Premier League cannot prevent use of foreign satellite decoders

United Kingdom

Khurram Aziz - News Editor

The English Premier League has lost its case at the Court of Justice of the European Union (CJEU) against a pub landlady who used a foreign satellite decoder to show live football matches.

The court ruled that prohibiting the import, sale or use of foreign satellite decoder cards from one EU state in another breached European laws.

The ruling comes as a major blow to BSkyB which has exclusive rights to show Premier League football matches in the UK. However, the judgment will also affect every sport that sells broadcast rights on a country-by-country basis.

The case dates back to 2006 when the Premier League sued pub-owner Karen Murphy for importing a Greek satellite decoder card in order to show Premier League matches at her pub for a tenth of the price of one of the Premier League's official UK broadcasters.

The League argued this was in violation of its copyright and damaged its contracts with authorised distributors.

In 2007, Murphy lost the case and was ordered to pay £8,000 in damages to the Premier League as well as court fees. Murphy appealed the decision and the High Court referred some questions to the CJEU for clarification.

In its ruling the European court said, "A system of licences for the broadcasting of football matches which grants broadcasters territorial exclusivity on a member state basis and which prohibits television viewers from watching the broadcasts with a decoder card in other member states is contrary to EU law".

The CJEU said the Premier League could not claim copyright over Premier League matches as they could not be considered to be an author's own "intellectual creation" and, therefore, to be "works" for the purposes of EU copyright law.

Toby Headdon, an IP lawyer at Berwin Leighton Paisner commented:

"This is a clear statement from Europe that intellectual property rights cannot be relied upon to fragment the market and charge different prices in different EU countries for the same content. The decision looks set to change the licensing landscape in Europe, not just for football broadcasts but potentially for other content such as films and music.

"The Premier League and BSkyB will have to go back to the drawing board. BSkyB pays in excess of £1bn to broadcast lucrative sporting events such as Premier League matches and it is likely to face a significant challenge in recouping that cost from subscribers who can now take advantage of cheaper subscriptions to broadcasts available elsewhere in Europe.

"One possible outcome is that the Premier League will confine its licences to the most profitable countries, but it is probably more likely that the different pricing structures currently in place in different countries will meet somewhere in the middle."

However, the CJEU did add that while live matches were not protected by copyright, any surrounding media, such as any opening video sequence, the Premier League anthem, pre-recorded films showing highlights of recent Premier League matches and various graphics, were "works" protected by copyright. To use any of these parts of a broadcast, a pub would need the permission of the Premier League.

The case will now be sent back to the UK High Court for a final decision.

Some thought from Nick Phillips, partner & head of department at Barlow Robbins LLP.

Implications for existing right-holders

"The CJEU's ruling appears to allow existing rights-holders to sell licences for the screening of Premier League matches in other countries.  However, one potential pitfall for the rights holders is the finding of the CJEU that the transmission of protected works such as the Premier League emblem or the opening video sequence in this way is not permissible in this way and therefore the rights holders may have to adapt their broadcasts to avoid infringing these rights."

Sky

"Sky is now likely to be faced with renegotiating the rights agreements which they have entered into so as to not breach the freedom of services between EU member states.  This may mean that Sky are offered a pan-European licence and then have to try to sub-licence those rights into individual EU member states.  However in practical terms those sub-licences will need to be agreed at the same price which is likely to make them either unattractive for Sky or (more likely) unattractive in some parts of the EU given the diverse nature of the EU."

Implications on Premier League's future rights agreements

"Future Premier League rights agreements will be sold in a different manner to how they have been previously.  It is likely that these will be sold as a complete package across the EU instead of separately for each region.  In real terms this may mean that there will be a reduction in the total income from the sale of these rights although the Premier League will have been working over time to find a strategy which complies with what the CJEU has said and which maximises their revenue."