Data was famously described by The Economist as as the new oil. Every valuable asset tends to be protected by IP in some shape or form and data is no exception. It is usually protected by a combination of lengthy contracts, trade secrets/the law of confidence, copyright and/or database right. Unsurprisingly, it is also often the subject of litigation.
Technomed v Bluecrest  EWHC 2142 is a recent High Court decision about the rights in databases and the potential IP dangers, including copyright infringement, which can arise when a business relationship terminates.
This case is interesting for stretching the bounds of what can be protected as a database including a PDF and XML format reports.
Technomed supplies ECG equipment, systems and services using an internet-based ECG analysis and reporting system known as ECG cloud. ECG Cloud enables ECG readings to be analysed remotely as part of a screening service which flags up potential problems (via a traffic light system) for further investigation by cardiologists. Technomed developed the current version of ECG cloud in 2010.
In 2012, Technomed entered into an agreement with Bluecrest to provide health screening services. By late 2013, the relationship had soured and Bluecrest approached Express (its co-defendant) to take on Technomed's responsibilities. As the judge, David Stone (sitting as a Deputy High Court Judge), put it "whilst Bluecrest was working with Express to enable a switch to occur, it was also dissembling with Technomed". From early 2014, Express was in place as Bluecrest's new supplier. Technomed alleged that Bluecrest and Express continued to use and infringed, their copyright in various explanatory images and in the database which underpinned their services.
Database right is an infrequent visitor to the IPKat's pages but it is an important right in many businesses and it is worth a quick reminder of exactly what it is ... The EU recognised the importance of databases to modern business and back in 1996 it created a standalone (or sui generis) database right. This right protects the investment which is put into the database rather than the creation of the data itself.
Article 1(2) of the Database Directive sets out its scope: "For the purposes of this Directive, ‘database’ shall mean a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means."
The Court of Justice of the European Union (CJEU) clarified in Fixtures Marketing Limited v Organismos Prognostikon Agonon Podosfairou C-444/02 that this meant: "any collection of works, data or other materials, separable from one another without the value of their contents being affected, including a method or system of some sort for the retrieval of each of its constituent materials" .
Even if a database is identified, it does not necessarily follow that the database is protected by database right.
Database right subsists in a database where the requirements of Article 7(1) of the Database Directive are met. This means, "a database which shows that there has been qualitatively or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents to prevent extraction and/or re-utilisation of the whole or a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database."
Like copyright, database right arises automatically. The right lasts for 15 years. However, each time the database is substantially modified a new set of rights are created for that database. Therefore, provided the database is regularly updated it can theoretically be protected indefinitely.
Copyright in a database
A database can be also protected by copyright. Article 3(1) of the Database Directive explains that "databases which, by reason of the selection or arrangement of their contents, constitute the author's own intellectual creation shall be protected as such by copyright. No other criteria shall be applied to determine their eligibility for that protection."
There was some argument that the pictures and database were not sufficiently original to be protected by copyright. It was agreed that the test for originality for database copyright is higher than for literary and artistic works (Football Dataco Limited v Brittens Pools Limited  EWHC 841). Stone pointed out that "it is insufficient in a copyright case to claim that the copyright work relied on is generic" (see para 90 for a summary of the various ways in which this sentiment can be expressed). Instead, there are two questions to be asked:
Has the work been slavishly copied? "the usual course will be to adduce the text books that are alleged to have been copied, to show that they were both accessible and earlier, and then to point to identical or near identical images or passages from which the copyright work alleged has been slavishly copied."
Was there no more than negligible or trivial effort or relevant skill in the creation of the work? This, again, needs to be proved by cogent evidence, mindful of the low threshold set by the legislation as interpreted by the Court of Justice.
Can a PDF be a database?
The Defendants argued that a PDF can never be a database "on the basis that it is akin to a photograph of a database, rather than the database itself." However, the judge noted that, in practice, the PDF was used in no different way to a telephone book and "Individual Classifications are accessible, either by reading the pdf with the human eye, or accessing the spread sheet electronically." It took "many hours" to verify the information "through a process of audit and review" . Consequently "Technomed invested substantially in the presentation of the information...that investment was in the obtaining and verifying of the data, assessed qualitatively."
Bluecrest had provided Express with a complete copy of the PDF and it was then copied for the first and second versions of the Express database. By the third version, there had been sufficient changes for it to no longer infringe .
What about the XML formats?
Each XML file for each patient provided to Bluecrest contained an extraction from the database for the relevant patient. The judge accepted that because the XML format contained content as well as structure and was the product of its author's intellectual creation, copyright subsisted in the format.
Copyright in explanatory materials?
The explanatory materials were based on existing explanations of ECG monitoring but converted into more patient friendly language. Although there were some similarities with earlier cardiology documents, because the explanatory materials were "not a slavish" copy, they were entitled to copyright protection.
There were similar arguments about the "patient definitions" i.e. the written response which was delivered to patients following ECG readings. There are different ways of expressing the results (see para 20). They ranged from:
The "normal" resting heart rate sits in a range of 60 – 99 beats per minute. Your heart rate is within normal limits.
Congratulations, well done, your heartbeat is normal, keep eating an apple a day and getting regular exercise, this is tops!
Because "sufficient, non-negligible intellectual effort was expended"  in both versions this was sufficient for the patient definitions to be protected by copyright.
What about amended stock images?
The two hearts image and wave diagrams were based on stock images. However, both were amended to a sufficient extent to create a new copyright work. The addition of words to both diagrams did not mean that they could be discarded from the artistic work. As the judge put it: "given words are a common part of a diagram, a term expressly defined in the legislation to be a graphic work, I do not consider this issue to be in doubt. ... Both diagrams are clearly artistic works within the meaning of section 4 of the CDPA 1988" .
Was there infringement?
In short - yes. There was clearly copying in the first version as the copyright works were almost identically reproduced including some errors. Although the judge considered that on the evidence the third version had been copied, the level of copying was not sufficient for a finding of infringement .
The emails between Bluecrest and Express sealed their fate on flagrancy (see paras 38 and 39, for example). They showed that Bluecrest had been sent the XML format file and asked "let me know how long you think it would take to replicate the XML Format/trace pdf that I sent through". Some further documents were sent a few weeks later including the Two Hearts Diagram, the Wave Diagram, the Explanatory Materials, and a pdf document containing the Database.
The attitude that Bluecrest took to the negotiations with Technomed added further fuel to the fire, particularly this choice extract: "I will try to speak to [Mr Hashemi of Technomed] at 8.30ish to give him the impression we are going to agree to his terms, but need time to obtain the guarantees he's after (being ultra-nice to him and giving him a lot of bullshit) but in the background can we work to make the switch asap?"
Although both copyright and database right infringement was found, Technomed was not entitled to double recovery.
Witnesses with a conflict of interest
One of the issues which cropped up concerned an expert witnesses conflict of interest. The witness did not disclose that his company had been in a business relationship with one of the Defendants. This conflict of interest only became apparent in the course of cross examination. The judge, David Stone, noted that part of the reason for the conflict not being disclosed was that the witness "was clearly not properly instructed under Part 35". Instead, the witness wrote a letter which was turned into a witness statement by the legal team. This meant that it included the fairly standard statements regarding having read part 35 and a statement of independence both of which turned out to be inaccurate.
It did not appear from the judgment that a great deal turned on the particular witness' evidence in the end but this is a useful reminder of the importance of checking that witnesses are aware of their disclosure obligations and actually read the final form of their evidence before signature (and long before they end up in the witness box).