Judges award VG Wort many millions of euros

In the present legal dispute of the collecting society Wort (VG Wort), it is fighting for the exploitation of copyright-protected literary works and their use in higher education institutions. Overall, it concerns economic interests valued at several 100 million euros. The Higher Regional Court (OLG) Munich had to decide on the amount of licence fees that universities must pay.

German copyright law permits copyright-protected published works or parts of works as well as individual articles from newspapers or magazines to be made publicly available for certain purposes, to pupils for purposes of illustration in teaching at schools and higher education institutions or to persons for their own scientific research. This is permissible insofar as it is necessary for the respective purpose and is justified for the pursuit of non-commercial purposes. For this use, however, an appropriate remuneration must be paid to VG Wort, which distributes the funds according to a complicated formula to its members, the authors of the literary works.

The amount and calculation basis of these compensation payments is disputed. Relevant contract negotiations between the individual federal states as operators of the higher education institutions and VG Wort failed, with the result that the collecting society filed a lawsuit. The states are arguing for a lower flat-rate remuneration for the literary works. VG Wort demands a higher usage-based remuneration.

Court decision
The Higher Regional Court (OLG) Munich decided withJudgment of 28.03.2011 – Az. 6 WG 12/09 – Press release that the higher education institutions must pay fees for the use of copyright-protected texts also retroactively. Contrary to the opinion of the federal states, the use of the texts in higher education institutions must be remunerated on a usage-based rather than a flat-rate basis.

The use of the literary works for the past will be calculated on the basis of future results. The states must therefore pay at least the flat-rate fees in the amount of 712,500 euros per semester for the period from January 2008 onwards.

The senate has permitted revision to the Federal Court of Justice (BGH).

Conclusion

It is to be assumed that this legal matter will ultimately be decided at the next instance before the Federal Court of Justice (BGH). If the Munich judges' vote stands, the states and thus the students and taxpayers will face considerably higher costs. However, the members of VG Wort can expect higher and possibly also more appropriate remuneration for their copyright-protected works.