Germany is somewhat famous for its rather creative legal concept around contributory liability, literally labelled "disquieter liability". The German Federal Supreme Court in its "Dead Island" decision seems to have put an end to cease and desist claims against operators of open Wi-Fis for IP infringements by third parties committed over their access points.
The decision needed to balance interests of copyright and other intellectual property holders, the European framework applicable to our modern information society and IP protection and, finally, individuals. What may look like a rather obvious result – when looking at Art. 12 of the e-Commerce Directive 2000/31/EC and its principles on access providers as "mere conduits" – may close a 15 year old chapter of enforcement strategy.
What is the backdrop: a game producer sued an IT specialist, which operated several open Wi-Fi access points and two Tor knots, in connection with copyright infringements in the game "Dead Island" committed over the network access points. As the actual infringer is often impossible to identify and enforce against, the operator of the networks access point has typically been the best choice for rights holders. The German Supreme Court had interpreted the e-Commerce Directive's liability filters not to cover cease and desist claims and had established a very refined liability framework around "causal contributions" and "reasonable duties" – which created severe commercial risk to providers of access points. In order to proliferate open Wi-Fi and reduce exposure of the operators, the German legislator had put in place specific rules, expressly exempting access providers from liability connected to user infringements, including to cease and desist, rectifications etc. It was unclear, however, whether the law complies with other European rules, namely Art. 11 sentence 3 of the Enforcement Directive, which requires Member States to put right holders in a position to apply for an injunction against intermediaries in this context.
The court simply put to rest the "disquieter liability" in this context, confirmed the new law and points rights holders to another new option in the law: to obtain an order "to block access to information" in order to prevent further infringements. This again addresses the Wi-Fi operator, but the court indicated that several different measures may be appropriate – user registration, access encryption, password access and – expressly as last resort – complete block of access. Thus, prior to leaving users on a dead island, access operators may be able to put in place a number of other measures, rather than counting three strikes out, whilst not being liable for costs or a direct cease and desist. Now the second instance court will have to decide the matter, based on the Federal Supreme Court's Guidance.
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