Recently, the Intellectual Property, Competition, Regulation and Supervision Section of the Lisbon Court of Appeals unanimously ruled on an appeal in a dispute regarding the construction of a water park.
In this case, the plaintiff company filed an injunction for the defendant company to be immediately prohibited from continuing to execute, through third-party contractors, the architectural and specialty plans described in the contract for the preparation of studies and plans and for the refurbishment, restoration, installation and expansion of the water park in question (the “Contract”). The appellant—a company that produces, designs, installs, markets and exports leisure and sports equipment for children—argued that the appellee could not continue working on the water park with a third company, as the plans the appellant had drawn up were protected by copyright and the amounts owed for these plans had not been paid.
The Lisbon Court of Appeals ultimately decided to dismiss the appellant’s requests, considering the appeal inadmissible and upholding the contested decision. The underlying discussion in this case and the considerations the court made about copyright are of particular interest.
In the appeal, the appellants sought to defend their alleged copyright protection for “architectural plans and water park equipment.” In their view, both the architectural plans and the water park equipment should be included as architectural artworks under article 2.g) and article 2.l) of the Copyright and Related Rights Code (CRRC).
They argued that (i) all the works produced by the appellant are protected by copyright; and (ii) the proprietary content of these rights was never transferred to the appellee, and that these rights would only be transferred when the services included in the Contract were paid in full.
Both the first instance court and the court of appeals took the following view:
- First, based on the evidence the appellant provided, the originality required for the water park equipment to be protected by copyright protection rules (CRRC) cannot be considered to have been proven. Therefore, it is not considered to be protected by copyright.
- Second, regarding the transfer of the economic content of the copyright, the first instance court considered that the transfer of ownership of the copyright of the architectural works was contingent solely on the payment established in the agreed payment plan. It was not contingent on the full payment of the amounts agreed under the Contract, which included other services such as the refurbishment, repair and expansion of the water park, the design, repair and installation of new water park equipment, and the coordination of the work necessary for these purposes. Despite the appellants’ arguments, the court of appeals took this reasoning further, holding that the payment schedule stipulated in the Contract clauses enabled a correlation to be established between each payment and the different construction work and plans envisioned in the Contract. Therefore, the transfer of the copyright arising from the Contract occurs in correlation with the payment of each of the above concepts. When we also consider that the water park facility itself is not considered protected by copyright, we can conclude that if the specific payments for architectural plans—which are indisputably protected by copyright law—were made, these rights were transferred.
Based on all these reasons, the Lisbon Court of Appeals decided to dismiss the appeal.
Conclusion: This ruling is particularly interesting because (i) it specifies that not all visual artworks are protected by copyright and that originality is required; and (ii) it clarifies that the financial rights arising from copyright can be individually transferred without necessarily considering the totality of the services and amounts agreed in the respective contract.