In an important first-instance ruling, the UK High Court has upheld a stipulation that operators and customers of paid digital news monitor services should pay newspapers for crawling their stories.
The case was lodged by UK news publishers’ Newspaper Licensing Agency (NLA) against PR monitor Meltwater, to gain endorsement for their stipulation that the services and their customers, who subscribe to receive alerts containing mentions of their company, must pay them for the privilege of “copying” news stories.
Our analysis…
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The case affects news monitors which charge private clients fees, and their customers, but not the likes of Google (NSDQ: GOOG) News, which are free and ad-supported, which the NLA has not levied its stipulation against.
Meltwater says the verdict is “disappointing”: “We strongly believe it reaches a wrong interpretation of the law … The first instance High Court ruling undermines the basic principles of the operation and use of the Internet.” Meltwater says it has been granted leave to appeal and, regardless, will go ahead with the parallel claim it has brought against the NLA before the UK Copyright Tribunal, due to be heard in February.
“Firstly we do not agree that our clients are required to sign a licensing agreement to receive email reports containing links to the online news article. Secondly, Meltwater has challenged the aggressive fee structure and the terms demanded from our clients.
“First, it means that simply the browsing of copyright protected content made freely available on the Internet will infringe copyright if it is read without a rightholder licence. We believe that browsing content made available on the Internet should not infringe copyright. Secondly, simply using headlines of an article for bibliographic reference could infringe copyright.”
Background…
In January 2010, the NLA, which was founded by Britain’s eight main national news publishers to collect fees for photocopies of their pages, sought to extend the practice by introducing two new online licenses – one requiring news aggregators to pay a levy for “copying” online stories in their pay-for services, the other requiring fees from these aggregators’ clients.
Meltwater was amongst several news crawlers to object; peer NewsNow launched a campaign called “Right2Link” and Moreover threatened to sue. But all such services eventually either complied or switched off services subject to payment, except Meltwater, which, though it paid the £10,000 fee levied against itself, refused to pass on charges to its clients – an amount it said is more than £1 million.
In December 2009, Meltwater and the Public Relations Consultants Association (PRCA), referred the NLA to the UK’s Copyright Tribunal, an independent body which arbitrates and settles intellectual property disputes, to challenge the licenses. The NLA had suspended collection of the client levy until a ruling. But, rather than wait for a ruling, this May it lodged a counter-claim in the High Court, supposedly a higher authority on the issue, to gain an earlier clarification.
Though the NLA suspended collection, it plans to resume collection on receipt of a verdict in its favour – meaning thousands of companies who use online PR clippings services could be subject to back-dated fees.
Despite the ongoing case, News International and Mail Online have already blocked Meltwater from crawling their sites. News International, whilst it is an NLA member, is not executing the NLA’s new online licenses, preferring to protect its content unilaterally but in a similar way – its sites are going behind paywalls and blocking search engines.
Meltwater is one of the world’s largest commercial news monitors and was formerly Magenta News.