Dutch e-book resale site has to close for now, court rules

Tom Kabinet, which allows sellers to upload e-book files to the site, has been online since June last year. It asks sellers to verify that the e-books being uploaded were legally obtained, via a declaration in which they also state that they will erase their copy after the upload. That, however, is not enough, according to a court.

The verdict of the Amsterdam Court of Appeal is a mixed bag for Tom Kabinet, because it also ruled that it is legal to offer a platform on which legally obtained e-books can be resold. However, as Tom Kabinet also potentially provides a "relatively simple and lucrative opportunity" to resell illegally obtained e-books and has no way to guarantee this will not happen, the site will have to close for now, the court said in a news release.

However, if Tom Kabinet manages to take measures sufficient to exclude illegally obtained e-books from its website, it can ask the court to lift the ban, according to the ruling. The site has to comply with the verdict within three days, and if it violates the ruling, it has to pay a penalty of €1,000 (US$1,160) per day, up to a maximum of €300,000, the court ruled.

Judith Mariën, one of Tom Kabinet's founders, said that despite the mixed verdict, it is "good news" that the court ruled that the site's business model is essentially legal.

In the coming days Tom Kabinet will try to find a way to keep the site online by toughening up the process to filter out illegally obtained e-books, which can possibly be done by checking the digital watermarks of all incoming e-books as well as of those in the database, Mariën said.

"Let me be clear: We think this should be allowed. And we will continue until this works perfectly," she said.

The case against Tom Kabinet was filed by the Dutch Publishers Association (NUV) shortly after the site went live. They lost the case but appealed to the Amsterdam court. The court did not give the publishers everything they wanted, however. The publishers wanted a ruling saying that resale of even legally obtained e-books infringes on copyright, and should therefore be banned. The court did not grant such a ban.

Nevertheless, the publishers welcomed the decision in a news release in which they said the number of illegal e-books on the site was large. Even today, there are sellers who offer more than a thousand e-books via the platform, the publishers said.

The question of whether the resale of legally obtained e-books is legal in itself remains, however. Tom Kabinet argued that its activities are legal under a 2012 ruling by the Court of Justice of the European Union (CJEU) that permits the trading of "used" software licenses.

The Amsterdam court, however, said that it could not decide whether the so-called UsedSoft verdict also applies to e-books. The issue was not a matter for the appeals court to decide, it said, adding that the matter should be dealt with in a separate lawsuit in which the court dealing with the matter could, for instance, refer questions to the CJEU, asking if it thinks the UsedSoft verdict also applies to e-books.

Loek is Amsterdam Correspondent and covers online privacy, intellectual property, online payment issues as well as EU technology policy and regulation for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to loek_essers@idg.com