German court says file-transfer firm needs to operate ‘takedown and stay down’ for safe harbour protection from copyright infringement claims

A German court has ruled that file-transfer and cloud-storage company Uploaded.net can be held liable for the copyright infringement of its users because it failed to implement enough measures to stop piracy occurring on its networks, reports Chris Cooke in Complete Musc Update today.

The role of cloud-storage services in facilitating the illegal distribution of music and movies has been on the entertainment industry’s radar for years, of course. The MegaUpload case probably remains the most high profile legal assault on such a service, though in Europe it was companies like RapidShare that were on the receiving end of the litigation.

Cloud-storage companies usually claim safe harbour protection. They argue that they remove infringing content when made aware of it by a copyright owner, and therefore they qualify for protection from liability for infringement under the safe harbours of US or European law.

“File-hosting services earn a lot of money though the exploitation of creative content. Copyright infringements are willingly accepted. This imbalance hurts our members and is something we can’t accept. We, therefore demand a legal framework where platform operators are held accountable and authors finally get their fair share in the respective proceeds. This decision is a clear signal for creatives” – Dr Harald Heker (GEMA)

Courts in different jurisdictions, and sometimes within the same jurisdiction, haven’t been especially consistent on quite how good a takedown system such platforms must operate in order to benefit from safe harbour.

Though interestingly in the latest legal battle with Uploaded.net, pursued by German collecting society GEMA, the courts said that simply responding to individual takedown notices from rights owners wasn’t enough.

In particular, the digital firm should put in place measures to stop previously removed infringing files from being re-uploaded. The rights owners call that ‘takedown and stay down’, and it’s one of the key obligations music and movie companies would like to see be extended to all web companies.

Which makes the ruling in the Regional Court Of Munich a good one for both GEMA and the wider entertainment industry. Though Uploaded.net owner Cyando AG is likely to appeal, and a separate hearing will be required to ascertain what damages GEMA is due from the cloud-storage firm for its past failings in policing piracy on its networks.