In a judgment laid down on 16 February 2012 in the Case 360/10 Sabam v. Netlog, the Court of Justice of the European Union (CJEU) ruled that EU national courts cannot issue injunctions forcing social networks to monitor their sites for illegal file-sharing because such injunctions would not strike a fair balance between the rights of intellectual property holders, on the one hand, and the rights of social network users to privacy and freedom to receive or impart information, on the other.

The ruling was a response to a request for a preliminary ruling by a Belgian court in a case involving music royalties collecting society, SABAM, and a social networking platform, Netlog.  SABAM had claimed that Netlog’s platform was being used to make music and audiovisual copyright works available to the public without SABAM’s consent and without Netlog paying it any fees.  SABAM sought an injunction under European copyright laws that would have required Netlog to introduce a filtering system to monitor illegal file-sharing by its users. 

The Belgian court referred the case to the CJEU asking the Court to rule whether the fundamental right to privacy and freedom of expression, which are enriched in the EU Charter of Fundamental Rights, would prevent national courts from issuing such injunctions.

The CJEU held that a system, which would filter most of the information which is stored on a social network’s servers in order to identify and block on its servers electronic files containing copyright works, would not only result in a serious infringement of the freedom to conduct business, but would also infringe the social network users’ right to privacy because such system would involve the identification, systematic analysis and processing of personal data connected with the user profiles.  The injunction could also potentially undermine the freedom of information since the filtering system may not have adequately distinguished between unlawful content and lawful content — possibly resulting to the blocking of lawful communications.

While the EU Charter of Fundamental Rights also provides for the protection of intellectual property rights, the CJEU stated that such protection is not inviolable and does not have to be absolutely protected.  In fact, the fundamental right to  intellectual property must be balanced against the protection of other fundamental rights.  The CJEU concluded that an injunction that would require a social network to filter user communications would not struck a fair balance between the right to intellectual property, on the other hand, and the social network’s freedom to conduct business as well as the users’ right to protection of personal data and the freedom to receive or import information, on the other.