On January 7, 2015 the Court of Appeal of Milan (Court of Appeal) rendered a relevant judgment on a dispute involving Yahoo! Italia S.r.l and Yahoo! Inc. vs. Reti Televisive Italiane S.p.A. (RTI), one of Italy’s major broadcasters. RTI sued Yahoo! Italia S.r.l. and Yahoo! Inc. (Yahoo!) because of the reproduction of RTI’s copyrighted videos on the Yahoo! Video-sharing platform (Yahoo! Video Italia). RTI requested the removal of such videos and the implementation by Yahoo! of a filtering and blocking system in order to detect and prevent any infringement of copyright. The Court of Appeal concluded that the hosting provider is only exclusively responsible if it takes active part in the uploading activity or is aware of the unlawful content or use of the material and does not erase them.
The first decision in the case, issued on May 19, 2011, by the Court of Milan was favorable to RTI. That court reasoned that Yahoo! operated as an active Internet Service Provider (ISP) and, consequently, could not benefit from the liability exception set forth by EU Directive no. 2000/31 for neutral, automatic and passive ISP.
The Court of Appeal overturned the Milan decision, applying principles stated by the European Court of Justice in recent judgments (i.e. C-314/12, March 27, 2014 and C-314/12, November 24, 2011), with specific reference to the balance between the freedom of expression and information and the right to conduct business vis-à-vis the protection of intellectual property rights. The final decision of the Court of Appeal was guided also by the principles stated by Directive 2004/48 according to which:
“The protection of intellectual property should allow the inventor or creator to derive a legitimate profit from his/her invention or creation…At the same time, it should not hamper freedom of expression, the free movement of information, or the protection of personal data, including on the internet.”
Thus, the protection of other fundamental rights may prevail over the protection of intellectual property rights.
The main conclusions of the Court of Appeal were the following:
- The definition of ‘active hosting provider’ does not apply to internet hosting services if the relevant provider does not manage in any way the content published by users.
- Based on Italian and European laws and regulations, the hosting provider is not requested to verify the copyright ownership or authority of material uploaded by its users.
Consequently, the hosting provider is responsible, only if it takes active part in the uploading activity or is aware of the unlawful content or use of the material and does not remove them. Indeed, based on acquired principles, the hosting provider has to grant neutrality in order to assure the freedom of expression and of information throughout the internet which would be limited by the use of a filtering and blocking system as requested by RTI.
This decision may represent a turning point in the Italian debate relating to ISPs’ liability for the copyright infringement of their users.