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German Media Newsletter, April 2017

April 2017

German Government Passes Disputed Draft of “Act Improving Law Enforcement on Social Networks”  

On April 5, the German government passed (in German only) the draft of an Act Improving Law Enforcement on Social Networks (Netzwerkdurchführungsgesetz – NetzDG, in German only), which aims to restrict hate speech and "fake news" on social networking sites. The draft seeks to enforce already existing offenses and to improve take-down processes of content punishable under German criminal law (e.g., incitement of the people, defamation) by directly addressing social network providers. To this end, the draft subjects social networks to a number of new obligations, inter alia filing of a quarterly report on the network’s handling of complaints, deleting “blatantly criminal” content within 24 hours and all other illegal content within 7 days, deleting all copies of illegal content available on the network, documenting illegal content in order to provide evidence for criminal procedures, and informing the user and the complainant about decisions taken (and their reasons) in the complaint process. Social networks failing to comply with the imposed obligations (deliberately or negligently) risk fines of up to EUR 5 million.

While it is generally recognized that hate speech and related phenomena need to be targeted, the draft now proposed was met with criticism from industry associations, civil rights activists, and practitioners. The criticism focuses on the draft's vague wording – in particular, the scope remains unclear, with the term "social network" defined very broadly –, the resulting risk of over-blocking by networks, and its potential effect on free speech. Some also think (in German only) that the draft disregards rules of European law, like the country of origin principle. It remains to be seen what the European Commission's view will be, to which the draft was notified (with an English summary) on March 27. 

German Federal Supreme Court Ruling on the Liability of Providers of Online Review Portals 

On April 4, the German Federal Supreme Court (Bundesgerichtshof) held (in German only) that reviews made by users on a review website are deemed the website provider’s opinion and, therefore, will be attributed to the provider if he deletes or changes parts of the reviews, especially without prior consultation with the authors and uploading users.

In the underlying case, the plaintiff’s ENT clinic had been poorly rated by a patient based on incorrect facts on the defendant’s review website. The plaintiff requested that the defendant remove the review from the website. The German Federal Supreme Court confirmed the lower courts’ findings and the defendant’s liability as a third party (Störerhaftung) to cease and desist. Since the defendant took responsibility for the content of the review, and not only examined but also edited it without prior consultation with the uploading user, the Court held that the defendant appropriated the review in question and is therefore liable for its contents.

Update: German Film Fund DFFF Expecting Substantial Increase to 125 Million Euro

After the German Federal Government Commissioner for Culture and the Media, Monika Grütters, had announced on February 9 an increase of the German federal film fund DFFF by 25 million Euro (press release in German only) and had indicated further increases for 2018, such additional increases have now begun to take form. The draft budget for 2018 passed by the German government on March 15 provides for a substantial increase of the DFFF from its current 50 million Euro to a total of 125 million Euro per year (for 2018 and the following years).
The 75 million Euro increase would include the initially announced increase, and would go to a new scheme within the DFFF (so-called "DFFF II"), available from summer 2017 and aimed specifically at major international and VFX-heavy theatrical productions. Serial projects will, however, remain excluded from the DFFF. Further details remain to be determined, and the increase as part of the government's draft budget for 2018 is still subject to being confirmed in the final budget, which will only happen after the German elections this fall. Upcoming production projects currently looking at funding opportunities should certainly keep an eye out for further news and developments. Please also see our brochure on the DFFF and other German subsidy schemes for film production.  

Update: Berlin High Court Decision Granting Subsequent Compensation for Johnny Depp's Dubbing Actor in "Pirates of the Caribbean" Becomes Final  

A June 1, 2016 decision (in German only) by the Berlin High Court (Kammergericht) awarding dubbing actor Marcus Off subsequent compensation for his work as the German voice of "Captain Jack Sparrow" in the "Pirates of the Caribbean" films (I-III) has taken legal effect and become res judicata. The Berlin High Court held that Off as the dubbing actor is entitled to subsequent compensation from two Disney entities exploiting the films in theaters and through DVD/VoD. The Court argued that there was an evident disproportion between the originally agreed compensation for his work of approximately EUR 1,300 to 4,000 per film and the films’ reported total gross revenues of approximately EUR 140 million in German-speaking markets. In its judgment, the Berlin High Court outlined a detailed model for calculating subsequent compensation taking into account viewing numbers from theaters, home entertainment, and downloads, and awarded Off an additional compensation of approximately ten times the originally agreed amount (EUR 67,314.77 in total, equivalent to a little less than 0.05 percent of reported gross revenues of the films).

While the defendants appealed the Berlin High Court’s decision, the petition to appeal has, on March 30, now been finally rejected by the German Federal Supreme Court (Bundesgerichtshof), rendering the Berlin High Court's award of subsequent compensation final after a decade of proceedings.