Antwerp Commercial Court Issues Injunction Closing Down Collaborative Video Recorder Provider Bhaalu
18/12/2014

On 4 November 2014, the Commercial Court of Antwerp ("the Court") issued a cease and desist order against NV Right Brain Interface ("RBI") to close down the collaborative video recording service "Bhaalu". The Court held that the service infringed copyright and neighbouring rights and that RBI had acted as an intermediary in the infringement.

The procedure had been brought by three Flemish television broadcasters: NV Vlaamse Radio- en Televisieomroeporganisatie, NV Medialaan and NV SBS Belgium ("the Broadcasters"). The Broadcasters claimed that Bhaalu violated their copyright, neighbouring rights and database rights by capturing their TV content.

Bhaalu is a collaborative Internet-based video recording provider, launched in November 2013 by RBI. Bhaalu users must buy a receptor box and subscribe to a service that records and makes TV content accessible in the "cloud".

Bhaalu is presented as a collaborative platform that allows its subscribers to share and watch TV content on their personal television at their convenience. In order to have access to this system, the subscribers must have a valid TV subscription with a Belgian distributor. RBI argues that Bhaalu relies on established private time-shifting principles, which it describes as "an international consumer right".

First, under copyright law, the Broadcasters claimed that Bhaalu constitutes an illegal reproduction under Article 44§1, b of the Copyright Act of 30 June 1994 (Wet betreffende het auteursrecht en naburige rechten/Loi relative au droit d'auteur et aux droits voisins - the "Copyright Act") and a communication to the public under Article 44, §1, d of the Copyright Act.

As regards the reproduction right, the Court sided with the Broadcasters in finding that the Bhaalu service constitutes a reproduction within the meaning of the Copyright Act. As a result, RBI should have obtained the Broadcasters' consent for such a reproduction before setting up its system. Interestingly however, the Court added that the users of the Bhaalu system make the actual infringement, rather than RBI.

Furthermore, the Court held that RBI could not rely on the exception of private copying contained in Article 22, §1, 5° of the Copyright Act since Bhaalu sources its recordings of a satellite signal from Telenet and TV Vlaanderen without the requisite permissions. In addition, it uses private smartcards of Bhaalu customers in order to decode this signal. According to the Court, these practices breach the general terms and conditions of the Broadcasters which prohibit users from making their subscription available to third parties. The Court added that these practices also run counter to criminally-sanctioned rules on conditional access since users make their smartcards available to decode encrypted signals. Since the exception of private copying does not apply if the protected works have not been obtained lawfully, the Court held that RBI could not rely on that exception.

As regards the right of communication to the public, the Court held that RBI "communicates" the broadcasting signals since it uses a specific technical process that is different from the original broadcasts. According to the Court, a defence based on TVCatchup (ECJ, Case C-607/11, ITV, Channel 4 and Channel 5 v. TVCatchup Limited, 7 March 2013) , a judgment handed down by the Court of Justice of the European Union ("ECJ"), is not pertinent. In that case, the ECJ held that an infringement of the right in a "communication to the public" implies that the communication should reach a "new public". The Court reasoned that the requirement of a "new public" was only relevant in specific situations, which did not apply to the case at hand. As a result, the Court found that RBI had made unlawful communications to the public, by making broadcasts available in such a way that members of the public could access protected works from a place and time individually chosen by them, without the authorisation of the Broadcasters.

Furthermore, the Broadcasters argued that RBI violated their sui generis right in their databases. For its part, the Court expressed doubts that the Broadcasters would have such a right under the Database Law of 31 August 1998 (Wet houdende omzetting in Belgisch recht van de Europese richtlijn van 11 maart 1996 betreffende de rechtsbescherming van databanken/Loi transposant en droit belge la directive européenne du 11 mars 1996 concernant la protection juridique des bases de données). According to the Court, it was doubtful whether the investment made in creating the database was independent from the principal broadcasting activity of the Broadcasters while the investment should be independent from other activities in order to benefit from the sui generis database right.

Nevertheless, the Court added that this consideration was irrelevant in the light of its finding that, in any case, Bhaalu did not use the database in an unlawful way. The copying of the Broadcasters' programme schedules would at most, the Court determined, constitute an indirect use, which does not infringe the sui generis database right.

The Court also held that RBI acted as an intermediary that could be ordered to take measures to cease an ongoing infringement of copyright and neighbouring rights. The Court thus required RBI to stop the Bhaalu service under penalty of a periodic payment in case it failed to comply. In addition, the Court ordered the publication of the decision and the communication of the decision to Bhaalu users.

Following this judgment, RBI announced that it would undertake negotiations to come to an arrangement with the Broadcasters. In the absence of such a negotiated solution, RBI plans to lodge an appeal against the decision of the Court.

The present judgment should be contrasted with an earlier decision of the Hasselt Division of the Antwerp Commercial Court (See, VBB on Belgian Business Law, Volume 2014, No. 7, p. 10, available at www.vbb.com). On 2 July 2014, the Commercial Court of Hasselt allowed the Bhaalu service to continue operating in proceedings brought against RBI by the satellite broadcaster M7 Group NV (operating under the brand name "TV Vlaanderen").

Significantly, in its judgment of 4 November 2014, the Court expressly stated that it was not bound by the earlier decision of the Court of Hasselt, which concerned a different type of plaintiff. In addition, the Court relied on technical expert reports that had not been available at the time of the decision of the Hasselt Commercial Court. 

Related : Van Bael & Bellis ( Mr. Peter L'Ecluse ,  Mr. Thibaut D'hulst )

Mr. Peter L'Ecluse Mr. Peter L'Ecluse
Partner
plecluse@vbb.com
Mr. Thibaut D'hulst Mr. Thibaut D'hulst
Counsel
tdhulst@vbb.com

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