Federal Constitutional Court - Press office -
Press release no. 56/2011 of 9 September 2011
Order of 19 July 2011 – 1 BvR 1916/09 –
Decision regarding the protection of the fundamental rights of legal
entities from the European Union and of distribution rights under the
Copyright Act (imitation designer furniture)
According to the Copyright Act (Urheberrechtsgesetz – UrhG), the author
of a work has the exclusive right of distribution. § 17.1 UrhG defines
the distribution right as the right to offer to the public or to put
into circulation the original work or copies thereof. The provision
serves, inter alia, to implement Article 4 of European Copyright
Directive 2001/29/EC in German domestic law. In the general view to
date, the term distribution encompassed any act offering the work to the
general public, for which any assignment of ownership was sufficient.
Additionally, § 96 UrhG contains a prohibition of exploitation for
unlawfully made copies.
The complainant, a limited liability company under Italian law
headquartered in Italy, manufactures furniture according to plans of the
architect and designer Le Corbusier, who died in 1965, and exercises his
copyright under license. The plaintiff of the original proceedings, a
cigar manufacturer, furnished a cigar lounge in an art and exhibition
hall in which it placed imitations of Le Corbusier furniture. Upon the
complainant’s request, the Regional Court (Landgericht) issued a
judgement to cease and desist, which was subsequently upheld by the
Higher Regional Court (Oberlandesgericht).
The Federal Court of Justice (Bundesgerichtshof), by contrast, rejected
the action on the ground that the placing of the furniture violated
neither the distribution right nor the prohibition of exploitation. It
based its ruling on a judgment of the European Court of Justice (ECJ),
which had ruled in a parallel case referred by the Federal Court of
Justice that distribution within the meaning of Article 4.1 of the
Copyright Directive applied only in case of transfer of ownership. The
Federal Court of Justice held that according to this judgment of the
ECJ, the distribution right was not violated if imitations of
copyrighted furniture were merely made available for use by the public
without involving a transfer of ownership. The Copyright Directive was
found to establish the maximum level of protection that a Member State
could not surpass. The complainant considers this to violate its
constitutional right of ownership. Furthermore, it contends that the
ruling violates its right to a statutory judge, alleging that the
Federal Court of Justice should have previously submitted to the ECJ the
questions as to whether offering works for use in any form was within
the scope of application of the Copyright Directive at all and whether
the directive comprised the maximum of the protection of distribution
rights.
The First Senate of the Federal Constitutional Court rejected the
constitutional complaint as unfounded. As a foreign legal entity
incorporated in the European Union, the complainant is a holder of
fundamental rights under the Basic Law (Grundgesetz – GG). However, in
the case at dispute its constitutional rights have not been violated.
In essence, the decision is based on the following considerations:
1. The Federal Constitutional Court decided that foreign legal entities
incorporated in the European Union may be holders of substantive
fundamental rights of the Basic Law.
According to Article 19 § 3 GG, fundamental rights under the Basic Law
also apply to domestic legal entities to the extent that the nature of
such rights permits. Even if legal entities from Member States of the EU
are not “domestic” within the meaning of the Basic Law, an expansion of
the application of the protection of fundamental rights to such legal
entities corresponds to the obligations assumed by Member States under
the European Treaties, which in particular are expressed in the
fundamental freedoms and the general ban on discrimination on grounds of
nationality enshrined in EU law. These oblige the Member States and all
their bodies and agencies to also place legal entities from another EU
Member State on the same footing as domestic entities with regard to the
legal protection that can be obtained. The provisions of European Union
law do not suppress Article 19.3 GG, but only prompt an extension of the
protection of fundamental rights to cover further legal subjects of the
European Single Market. The extension is contingent on the legal entity
having an adequate domestic connection, which will generally be the case
if the foreign legal entity operates in Germany and is able to file
lawsuits and be sued before the ordinary (non-constitutional) courts in
this country. 2. Furthermore, the Federal Constitutional Court had to
clarify whether and to what degree the ordinary courts have to test the
German law which they are to apply, be it fully or partly harmonised by
Union law, by the standard of the German Basic Law and of the law of the
European Union, and to what degree the Federal Constitutional Court in
turn reviews the ordinary courts’ interpretation of the European
Directive in terms of the Basic Law. When interpreting domestic
copyright law, the civil courts have to take the protection of property
rights under the Basic Law into account, insofar as European law leaves
leeway with regard to national implementation. If the courts consider
full harmonisation by Union law to be evident without referring the case
to the ECJ for a preliminary ruling, this is subject to review by the
Federal Constitutional Court. If such a case arises, the latter is not
restricted to a mere review of arbitrariness. If the Member States have
no leeway in the implementation of EU law, the courts must review the
applicable Union law where appropriate as to its reconcilability with
the fundamental rights of Union law and, where necessary, refer the
matter to the ECJ.
According to these standards, the complainant’s copyright protected by
Article 14.1 GG to control the distribution of copies of the furniture
was not violated by the impugned judgment. The presumption by the
Federal Court of Justice that the Copyright Directive, as interpreted by
the ECJ, did not leave any latitude to domestic law with regard to
protecting the mere offering of imitated furniture for use as copyright,
is constitutionally unobjectionable. In the parallel case, the ECJ did
not mention any leeway in implementation, and explicitly reserved any
expansion of the term “distribution” to the Union legislature. The
Federal Court of Justice was able to presume that regarding the
interpretation of § 17 UrhG, the ECJ judgment did not leave it any
latitude.
3. The impugned judgment does not deprive the complainant of its
statutory judge (Article 101 § 1 sentence 2 GG). According to the
case-law of the ECJ, a national court of final instance must comply with
its obligation of reference under Article 267 of the Treaty on the
Functioning of the European Union if a question of Union law arises in
proceedings pending before it, unless the court has found that the
question is not material to the ruling, that it has already been the
subject of interpretation by the ECJ, or that the correct application of
Community law is so obvious as to leave no room for any reasonable
doubt. The Federal Constitutional Court only reviews whether the
application of these rules is manifestly untenable.
Having submitted the questions it considered relevant for the ruling to
the ECJ in the parallel case, the Federal Court of Justice has not
fundamentally misjudged its obligation to refer to the ECJ in the case
at hand. From the impugned judgment, one can deduce the reasonable
conviction of the Federal Court of Justice that Article 4.1 of the
Copyright Directive constitutes a fully harmonised provision of the
distribution right and that the ECJ has finally and comprehensively
clarified the interpretation of the definition of distribution contained
in the directive.
This press release is also available in the original german version.
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