Monday 23 January 2012

For what it’s worth

The Higher Regional Court of Celle (OLG Celle) recently had to decide a curious question: what is the value of a copyright injunction? It’s tricky enough to calculate damages in copyright cases – the actual damage more often than not is difficult to prove, and models such as the fictitious licence (‘Lizenzanalogie’) or the amount by which the infringer is unlawfully enriched due to the infringement (‘ungerechtfertigte Bereicherung’) all have their weak points. But how do you determine the value of an injunction? And why would anyone even want to know?

The answer to the second question is straightforward enough. In Germany, the amount in dispute (‘Streitwert’) determines whether a claim will be heard in a District Court (Amtsgericht) or in a Regional Court (Landgericht). The Amtsgericht deals with claims where the amount in dispute is 5,000 EUR or less (they also deal with specific areas of law regardless of the amount in dispute, but this does not affect copyright). If the amount in dispute is larger than 5,000 EUR, only a District Court is competent to hear the case.

The answer to the first question is of course the lawyer’s all-time favourite ‘it depends’. In the case at hand, the claimant had applied for an injunction ordering the defendant to cease and desist from communicating to the public football broadcasts in his pub. The court decided that the value of the injunction equalled the amount of the television broadcaster’s estimated loss of earnings during a period of three years. Why three years? I’m afraid the court failed to explain. Maybe three years was the typical duration of a licence agreement in the relevant market, but that’s just a wild guess… However, the court did elaborate that since the case only concerned the application for a preliminary injunction rather than a permanent one, the amount in dispute must be reduced by one third (i.e. the loss of earnings of two years).

In addition, the court pointed out that aspects of general prevention of copyright infringement must not be taken into consideration when determining the amount in dispute. It held that deciding on the amount in dispute is not the place to try and deter potential copycat infringers or penalise the defendant. In doing so, it openly contradicted previous judgments by a number of other Regional Courts, namely OLG Koblenz, KG Berlin, OLG Hamburg and OLG Thüringen. On the other hand, OLG Frankfurt, OLG Braunschweig and Schleswig-Holsteinisches OLG support the same view as OLG Celle.

So basically it’s a tie and something the Bundesgerichtshof (BGH) should be keen to jump on in the name of the unity of the legal system, but I think it’s not very likely that someone will take a case all the way to the BGH just because of a disagreement over the amount in dispute. Dear BGH, can we have an obiter dictum sometime soon, please?

Source: OLG Celle, 7 December 2011 - 13 U 130/11, available online (in German) here

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