The Case C‑666/18 IT Development SAS v Free Mobile SAS of Court of Justice of the European Union (CJEU) issued 18 December 2019 provides interesting judgement regarding Infringement of Software Copyright and Breach of Software License Agreement.
CJEU ruled that Directive 2004/48/EC and Directive 2009/24/EC must be interpreted as meaning that the breach of a clause in a licence agreement for a computer program relating to the intellectual property rights falls within the concept of ‘infringement of intellectual property rights’ and therefore owner of copyright must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law.
IT Development brought proceedings against Free Mobile before the Regional Court, Paris, France for infringement of the copyright of the ClickOnSite software package. IT Development alleged that Free Mobile had modified the software, in particular by creating new forms. In IT Development’s opinion Free Mobile did not have the right to make such modifications because the provisions of the licence agreement stated that the customer expressly undertakes not to modify, correct, adapt, create second works and add, directly or indirectly, to that software.
Regional Court of Paris declared the claims brought by IT Development based on Free Mobile’s tortious liability inadmissible. The court held that there are two separate sets of rules relating to liability in intellectual property matters, one being tortious liability in the event of infringement of the exploitation rights of the author of the software, as determined by law, the other being contractual liability in the event of infringement of a copyright reserved by contract, and that, in the present case, Free Mobile was clearly alleged to have failed to perform its contractual obligations, providing a basis for an action for contractual liability, and not for the tortious act of infringement of software copyright.
IT Development brought an appeal against that judgment before the Court of Appeal, Paris, France and seeked a declaration that the modifications to the software made by Free Mobile constituted copyright infringements, for which Free Mobile should be ordered to pay IT Development the sum of EUR 1 440 000 as compensation for the damage suffered and, in the alternative, that Free Mobile should be ordered, on a contractual basis, to pay IT Development the sum of EUR 840 000 as compensation for that damage.
According to CJEU determination of the applicable liability regime falls within the competence of the Member States. However, the application of a particular liability regime should in no way constitute an obstacle to the effective protection of the intellectual property rights of the owner of the copyright of that program as established by Directives 2004/48 and 2009/24. Further, the national court is required, to the greatest extent possible, to interpret national law in conformity with the requirements of EU law and to thus ensure, the full effectiveness of EU law when it determines the dispute before it.
In the light of all the foregoing, the Directives 2004/48 and 2009/24 must be interpreted as meaning that the breach of a clause in a licence agreement for a computer program relating to the intellectual property rights of the owner of the copyright of that program falls within the concept of ‘infringement of intellectual property rights’, within the meaning of Directive 2004/48, and that, therefore, that owner must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law.