France fines Google for unauthorised use of media content - CJEU Case C-382/21P: PCT priority and community designs applications

France fines Google €250 million for unauthorised use of media content

The ongoing dispute between Google and French newspapers has taken a new turn with the imposition of a €250 million fine by the French competition authority.

In 2020 the Paris Court of Appeal ruled that Google had to negotiate with newspaper publishers and compensate them for displaying and linking to news articles in its search engine’s results, following the recognition of "press publishers' rights" in Article 15(5) of the 2019 Copyright Directive.

A year later, in 2021, France fined Google 500 million euros for failing to compensate French media, accusing the company of not negotiating "in good faith" with press editors. Google accepted the decision and decided not to appeal, reaching agreements with press editors to settle the dispute. In the autumn of 2023, the authority opened an investigation and sent questionnaires to both Google and the news agencies to assess the progress of negotiations between the two parties. At the end of the investigation, the Competition Authority found that the amounts of compensation paid by Google to the news publishers were not significant enough, in particular when compared to the revenues that the platform generated through its search engine by offering multimedia content.

On 20 March 2024, the French authority fined Google again, in particular for the unauthorised use of French media news in Google's artificial intelligence platform. These arguments are similar to those made by The New York Times against OpenAI and similar cases. In this case, French newspapers are claiming that Google is using their content to feed and train Gemini, previously known as Bard.

In that context, the French authorities argued that Google had failed to meet the negotiation and transparency commitments made following the 2021 decision, resulting in another sanction. In particular, Google failed to negotiate with the media in good faith and based on transparent, objective and non-discriminatory criteria. It also failed to provide transparent information on the remuneration for related rights and to take steps to prevent the negotiations from affecting other economic relationships. In addition, the Authority found that Google did not comply with the transparency obligation in the first commitment by not informing publishers and press agencies about the use of their content by Bard/Gemini, and by not providing a clear solution to French press organisation to “opt-out” and thereby excluding their content from being fed into Bard/Gemini..

The American giant expressed its dissatisfaction and considered the fine to be disproportionate, highlighting that it is the only platform to have signed agreements with 280 French newspapers, paying them significant annual compensation for the use of their content.

CJEU Case C-382/21P: PCT priority and community designs applications

On 27 February, the Court of Justice of the European Union delivered a judgment in case C-382/21P, on whether or not the holder of an international patent application filed under the Patent Cooperation Treaty (PCT) can base a priority claim for a subsequent application for a registered Community design.

In October 2018, KaiKai Company applied to the European Union Intellectual Property Office (EUIPO) for the registration of twelve Community Designs, for which they claimed priority based on an international patent application filed under the Patent Cooperation Treaty (PCT). The EUIPO granted the application for registration but did not grant the right of priority. The basis for the decision was Article 41(1) of the Community Design Regulation (CDR) which states priority may be claimed up to 6 months from the date of first filing. In this case, the PCT application had been filed more than six months earlier and, therefore the Court considered that there was no right of priority.

KaiKai appealed the decision to the General Court, which partly upheld the appeal and overturned the EUIPO's decision by holding that an international patent application under the PCT could be the base for a priority claim from a Community design application where both relate to the same subject matter, in accordance with Article 41(1) CDR, and that the time during which priority could be claimed depended on the right on which priority is claimed (i.e. one year for patents, instead of 6 months for designs). It found that the EUIPO had erroneously applied a priority period of six months instead of twelve, since Article 41(1) CDR explicitly provides for a priority period of six months based on previous design and utility model applications. However, KaiKai's earlier application was for a patent. Article 41(1) CDR does not mention patents but only designs and utility models. The Court considered that Article 4 of the Paris Convention (an international treaty harmonising the IP law of most countries in the world) allows for priority claims between different types of intellectual property rights and applied in this case. Under Article 4(C)(1) of the Paris Convention, the priority period for patents is twelve months.

The EUIPO appealed to the CJEU, which had to decide whether a RCD registration could claim priority from a previous PCT international patent application and whether the time limit for such claims should be six months or a year after the first filing.

The CJEU fully upheld the EUIPO's appeal, agreeing that priority claims in Community Design applications are governed solely by Article 41(1) CDR, which specifically provides for priority claims based on previous design and utility model applications. Given that utility model applications can be subject to international registration through the PCT, it follows that a previous PCT application can only be the basis for a priority claim if it was filed for utility model protection – not patent.

Finally, it's important to note that while all EU countries are party to the Paris Convention, the European Union itself is not. However, the EU is part of an agreement called the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). This agreement includes several parts of the Paris Convention, such as Article 4. However, neither the Paris Convention nor TRIPS has “direct effect”, which means that while its content is binding on the institutions of the countries which have signed the treaty, they do not create rights which private individuals or companies can claim (hence there is no “direct effect”). Rather, the content of these treaties are included in the national (or regional in the case of the EU) laws of each signatory country. While these treaties can then be used to interpret the national law to be applied in cases, the literal meaning of the law as written normally takes precedence. As was the case here: while the Paris Convention could be interpreted to allow for a priority claim in a design application could be made on the basis of a patent application filed more than six months earlier, the applicable law (i.e. the Design Regulation) could not be interpreted in such a way.