A German copyright law that gives publishers the exclusive right to the commercial use of their content online is unconstitutional according to Yahoo, which has filed a complaint with Germany's Federal Constitutional Court.
The law, which came into effect last August, gives publishers exclusive commercial rights over their content online except in the case of single words or small text snippets.
The exemption for small text snippets was added to allow search engines and aggregators to continue to show parts of news articles without infringing on copyright. However, publishers interpret the law differently and are demanding compensation from search engines.
The copyright law has been controversial from the start. A consortium of news publishers started legal action against Google in June, demanding a cut of the revenue it generates by publishing excerpts of news stories. They did so after Google declared it would not pay such compensation.
The publishers filed a similar complaint against Yahoo on July 1. Yahoo also showed no interest in licensing negotiations, making a legal process necessary, according to VG Media, the collecting society that acts on behalf of German news publishers.
"We believe that the Ancillary Copyright Law fundamentally violates our constitutional rights as a search engine operating in Germany and we hope the Court will find in our favor, and ensure that German users can benefit from the same breadth of information online as others around the world," a Yahoo spokeswoman said in an emailed statement.
Yahoo thinks that the new copyright law imposes an unconstitutional restriction on the freedom of information of Internet users because obtaining specific information from the Internet without the help of search engines is not feasible, Helge Huffman, general counsel of Yahoo Germany said in a statement published on Friday.
The German constitution requires the state to protect the freedom of information, including the structures that guarantee people can obtain information, Huffman said, adding that the new law is not compatible with constitutional articles that guarantee press freedom, occupational freedom and the principle of equality.
Moreover, Yahoo also finds the law too vague. Its vagueness leads to legal uncertainty, Huffman said.
As Yahoo is a digital media company as well as a search engine provider it wants to protect high quality journalism while it is also committed to fair competition in the search market, he said.
Loek is Amsterdam Correspondent and covers online privacy, intellectual property, open-source and online payment issues for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to loek_essers@idg.com