New Zealand’s High Court refuses to grant interim injunction against Viagogo

May 2020

CONSUMER: Over the last year or so a number of regulatory authorities have gone after Viagogo, the now controversial secondary ticket resale platform based in Switzerland, over complaints from consumers. Complaints include the use of misleading statements referring to the availability of tickets and the failure to identify seat numbers and seller identities, and notably, the UK Competition and Markets Authority and the Australian Competition & Consumer Commission have filed legal complaints against the Swiss company.

In August, last year, it was the turn of New Zealand’s Commerce Commission (Commission), at the time Complete Music Update reported that the Commission was seeking “declarations that Viagogo has breached the [Fair Trading Act], an injunction restraining it from further breaches and corrective advertising orders”. Reference was made to the use of words such as ‘official’, ‘guarantee’ and ‘limited’ when Viagogo was not ‘official’, refunds were not ‘guaranteed’ and tickets were not ‘limited’.

Not stopping there, the Commission also referred to an unfair contract term in that any consumer disputes against Viagogo must be heard under Swiss law in Swiss Courts, whereas on the other hand, Viagogo is free to take action against consumers in a jurisdiction of its choosing.

Whilst these substantive arguments are yet to be heard in New Zealand’s High Court, the Commission “sought an interim injunction to prohibit website representations by Viagogo which the Commission alleges are misleading.”

Due to the fact that Viagogo is a Swiss company and the Commission had failed to serve proceedings in Switzerland against Viagogo, the High Court ruled that it could not grant the interim injunction. It should be noted that Viagogo did not make the service issue any easier for the Commission by refusing to waive formal service.

On the issue of the interim injunction High Court Judge, Justice Patricia Courtney, explained that “Viagogo is aware of the proceedings and its New Zealand solicitors have been provided with copies of the documents but formal service in Switzerland will, apparently, take some six months.”  In the hearing, Viagogo’s lawyer stated that it intends, once served, to file an appearance and objection to jurisdiction.

The Commission argued that under the Fair Trading Act and, in the absence of any objection to jurisdiction actually having been filed, there is no barrier to the Court determining the application.

Justice Patricia Courtney, in her succinct Judgment, ruled that the High Court did not have jurisdiction over Viagogo and “The problem for the Commission is not whether an objection to jurisdiction has been filed or merely been intimated, but the fact that the defendant has not yet been served.”

Commission Chairman, Dr Mark Berry, said “We knew this was not an easy course but we had hoped to get interim orders to protect New Zealand consumers until we could have the Court hear our substantive case against Viagogo. Our focus remains on preparing for the main hearing against Viagogo.”

Complete Music Updates has reported that Viagogo was treating the Commission’s failure to obtain the injunction as a ‘significant legal victory’ and “For over a decade, millions of customers have been successfully using Viagogo, which is why we remain committed to providing a secure platform for people to sell as well as buy sport, music and entertainment tickets to events in New Zealand and all over the world”.

Ultimately, cases are often won or lost by way of procedural issues and lack of jurisdiction is probably the god father of all defences. Whilst Viagogo may have ‘won’ the round it certainly does not negate the fact that the battle is not over. The Commission has gone some way to inform New Zealand consumers of Viagogo’s practices and who knows, maybe the Commission’s failure to obtain injunctive relief may have spread the word further.

by Samuel O’Toole (www.lawditmusic.co.uk)

https://www.courtsofnz.govt.nz/cases/commerce-commission-v-viagogo-ag/@@images/fileDecision?r=675.417607049

https://comcom.govt.nz/case-register/case-register-entries/viagogo/media-releases/commission-urges-consumer-caution-following-viagogo-decision

Agreement on DSM Directive reached in trilogue

COPYRIGHT: Over on the IPKat, Eleonora Rosati reports that at last, after several weeks, several discussions, and after France and Germany achieved a compromise on some key provisions in the draft Directive on copyright in the Digital Single Market an agreement has been reached between the European Parliament and Council negotiators on the content of this new piece of legislation.

The text is not yet available, but according to a press release from the European Parliament:

Tech giants to share revenue with artists and journalists: The deal aims at enhancing rights holders’ chances, notably musicians, performers and script authors, as well as news publishers, to negotiate better remuneration deals for the use of their works featured on internet platforms.

Locking in freedom of expression: Sharing snippets of news articles will not engage the rights of the media house which produced the shared article. The deal however also contains provisions to avoid news aggregators abusing this allowance. The ‘snippet’ can therefore continue to appear in a Google News newsfeeds, for example, or when an article is shared on Facebook, provided it is “very short”. Uploading protected works for purposes of quotation, criticism, review, caricature, parody or pastiche has been protected, ensuring that memes and Gifs will continue to be available and shareable on online platforms.

Many online platforms will not be affected: The text also specifies that uploading works to online encyclopaedias in a non-commercial way, such as Wikipedia, or open source software platforms, such as GitHub, will automatically be excluded. Start-up platforms will be subject to lighter obligations than more established ones.

Stronger negotiating rights for authors and performers: Authors and performers will be able to claim additional remuneration from the distributor exploiting their rights when the remuneration originally agreed is disproportionately low compared to the benefits derived by the distributor.

How this directive changes the status quo: Currently, internet companies have little incentive to sign fair licensing agreements with rights holders, because they are not considered liable for the content that their users upload. They are only obliged to remove infringing content when a rights holder asks them to do so. However, this is cumbersome for rights holders and does not guarantee them a fair revenue. Making internet companies liable will enhance rights holders’ chances (notably musicians, performers and script authors, as well as news publishers and journalists) to secure fair licensing agreements, thereby obtaining fairer remuneration for the use of their works exploited digitally.

Next steps: The deal must now be approved by Council representatives and the EP plenary.

Dr. Harald Heker, CEO of German music collection society GEMA, said:  “We welcome the agreement reached today between the EU institutions regarding copyright. Thanks to the Directive, online platforms will finally have to pay authors a fair remuneration for the usage of their works” adding “The draft of the Directive that we now have in front of us imposes a higher level of responsibility onto the online platforms and strengthens the position of creators as well as internet users at the same time.

Andrus Ansip European Commission Vice-President for the Digital Single Market wrote in a tweet that the outcome is a “major achievement for Europe”

https://euobserver.com/science/144165

https://www.billboard.com/articles/business/8498315/european-union-approves-deal-over-controversial-copyright-directive

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