Paper and canvas are not the same thing: the Allposters case under the Court’s exam

Recently the Advocate General has had to answer an enquiry regarding the exhaustion of the distribution right on a rather peculiar case.

A Dutch company acquired on the market posters reproducing artworks, regularly sold on the market with the consent of the copyright’s owner. This company, however, did not limit itself to the re-sale of these posters -which it could have well done due to the fact that the right on the support that the artwork contained had been exhausted-, but instead it “extracted” the image from the poster and re-stamped it on canvas, thus selling afterwards a canvas that reproduced the original artwork.

The case finished at the Court of Justice, which shall decide whether the right of the owner has been exhausted or not, but it is actually an issue that seems to have little to do with the exhaustion right and rather more with reproduction rights.

Pursuant to the exhaustion principle, the owner of copyright that voluntarily sells its own work in the context of the European economic area cannot oppose to the subsequent transfer operations made by the purchaser because, with the first sell, its right has been exhausted.
It is a principle recognized by different treaties concerning Industrial and Intellectual Property. Nevertheless, as copyright is concerned, this principle sometimes generates interpretative doubts because, on the one hand, by transferring the ownership of the asset (so-called corpus mechanicum) the author is not abandoning its exercise of copyright (so-called corpus mysticum) and, on the other hand, sometimes the author does not assign the asset but rather confers a particular modality of use of the same.

In this regard, the Court of Justice has already asserted that the exhaustion principle pursuant to art. 4 Dir. 2001/29 EC refers exclusively to the transfer of property of other real right and does not apply, therefore, to the grant of other exploitation rights.

In the case recently submitted to the Court, the Advocate General notices this particularity and with relation to the activity exercised by the Dutch company it states the following: « With said operation an image initially reproduced on paper is transferred on canvas, which implies an evident modification of the tangible support with relation to which the distribution of the painting works has been authorized. What distinguishes such a modification is the fact that with the transfer on canvas the image is not transferred on any whatsoever support, but precisely on a support of the same type of the one in which the original work is incorporated. Therefore, in my opinion, a question that could be made is if the right actually at play is the distribution right or, before it, the right of reproduction of the artwork in its entirety, as a whole constituted by an image incorporated in a determined support. In other words, it could be claimed that Allposters does not limit itself to distributing on paper an image originally incorporated in a canvas, but that it in fact reproduces the complete artistic creation. Ultimately, it does not commercialize the image of a painting, but rather an equivalent of the painting itself. Leaving apart this last observation (…) the answer of the Court has to limit itself to establish whether, under the circumstances of the present case, the modification made by Allposters implies a variation of the material support of such an extent as to involve at least a distribution of the works reproduced with respect to which the right guaranteed to Pictoright by article 4 of the directive 2001/29 has not been exhausted. In conclusion, I consider that, in the present lawsuit, the right of Pictoright to control the distribution of the reproductions of the works in words has not been exhausted with the first sale of the posters, since what Allposters intends to distribute is clearly «another thing», regardless of the circumstance that such «(an)other thing» has been obtained through the manipulation of said posters, this last one being a random circumstance that cannot be decisive.»