Nova Productions Ltd v Mazooma Games Ltd & Ors

Factual and Procedural Background

This opinion concerns an application for a preliminary reference to the European Court of Justice (ECJ) in the context of pending appeals brought by the Appellant, Company A, against two Defendants, Company B and Company C. Company A alleges that the Defendants infringed their copyrights related to their computer game "Pocket Money." Specifically, Company B's alleged infringement is titled "Jackpot Pool," and Company C's is "Trick Shot."

The initial claims relied on various types of copyright works, including "artistic works," "literary works," and "dramatic works." The trial judge rejected all claims in both actions and granted permission to appeal. The Appellant has since abandoned the claim based on "dramatic works," so the appeals now focus solely on "artistic" and "literary" works.

The Appellant seeks a preliminary reference to the ECJ on a question of European law relating primarily to the "literary works" claim, arguing that this question is critical to the appeal and "necessary" for resolution. The court had formed a clear view that the application for reference should be refused and provided reasons for this decision.

Legal Issues Presented

1. Whether the national court should make a preliminary reference to the European Court of Justice on the interpretation of European law concerning the protection of computer programs as "literary works" under the Software Directive 91/250.
2. Whether "preparatory design material" is included within the scope of protected "computer programs" as literary works under the Directive and relevant UK law.
3. Whether the alleged infringement by the Defendants involved the taking of a substantial part of the literary work (computer program) or merely the taking of unprotected ideas and principles.
4. Whether the test of "necessity" for making a preliminary reference under Article 234(2) of the EC Treaty is satisfied in this case.

Arguments of the Parties

Appellant's Arguments

• The Appellant’s main argument relates to the classification of computer programs as "literary works" under European law and the Software Directive.
• The Appellant contends that the Directive expressly includes "preparatory design material" as part of the computer program, which should be protected, and that the trial judge erred in discounting this material.
• If "preparatory design material" were properly considered, the Appellant argues that the Defendants’ actions would amount to taking a substantial part of their computer program.
• The Appellant submits that the question of European law is so critical that a preliminary reference to the ECJ is "necessary" to resolve the appeal.
• The Appellant indicated willingness to abandon the artistic works claim if the ECJ ruling were unfavorable on the literary works claim.

Table of Precedents Cited

Court's Reasoning and Analysis

The court began by acknowledging the legal framework under Article 234(2) of the EC Treaty, which allows a national court discretion to make a preliminary reference only if it considers such a decision necessary to give judgment. The court adopted a broad test of necessity, whereby a reference is justified if one possible answer would be dispositive of the case.

However, the court identified several reasons why a reference was inappropriate at this stage:

• There is a real prospect that the Appellant will fail on the facts regardless of the legal interpretation.
• The court could, if necessary, make its own reference later in the proceedings with a more precise formulation of questions and suggested answers, as encouraged by the ECJ.
• A reference now would cause substantial and unnecessary delay, potentially extending the case resolution by several years.
• There is no clear evidence of substantial cost savings from making the reference at this stage.

The court also considered the nature of the legal point sought to be referred, noting that the parties had not agreed on the precise questions to be asked, indicating insufficient clarity for a reference. The court reviewed the factual findings that the Defendants did not copy the program code or architecture but only took generalised ideas, which are expressly not protected under the Directive.

The court further noted that whether something is a mere "idea or principle" is a question of fact, not law, and the appeal might be resolved without any issue of European law arising. The court emphasized that it would be in a stronger position to frame precise questions and offer reasoned answers if a reference became necessary later.

Finally, the court addressed pragmatic considerations, including the time expected for the ECJ to decide a reference (potentially much longer than the 18 months suggested by the Appellant) and the minimal difference in costs between a direct appeal and a reference.

Holding and Implications

The court REFUSED the Appellant's application for a preliminary reference to the European Court of Justice at this stage.

This decision means that the pending appeals will proceed without immediate involvement of the ECJ, allowing the national court to resolve the issues based on domestic law and facts. The court left open the possibility of making a reference later if the need arises with clearer questions and a better-defined legal issue. No new precedent was established by this decision beyond the exercise of discretion regarding preliminary references.