Liability of online service providers

01-10-2012

Aurélia Marie

Several recent court decisions have clarified the nature, in law, of the activities of service providers on the Internet, and their related obligations.

Several recent court decisions have clarified the nature, in law, of the activities of service providers on the Internet, and their related obligations.

In an unprecedented case, the Paris Court of Appeal has held that eBay France and eBay Europe were not performing any acts of sale by public auction. In its judgment of May 25, 2012, the court held that:

  • In view of the absence of representation of the seller by eBay and the active role kept by the seller in the sale, eBay entities were not acting as an agent of the seller; and
     
  • In view that the seller may choose a bidder other than the highest one, the sale was not made by auction.

According to the court, eBay’s activities thus merely constitute brokerage, ie, putting persons willing to enter into an agreement in touch.

In a judgment of May 29, 2012, the Paris First Instance Court took a stance on the nature, in law, of the activities of another major actor in the Internet market. In this case, a French TV channel held YouTube responsible for several items of content put online by users of the YouTube website which infringed its rights.

The channel based its claims on several services offered by YouTube which, it says, demonstrate an organisation and a control by YouTube of the content put online by the users of the website amounting to editing services, and not merely hosting.

The court refused to designate YouTube as providing ‘editing services’.

As regards the possibility of searching content by category, offered by YouTube, the court considered that this could not be regarded as organisation or control of the content in the absence of advertising of the most attractive content and of any a priori or a posteriori control by YouTube of the content put online by users.

"THE COURT MADE CLEAR THAT ARTICLE 9.4 OF THE YOUTUBE TERMS OF SERVICE DOES NOT MEAN THAT YOUTUBE CONTROLS THE CONTENT."

For this reason, the court made clear that Article 9.4 of the YouTube terms of service, which specifies that "YouTube has the right (but not the obligation) to decide whether the contributions respect the requirements related to the content as specified in the present terms of service and to suppress any contribution which would violate such terms” does not mean that YouTube controls the content, but only expresses the obligation for YouTube to withdraw content which is obviously unlawful, as required by Law No. 2004-575 of June 21, 2004.

In the same way, the court considered that the provisions of Article 10 of the YouTube terms of service, which specify that YouTube benefits from an automatic assignment of rights on the content put online by users, does not characterise organisation or control of the content by YouTube in the absence of any use by YouTube of the content put online by the users.

Finally, the court considered that the offer by YouTube of advertising space in relation to content put online was not incompatible with the activity of ‘hosting’ in the absence of specification by the advertiser of the content of the files put online by Internet users.

The court concluded that the services offered by YouTube can be regarded simply as hosting services.

These cases remind us that the legal categorisation of the services provided by service providers in the information society has a determining influence on the obligations and the regime governing liability of such companies.

Thus, by acting as a broker—and not as a seller by public auction— eBay does not have to request any official approval.

In the same way, its status as host—not editor—enables YouTube to benefit from the derogatory regime of liability established by the Law No. 2004-575 of June 21, 2004, implementing the E-Commerce Directive 2000/31/EC in France. According to this regime, the host incurs liability only if it does not react promptly to withdraw unlawful content which is expressly notified to it.

Such a notification must respect a specific formalism and specify different types of information. As can be seen from a last decision of the Bordeaux Court of Appeal, case law is relatively demanding regarding the type of information which must be provided to the host in a notification of allegedly unlawful content.

The Bordeaux Court of Appeal considered indeed that the host had not been validly notified of the unlawful acts in the absence of indication of the profession, the address, the nationality and the date and place of birth of the person having notified the information to the host (Bordeaux Court of Appeal, May 10, 2012).

In the absence of a valid notification, the host could not be liable despite the late withdrawal of the unlawful content.

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Aurélia Marie is a partner at Cabinet Beau de Loménie. She can be contacted at: amarie@bdl-ip.com

online, service providers, eBay, YouTube, hosting