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WIPOD – Arbitration and Mediation Matters: Transcript of Episode 2

ADR for Copyright and Content Disputes in the Digital Environment

Selin Ozturk: Welcome to WIPOD Arbitration and Mediation Matters. The WIPO Arbitration and Mediation Center’s (the WIPO Center) podcast on intellectual property (IP) and innovation disputes. My name is Selin and thank you for listening, as this podcast aims to provide practitioners a deeper understanding of the use of alternative dispute resolution (ADR) mechanisms, for example, mediation and arbitration for such disputes.

Today we are delighted to have with us Dev Gangjee, Leandro Toscano and Oscar Suarez to discuss dispute resolution trends for copyright- and content-related disputes in the digital environment.

Dev Gangjee is a Professor of Intellectual Property Law at the University of Oxford. He is also one of the primary writers of the WIPO-MCST Survey Report on ADR Mechanisms for Business-to-Business (B2B) Digital Copyright- and Content-related Disputes. Additionally, Leandro Toscano and Oscar Suarez are lawyers at the WIPO Center, and have contributed to the development and publication of the Survey Report. Thank you Dev, Leandro and Oscar for joining us today. Leandro if you would, please take us away.

Leandro Toscano: Thank you for your kind introduction, Selin. In recent years, the WIPO Arbitration and Mediation Center has seen a marked increase in copyright- and content-related mediation and arbitration cases. For example, in 2021 copyright cases represented 41% of the WIPO ADR caseload. We often see in WIPO cases disputes that are related to audiovisual and musical works, mobile applications, photographic works, social media platforms, software and video games, among others.

Oscar Suarez: Hi Selin, hi Leandro, hi Dev. Thank you for having me here. To add to a fact-based understanding of this topic across industries, the WIPO Center, with the support of the Ministry of Culture, Sports and Tourism of the Republic of Korea (MCST), has recently published the results of an international survey on the use of ADR mechanisms for B2B digital copyright and content disputes. We can see here, not surprisingly, that there is actually a great support for the use of ADR in this digital environment.

Leandro Toscano: Hi Dev, welcome to our Podcast. Thank you for being with us today. The WIPO Center with the support of the MCST conducted an extensive Survey on the use of ADR to resolve digital copyright and content disputes. You are one of the authors of the Report on that Survey. Do you consider whether there has been a change in the use of ADR to resolve copyright and content disputes in the digital environment?

Dev Gangjee: Thank you Leandro for having me, and it was a pleasure to work on the Report together with WIPO. I think the short answer to your question is that yes, there has been a change. What kind of change? Well very simply more of an appetite or an interest in ADR for B2B copyright disputes. We looked at a very specific slice of disputes in the Report and that has to do with business-to-business digital copyright and content related disputes. So why does our Report suggest that there has been a change?

Well first, to begin with, there is the Survey response results; there is a lot of appetite and interest among respondents for ADR options and solutions for these kinds of disputes. Then there’s the few statistics that we have, so that’s from the WIPO Center from statistics in the Republic of Korea, we’ve got figures suggesting that more of these disputes are finding their way to ADR solutions. Then having nudges by the judiciary towards ADR, so some of these are part of the broader trends.

For example in 2017, the Court of Justice of the EU decided that within the consumer protection context you can have mandatory mediation as a first step before allowing consumers to access courts if they do have a dispute in a consumer protection context. The general direction of travel for courts seems to be favoring ADR and there are some specific IP references as well. And then in legislation as our Report documents, there’s a lot of specific types of copyright disputes where legislation mandatorily requires or very strongly encourages ADR solutions like mediation or like arbitration.

Another piece of evidence we saw was IP Offices, so a lot of national IP Offices are offering ADR services or facilitating ADR in a range of ways. And then the final sort of piece of evidence we discovered was a number of practitioners associations, so IP practitioner associations, INTA, AIPPI, they are setting up specialized groups within the association with an emphasis on ADR and interest in ADR solutions. There is a lot of evidence to suggest that there is an interest in ADR for these kinds of disputes.

Oscar Suarez: Thank you Dev for those first insights. Going back to the Survey Report, could you share with our audience the key findings of the Survey?

Dev Gangjee: So we did two things in that we ran a Survey in the very large number, almost 1,000 respondents, and then we did in depth qualitative interviews for a very significant proportion of those respondents to get expertise and in-depth commentary, which then enriched the Report. A number of interesting things came up. For a start, we were very happy to just see the range and relevance of the respondents, so we had law firms, we had governments, we had collective management organizations - who manage rights on behalf of copyright right owners, we had content owners or their representatives, we had industry associations; and all of these came together to give us quite a rich range of perspectives on the questions we were asking. We also had a very good geographical spread so we had respondents from Europe, Latin America, Asia, North America, Africa, Oceania, so really across the globe we had people responding to this.

Another very valuable thing for us in terms of the quality of the responses was between 10% and 15% of respondents had arbitration or mediation experience. So you had quite a number of respondents with specific IP ADR expertise who were responding to this. 49% were legal professionals, so they had a sense of some of the legal issues, and 61% of our respondents had prior involvement in business copyright disputes. So it’s a very relevant field of responses that we had and then they’re further insights which emerge in terms of the kinds of disputes they had experiences with. In terms of copyright content, 57% of the disputes were contractual and 67% of the disputes were domestic. It gives us an insight into where these disputes are happening, who is participating in them and something about the nature of these disputes.

So in terms of the nature of the disputes, we had interesting categories of subject matter, so things you would expect: musical works, music in general, software – software was a big category, advertising materials, literary works, books, kinds of printed matter as well, and then films, photos, things you would expect online, but also databases. Databases is an interesting category, which features there. Apps for mobile phones, as well as TV formats so you can see things, which have commercial value, but are not really mainstream, otherwise, in copyright discourse you see these featuring in the Survey responses as well.

I’ll just end by saying just a couple of interesting things about some of the kinds of contractual issues and non-contractual issues which emerged from the qualitative interviews, when we actually sat down and talked to people, what were the kinds of insights they shared with us. For software for example, one of the contractual disputes that arose was when you commission programmers to write code for you or you ask them to update code for you, you need to be clear about the ownership implications of that code which is written because otherwise it lends itself to disputes arising.

In terms of non-contractual disputes, lots of it increases in digital and online disputes, so entire web pages content is taken or the layout is being taken as well and as you would expect the effectiveness of platforms or mechanisms like notice and take down to get rid of infringing content. So there is lots else that is interesting in the report, in terms of amounts and types of disputes but I would be happy to come back to that in another question.

Oscar Suarez: Thank you Dev, and based on such findings do you think ADR is becoming more relevant for digital copyright- and content-related disputes?

Dev Gangjee: Again, I think listening quite closely and putting the data together, the answer is yes, because of where this particular slice of disputes is situated. Digital copyright issues have huge commercial relevance. If you’ve been following the news, you have seen Microsoft has bought over Blizzard and some of the thinking around why that’s happened is because Blizzard and the gaming industry in general is plugged into virtual worlds, and the big buzz now is about the Metaverse and the blending of reality and virtual reality. Video games have been a sector where virtual worlds have long been a part of video games. That seems to be the future direction of travel and it is already – games are hugely commercially significant and my sense is there more valuable than films as a category of cultural products. From e-books, to music, to films, much of our cultural world is consumed, shared, and enjoyed online, and therefore this was a good slice to look at.

Because it is B2B, what is evident as you begin is the parties vary in size and sophistications, so you could have the individual photographer as a professional and a big corporation on the other side, so, both parties aren’t equally well situated and well-funded all the time, even though they’re both commercial parties. Therefore, ADR is a way of balancing out access to dispute resolution when you have that imbalance or mismatch. Another issue, which comes up quite frequently, is these disputes tend to straddle or to span different jurisdictions where you’ve got perhaps different rules operating and then choosing in advance which rules are going to govern the dispute is a very helpful thing to have and that’s what ADR amounts. ADR is increasingly adopting a broader trend and you see this in mainstream litigation as well and that is online dispute resolution, and the pandemic has just accelerated the adoption of online dispute resolution. That’s another trend driving people towards ADR where you have ADR well set up to use online dispute resolution tools and I know WIPO has an online docket of tools and dispute resolution tools as well. In the B2B context, because we were looking at B2B copyright disputes, preserving confidentiality is important but I think more than that preserving the relationship is also important as well.

You don’t want the perhaps more unforgiving and adversarial approach to litigation, you want to resolve a dispute but carry on being business partners and ADR perhaps facilitates that more. It also lends itself to speed if it’s well designed at length itself to speed and you can select experts to help you decide the dispute. All of these suggest that and this is the evidence that suggests that these are the reasons why people are turning to ADR for these disputes.

Leandro Toscano: Dev, in the report it is quite evident that in many countries copyright legislation already includes references to ADR mechanisms. Could you give some examples of recent copyright legislative developments that also include specific references to ADR?

Dev Gangjee: In fact, I think we were surprised when we were working on the report in terms of just the range and variety and spread of national copyright legislation which for certain types of disputes nudges people towards ADR solutions. We found evidence in Japan, we found it in the Republic of Korea dating back to 1987, in Mexico, Nigeria, but I think Singapore is a jurisdiction that I remember from the Report because you’ve got the Intellectual Property Dispute Resolution Act of 2019, which more broadly facilitates ADR processes for IP, including copyright.

That was a structural or environmental change, which facilitated accommodating IP disputes. I think the other recent development that’s got a lot of attention is the EU’s Digital Single Market Directive (DSM) and the DSM is really something which has updated the EU copyright rules for the internet age and the current wave of internet developments that we find ourselves in. Article 13 of the DSM, for example, says that where there is a contractual licensing dispute, then mediation is the proposed solution. Articles 19 to 21 of the DSM say that, for example if there’s a contractual relationship between an author of a work and somebody they sold their rights to exploiting or distributing the work for them then there’s a contract adjustment provision if the work does better than expected. So if the work is a best seller or a better than expected seller, there is a way of adjusting the contractual price bid and there is a voluntary ADR procedure which is required by Articles 19 to 21. That is another area where the DSM directive is encouraging or nudging people to consider ADR options in the copyright dispute space.

But perhaps the most interesting development and one of the most controversial in recent times has been Article 17, which imposes duties on large scale online service providers, online content service providers, to either seek a license in advance for right holders or provide content moderating mechanisms or filters on their platforms. And then if there’s a dispute arising from that filtering process at the tail end of that dispute process ADR seems to emerge again as one of the options; and because platforms are now ubiquitous, and because disputes happen in large numbers when they happen this is scaling up and ADR being recommended as an option is a very interesting and challenging development.

Oscar Suarez: So you mentioned the European Directive on the Digital Single Market. Could you maybe elaborate on the references to ADR included in the text of the DSM?

Dev Gangjee: Article 17 seems to set up an obligation upon these platforms which says either get a license in advance from right holders or their representatives or else, in order to avoid liability you have to set up some kind of algorithmic filters or automatic mechanisms to go seeking out infringing content. Then doing something, effective to remove that sort of content and blocking is what comes to mind, so automated blocking of such content.

Invariably as past experience has sort of shown, where you’ve got these automated filtering algorithms you could end up inadvertently blocking content which is non infringing or which might be infringing, but which has a defense or excuse or an exception applying to it, like a parody for example, as a song. In those circumstances, the person who has uploaded the content, which is allegedly infringing should be able to push back against the claim. The platform then, the automated filter blocks the content, there is a dispute over whether it should be blocked or not, and then the uploader pushes back against the charge that it’s infringing and then the platform has to make a decision. Presumably, a human being who works for the platform has to make a decision about whether it’s infringing or not.

Once that decision is made, so let’s call it a second level decision, the first level automated decision happens by the filter, the second level decision happens by a human employee of the platform. Then if either party, the right holder or the uploader is aggrieved with that decision and disagrees with it, they should be able to take it to a speedy mechanism; and it’s here that Article 17 seems to be suggesting that ADR should be a solution.

Leandro Toscano: Before we finish this interview, in the last chapter of the WIPO-MCST Report, we can find ADR practical applications. For example, WIPO model submission agreements specifically drafted to facilitate the referral of digital copyright- and content-related disputes to either WIPO Mediation or WIPO Arbitration. We can also find references to the recently developed WIPO Expert Determination procedure to resolve user uploaded content disputes in the context of Article 17(9) of the EU DSM. Could you share your views on these various developments?

Dev Gangjee: I think the first in terms of the model submission agreement. My sense of talking to practitioners and barristers, who are involved here in the UK in IP ADR processes, is they find this very helpful. They find it very helpful because it’s something they can point to so where you have even people who are drafting agreements. At that stage, it’s very helpful to have these templates almost as a set of references which people can incorporate into the paperwork into their agreements in advance. I think related to that is the question of making sure that user groups and associations: authors groups, photographers, publishers, musicians, people who create copyright content are aware of these provisions.

So then they can start, through associations and representative groups, being made aware that these provisions exist, start folding them within their regular contracts and that’s how these templates like the WIPO model submission agreement will tend to circulate and then get embedded in the actual contract. So I think it’s very important to have them and now making sure they travel widely and they’re advertised. I think that that is something that people would like to see happen a little more.

The second development is WIPO’s quite brave experiment to build an ADR system to respond to the Article 17 situation we were just talking about and WIPO’s expert determination procedure to resolve these kinds of user uploaded content disputes is quite a brave experiment. Because it’s new, it’s different from the past experience with the UDRP (Uniform Domain Name Dispute Resolution Policy) for domain names and it’s going to be happening on quite a bit of scale here.

I think one of the interesting things that WIPO is doing is developing a fairly tightly defined catalogue of exceptions like parody, or commentary, or review, or criticism, and if you fit within one of the exceptional categories then that’s a starting point for saying that the uploaders should be allowed to upload the content. One of the follow-up developments is going to be to then fill out each of these categories in many jurisdiction specific ways. How a U.S. court might read a parody, for example, because it has a very generous freedom of speech or fundamental right, like the right to freedom of expression it might be different from how another country might read a parody where it perhaps has a less generous approach to free speech kind of argument.

Leandro Toscano: Thank you Dev, and it’s also important to highlight that parties to the dispute will have the chance to go to the national courts to resolve this type of disputes too.

Dev Gangjee: Yes, I think that’s very important. Therefore the quality of the procedure gives parties a speedy resolution of the dispute and my sense is there is a genuine interest and an appetite in ADR in the IP space because parties are seeing the value of a high quality decision with perhaps maybe some compromises in this step enter into ADR process.

But then, savings on cost, savings on time, and a result that parties can be happy with and provided they’re happy with that then the dispute stops at that level, and if they’re not happy with it then they can always take it back to the court system. That’s important to remember as it’s always going to be “there’s a next step”, but I think parties in general in the sectors in which ADR works well they tend to be happy. My sense is most of the UDRP decisions don’t get appealed to court, they stop there.

Leandro Toscano: Thank you very much Dev, it’s always a pleasure to hear your views and to learn from your vast experience.

Oscar Suarez: Thank you Dev!

Dev Gangjee: Thank you for having me!

Selin Ozturk: Thank you for listening and do not forget to subscribe, as we come out with new episodes every month. For more information on WIPO’s alternative dispute resolution services, you may visit the WIPO Center’s website or follow us on LinkedIn.