The battle between William Hill and the British Horseracing
Board was one of four cases upon which the European Court of
Justice ruled on Tuesday. The other three cases concerned Fixtures
Marketing Ltd, a company that grants licences for football
fixtures.
The ruling, to which there is no appeal, could leave both the
football and horseracing industries out of pocket, according to
commentators, as it may permit pools companies and gaming sites to
re-publish fixture lists and racing details without having to pay
licence fees for the privilege.
Facts of the cases
The British Horseracing Board's lawsuit
The British Horseracing Board (BHB), the governing authority for
the British horse racing industry, is responsible for the
compilation of data related to horseracing.
Its database contains racing information and the official
document of registration of thoroughbred horses – known as the Stud
Book – in the UK. It contains details of registered horses,
jockeys, and fixture lists comprising race conditions, entries,
runners and more.
The annual cost of continuing to maintain the database and keep
it up to date is approximately £4 million and involves around 80
employees in addition to "extensive" software and hardware.
The racing information is made available to radio and television
broadcasters, magazines and newspapers and to members of the public
who follow horse racing on the morning of the day before the
race.
The names of all the participants in all the races in the UK are
made available to the public on the afternoon before the race
through newspapers and Ceefax/Teletext. On the day before a race,
bookmakers receive, through various subscriber services, a specific
compilation of information without which bets could not be
placed.
William Hill Organisation Ltd is one of the leading providers of
odds in horseracing. In addition to traditional sales methods –
such as licensed betting offices and telephone betting – it offers
internet betting for all the major horse races in the UK.
The information displayed on its web sites comes from newspapers
and from an information service for subscribers that in turn
obtains its information from the BHB's database. Neither the
newspapers nor the information service have any right to grant a
sublicense to William Hill to use any information derived from the
BHB's database on its web site.
The information on the William Hill web site only covers a small
part of the whole of the BHB database and is arranged in a
different way. If the customer requires any other information to
arrive at an informed view of the horse's chances of success, such
information can be found elsewhere, such as newspapers.
The Fixtures Marketing lawsuits
Fixtures Marketing Ltd grants licences for the exploitation
outside the UK of the fixture lists for the English premier league
and its Scottish equivalent. Its distribution of licences is
carried out on behalf of the organisers of the league games.
Around 2,000 matches are played each season and the fixture
lists drawn up at the start of each season by the organisers of the
leagues are stored electronically and set out in printed booklets
(and other places).
According to Fixtures Marketing, the annual costs of developing
and administering the fixture lists in England is about £11.5
million and annual licensing revenues in respect of the data about
fixture lists in the English database are only about £7
million.
Oy Veikkaus AB, a Finnish pools operator, uses data relating to
games in the Premier League and the Scottish Football League for
its betting activities. In 1998/1999 it used all the data relating
to Premier league matches during the football season.
Veikkaus did not hold a licence to do so from Fixtures
Marketing. It obtains the data from the internet, newspapers or
directly from the football clubs and continuously checks their
correctness. Veikkaus' annual turnover from betting on football
matches in England amounts to several tens of millions of
Euros.
In Sweden, AB Svenska Spel operates pools games in which bets
can be placed on the results of football matches in the English and
Scottish football leagues. Svenska Spel uses matches from the
leagues on pools coupons and in a special programme.
According to Svenska Spel, the data on the pools coupons come
from British and Swedish daily newspapers, from Teletext, from the
football teams in question, from an information service and from
the publication 'Football Annual'.
Svenska Spel has no licence to exploit those data from Fixtures
Marketing. According to Fixtures Marketing, the profit made by
Svenska Spel in the games, for which it uses between 21% and 90% of
the total number of matches in the fixture lists of the English
football leagues, amounts to SEK 600 to 700 million (or €65,955,809
to €76,948,444) per year in each case.
In Greece, Fixtures Marketing filed a number of lawsuits against
the limited company Organismos Prognostikon Agonon Pododfairou AE
(OPAP).
Fixtures Marketing brought claims against Oy Veikkaus AB, AB
Svenska Spel and OPAP for unlawfully, and without permission,
repeatedly extracting from the lists of football fixtures in
England and Scotland a substantial amount of data regarding
fixtures.
Argument of British Horseracing Board and Fixtures
Marketing
BHB and Fixtures Marketing consider that the companies which are
using their data for the purposes of taking bets on horseracing or
football matches have infringed their so-called "database right"
under the Database Directive. In terms of the Directive, the maker
of a database who can show that there has been qualitatively and/or
quantitatively a substantial investment in either the obtaining,
verifying or presenting of the contents of the database can prevent
the extraction and/or re-utilization of the whole or of a
substantial part, evaluated qualitatively and/or quantitatively, of
the contents of that database by any party not authorised by them
to do so.
How the cases reached Europe
The Finnish Vantaan Käräjäoikeus, the Court of Appeal of England
and Wales, the Swedish Högsta Domstolen and the Greek Monomeles
Protodikeio Athinon before which these proceedings are pending each
referred several questions to the Court of Justice on the subject
of the effect of this "database right" under the Database
Directive. The UK referral was made in August 2001.
The rulings
The Court clarified that the term "database" refers to any
collection of works, data or other materials - separable from one
another without the value of their contents being affected - which
includes a method or system of some sort for the retrieval of each
of its constituent materials.
Furthermore, it added, under the Database Directive the
protection for databases is reserved for those databases that show
that there has been, qualitatively or quantitatively a substantial
investment in the obtaining, verification or presentation of their
contents.
The Directive also prohibits extraction and/or re-utilisation of
the whole or of a substantial part of a database and, under certain
conditions, of insubstantial parts of a database too, ruled the
Court. The Court then turned to the specifics of each case.
Judgments on the Fixtures Marketing lawsuits
The question for the Court in these cases was whether there had
been sufficient investment in the Fixtures Marketing database to
bring the protection granted by the Directive into play.
The Court ruled that the expression 'investment' in the
obtaining of the contents of a database refers to the resources
used to seek out existing materials and collect them in the
database. It does not cover the resources used for the creation of
materials that make up the contents of a database.
The fact that the maker of a database is also the creator of the
materials contained in it does not exclude that database from the
protection of the database right, provided that he establishes that
the obtaining of those materials, their verification or their
presentation required substantial investment in quantitative or
qualitative terms, which was independent of the resources used to
create those materials, said the Court.
But, the Court found, although a football fixture list may be
considered to be a database within the meaning of the Directive,
finding and collecting the data that make up such a list does not
require any particular effort on the part of the professional
leagues. Those activities are indivisibly linked to the creation of
those data, in which the leagues participate directly as those
responsible for the organisation of football league fixtures.
Obtaining the contents of a football fixture list thus does not
require any investment independent of that required for the
creation of the data contained in that list.
Nor do the professional football leagues need to put any
particular effort into monitoring the accuracy of the data on
league matches when the list is made up, because those leagues are
directly involved in the creation of those data. Even the
verification of the accuracy of the contents of fixture lists
during the season (for example, following the postponement of a
match) does not entail substantial investment.
The presentation of a football fixture list, too, is closely
linked to the creation of the data that make up the list and does
not require investment independent of the investment in the
creation of its constituent data.
It follows, said the Court, that neither the obtaining,
verification, nor presentation of the contents of a football
fixture list attests to substantial investment which could justify
protection by the database right provided for by the Directive.
Fixtures Marketing could therefore not use the Database
Directive to prevent the use of its data by Oy Veikkaus, Svenska
Spel and OPAP.
Judgment on The British Horseracing Board's suit
The question here was not whether the BHB database was protected
by the Directive – it was – but whether William Hill was carrying
out acts prohibited by the database right.
Under the Directive, said the Court, acts of extraction
(transferring the contents of a database to another medium) and
acts of re-utilisation (making available to the public), of the
whole or a substantial part of the contents of a database, require
the authorisation of the maker of the database even where he has
made his database accessible as a whole or in part to the public or
has authorised a specific third party or specific third parties to
distribute it to the public.
Had, therefore, William Hill extracted or utilised a
"substantial part" of the database? The Court said no.
The expression "substantial part", in quantitative terms, of the
contents of a database refers to the volume of data extracted from
the database and/or re-utilised and must be assessed in relation to
the total volume of the contents of the database, said the Court.
In qualitative terms, it refers to the scale of the investment in
the obtaining, verification or presentation of the contents
extracted or re-utilised.
The volume of data extracted by William Hill represented,
according to the Court, "only a very small proportion of the whole
of that database", and was therefore not, quantitatively, a
substantial part of the database.
In addition, observed the Court, the resources used by the BHB
in the course of organising horse races, to decide the date, the
time, the place and or name of the race and the horses running in
it, represented investment in the creation of the materials
contained in its database, which, as in the Fixtures Marketing
cases, is not relevant in terms of the Directive's protection.
Moreover, the verification prior to the entry of a horse on a
list (verification of the identity of the person entering the
horse, the characteristics of the horse, the identity of the owner
and the jockey) takes place at the stage of the creation of the
data and cannot, therefore, be considered to constitute investment
in the verification of the contents of a database.
Accordingly, since the materials extracted and re-utilised by
William Hill did not require investment by BHB that was independent
of the resources required for their creation, those materials did
not qualitatively constitute a substantial part of the contents of
the BHB database.
The Court then considered a prohibition in the Directive against
the unauthorised extraction and/or re-utilisation of insubstantial
parts of the contents of a database by unauthorised acts, the
cumulative effect of which is to reconstitute and/or make available
to the public the whole or a substantial part of the contents of
that database and thereby seriously prejudice the investment made
by the maker of the database.
Did this apply to William Hill? Again the Court said no.
In its opinion the acts of extraction and/or re-utilisation
carried out in a repeated and systematic manner by William Hill on
the occasion of each race held did concern insubstantial parts of
the BHB database. However, said the Court, there was no possibility
that, through the cumulative effect of its acts, William Hill might
reconstitute and make available to the public the whole or a
substantial part of the contents of the BHB database.
William Hill, therefore, did not seriously prejudice the
investment made by the BHB in the creation of that database, and
was not prohibited by the Directive from using the database.
