Liability for unsecured WLAN/gate exit node

The German Federal Court of Justice has ruled that the operator of an Internet access via WLAN and a Tor exit node is liable under the new version of Section 8 para. 1 sentence 2 of the German Telemedia Act (TMG)* is not liable as a “Stoerer” (interferer) for copyright infringements committed by third parties via his Internet connection by way of file sharing. However, a blocking claim of the right holder according to § 7 para. 4 TMG nF can be considered.

The plaintiff is the owner of the exclusive rights of use to the computer game “Dead Island”. The defendant maintained an Internet connection. On January 6, 2013, the program “Dead Island” was offered for download on an Internet file-sharing platform via the defendant’s Internet connection. The plaintiff issued a warning to the defendant in March 2013 and demanded that the defendant submit a cease-and-desist declaration with a penalty clause. Previously, the plaintiff had sent the defendant two legal warnings for copyright infringements committed via his Internet connection in 2011 relating to other works by file sharing.

The Federal Court of Justice has ruled that the defendant is obliged to compensate the warning costs under the relevant law in force at the time the warning was issued, because it is liable as a “Stoerer” (interferer) for the infringement of the rights of third parties. The defendant was in breach of duty in failing to secure its WLAN against misuse by third parties by using the encryption standard that was current at the time of purchase and an individual password. In the case of private provision by the defendant, this obligation existed without further ado as soon as the connection was put into operation. Insofar as the defendant provided Internet access via WLAN on a commercial basis, he was obligated to take these security measures because he had already been notified that copyright infringements had been committed via his Internet connection in 2011 by way of file sharing. The assumption of “Stoererhaftung” (Breach of Duty of Care) is not precluded by the fact that the work named in the notice is not identical to the work affected by the renewed infringement. The liability requirements are also met if the infringement occurred via the Tor exit node operated by the defendant. The defendant was in breach of duty in failing to take technical precautions to counteract the known risk of copyright infringements through file sharing.

On the other hand, the Federal Court of Justice overturned the order to cease and desist because, according to the new version of Section 8 para. 1 sentence 2 of the German Telemedia Act (TMG), the provider of Internet access cannot be held liable for damages, removal or omission of an infringement due to an unlawful act of a user. If an act is no longer unlawful at the time of the appeal decision, the award of injunctive relief is out of the question.

Against the application of § 8 para. 1 sentence 2 TMG nF, the BGH also did not see any concerns under EU law. It is true that the Member States are obliged under Art. 8 para. 3 of Directive 2001/29/EC and the third sentence of Article 11 of Directive 2004/48/EC to provide for the possibility of injunctions in favor of rightholders against intermediaries whose services are used by a third party to infringe a copyright or related right. The German legislator has defined the access provider’s liability to cease and desist in § 8 (1). 1 sentence 2 TMG nF excluded, but at the same time in § 7 para. 4 TMG nF provides for a claim against the operator of an Internet access via WLAN aimed at blocking access to information. This provision should be amended in line with the Directive so that the blocking claim can also be asserted against providers of wired Internet access. The right to blocking measures is not limited to specific blocking measures and may also include the obligation to register users, to encrypt access with a password or – in the most extreme case – to block access completely.

For the examination of the question whether the plaintiff has a claim against the defendant for the blocking of information pursuant to Section 7 para. 4 TMG nF, the Federal Court of Justice referred the matter back to the Higher Regional Court.