Developments in Open Source Law in 2021 in Germany: Higher Regional Court decides on copyleft clause

German courts made new rulings on Open Source licenses in 2021, such as the decision by the Karlsruhe Higher Regional Court dealing with the effect of the copyleft clause of the GPL-2.0. According to the Court, an infringement of the copyleft clause leads to the loss of the rights to use and modify this Open Source software. The infringement, however, does not entitle a third party to publish the source code of modifications of Open Source software on its own authority. The following article reviews this ruling.

Copyleft of the GPL-2.0

The GPL 2.0 grants anyone the right to run the software licensed under it: to distribute, copy, and modify it and to distribute modifications:

"You may modify your copy or copies of the Programme or any portion of it, thus forming a work based on the Programme, and copy and distribute such modifications or work under the terms of Section 1 above, provided that you also meet all of these conditions […]" (GPL 2.0 clause 2)

At the same time, the GPL-2.0 contains a copyleft clause for "protection". The copyleft clause ensures that each recipient of the software also receives the same rights in all derivative works of the software, with the consequence that the source code must also be published to the recipients of the software. Thus, clause 2 b) of the GPL 2.0 states:

"You must cause any work that you distribute or publish, that in whole or in part contains or is derived from the Programme or any part thereof, to be licensed as a whole at no charge to all third parties under the terms of this License."

The copyleft effect only applies to derivative works. It expressly does not apply to independent and separate works in themselves:

"If identifiable sections of that work are not derived from the Programme, and can be reasonably considered independent and separate works in themselves, then this License, and its terms, do not apply to those sections when you distribute them as separate works." (GPL 2.0, clause 2, Para. 2)

How to draw the line between a "derivative work" and an "independent and separate works in themselves" has always been controversial. As a result, the scope of copyleft is subject to many disputes.

Background to the proceedings

The plaintiff distributed pre-designed layouts (i.e. "themes") for the well-known content management system WordPress, which was developed as an Open Source project licensed under the GPL-2.0 that can be freely downloaded and used by anyone.

The plaintiff hired an agency to design new themes for WordPress in order to distribute it. The agency transferred the exclusive rights of use and exploitation to the themes to the plaintiff and he then offered the themes online for a fee using his own proprietary license.

The defendant threatened the plaintiff that it would make the source code of the themes freely available to everyone on the Internet and justified this on the grounds that themes also had to be licensed under the GPL 2.0 because they were derivative works of WordPress. Subsequently, the source code would have to be published due to the copyleft.

In order to prevent the publication of "his" themes, the plaintiff applied for an interim injunction to stop the publication of the source code of the themes. The interim injunction was granted and the parties disputed the matter before the Karlsruhe Higher Regional Court.

Assessment of the Court: GPL-2.0 does not grant everyone a right to publish

The Karlsruhe Higher Regional Court (judgement of 27.01.2021 – 6 U 60/20) addressed the question of whether, in the modification of WordPress by creating a theme, a right to publish the theme exists for a third party (to be examined in Germany pursuant to Section 69c No. 4 German Copyright Act) or whether the publication of the theme would constitute an act of infringement under copyright law.

There were two questions to be answered:

• First question: Is the theme a derivative work of WordPress (which is a question about the applicability of copyleft)? If this question is answered in the affirmative, the GPL-2.0 applies to the theme, which is sometimes (albeit misleadingly) referred to as the "viral effect".
• Second question: Can anyone publish the source code of a derivative work (i.e. in this case, the theme for WordPress) of GPL-2.0 software if the copyleft applies? (This question concerns the consequences of copyleft).

First question: Is a theme a derivative work?

The scope of copyleft has been long disputed. So far, there is no case law in Germany that can be used for specification.

Unfortunately, the Court also refrained from answering the first question on the scope of copyleft and left this question unanswered, since the publication of the theme would have been prohibited, regardless of whether the copyleft effect extended to the theme.

Even if the copyleft applies, the GPL-2.0 does not automatically extend to the theme. Therefore, the defendant would not have had the right to publish the source code of the themes in any situation (see the second question).

Second question: What are the consequences if the copyleft applies?

If the themes are derivative works, they would have to be licensed under the GPL-2.0 and their source code would have to be disclosed by the plaintiff to the recipients of the themes. According to the GPL-2.0, however, there is no automatic licensing of modifications to anyone. The Court stated:

"The plaintiff or its programmers have not consented to the granting of rights of use to the general public. An implied consent does not result from the assumed modification of the WordPress software, which is subject to the GPL license terms.

It may be inferred from the GPL terms and conditions that the authors of the original programme, by licensing it under GPL terms and conditions, at the same time give their consent, which may be required, to the licensing of a modification under the same terms and conditions, because the GPL terms and conditions provide that the rights of use of the modifier to the original programme are conditional on the fact that he also licenses his modification free of charge under GPL terms and conditions. However, the permissibility of the use of the modification by the general public under GPL conditions, insofar as the rights of the authors in the original programme extend to the modification, also requires their consent, which can obviously already be seen in the original consent to the modification of the original programme.

However, it cannot be inferred from the aforementioned condition for the granting of rights of use in the original programme that the modifier, by modifying the original programme, already grants a license to the modification under GPL terms or consents to such a license."

If the copyleft applies, the GPL-2.0 obliges the modification to be licensed under the GPL-2.0. A third party, however, cannot enforce this obligation. The GPL-2.0 is a license agreement that is only binding between the contracting parties, which have a mutual claim to compliance with the license. On the other hand, a third party – even in the event of a willful breach of the GPL-2.0 – cannot enforce compliance with the GPL-2.0. The Court stated:

"It is true that, on the basis of the condition discussed above, the modifier is obliged to make his modification freely available to the general public under the GPL as Open Source (so-called copyleft). However, it seems questionable whether an obligation to consent to the original authors follows from the condition, because according to this condition an infringement of the copyleft by the modifier only leads directly to the fact that he may not use the original programme and, under the conditions of Section 63c no. 2 German Copyright Act, also the modification".

The defendant – a third party who disliked the fact that the themes were not published under the GPL-2.0 – was therefore not entitled to publish the source code of the themes from the GPL-2.0.

Furthermore, the Court examined whether a possible co-authorship between the developers of WordPress and the developers of the themes would lead to a different result. In Germany, co-authorship exists if several persons have jointly created a work without their shares being separately exploitable. In this situation, they are considered co-authors of the work. (Section 8 (1) of the German Copyright Act). This is not per se excluded in the case of successive contributions to a work (e.g. the modification of an Open Source software).

According to the Court, the original developers of WordPress may have already granted rights to their co-authorship share (in a later modifications) to the general public. However, nothing could be derived from this for the other co-authors (i.e. the agency that was hired to develop the themes):

"It may be conceivable that a co-author can grant third parties rights of use to his share of the joint right without the cooperation of the other co-authors. Therefore, it is not excluded that the authors of WordPress, through the GPL licensing, have simultaneously granted the general public rights of use to their co-author's share in a subsequent modification of their original programme by others, insofar as they are entitled to co-authorship rights thereto. However, this does not result in a right of the third party to publish and exploit the joint work, because the co-author is likewise not entitled to such a right without the consent of the other co-authors."

It follows that the plaintiff would not have been authorised to publish the themes or to threaten to publish the themes. In any case, the publication of the source code would have required the consent of the plaintiff, to whom the rights to the themes had been transferred by the agency hired.

Further arguments of the Court

GPL does not lead to waiver of rights

A waiver of copyright as such is not possible under German law. According to the Karlsruhe Higher Regional Court, there was also no waiver of rights of use and exploitation in the present case. A waiver requires an express declaration. The plaintiff did not make such a declaration and, according to the OLG Karlsruhe, such a declaration does not result from the GPL-2.0:

"However, it has not been shown that the GPL provides for such a waiver of copyright or exploitation rights.

It is not sufficient for this that a modifier might be obliged to license the modification of an original programme licensed under the GPL freely under the GPL conditions, nor that he loses his resulting rights of use to the original programme in the event of a breach of this obligation under the GPL. It cannot be inferred from this with the clarity required for a waiver that the modifier of an open source software waives his own rights to modifications."

Even if one assumes an infringement of the GPL-2.0 (i.e. if it is a derivative work), the loss of the plaintiff's or the agency's copyright for it does not follow from this. The GPL-2.0 provides for a retroactive loss of rights only for the original programme, but not for the modification for which a separate copyright arises. The modifier does violate the GPL 2.0 on a contractual level since the modifier loses his right to modify the original programme if the modification is not licensed under the GPL-2.0. However, this does not result in a loss of the modifier's copyright on the modification:

"The loss of the rights of use resulting from the GPL in the event of an infringement of the conditions of the GPL only affects the rights of use to the original programme, but not also the rights to the modified programme originally created by the modifier as a result of the modification. Even if, as a result, the use of the modified programme by the plaintiff in relation to the WordPress programmers would no longer be lawful, his rights to prohibit third parties would remain unaffected. Whether the plaintiff has breached his obligations under the GPL therefore does not need to be considered in this respect."

If the agency's modification for the plaintiff is considered an independent and separate work, this result already follows from the fact that the author of the original software is not entitled to any rights in a modification (Section 3 sentence 1 German Copyright Act).

Dolo agit argument

The plaintiff's request to prohibit the publication of the source code of "his" themes by a third party was also not precluded by the objection of disloyalty (in Germany according to Section 242 of the German Civil Code). It is true that the GPL-2.0 does impose an obligation to publish the source code in the case of derivative works. According to the Karlsruhe Higher Regional Court, this objection would only apply to the authors of the original software since they granted the plaintiff rights to the original software in the expectation that the plaintiff, as a subsequent modifier, would also grant anyone a free license (as stipulated under the GPL-2.0) to his modification:

"A possible breach of loyalty would only exist vis-à-vis the authors of the original programme, who licensed the original programme under GPL conditions and allowed a modification and may have had the expectation that the general public would also be granted rights of use to the modification under GPL conditions. Third parties could not derive anything from this. Irrespective of this, the fact that a modifier of a programme licensed under the GPL does not make the modified programme available to the general public under these conditions does not constitute disloyal behaviour towards the authors of the original programme. Whether there is a breach of trust is to be assessed according to the overall circumstances. In particular, existing agreements between the parties involved must be taken into account.

As already explained, the fact that the modifier does not make the modified programme available to the general public under GPL conditions only leads, according to the GPL conditions, to the loss of the rights of use to the original programme. An infringement of the law would then lie solely in any further use of the original programme and (if the requirements of Section 69c no. 2 German Copyright Act are met) the modification, but not in the exclusion of third parties from using the modification. Against this background, enforcing the right to prohibit against third parties does not constitute a violation of good faith or an abuse of rights."

Conclusion: no viral effect

The contractual obligations under the GPL-2.0 only apply between the parties. Only the contracting parties can demand compliance from each other and assert claims in the event of a breach of the GPL-2.0. This right is not available to a third party, regardless of how serious the breach of GPL 2.0 may be.

Unfortunately, the Karlsruhe Higher Regional Court missed the opportunity to comment on the question of the scope of copyleft in this specific case. The question of whether themes are a derivative works of WordPress therefore remained unanswered. Legal practitioners and professionals could have been provided with further criteria, which would have been welcomed. The Court only made this rough assessment:

"However, there is much to suggest that the plaintiff's submission that his theme does not use any programme code from WordPress is technically correct. A closer examination, which would have to be carried out with the help of an expert, is not necessary for the decision of the dispute."

On the other hand, the Court makes the important decision that the consequences of a breach of a copyleft clause are limited to the sanctions specified in the license. In the event of a breach, the rights to the original software granted to the licensee under the GPL-2.0 are forfeited. On the other hand, there is no automatic licensing of modifications of the GPL-2.0 software. The Court thus rejects the notorious "viral effect" of the GPL-2.0.

For more information on this Open Source, contact your CMS client partner or local CMS experts Philippe Heinzke and Antonia Stoffers.