Providing links on net poses legal pitfalls

By EARL GRAY and LIANNE YOUNG

Hyperlinks, the foundation on which the internet's worldwide web builds its tremendous communicative force, are under attack.

Many industry voices are claiming that the use of hyperlinks may infringe intellectual property rights. This area of law, like so many internet-related legal issues, remains unsettled in New Zealand and overseas.

Hyperlinks are pieces of "live" text or graphic images found on many websites. With a single mouse click on these links, the user's computer downloads the new web page on to the screen.

Reasons for the attack are:

To protect intellectual property, such as trademarks and copyright material, from unauthorised use.

To prevent users from being misled as to associations between the two linked websites.

Concern raised by "deep linking" (a hyperlink which takes the user to a web page deep inside another website, bypassing its home page, other pages and often advertising from which the owner of the other site could generate earnings).

Under New Zealand law, providing a hyperlink to a third party's website may contravene copyright, trademark and passing-off laws or breach the Fair Trading or Commerce Acts.

Under copyright law, a hyperlink which contains a single word, short phrase or website address will probably not infringe copyright.

Infringement is more likely when the hyperlink contains a graphic or other more substantial wording, neither of which was created by the owner of the site containing the hyperlink.

The creator of that graphic or those words will often have copyright protection for that material. Under New Zealand law, if the hyperlink amounts to an unauthorised copying of a substantial part of those copyright works, it will be a breach of copyright.

Breach of copyright may also occur whenever a website, which contains copyright-protected material, is accessed via a hyperlink, because the material is duplicated on the user's screen. This may mean the owner of the site containing the hyperlink is liable because it has authorised the copying by the user.

A breach may also occur if a third-party website falls within the legal definition of a "cable programme service."

If the hyperlink contains a registered trademark it might constitute infringement under the Trade Marks Act if used in relation to the same or similar goods. Under the Fair Trading Act and the law of passing-off, a hyperlink containing a trademark could misrepresent that there is an association, endorsement, sponsorship or approval between the owners of the two websites being linked.

Hyperlinking could also breach the Commerce Act if the two websites being linked have contractual or collaborative arrangements (for example, referral fees or royalty payments) and the linking amounts to anti-competitive behaviour.

These issues have not yet been considered by New Zealand courts.

Adding to the debate are claims by British Telecommunications (BT) that it is the owner of a US patent for hyperlinks.

BT's patent still has six years to run in the United States but has expired in other countries.

* Earl Gray is a partner and Lianne Young is a senior associate in Simpson Grierson's intellectual property group.