of the screen prints attached to and forming part of the pleading show what a UK punter sees when he or she clicks on the bet365 website “live scores”. It is a screen showing live data for a particular match. Although it is provided by betradar it carries a big banner saying bet365. It is clearly the result of co-operation between the defendants and bet365.

Now if the claimants are right about copying, it is obviously clearly arguable that the two defendants and bet365 are acting in concert to enable UK punters to access the data copied by the defendants. There may be an infringement (issues of sustainability and “little and often” remain live) of the database right (albeit innocent) by the actual punter who gets copies of the data loaded onto his computer and displayed on his screen. bet365 and the defendants jointly cause that – in the language of the pleading “authorise the reproduction.” I would add that given the allegation that bet365 is a customer of the defendants, it is also reasonable to infer that the defendants permit their customer to access the data – which they may well wish to do to help them set odds.

English procedural law says that if you allege in your pleading facts which, if proved, would establish a cause of action, that is sufficient to support claim for that cause of action, see e.g. Letang v Cooper [1965] 1 Q.B. 232 and re Vandervell’s Trusts (No.2) [1974] Ch 269 at 321. You do not have to spell out precisely the legal basis of the cause of action. “Pleadings” in England have a technical meaning. They are the documents which contain the assertions of fact which the party intends in due course to prove by evidence. They do not need to include arguments of law and seldom do. I have no doubt that sufficient facts are alleged here to cover a claim of joint tortfeasorship both with bet365 and with ultimate UK punters.

But, says Mr Henry Carr QC for the defendants, English procedural law standards as to what is enough to plead a cause of action are irrelevant. “Cause of action” has an autonomous meaning in Art. 27 of the Brussels Regulation. This provides:

1.

Where proceedings involving the same cause of action and between the same parties are brought in the courts of different Member States, any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established.

2.

Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court.

Mr Carr submitted that the autonomous meaning comprises not only the facts, but also the rule of law relied on and the object, ie the relief. He said all three things must be set out before one can say a court is seised of a cause of action.

He drew attention to Metall & Rohstoff v Donaldson [1990] 1QB 391. That was not a case under the Regulation (or its predecessor, the Brussels Convention). It was under the former Order 11(1) of the Rules of the Supreme Court. The Court held that the Rule required more than a pleading of the facts to justify service out of the jurisdiction. This was because both the court and the defendant needed to know the nature of the claim, the court so as to be sure that it was proper to assert jurisdiction over a foreign defendant and the defendant so that he could know the nature of the claim in case he wished to challenge jurisdiction. Mr Carr said the same reasons apply under the Regulation. Unless the legal nature of the claim was spelt out in the proceedings before the Court said to be first seised, a second court could not know whether it was or not.

Mr James Mellor QC for the claimants accepted that “cause of action” has an autonomous meaning. But, he submitted, that does not help the defendants because the autonomous meaning of “cause of action” in Art. 27 covers the present case, being wider than that the English procedural rule. He took us to ECJ cases which indeed establish that. They were Gubisch Maschinenfabrik v Giulio Palumbo Case 144/86 and The Tatry Case C-406/92.

These cases show that for Art. 27 to apply you indeed need three identities: the same parties, the same cause (la même cause) and the same object (objet). But the cases also show that these do not have narrow meanings for which Mr Carr contended. On the contrary the meanings are wide.

The purpose of the Brussels Convention (now the Regulation) is:

To prevent parallel proceedings before the courts of different contracting states and to avoid conflicts between decisions which might result therefrom. Those rules are therefore designs to preclude in so far as is possible and from the outset, the possibility of a situation arising such as that referred to in Art.27(3), that is to say the non-recognition of a judgment on account of its irreconcilability with the judgment given in a dispute in which recognition is sought (Gubisch [8])

The wide meaning of cause and objet is illustrated by the very facts of those cases. In Gubisch an action to enforce a contract and an action to have it declared inoperative or rescinded or dissolved had the same cause and objet. The Court said:

[16] In particular, in a case such as this, involving the international sale of tangible moveable property, it is apparent that the action to enforce the contract is aimed at giving effect to it, and that the action for its rescission or discharge is aimed precisely at depriving it of any effect. The question whether the contract is binding therefore lies at the heart of the two actions. If it is the action for rescission or discharge of the contract that I brought subsequently, it may even be regarded as simply a defence against the first action, brought in the form of independent proceedings before a court in another contracting state.

[17] In those procedural circumstances it must be held at that the two actions have the same subject-matter, for that concept cannot be restricted so as to mean two claims which are entirely identical.

[18] If, in circumstances such as those of this case, the questions at issue concerning a single international sales contract were not decided solely by the court before which the action to enforce the contract is pending and which was seised first, there would be a danger for the party seeking enforcement that under Article 27(3) a judgment given in his favour might not be recognized, even though any defence put forward by the defendant alleging that the contract was not binding had not been accepted. There can be no doubt that a judgment given in a contracting state requiring performance of the contract would not be recognized in the state in which recognition was sought if a court in that state had given a judgment rescinding or discharging the contract. Such a result, restricting the effects of each judgment to the territory of the state concerned, would run counter to the objectives of the convention, which is intended to strengthen legal protection throughout the territory of the community and to facilitate recognition in each contracting state of judgments given in any other contracting state.

In The Tatry shipowners had claimed a declaration in the courts of the Netherlands that they were not liable for damage to a cargo they had carried. In England they were sued for damages for damage to the cargo. It did not matter that separate contracts were involved or that the one action was in personam and the other in rem. The Court said:

[38] For the purposes of Art. 21 of the Convention the “cause of action” comprises the facts and the rule of law relied on as the basis of the action.

[39] Consequently, an action for a declaration of non-liability, such as that brought in the main proceedings in this case, and another action, such as that brought subsequently by the cargo owners on the basis of shipping contracts which are separate but in identical terms, concerning the same cargo and transported in bulk and damages in the same circumstances

[40] The “object of the action” for the purposes of Art. 21 means the end the action has in view.

There is no trace of the kind of reasoning in Metall & Rohstoff in any of these cases. The emphasis is on avoiding conflicting decisions.

I turn to consider how these principles apply here. There is clearly identity of parties. As to cause, the pleadings make it plain that the claimants are suing the defendants in respect of breaches of database right. It is true that the detail about joint tortfeasorship is not spelt out particularly well, but I do not see that as affecting the cause. The “heart” of the claim (to use the Court’s word in Gubisch) is database infringement.The English court was first seized of that cause. Likewise the objet – the end in view – is clear. It is to claim damages from the defendants and an injunction to restrain “the acts complained of.”

Accordingly I would dismiss the defendants’ appeal concerning jurisdiction over the database infringement claims.

That makes it unnecessary to say much about the claimants’ point based on Art.5 (3) of the Convention. They say they can sue here because this is where the harmful events complained of occur. Given that joint-tortfeasorship is adequately pleaded (as I have held), then jurisdiction on this basis follows too.

I turn therefore to the claimants’ appeal. This turns on the meaning of the definition of infringement in the Database Directive. The right is:

to prevent extraction and/or re-utilization of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database.

Both extraction and re-utilization are defined terms (by Art. 7.2):

2.

For the purposes of this Chapter:

(a)

'extraction` shall mean the permanent or temporary transfer of all or a substantial part of the contents of a database to another medium by any means or in any form;

(b)

're-utilization` shall mean any form of making available to the public all or a substantial part of the contents of a database by the distribution of copies, by renting, by on-line or other forms of transmission. The first sale of a copy of a database within the Community by the rightholder or with his consent shall exhaust the right to control resale of that copy within the Community;

In the case of the UK database right, the claimants say that this means making available to the UK public. That they say the defendants do by copying (re-utilizing) Football Live on their Austrian server and transmitting the copied data to those members of the UK public who click on “live scores”. “Transmission,” they say, in the case of provision of data over the internet or indeed otherwise by wire involves both the acts of hosting the website (Austria and Holland in this case) but also the act of the user in accessing it. It is not transmitted unless and until it is received. Before there can in reality be a transmission there must be a transmittor and a transmittee. This I will call the “transmission theory” or the “communication theory”.

The defendants say not so, that acts of “transmission” occur only in the place from which the data emanates. This was called the “emission theory.” The Judge thought that the “better view” was that the defendants were right about that though it was not acte clair.

Before us the parties deployed considerable arguments in support of their respective positions. Mr Mellor contended that the argument was so strong in the claimants’ favour to be acte clair. After we had heard him we were not satisfied of this. Mr Carr did not dispute that position or that the point was important and could be decisive. He did not, therefore, oppose a reference to the CJEU.

We decided it was not appropriate for us to form our own view about this very important and difficult question. So all I do here is to briefly summarise the respective arguments.

These I summarise as follows:

Following the hearing the parties entered a debate about the questions. They could not agree. We have settled upon the following which, we think, are non-tendentious and fully raise the points in dispute. They read as follows:

Where a party uploads data from a database protected by sui generis right under Directive 96/9/EC (“the Database Directive”) onto that party’s webserver located in member state A and in response to requests from a user in another member state B the webserver sends such data to the user’s computer so that the data is stored in the memory of that computer and displayed on its screen

(a)

is the act of sending the data an act of “extraction” or “re-utilisation” by that party?

(b)

does any act of extraction and/or re-utilisation by that party occur

(i)

in A only

(ii)

in B only; or

(iii)

in both A and B?

Because we are making a reference, those aspects of the claim which allege that the defendants are directly liable for breach of database right must be stayed. But we see no reason for staying the claim in joint-tortfeasorship which in no way depends on resolution of the questions asked.

I agree.

I also agree.