The Civil Chamber of the Supreme Court of Poland referred its second preliminary question to the CJEU (following a previous one reported previously on Polish Private Law). This time it addressed issues of intellectual property protection, against the background of the 2004/48/EC directive of 29 April 2004 on the enforcement of intellectual property rights. The Court confronted this act with the domestic remedies in the case of copyright infringements, concluding that the possibility to award damages without ascertaining the real amount of loss, as set forth in the Polish regulation, is not compliant with the EU rules, excluding penal measures in these terms.
The background
In the decision of 15 May 2015 (V CSK 41/14), the Supreme Court asked the Tribunal about its interpretation of Article 13 of the directive – namely, on the possibility of understanding this provision in such a way that it allows a victim of an infringement to claim damages under general premises of civil law, or whether it provides the right to claim damages without the need to prove the damage and a causal link (amounting to double or triple the sum of due remuneration).
The proceedings were initiated by the organisation administering intellectual property rights, which issued a claim against a cable TV provider reemitting television programmes subject to the authorship rights of other persons. The claimant demanded an injunction (prohibiting the defendant to continue this practice), as well as pecuniary compensation. Under Article 79 section 1 of the Act on Copyright and Related Rights of 4 February 1994, the person whose intellectual property rights have been infringed is entitled to demand a cease or restitution injunction, the return of benefits acquired by the infringer and – of particular importance for the Supreme Court’s inquiry – compensation. The latter can be claimed, alternatively: upon the general rules of civil law (which entails proving the typical premises, including a causal link and the amount of loss) or as double or triple (if infringement was culpable) the amount of the respective remuneration, calculated with regard to claiming it.
The sources of concern
Expanding upon this problem, the Court pointed out that, under Article 13 section 1 (a), the adjudication of damages remains a matter for domestic courts and only exceptionally it is possible to provide a lump sum compensation, taking into account the prerequisites listed in Article 13 section 1 (b) of the directive. Further, the Court also expressed its concern about the admissibility of doubling or tripling the sum of the (hypothetical) remuneration due to the person entitled to the right in light of the directive. It emphasised that recital 26 of Directive 2004/48/EC clearly sets out that the aim of this regulation is not to provide damages of a punitive character. According to the Supreme Court, the directive therefore contradicts the imposition of damages in the form set out by the Polish copyright regulation – i.e. damages exceeding the loss actually incurred. As the Court pointed out, the remedy in this shape has a penal nature, burdening the claimant only with proving the damage (without specifying its extent or evidencing other premises of liability). Only while claiming triple compensation is the claimant obliged additionally to prove the culpability of the defendant’s conduct. Therefore, as the Court observed, the remedy in question is compensation in name only, while actually being a way of penalising the infringer. In addition, as the Supreme Court pointed out, the alternative of awarding “lump sum” damages means only a different (and simplified) way of ascertaining the amount of compensation, which can be chosen by the court, rather than by the party itself. Therefore it cannot be equated with the double/triple compensation available under Polish law.
The further observations of the Court
According to the Supreme Court, the Polish regulation also provides a differentiation between copyright and industrial property rights. In the case of infringing the latter, the injured person may claim only compensation under the general civil law regime, without being able to obtain a double/triple lump sum available for an infringement of the former. Such a disparity of remedies is, in the Court’s view, irreconcilable with the directive. At the same time, as has also been pointed out, the protective measures in the sphere of industrial property seem properly harmonised with the EU act, as opposed to the aforementioned “penal” protection of copyright. Further, the Supreme Court also noticed that, although the directive approves of raising the standard of protection in the implementation process, it still cannot constitute remedies of a penal nature.
For obvious reasons, the question of the conformity of the Polish regulation with the directive is of crucial importance for adjudicating the case. The possible lack of compliance will lead to the inapplicability of the domestic provision, thereby leaving a clear and exclusive way to ascertain compensation in the general regime, not under the simplified “lump sum” scheme.
The question is decided by the CJEU as case C-367/15, Stowarzyszenie Oławska Telewizja Kablowa.
For the other preliminary question from the Polish courts, see also the database of the Institute of Justice.
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