ISP Liability: Yahoo! Wins the Rematch against R.T.I.

After (almost) exactly three years since a well-known Milan IP Court ruling settled a litigation between Yahoo! Italia and R.T.I.—the TV arm of the Mediaset group—in favour of the latter, the same Court, ruling on a new copyright infringement litigation between the same parties, issued a reverse decision, awarding the victory to Yahoo! But it is not a case of judicial schizophrenia: crucial circumstances, as we shall see, were different.

The connection with the 2011 ruling is not just rhetorical. The latest lawsuit was grounded by R.T.I. on the basis of that first litigation.

In particular, in 2012 R.T.I. had filed a new lawsuit complaining that a search engine service provided by Yahoo! Italia indexed third party video content infringing its copyright on certain TV programmes. The plaintiff argued that such activity entailed a breach of the 2011 injunction on the part of Yahoo! Italia, to the extent that the works involved were already covered by that order, and its intermediary liability for copyright infringement, with regard to all the other (infringed) works. R.T.I. maintained that the grounds for the latter claim consisted of the same reasons provided by the Milan Court for its 2011 decision. It should be noted here that, before filing the new lawsuit, R.T.I. had sent a take-down notice to Yahoo! for the alleged new offences.

On these premises, R.T.I. requested that Yahoo! be ordered to pay several million euro overall in cumulated fines for breach of injunction and damages for copyright infringements, and to disable access to the indexed sites containing infringing content.

The Milan Court, however, took a different view, essentially upholding Yahoo!’s main defensive argument that the factual elements of the two cases were different.

The Court pointed out that the 2011 judgment concerned a Yahoo! Italia service—now discontinued—consisting of the hosting of video content uploaded by users. This service was found by the Court at the time to be “non-neutral” (so-called active hosting), and, as such, not deserving of the exemption from liability granted to ISPs by the e-commerce legislation, on the basis of several indicators, such as the detailed regulation of the contractual relationship between the provider and the user.

The search engine service, on the other hand, had in the Court’s view an entirely different nature: it fell within the definition of caching under Article 15 of Legislative Decree no. 70/2003 (implementing Article 13 of Directive 31/2000/EC) and was characterised by its automatism and its neutrality.

This conclusion, the Court ruled, was not affected by the use in the Yahoo! search engine, besides the traditional linking of third party content, of video-embedding and suggested search functionalities, which were much emphasised by R.T.I. in its defence. These, in the Court’s eyes, were tools meant to optimise the search service, but did not in themselves disprove the condition of neutrality of the service provider with respect to the information provided; the embedding of videos, furthermore, depended on a choice made by the source sites. The plaintiff, on the other hand, had failed to provide any evidence suggesting that the defendant had in any manner selected, or interfered with, the information processed, thus abandoning its condition of neutrality.

In light of these premises, the Court concluded that, pursuant to Article 17 of Legislative Decree no. 70/2003 (implementing Article 15 of Directive 31/2000/EC) Yahoo! Italia was under no obligation to monitor the information that it transmitted or stored, nor to actively seek facts or circumstances indicating illegal activity. The only obligations on Yahoo! as a provider of a search engine service were those to inform and co-operate with the competent authorities: in this regard, the Court noted that the defendant, upon receipt of the plaintiff’s take-down notice (which however, the Court noted, failed to specify the URL of the affected sites), had diligently transmitted it to the competent public prosecutor’s office.

All of R.T.I.’s claims were consequently dismissed.

This ruling is interesting because it categorises—whether correctly is debatable—the activity of search engine providers under the Italian legislation implementing the E-Commerce Directive. The author is not aware that this has ever been done at the level of the ECJ: the latter has marginally touched upon the issue when it famously dealt with Google’s AdWord service.

Finally, is this ruling in counter-trend to the recent, well-known ECJ decision about Google Spain and the “right to be forgotten”? Not in a strict sense. In that case, the ECJ addressed the role and obligations of Google as a personal data controller, not its liability for infringements committed through its services.