Facts
The British Horseracing Board ('BHB') is the governing authority
for the British horseracing industry and carries out a large number
of administrative functions. These functions reflect the size
of the racing industry in the UK: for example, there were, in 2000,
1,209 race programmes and fixtures, 59 racecourses, and race
meetings were held on 327 days of the year. There are some
15,000 horses in training, 9,000 active owners and 1,000
trainers. Each owner has unique colours in which his horses
run.
BHB spends some 4 to 5 months each year compiling, granting and
publishing the Fixture List. Publication of this in July of
the preceding year marks the start of the full process which
culminates in weekly advertisements in the Racing Calendar of the
races (for which entries are taken centrally under the Orders and
Rules of Racing). There are approximately 7,800 races run
each year, and in 2000 there were some 175,000 entries for
races. Not all horses run, since some may be withdrawn or the
race may be oversubscribed. Shortly before each race,
trainers must make a "declaration" of the horses which will
actually run in a particular race. In 2000, there were some
80,000 declarations of this nature, and 80,000 related declarations
of riders.
BHB maintains a computerised collection of information (the "BHB
Database") which is constantly updated with the latest
information. This involves extensive work, collecting raw
data, designing the database, the selection and verification of the
data for inclusion and the insertion and arrangement of selected
data in the database. The cost of obtaining, verifying and
presenting its contents is approximately £4 million per annum and
involves some 80 employees, as well as much computer hardware and
software.
As the database has been in existence for some time, the BHB
Database contains a vast amount of relevant information about
owners, trainers, horses and much else. It contains "pre-race
information", which is made available in advance of a race,
covering place and date of a race, distance, criteria for entering
the race, date for entries to be made, entry fee, and so on.
Nearer the date of the race, the information is expanded and
includes the time at which the race is scheduled to be run, and the
list of the horses entered. The final stage of pre-race
information includes the "declared" runners, riders, weight,
starting stall and owners' colours. All this information is
taken from BHB's computerised database.
Data is extensively checked, including checking details by
telephone, with recordings made to allow independent verification
of the details by someone other than the person who made the
telephone call.
BHB is self-financing, and obtains its income from fees for
registrations and licences, fixture fees from racecourses and entry
handling charges payable by owners and racecourses. Part of
its income derives from fees charged to third parties for use of
information contained in the BHB Database. This source
provides income of around £1 million per annum.
Information from the database is supplied to a wide variety of
people, including elements of the racing industry (such as
racecourses and owners); by the website
www.bhb-weatherbys.racingadmin.co.uk, by the Prestel network, and
also every week in the Racing Calendar. It is used by
journalists and broadcasters as well as other information services
(such as Ceefax).
Information is supplied also to bookmakers by two routes.
Firstly, data is supplied to Racing Pages Ltd, controlled and owned
jointly by Weatherbys and the Press Association. Racing Pages
makes available data to subscribers via a datafeed known as the
"Declarations Feed". This is an accurate and up-to-date list
of races, declared runners and jockeys, distance, race times,
number of runners and other information. Secondly, data is
supplied to Satellite Information Services Ltd ("SIS") which is
allowed to forward data to its own subscribers in the form of a raw
data feed (“RDF”).
William Hill is the nationally known bookmakers. It does
business by Licensed Betting Offices ("LBOs") and also by telephone
betting. At the LBOs, information is provided by means of
data from SIS which gives live coverage by television and also a
text service provided by William Hill on television screens.
Screens are updated during the day with the latest information as
to odds and results. Pages from the Racing Post are also
displayed on the walls, and these provide much more information
than is possible with the screens.
William Hill subscribes to SIS audio and video service, and has
its own promotional audio material. William Hill provides its
own text service to its LBOs via a satellite channel provided by
SIS. While much of the information displayed derives
ultimately from the BHB Database, no objection was taken to this,
and BHB considered that these various uses were licensed and that
it was being adequately recompensed for this.
The dispute related to the recent commencement by William Hill
of betting services offered over the internet. The public
could access these webpages, see the horses that were running, when
and where, and the odds offered by William Hill. They could
place bets by the internet as well.
William Hill provided internet betting on selected races between
May 1999 and February 2000, but after that started to offer betting
on all mainstream racing in the UK. The data for the races
was derived from the RDF taken from SIS. However, by the time
William Hill published this data, it was available from several
sources other than SIS, for example, the television and the press
as well as on several teletext services. Thus, William Hill
took its data from SIS, which SIS in turn had received from data on
BHB's computer. It was information which was also to be found
in the Declaration Feed made available through the Racing
Pages. SIS had no right to sub-license William Hill to use
any of BHB's data on its internet site, and had not purported to do
so. However, the data in question was data identical to
information supplied to SIS from the BHB Database.
BHB claimed that it owned the database right in the BHB Database
and that William Hill was making unlicensed use of it in its
internet business. BHB said that William Hill took data from
the SIS RDF, which was itself derived from the BHB Database and
this infringed the database right in two ways. Firstly, each
day's use by William Hill of the data from the SIS RDF was an
extraction or re-utilisation of a substantial part of the contents
of the database contrary to Article 7(1) of the Directive.
Secondly, even if the extracts were not substantial, the totality
of William Hill's actions amounted to repeated and systematic
extraction or re-utilisation of insubstantial parts of the contents
of the database contrary to Article 7(5).
William Hill in reply accepted that the database at any given
time qualified as a collection of data in which database right
existed. However, the database was dynamic and constantly
changing, and so there was a point as to whether it was the same
database for the purposes of the law as the collection of data even
a few days later. Furthermore, there are alternative sources for
the data which William Hill could use and which would avoid any
allegation of infringement.
Judgment
Database right was introduced by a Directive. It was
intended to harmonise the law among the Member States by
introducing some harmonisation in copyright law as well as
introducing a new right, described as sui generis. This
description was important since, although there are some
similarities between copyright law and database right, the scope of
the new right had to be determined from the Directive itself and
not by applying copyright principles by analogy.
The definition of "database" in the Directive at Article 1 was
important:
“This Directive concerns the legal
protection of databases in any form.
For the purposes of this Directive, "database" shall mean a
collection of independent works, data or other materials arranged
in a systematic or methodical way and individually accessible by
electronic or other means.
Protection under this Directive shall apply to computer programs
used in the making or operation of databases accessible by
electronic means."
The Recitals to the Directive expand on this definition.
Thus, by Recital 17, a recording, or an audio visual,
cinematographic, literary or musical work as such does not fall
within the scope of the Directive. Further, by Recitals 15
and 16, it is expressed that originality (in the sense of the
author's own intellectual creation) is the sole criterion for
copyright protection of the database, without the necessity to
prove any aesthetic or qualitative criteria. However, Recital
21 makes it clear that for the database right to exist, the
requirement that works, data or other material should be arranged
systematically or methodically does not mean that those materials
should have been physically stored in an organised manner.
Thus, "database" has a very wide meaning, covering virtually all
collections of data in searchable form.
Understanding the purpose behind database right is important as
it throws light on what types of activity amount to breach.
Based on the Directive (for example Recital 40 and Article 7(1)),
it seems that what the new right is aimed at protecting is the
investment in the database's creation, and that investment must be
directed at obtaining, verifying or presenting the database's
contents.
However, the effort put into creating the data itself is
irrelevant - Article 7(4) draws a distinction between rights in the
database and rights in the data in the database. Thus, the
cost of BHB in fixing the date of a race meeting is not relevant to
the question of investment, but the efforts that went into the
gathering of all the data together were relevant. Recital 55
effectively provides that, if sufficient investment is put into
ensuring that it is up to date and accurate, it is protected by the
new right.
Database right also protects the investment in presentation of
data, which must cover at least the effort and resources that make
the data more readily accessible by the user. However,
Article 7(3) provides that database right does not cover computer
programs used to make or operate databases accessible by electronic
means. This may give rise to difficult questions as to where
the exact borderline lies, but this question did not arise in this
case.
The Claimant had to prove under Articles 7(1) and (5) of the
Directive that the Defendant was misusing (in a relevant manner)
parts of its database rather than data obtained from some other,
independent source. William Hill has on its websites
information admittedly derived from the SIS RDF. This is
identical to information supplied to SIS by BHB from the BHB
Database and also to the information supplied through the Racing
Pages in the Declarations Feed which William Hill uses for its
telephone betting service. This was important, since William
Hill argued that some at least of the information it took from the
RDF could well have been obtained directly by SIS from racecourses
and BHB had not proved otherwise. William Hill pointed to the
existence of an agreement between the Racecourse Association
Limited and SIS, allowing SIS to broadcast races and obliging
members of the Racecourse Association to provide SIS with race
information in advance.
This argument was rejected on the facts. The evidence
showed that the racing world looked on the information derived from
the BHB Database as definitive, and there was no reason why SIS
would look to the less complete information delivered by individual
racecourses.
Article 7(1) provides that one of the purposes of database right
is "to prevent extraction and/or re-utilisation of the whole or
of a substantial part, evaluated qualitatively and/or
quantitatively, of the contents of the database". BHB
argued as follows:
- what William Hill took by the RDF was a substantial part of the
contents of the BHB Database;
- although the BHB Database contains more information than what
was actually taken, what was taken was core data;
- it was BHB's investment in keeping that information up to date
and accurate which William Hill was using for the purpose of its
new commercial venture.
William Hill argued the following points:
- what William Hill used was not a part (in the relevant sense)
of the BHB Database;
- even if it was a part, it was not a substantial part;
- the use made of it did not amount to an "extraction" from the
BHB Database;
- it was not a re-utilisation of the BHB Database.
William Hill's essential argument was that there was a
difference between a database and the information contained in
it. Simply to take the facts contained in a database could
not be infringement of database right. Any acts, to be
infringing, would have to take advantage in some way of the
arrangement of the contents of the database, or the way the maker
has made them accessible. William Hill further argued that
database right, in effect, had to be construed as being narrower
that the protection that used to be afforded to compilations under
English copyright law.
This approach was incorrect. While a collection of data
had to have the form of a database as defined by the Directive,
this did not mean that that was the limit of the protection.
It was not possible to take the contents of a database, re-arrange
them and thereby avoid infringement of the new right.
As to substantiality, William Hill argued that, of the total
data contained in the BHB Database, very little, relatively
speaking, had been taken. This approach was wrong.
While the test was not simply to gauge the importance to the
Defendant of what had been taken, that might throw some light on
whether something substantial had been taken. Article 7(1)
requires one to look at both qualitative and quantitative criteria,
but that did not mean looking at them separately, they had to be
looked at in combination. In this case, the Defendant was
making use of the most recent and core information in the BHB
Database, and thereby relying on the completeness and accuracy of
that information taken from the RDF i.e. the product of BHB's
investment in obtaining and verifying that data. This was a
substantial part of the contents, and it made no sense to look at
the issue first on a quantitative basis, and then on a qualitative
basis.
"Extraction" and "re-utilisation" are defined
very precisely in Article 7(2):
"(a) "extraction" shall mean the
permanent or temporary transfer of all or a substantial part of the
contents of a database to another medium by any means or in any
form;
(b) "re-utilisation" shall mean any form of making available to the
public all or a substantial part of the contents of a database by
the distribution of copies, by renting, by on-line or other forms
of transmission. The first sale of a copy of a database
within the Community by the right holder or with his consent shall
exhaust the right to control resale of that copy within the
Community; public lending is not an act of extraction or
re-utilisation."
William Hill argued for a restrictive interpretation of each
expression. As to extraction, William Hill argued that it was
only the first removal of the data, after which infringement could
only be committed by a re-utilisation of that data. This
argument was rejected. "Re-utilisation", according to William
Hill, meant making available to the public for the first
time. This argument was also rejected.
In conclusion, William Hill's action of taking information from
the RDF and loading it onto its own computers for the purpose of
making it available on its website was an unlicensed act of
extracting a substantial part of the BHB Database and the
subsequent transmission of that data onto its website for access by
members of the public was a re-utilisation.
BHB also relied on Article 7(5) which states:
"The repeated and systematic extraction
and/or re-utilisation of insubstantial parts of the contents of the
database implying acts which conflict with a normal exploitation of
that database or which unreasonably prejudice the legitimate
interests of the maker of the database shall not be permitted."
William Hill argued that what it was doing was taking very small
bits of information from what was a constantly changing
database. This amounted to taking one insubstantial part from
a sequence of different databases, each of which was a new database
coming into existence as ever changing details of horses, races and
so on were added. While this was an intriguing argument, it
was also rejected. It was impossible and unrealistic to try
to split the BHB Database into separate databases. As new
data was added, the database's term of protection was constantly
being renewed.
William Hill also argued from the closing words of Article 7(5)
that its activities did not conflict with normal exploitation of
the BHB Database and did not unreasonably prejudice the legitimate
interests of BHB. What amounted to normal exploitation or
unreasonable prejudice was perhaps impossible to define, however,
William Hill's activities clearly undermined a significant part of
BHB's exploitation of its database and unreasonably prejudiced its
interests, since it risked significantly affecting the value of the
licences for the use of the database.
Finally, William Hill had proposed to circumvent any negative
ruling by the Court by making some amendments to its website.
If it could not publish the race names or times, it could give the
number of the race instead. However, it was held that this
was simply manipulating information that had already been
wrongfully extracted. Such manipulation itself was infringing
by re-utilisation.
Commentary
Many people were confused (and remain confused) by the
introduction of database right. This is the first case (and
the only case in this jurisdiction at the time of writing) looking
at this new right, and it is therefore valuable in giving some
guidance as to the scope of the right. In that sense,
it is useful that the judge took the course of outlining the
main features of the right. The most important principle to
emerge from the judgment is that database right, whatever it is,
should be interpreted by reference to the principles underlying the
reasons for its creation, and it is not necessary to import from
copyright law principles and features which are specific to
copyright law.
Of interest to those who are otherwise unfamiliar with modern
intellectual property decisions, is the judge's practice of quoting
only from the original Directive, and not from the implementing
legislation (in fact the Copyright and Rights in Databases
Regulations SI 1997/3032). The latter is in fact normal when
judges of the Patents Court look at rights deriving from European
legislation.
With the full report of the judgment given above, it barely
seems necessary to look at the actual result: indeed, the arguments
put forward by William Hill seemed to have more of ingenuity to
them than practicality and so the result on that basis seems to be
well founded. It is perhaps worth setting out the basic core
of this new right with an eye on the judge's words in this
case.
It is probably true that UK copyright law was not in need of
intervention in this area, and that the real thrust of the
Directive was aimed at other European countries whose laws did not
provide for effective protection of databases. UK copyright
law, which had provided protection for compilations, was less
obviously in need of refinement in this area. Unfortunately,
the result of the Directive is something of an ugly mess, akin to
the clash between designs and copyright. The reason for this
is that there is no clear dividing line between copyright and
database right: it is possible for one and the same database to
benefit from both rights. However, the scope of protection
given by each right is different.
A database is defined by Article 1(2) of the Directive as "a
collection of independent works, data or other materials arranged
in a systematic or methodical way and individually accessible by
electronic or other means." Foreign corporations should note
the qualification requirements in Paragraph 18 of the Regulations,
basically limiting database right to EEA nationals and
corporations. However, the principal difference between
copyright and database right emerging is that the only criterion
for copyright protection is that the database is the author's own
intellectual creation. For database right, Article 7(1) of
the Directive provides that the new right applies to a maker of a
database who "shows that there has been qualitatively and/or
quantitatively a substantial investment in either the obtaining,
verification or presentation of the contents". The case
of William Hill of course looks at this concept, and the
judge is careful to set out in some detail the complexity and
refinement of the BHB Database as well as the considerable work
that goes into its verification.
One difficulty with databases is that they are rarely static,
and this impacts on their duration, which is normally 15 years from
the end of the calendar year in which the making of the database
was completed or when it was first made available to the
public. This is somewhat troublesome. There is a sense
in which most databases are never finished. For example, if I
start a comprehensive catalogue of commercially available CDs, this
is a task that will never finish (assuming manufacturers continue
with the CD format), so when does the 15 years start from?
Perhaps only when I have catalogued albums by ZZ Top.
Taking that example forward, if I keep the database up to date
with the latest releases, what happens to the term then? This
is an issue that caused problems during the drafting of the
Directive and a solution was attempted in Article 10(3):
"Any substantial change, evaluated
qualitatively or quantitatively, to the contents of a database,
including any substantial change resulting from the accumulation of
successive additions, deletions or alterations, which would result
in the database being considered to be a substantial new
investment, evaluated qualitatively or quantitatively, shall
qualify the database resulting from that investment for its own
term of protection."
This is fine as a statement of principle, but its application in
practice is fraught with difficulty. There was little problem
in William Hill, since the continuing work was so intense,
that changes could be said to be substantial. Going back to
the example of the CD catalogue, what level of work would be
required to make substantial changes? What if I go through
bands and composers on a purely alphabetical basis over the course
of years, when does the right vest, and when would it be
renewed? Such questions remain unanswered (and possibly
unanswerable), although Recitals 53 and 54 of the Directive are
relevant here, as they put the burden of proof on these issues on
the maker.
The infringing acts are also different from copyright,
consisting of "extraction" and "re-utilisation". These terms
are defined in the Directive and are discussed in the
judgment. Note that the judge in William Hill shied
away from applying a two-stage test of quantitative and qualitative
elements. The judge's comments on Article 10(3) also deserve
note, in particular his rejection of the somewhat scholastic
argument that the BHB Database was changing so frequently that
repeated extractions could not be from the same database.
This argument is reminiscent of Herclitus' statement that one could
not step into the same river twice.
The Directive tries to get around the problem of where an
individual act that potentially infringes is only of an
insubstantial amount, but it happens repeatedly over a course of
time. Article 7(5) also received comment from the judge, as
it provides:
"The repeated and systematic extraction
and/or re-utilisation of insubstantial parts of the database
implying acts which conflict with a normal exploitation of that
database or which unreasonably prejudice the legitimate interests
of the maker of the database shall not be permitted."
This problem had arisen in copyright law. In Cate v
Devon & Exeter Constitutional Newspaper Co (1889) 40 Ch D
500 the defendant took small amounts from the plaintiff's newspaper
at regular intervals and included it in his own newspaper.
The finding was that he had infringed copyright, even though the
amount taken each week was, seen by itself, actually very
small. Curiously, Laddie J. cast doubt on this in
Electronic Techniques (Anglia) Ltd v Critchley Components
Ltd [1997] FSR 401, so the matter seems unsettled at least in
copyright law.
The matter is important in database right, since infringement
only happens when the infringer extracts or re-utilises all or a
substantial part of the contents of a database - it is expressly
not an infringement for a lawful user to extract or re-utilise an
insubstantial part (Article 16(1) of the Regulations and Articles
7(2) and 8(1) of the Directive; see also Recital 49).
The result of this case is not great new law, but an interesting
application of otherwise confusing principles. Given the
importance of databases for all manner of on-line activities, it is
a case that, however, deserves careful notice.
