Liability of Online Platforms for Third-Party Infringements – Disturber or Perpetrator?

Examples of such infringements are copyright infringements on Youtube, trademark infringements on eBay, hate speech on social media platforms, infringing search suggestions on Google. On the other hand, these platforms represent business models that are approved by the legal system and are socially relevant, the implementation of which would be jeopardised by excessive control obligations and liability risks.

However, in view of a clear trend in legislation and case law towards increased recourse to platforms, the latter are increasingly faced with the problem of increased and often not clearly definable obligations. At what point is the platform operator liable for third-party infringements? What obligations does he have and how can he prevent liability risks? The legal concept of “Stoererhaftung” (Breach of Duty of Care), developed by case law, addresses this problem of indirect liability for infringements by third parties on the internet.

Distinction between own and third-party content

To answer the question of liability, a distinction must first be made as to whether the platform is a content provider or a host provider. For its own infringing content, the so-called content provider is in principle liable without limitation as a perpetrator under the general laws for damages, injunctive relief and information. Host providers such as merchant platforms, forums and social networks that merely store third-party content and make it available for use, on the other hand, enjoy the liability privileges of sections 7 to 10 TMG.

However, something different applies here as soon as the provider makes third-party information its own by leaving its neutral position as a host and assuming an active role that gives it knowledge of or control over certain data(ECJ, judgment of 12 July 2011, Case C-324/09 – L’Oréal/eBay). An example of this is active advertising by the operator for offers for sale. Then the platform operator is treated as if it had provided the content itself. Of course, many platforms have both hosting and content elements, so that the individual case must always be considered and the understanding of a reasonable internet user must be taken into account.

Liability privilege of the host provider

If the content is not made available on the platform, the privilege remains in place and the host provider is not liable for third-party information pursuant to section 10 of the German Telemedia Act (TMG) as long as he has no knowledge of legal violations and these are not obvious. This means that the host provider is not subject to any obligation to investigate any content posted on the platform for possible violations of the law. However, this privileged liability only regulates liability for damages, so that claims for removal and injunctive relief are not covered. With regard to the latter, the general principles of “Stoererhaftung” (Breach of Duty of Care) developed by the courts apply.

The principles of “Stoererhaftung”

According to case law, a “Stoerer” is someone who, without being a perpetrator or participant, has in some way intentionally and adequately causally contributed to the infringement of an absolute right (BGH, judgement of 11 March 2004, ref. I ZR 304/01 – Internet auction; BGH, judgement of 22 July 2010, ref. I ZR 139/08 – Children’s highchairs on the Internet). In contrast to perpetrator liability, the “Stoerer” is only liable for removal and omission. Moreover, since the “Stoererhaftung” may not be unduly extended to third parties, the “Stoerer” is only liable if it is legally and factually possible and reasonable for him to prevent the indirect infringement and if he has violated reasonable inspection obligations.

Accordingly, it is generally unreasonable to expect the platform operator to check every third-party offer for a possible infringement of rights before publishing it on the internet, if otherwise his business model, which is approved by the legal system, would be endangered or his activity would be disproportionately difficult. Rather, he is obliged to remove illegal content as soon as he becomes aware of the infringement (“notice-and-take-down principle”) and then to prevent further similar infringements. If he complies with this obligation, he does not have to fear any further liability for this infringement.

It is important to realise that when the infringement is first brought to the attention of the infringer, there is not yet a completed infringement that could give rise to a risk of repetition in the sense of a claim for injunctive relief. After gaining knowledge of the infringement, the operator first has a duty to check and act. And only the violation of this duty to eliminate and prevent further such violations gives rise to a claim for injunctive relief.

Concrete indication of a clear infringement

However, strict requirements apply to the notice of infringement addressed to the platform operator. According to case law, for a duty to examine to arise, the notice must be so specific that the platform operator can recognise the infringement obviously or easily, i.e. without a detailed legal or factual examination (BGH, judgement of 17.08.2011, Case No. I ZR 57/09 – Pen Perfume; Case No. 11.03.2004, Case No. I ZR 304/01 – Internet Auction I; Case No. 19.04.2007, Case No. I ZR 35/04 – Internet Auction II; Case No. 22.07.2010, Case No. I ZR 139/08 – Highchairs for Children on the Internet).

The provider must thus be enabled to identify the clear infringement from the multitude of contents on its platform. Therefore, for example, for an asserted copyright infringement, in addition to the exact designation of the offer complained of, the notification of the authorship of the infringed party is also required (BGH, judgement of 29 April 2010, file no. I ZR 69/08 – Thumbnails). Larger platforms provide users with special programmes for this purpose, with the help of which they can easily report infringements.

Scope of the inspection obligations of platforms

After a specific notice has been given, the extent of the examination to be expected of the operator in this respect depends on the circumstances of the individual case, in particular on the weight of the reported infringements on the one hand and the possibilities of the operator to obtain knowledge on the other hand. If the platform fulfils a function that is approved by the legal system and desired by society, the examination effort to be made by the provider must neither jeopardise the business model economically nor make it disproportionately difficult. As a rule, purely reactive inspection obligations do not exceed the limit of reasonableness.

Although proof of the right holder’s infringement is generally not required, it may be demanded from the provider under certain circumstances if the provider has justified doubts about the existence of an IP right or the authority to assert it. If, for example, in contrast to the assertion of trade mark infringements, the infringement of personality rights is alleged, an infringement of rights cannot usually be established without further ado, as this requires a balancing exercise. If the host provider receives a notice that a user contribution infringes personal rights and the complaint is so concrete that the legal infringement can be affirmed without difficulty, an investigation and assessment of the entire facts is required, taking into account any statements made by the person responsible for the contribution(BGH, judgment of 01.03.2016, Case No. VI ZR 34/15 – Ärztebewertungsportal III).

Liability in competition law

In intellectual property law and competition law, indirect infringements are now dealt with by different approaches. In competition law, liability for infringements of third parties was previously also dealt with through the institute of “Stoererhaftung” (Breach of Duty of Care). However, with the decisions “Jugendgefährdende Medien bei eBay”(BGH, judgement of 12 July 2007, ref. I ZR 18/04) and “Kinderhochstühle im Internet” (see above), the BGH put an end to “Stoererhaftung” (Breach of Duty of Care) in this area and bases liability on the violation of so-called “Wettbewerbsrechtliche Verkehrspflichten” (obligations under competition law). In copyright, trademark and statements law, on the other hand, “Stoererhaftung” (Breach of Duty of Care) continues to apply, even though there is a clear trend away from “Stoerer” (Breach of Duty of Care) towards “Täterhaftung” (Perpetrator Liability). In competition law, there is now perpetrator (!) liability if the provider, through its actions in the course of business, imputably opens up the danger that third parties will violate the interests of market participants protected by competition law and it does not limit this danger within the scope of what is possible and reasonable.

But what does this mean? Has this opened the door to stricter provider liability? However, these traffic obligations are nothing more than inspection obligations, the scope of which is in turn determined by the principles of “Stoererhaftung” (Breach of Duty of Care). At the level of the offence, there is therefore no difference to “Stoererhaftung” (Breach of Duty of Care), but the violator of such a traffic obligation can now also be liable for damages as a perpetrator (in contrast to “Stoererhaftung”).

The central question is and remains the testing obligations

It remains to be said that – whether “Stoererhaftung” (Breach of Duty of Care) or not – the liability of the platforms always revolves around the question of reasonable inspection obligations. The principles of case law on these duties of inspection must be applied in the most diverse areas of application around online services and adapted to the specific case. Therefore, a feeling of legal certainty can hardly be established so far. The cases of application are manifold:

• Forums, rating portals, social networks
• Upload platforms for videos
• Hyperlinks
• Search engines (search results, autocomplete function)
• Sharehosters, file sharing
• WLAN operators

In all these cases, the question of an indirect liability of the operator and thus of the inspection obligations imposed on him can arise.

Clear tendency towards increased use of platforms

In practice, a trend away from “Stoererhaftung”  towards greater recourse to platform operators has been apparent for some time. This is due to the fact that facts are increasingly being assigned to perpetrator liability, the adoption of “Stoererhaftung”  in competition law and in the case of WLAN operators, or the intensification of the testing obligations imposed.

This trend has recently become more pronounced and was clearly demonstrated by the increased interest of the EU Commission in regulating platforms, especially those with great market power. Thus, several EU regulations have recently been adopted that address the regulation and accountability of online services. These include, to name just a few, the Copyright Directive (EU) 2019/790 and the Digital Service Act, which is aimed at online providers and, in addition to creating transparency for consumers, aims to combat illegal content on the internet.

Accordingly, the aforementioned notice-and-take-down procedure is to be retained. However, the “big” host providers in particular will have to make it easier to report illegal content in future by making appropriate tools available to rights holders. The use of so-called “trusted flaggers”, who report content frequently and reliably, is also emphasised. In addition, it is to become transparent on online platforms whether the content and goods that can be called up are offered by providers and not the operator itself, as the latter is otherwise liable himself. This regulation thus ties in with the issue of attribution.

In the course of implementing the EU copyright reform, regulations on upload filters also came into force last year, requiring large upload platforms such as youtube, facebook and TikTok to automatically filter uploaded content for copyright infringements. Here, the previous limit on proactive review obligations softens significantly and increases the requirements for platforms to avoid liability. Smaller platforms cannot reasonably be expected to have such filtering facilities. However, the question remains open as to who is actually affected. Therefore, the courts will be busy in the future examining which platforms fall under this obligation and which do not.

What can platform operators do in concrete terms?

So far, smaller platforms cannot be expected to set up filter systems. Nevertheless, a few points should be observed in order to avoid liability:

• As soon as there is a concrete indication of a clear infringement, the operator is obliged to check and, if necessary, act (notice-and-take-down)
• In addition, from this point on, reasonable and effective precautions must be taken against further similar infringements
• The platform must offer users the technical prerequisites to enable them to comply with legal obligations (e.g. imprint obligations for traders; indication of entrepreneurial status) and it should contain information for platform users on legal requirements

Outlook

In conclusion, it can be said that “Stoererhaftung im Internet” (Breach of Duty of Care on the Internet) is an issue that is constantly evolving and whose boundaries are gradually softening. At the heart of the issue of platform liability are the reasonable inspection obligations imposed on operators, which must always be determined for each individual case.

There is a clear tendency in legislation and case law to increase the use of online platforms as a reaction to the changed balance of power. The adjusting screw here is the intensification of the inspection obligations and thus also their partial shift into the proactive area. It is clear that in the future it will become increasingly difficult for large platforms to withdraw to a purely disruptive role. They will be faced with increased inspection obligations and liability risks that must be managed. Which platforms are to be classified where and what the individual cases look like, however, remains open and will continue to occupy case law in the future.