Application of UK database rights to forking and blockchain technology

This article was first published on Dr. Craig Wright’s blog, and we republished with permission from the author.

May 21, 2023

Note: the author disagrees with the terminology of cryptocurrency, but has utilized the same terminology based on the definitions used by the authors of each paper.

Annotated Bibliography

This analysis explores the application of U.K. database rights in the context of ‘forking’ and blockchain technologies. It examines the legal framework surrounding database rights under U.K. law, analyzes the challenges posed by forking in the context of database rights, and discusses the implications of blockchain technology on the protection of databases. The study concludes by highlighting potential legal considerations and providing recommendations for policymakers and stakeholders in navigating the complex intersection of U.K. database rights, forking, and blockchain technology.

Stokes (2019) comprehensively examines copyright law in the digital age relevant to database rights and open-source development. Stokes explores the legal framework surrounding database rights, and analyzes their interaction with open-source practices. The book delves into the complexities of protecting databases, the rights of database creators, and the limitations and exceptions to database rights. Stokes also discusses the challenges and opportunities presented by open-source development concerning copyright law, including licensing open-source databases and balancing intellectual property protection and collaboration. With its focus on digital copyright, the book provides valuable insights into the legal landscape concerning database rights and their implications for open-source development.

Trump et al. (2018) present a paper that sheds light on the complexities and challenges of governing cryptocurrencies, considering the decentralized and ungovernable nature of such systems. In addition, it provides insights into the various governance mechanisms employed within the cryptocurrency space and emphasizes the importance of effective governance for the long-term viability and acceptance of cryptocurrencies. Yet, as new systems are created, and database rights are already regulated, the argument for or against the ability to regulate hard forks and hence the open-source nature of blockchain systems can be argued to exist within the current legal framework.

Broos and Jans (2020) comprehensively examine the legal implications surrounding blockchain technology. The paper explores various applications of blockchain technology, and analyzes the legal challenges and considerations associated with each use case. The authors delve into topics such as smart contracts, digital currencies, supply-chain management, and data protection within the context of blockchain technology. They discuss the legal implications of such applications, including regulatory compliance, privacy concerns, intellectual property rights, and contractual issues. The paper aims to provide a legal framework and guidance for practitioners, policymakers, and researchers navigating the legal landscape of blockchain technology and its applications.

The papers cover the intersection of copyright, blockchain technology, and digital property. Such sources provide valuable insights into the evolving legal landscape in the digital age, and emphasize the need for appropriate regulatory frameworks to address the challenges posed by technological advancements. Brauneis and Schechter’s (2022) scholarly paper on copyright highlights the complexities of copyright law in the digital era, and advocates for a contemporary approach to regulation. Broos and Jans (2020) explore the legal implications of blockchain applications and the potential conflicts that arise from integrating blockchain technology with existing legal frameworks.

Samuelson and Hashimoto’s (2019) article raises thought-provoking questions about the digitized property and the need for appropriate legal frameworks to address the complexities of assets in the digital realm. Finally, Stokes (2019) provides a comprehensive overview of digital copyright law, addressing practical aspects such as infringement and licensing.

The case of The Newspaper Licensing Agency Ltd & Ors v. Meltwater Holding BV & Ors [2011] EWCA Civ 890 highlights the importance of adhering to database access terms and the legal implications of unauthorized copying. It also reminds us that commercial applications sold for value can still be subject to legal regulations, even in open-source blockchains. Lastly, Trump et al. (2018) discuss the governance of cryptocurrencies and the need for regulatory frameworks to ensure their stability and security.

The sources underscore the significance of navigating the complex legal landscape in the digital age. The synthesis of the works emphasizes the need for updated copyright regulations, the exploration of legal implications in blockchain technology, the establishment of appropriate frameworks for digitized property, and the governance of emerging technologies such as cryptocurrencies. Understanding the interplay between technology and the law is crucial for fostering innovation, protecting intellectual property, and ensuring the proper governance of digital assets.

The analysis and synthesis of the selected sources provide valuable insights into the complexities of copyright, blockchain technology, and digital property. In addition, the works shed light on the evolving legal landscape in the digital age and emphasize the need for appropriate regulatory frameworks to address the challenges posed by technological advancements.

Annotated Bibliography

Stokes, S. (2019). Digital Copyright: Law and Practice. Bloomsbury Publishing.

Stokes (2019, p. 86) notes that “fair dealing and moral rights provisions in the CDPA do not apply to the database right”. Stokes (2019) highlights an essential aspect regarding the interplay of fair dealing and moral rights provisions with the database right under the U.K.’s Copyright, Designs, and Patents Act (CDPA). Expressly, it is noted that these provisions do not extend to the database right, signifying a distinction between the treatment of database rights and copyright. However, despite this limitation, the CDPA provides certain exceptions to the exclusive rights granted by the database right. These exceptions balance the rights of the database creators with the needs and interests of users.

One exception is the allowance for extracting and re-utilizing insubstantial parts of a database for private purposes. This exception permits individuals to extract and use small portions of a database for personal use without infringing on the database creator’s rights.

Another exception pertains to the extraction and re-utilization of insubstantial parts of a database for the purposes of criticism or review. This exception permits individuals to analyze and discuss the content of a database within the framework of fair dealing, facilitating scholarly or critical assessment of the database.

Additionally, the CDPA allows for the extraction and re-utilization of insubstantial parts of a database to report current events. This exception recognizes the importance of using database content in news reporting or journalism, enabling the dissemination of timely information to the public. Next, the CDPA provides an exception for extracting and re-utilizing insubstantial parts of a database for educational purposes. This exception recognizes the value of using database content in academic settings, such as teaching, research, or private study. Notably, these exceptions are specific to the database right itself and should be distinguished from copyright law. The underlying works or materials in the database may be subject to different copyright protections, which may have their exceptions and limitations.

In summary, while the fair dealing and moral rights provisions may not directly apply to the database right, the CDPA does provide limited exceptions that allow for the use of insubstantial parts of a database for private purposes, criticism or review, reporting current events, and educational use. These exceptions strike a balance between the rights of the database creator and the interests of users, ensuring a reasonable level of access and utilization of database content within specific contexts.

In a blockchain context, where the blockchain is recognized as a database, and the creator holds rights over it, the issue of an unauthorized copy being used to fork the database raises complex legal considerations.

When a blockchain is forked, a new branch or version of the blockchain is created, typically forming two separate and distinct chains. The fork can be either hard or soft, with different implications for the database rights of the original creator. In the case of a hard fork, where there is a substantial divergence, and the new chain operates independently, the question arises regarding the rights of the original creator over the forked database arises. Since the blockchain is recognized as a database, the creator may hold exclusive rights over the initial database, including rights of extraction, re-utilization, and control over derivative works. Consequently, the unauthorized copying and forking of the database could potentially infringe upon the creator’s rights.

It is crucial to consider factors such as the applicable intellectual property laws, contractual agreements, open-source licensing, and the decentralized nature of the blockchain ecosystem.

Additionally, open-source development within the blockchain community introduces further nuances. If the original database was developed under an open-source license, the terms and conditions of that license could impact the rights and permissions granted to users and developers. Open source licenses often involve sharing, modification, and distribution rights that could influence the legality of forking and the use of the forked…