December 17, 2018

The claimants, Ralf Hütter and Florian Schneider-Esleben, were members of the music group Kraftwerk. In 1977, Kraftwerk released a recording, produced by Mr Hütter and Mr Schneider Esleben, featuring the song Metall auf Metall. Mr Hütter and Mr Schneider-Esleben were also the performers on the recording and Mr Hütter was also the author (composer).

The defendant, Pelham GmbH, produced a recording featuring the song Nur mir, performed by the singer Sabrina Setlur. Moses Pelham and Martin Haas, also defendants, were the authors of the song.

Mr Hütter and Mr Schneider-Esleben claimed that the defendants had copied, through electronic sampling, approximately two seconds of a rhythm sequence from the recording Metall auf Metall and incorporated it, as a continuous loop, into the recording of Nur mir.

The case eventually ended up in the German Federal Court of Justice, which referred six questions to the Court of Justice of the European Union, including:

1. whether taking very short snatches from a phonogram and transferring them to another phonogram amounted to an infringement of the phonogram producer’s exclusive right to reproduce its phonogram under Article 2(c) of the Copyright Directive (2001/29/EC);
2. whether a phonogram containing samples from another phonogram was a copy for the purposes of the exclusive distribution right under Article 9(1)(b) of the Rental and Lending Right Directive (2006/115/EC);

• whether the quotation exception provided for in Article 5(3)(d) of the Copyright Directive 2001/29 applies where a phonogram sample has been incorporated into another phonogram such that it forms an indistinguishable part of the second phonogram; and

1. how the fundamental rights set out in the Charter of Fundamental Rights should be taken into account when interpreting the scope of the exclusive rights of phonogram producers under both Directives and the limitations and exceptions to those rights provided for by those same Directives.

In Advocate General Szpunar’s opinion, the answer to the first question referred was clearly “yes”. Taking a sample from a phonogram for the purpose of using it in another phonogram does indeed infringe the producer’s exclusive right to authorise or prohibit the reproduction of his phonogram within the meaning of Article 2(c) where it is taken without the producer’s permission. It was common ground that the defendants had sampled a two second rhythm sequence from the claimants’ recording and incorporated it, as a continuous loop, with minimal modifications and in such a way as to be recognisable as a rhythm sequence in their work Nur mir.

In the AG’s view, it therefore went without saying that this amounted to reproduction within the meaning of Article 2, which concerns any “direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part” of subject-matter. Sampling (generally) involves the direct and permanent reproduction, by digital means and in digital form, of a portion or sample of a phonogram. It was therefore quite clear that that act amounted to an infringement, he said. The AG rejected the claims of certain governments that the rights of phonogram producers in this respect should be more limited than the rights of authors of Berne works.

As for the exclusive distribution right under Article 9(1)(b) of the Rental and Lending Right Directive, however, the AG said that a phonogram containing samples from another phonogram is not a copy of the other phonogram within the meaning of Article 9(1)(b). The main purpose of the distribution right, the AG said, is to protect against piracy, i.e. the production and distribution of counterfeit copies to replace lawful copies. The word “copy” in Article 9(1)(b) means a copy that incorporates all or a substantial part of the sounds of a protected phonogram, intending to replace lawful copies thereof. In the AG’s view, the scope of that provision is therefore narrower than that of Article 2 of the Copyright Directive.

Sampling is not used to produce a phonogram that replaced the original phonogram, the AG said, but to create a new work independent of the original. Equally, a phonogram created through sampling does not incorporate all or a substantial part of the sounds of the original phonogram. It could not therefore be classified as a copy within the meaning of Article 9(1)(b).

As for the quotation exception under Article 5(3)(d) of the Copyright Directive, the AG said that this does not apply where a sample has been incorporated into another phonogram without any intention of interacting with the first phonogram and in such a way that it forms an indistinguishable part of the second phonogram.

In order for the quotation exception to apply, the AG said, it has to satisfy a number of conditions under Article 5(3)(d). The first concerns the purpose for which the quotation is used, such as “criticism or review”. In the AG’s opinion, the wording of the provision clearly indicates that the quotation has to enter into “some kind of dialogue” with the work quoted. Whether in confrontation, as a tribute to or in any other way, interaction between the quoting work and the work quoted is necessary.

Secondly, the quotation has to be incorporated into the quoting work so that it can be easily distinguished as a foreign element. That was not the case here.

Thirdly, the AG said, Article 5(3)(d) requires the second work incorporating the quotation to indicate the source, including the author’s name, unless it is not possible. In a recording, it is possible to indicate the source in its written description, or even in the title, although the AG noted that samples are rarely credited in such circumstances.

As for the issue of fundamental rights, the AG opined that the exclusive right of phonogram producers under Article 2(c) of the Copyright Directive to authorise or prohibit reproduction, in part, of their phonogram in the event of its use for sampling purposes is not contrary to the freedom of the arts as enshrined in Article 13 of the Charter of Fundamental Rights of the European Union. (Case C-476/17 Pelham GmbH v Ralf Hütter (Advocate General Opinion) (12 December 2018) — to read the Opinion in full, go to the curia search form, type in the case number and follow the link).