Ruling flags risk facing data licensees

Out-Law News | 21 Nov 2019 | 9:27 am | 3 min. read

A recent ruling highlights the need for businesses accessing data from third parties to make sure that their intended use of that data is covered by the licensing terms on which the data is being made available, an expert in intellectual property law has said.

Iain Connor of Pinsent Masons, the law firm behind Out-Law, was commenting after the High Court in London found that a mapping service, while successfully defending its business practices in relation to some of the claims raised against it, breached licence terms in how it used data created by rival mapping data providers and also infringed their underlying database rights.

Connor said: "This case highlights both the value of the protection afforded to databases by the so called 'database right' and the fact that even when licensed you need to check that your licence covers your intended use. Database right is a forgotten IP right which can be a very useful tool to protect valuable work product in data driven sectors."

In its judgment, the High Court considered the way in which 77m developed its 'Matrix' dataset, which provides an "up-to-date, detailed and accurate list of the geospatial coordinates of all the residential and non-residential addresses in Great Britain".

The information that comprised the Matrix dataset was pooled from a number of different sources, including datasets maintained by the Land Registry and Royal Mail. Different licensing conditions were attached to each of the datasets 77m pooled data from.

Ordinance Survey (OS) challenged the way that 77m used the data. OS claimed, among other things, that it owned database rights in relation to some of the data 77m had used and that 77m did not have permission to use the data in the way it did – 77m essentially matched data from the different datasets in order to provide its own dataset that it made available on commercial terms.

Database rights derive from the EU's Database Directive which aims to harmonise the law protecting databases so as to encourage the development of database-dependent businesses in the digital age by creating a new IP right known as the 'sui generis' database right.

Database rights protection does not apply to every aggregation of data. Only if database creators have invested sufficient time, money or skill into developing their database will those creations be protected by database rights. Databases that arise as a by-product of doing business do not attract database right protection.

Those with database rights can generally "prevent extraction and/or re-utilisation of the whole or a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database".

In the case before it, the High Court in London considered whether 77m was responsible for a breach of licensing agreements it had entered into and also whether it was liable for unauthorised extraction of at least a substantial part of the data protected by database rights owned by others.

The judge found in 77m's favour in relation to some of the data it had downloaded or extracted, but held that in other cases the company was responsible for a breach of licensing terms and for database rights infringement.

One aspect of the case that the court assessed was whether 77m's temporary transfer of data from one dataset to another medium had entailed mere consultation of that information rather than an unauthorised extraction for the purposes of database rights law.

Mr Justice Birss said that the scale of information transferred was relevant to determining this point.

The judge said: "What I think deprives 77m's activity of the character of mere consultation is its scale. When a member of the public, or a commercial user, wishes to consult the database to learn something about a particular entry or to learn something about particular entries, they consult the database. By contrast someone who takes all or a substantial part of all the contents, and transfers them into another medium so that they can use them, is appropriating to themselves a substantial part of the investment which went into creating the database. Protecting that investment is what database right is for. That is what 77m did and that is why it is extraction not consultation."

"There may be a grey area between the sort of commercial consultation I refer to and wholesale activity of the kind carried out by 77m but the scale of 77m's actions puts them firmly on the extraction side of the line," he said.