Meltwater and the PRCA’s appeal of the decision of the High Court to allow the Newspaper Licensing Agency (NLA) to charge copyright licensing fees for online content has resulted in the High Court’s initial decision being upheld.

The UK Court of Appeal’s ruling modifies the former High Court ruling by reducing the copyright in headlines, but maintains that copyright exists in the process of looking at a web page on a computer. The NLA is therefore eligible to charge copyright fees to both agencies, such as Meltwater, that engage in online news aggregation, and their clients, the end-users who view the articles sent to them by media monitoring services.

Francis Ingham, chief executive of the PRCA, believes that the appeal’s decision over copyright in headlines is extremely encouraging for the case. “We are going into the hearing of the Copyright Tribunal [a separate action considering the terms of the licensing, due to be heard in September of this year] confident of a favourable result. However, it is the judgement over temporary copy – that there is copyright extant in looking at a web page – that gives us significant concern.”

The PRCA intends to take this part of the decision to the UK Supreme Court for further appeal. “Part of this ruling deals on a high level with the specifics of this particular case,” says Jorn Lyseggen, founder and CEO of Meltwater Group, “but we feel that society is not served by the wider implications of the ruling to do with the very nature of browsing. It’s a simple action that could end up in millions of people being copyright offenders. Copyright law is simply not fit for purpose in the internet age.”

Stephen Waddington, MD of Speed Communications, agrees with Lyseggen and the PRCA that the judgement demonstrates the law's inability to keep up with the technological age. "Basically, this sets us back by 25 years. Anyone involved in the supply chain of web content is now going to have to pay a license fee. I assume this is a win for the NLA, who have said all along that if you're in the content supply chain, a charge should be involved. Effectively, the internet is way ahead of the law in this case, and Meltwater and the PRCA deserve huge recognition for taking the case this far and attempting to straighten out what agencies and monitoring organisations can do."

“In a few years,” predicts Lyseggen, “we will find it difficult to believe that we were at this stage, that we contemplated this severe reduction of the internet as a business resource.” He is clear that Meltwater has agreed to a license fee with the NLA, but that the argument is over whether its clients should also have to pay a fee – what the PRCA’s counsel termed “double licensing” in the appeal submissions.

Steve Kuncewicz, intellectual property & media solicitor at HBJ Gateley Wearing LLP, believes that the warning of the PRCA and Meltwater that millions face copyright infringement is the widest possible interpretation of the ruling. “In reality, this particular ruling is propping up rightholders,” he comments. “It’s very close to the letter of the law, and effectively an exercise in giving the newspaper industry one last grab at a revenue stream. Cases like this, however, are applying pressure for overall reform of copyright law in the UK. This ruling, though it applies to a specific sector of industry, will be a steer for copyright principles in the future.”

Ingham says that the PRCA will be pursuing further appeal on behalf of its members and the wider industry, but copyright expert Emily Goodhand thinks it may well be a waste of time. “They’ll be throwing their money away. This ruling isn’t particularly surprising – the earlier judgement looked at the letter of the law, and although the position on headline copyright has been retracted to a degree, under current copyright legislation when you click a link, you are in essence creating a copy of the work. The process for which the NLA proposes to exact a license fee doesn’t fit the definition of temporary copy, because there’s tailoring involved. It would be better for the PRCA and Meltwater to concentrate on the Copyright Tribunal, which may well find that the contract between Meltwater and the NLA – which currently requires both the agency and the end-user to pay a license fee – is unfair.”

The High Court ruled in November that copyright can subsist in newspaper headlines and in links through to articles on a newspaper’s website. The new decision - which states that web pages viewed on a computer are not "temporary copy", but possess enduring copyright - applies to commercial enterprise only.

The fees were first introduced in January 2010 for online media monitoring and news aggregator services. David Pugh, managing director of the NLA, pointed last December to the volume of online news that was being used by aggregator services: “This case is about the 5,000 companies trading in newspaper web content; not friends sharing links.”

• PRCA will appeal decision of High Court over online license fees (December 2010)
• High Court rules against Meltwater and PRCA (November 2010)
• Times Online blocks news aggregators. NLA suspends invoicing (January 2010)