Introduction

In a landmark decision, the Cologne Higher Regional Court has recalibrated the liability of service providers in the area of copyright law. The focus is on Cloudflare, a provider that has also enabled access to copyrighted content through its services. The court’s finding of perpetrator liability for copyright infringements could set a precedent with far-reaching consequences for the entire industry.

History of the procedure

The roots of the case go back to the closure of platforms such as DDL Music, which made copyrighted music available without the permission of the rights holders. Cloudflare, the service provider that granted anonymity to these platforms, was subsequently prosecuted by the rights holders.

Cloudflare has already been ordered to cease and desist in the preliminary injunction proceedings, as the company had not taken sufficient action against the copyright infringements. The main proceedings not only confirmed this view, but also extended it: Cloudflare is now held liable as a perpetrator beyond the liability for interference. This implies Cloudflare’s active participation in the infringements and represents a significant tightening of the previous legal interpretation.

Legal assessment and signal effect

The decision of the Higher Regional Court of Cologne sends a clear signal: Courts are prepared to extend the liability of service providers if they do not actively take action against copyright infringements. This is in contrast to previous rulings, in which liability usually only arose after knowledge of legal infringements and a lack of reaction.

Comparison with the case law on Quad9 A comparison with the case law on the DNS resolver Quad9 shows a converging trend: liability was also established here because the service did not prevent access to illegal content. This ruling emphasizes the courts’ expectation of technical service providers to take an active role in preventing copyright infringements.

Challenges for the industry

The latest court rulings confront the entire industry with fundamental challenges: Service providers are faced with the task of redefining their role in the digital space and possibly rethinking their business models. The times when a neutral positioning as a pure infrastructure provider was sufficient to avoid liability seem to be over. The responsibility of service providers is being reassessed and they are expected to actively contribute to the prevention of copyright infringements.

This development also raises questions that go far beyond individual cases. The focus is particularly on how the Federal Court of Justice (BGH) will handle similar cases in the future. Although the Federal Court of Justice has already ruled on perpetrator liability for sharehosting platforms, the dynamics of digital change and the complexity of technologies could lead to an ongoing review and adaptation of case law. Should Cloudflare take the route of an appeal against denial of leave to appeal, this could not only result in a new legal assessment, but could also further develop legal practice in this area. We know from our own experience that even established rulings of the BGH can be subject to change over time. Against this background, the further development of case law on copyright infringements on the Internet remains an exciting and important field that should be followed with interest and caution by all market participants and legal observers alike.

For a more in-depth look at the case law in the Quad9 case and its implications for the industry, please refer to the article DNS resolvers as perpetrators of copyright infringement on my blog.

Conclusion

The decision of the Higher Regional Court of Cologne marks a turning point and calls on service providers to take responsibility and take proactive steps to prevent copyright infringements. How the legal situation will develop remains an exciting question that the industry will continue to follow closely.