Transfer of rights in Amazon terms and conditions ruled invalid

Amazon's terms and conditions provide that marketplace sellers grant a comprehensive right of use for each uploaded product image. For Amazon, this process is in a sense the foundation of its business model, because only in this way is centralized data management possible. However, this raises the question of whether such a transfer of rights is possible and valid at all. The Regional Court (LG) Cologne has now provisionally answered this question and expanded the prevailing uncertainties with new aspects.

The subject matter of the dispute was photographs of a seller, which the seller had uploaded to Amazon with consent to the terms and conditions therein for a specific product listing. These terms and conditions provide that participants grant Amazon a royalty-free, unlimited in time, comprehensive right of use, in particular for reproduction, distribution, editing, as well as the right to publish the content in all conceivable media – possibly also for advertising purposes.

The images in dispute subsequently appeared in connection with a similar offering by another seller, because Amazon made these available for its own offering by exercising the rights of use acquired under the contract. The seller was thereupon sued for injunctive relief by the rights holder or the initial uploader.

The court's decision

The seller who was sued naturally relied in the proceedings on the fact that Amazon had granted him a licence to the photographs and that therefore no rights could be asserted against him. Thus, the validity of the transfer of rights provided for in Amazon's terms and conditions by the initial provider is the decisive preliminary question. The Regional Court (LG) Cologne decided in its judgment of 13.02.2014 (Az. 14 O 184/13) that the clause in its specific scope is invalid. The terms and conditions used in the B2B sector are admittedly subject to only limited scrutiny. However, since it is not a matter of the design of the principal contractual obligations, judicial review is possible in the present case. According to the court's view, the comprehensive transfer of rights free of charge constitutes a violation of the fundamental copyright principle that the creator must always receive adequate remuneration for the granting of rights of use, which must also apply to any intermediary seller who has acquired a licence from the photographer.

According to the court's view, such an extent of transfer of rights has no connection to the illustration of the original product listing, which from the perspective of the seller is the sole purpose for uploading the product photographs. In order to obtain legal certainty for its own business model, it would have needed only product-related rights for reproduction and public making available. For this reason, the transfer of rights provided for by Amazon in this form is incompatible with fundamental copyright principles and is therefore null and void.

As a consequence, the defendant seller could not acquire a licence either. Nevertheless, he was not ordered to cease and desist. A wrongful interference with copyright entitlements is to be denied in this constellation because, at least in the relationship between the rights holder and the user, there is consent to the use of the photographs, because the former must have been aware that it is a system-inherent practice at Amazon for such duplicate use of image material to occur regularly – namely whenever Amazon determines that two offerings exist for one and the same product. In the court's view, it is purely a matter of chance whether someone acts as the initial uploader or, due to the existence of an identical offering, receives another party's photographs "foisted upon" them.

Conclusion

Amazon disputes can currently be fairly described as a matter of chance. The courts are still divided on how photograph rights at Amazon are to be treated and what the consequences are in the event of unauthorised use of images.

While in the present case the finding of invalidity of Amazon's terms and conditions is readily comprehensible, the nonetheless denied liability of the secondary user is inconsistent. The court's reasoning has something of the Google case law, according to which the person who does not consent to image use is not the one who has consented to it, but rather the one who has not prevented it with effective means. Apparently, the court assumed that if the undoubtedly correct approach were followed through consistently, (yet again) an internet business model would have been in jeopardy. However, this is not the case, since Amazon would merely need to reduce the transfer of rights to the absolute necessary extent and would then have good chances of that clause "surviving".