User:RobbieIanMorrison/sandbox/work in progress eW4bo3

• target: open source copyright litigation
• text: as below
• status: T R A N S F E R R E D
• section: Geniatech v. McHardy (2018)

Geniatech v. McHardy (2018)

The Geniatech v. McHardy case, heard by the Higher Regional Court of Cologne (OLG Köln), Germany in 2018, was the culmination of a string of abusive litigations by Linux kernel developer Patrick McHardy concerning the non‑compliance of GPL licensing terms (version 2) by a number of Linux distributors. After the bench outlined their understanding of the case, McHardy elected to withdraw all extant proceedings, and the bench then duly awarded all costs to McHardy — in what is seen as a substantial victory against copyright trolling by many in the open source community.

For about a decade, McHardy had contributed to the development of the Netfilter subsystem that provides network‑related operations to the Linux kernel. Geniatech Europe GmbH is the Germany‑based representative of consumer products manufacturer Geniatech, headquartered in Shenzhen, China. The actual devices in question are a series of satellite TV receivers manufactured by Geniatech that employ the Linux operating system.

Specifically, the Cologne court advanced the view that McHardy is not a co‑author of the Linux kernel nor of Netfilter and that although McHardy might have rights in derivative works, he did not provide sufficient evidence of the copyrightability of his contributions. To be protected, such contributions need to represent the intellectual creation of the developer, which necessarily excludes most if not all maintenance programing. The court also opined that McHardy may have misused any rights he may hold, but noted that this matter would require further analysis. In addition, Geniatech made substantiated claims in filings that McHardy primarily performed his enforcement activities to seek monetary gain and not license compliance.

McHardy's strategy was to approach a commercial entity with minor GPL violations — such as attribution deficiencies, lack or inadequacy of a written offer for source code, or an EULA conflicting with the GPL license — for the sole purpose of obtaining an undertaking to cease and desist from further infringing activity and including a clause imposing contractual payments on any future infringements. German law admits such penalties to €250000 per violation, so the sums involved can be substantial. While the initial demands appeared modest, once McHardy has secured a contractual remedy he sought to uncover further violations and repeat the process while increasing the penalties. And because his cease and desist declarations may likely have required non‑disclosure, it was difficult for defendants to band together and resist. This business model was both enabled by and tailored to the specifics of the German legal system. It is believed that McHardy approached around 80 companies over license non‑compliance and may have netted two million euro or more while active.

Markus von Welser, who represented Geniatech at trial, argues that McHardy's litigation was an abuse of law and outlines defensive strategies for companies that find themselves subject to this kind of copyright profiteering.

In early‑2022, the Netfilter project announced that a legally‑binding settlement between Patrick McHardy and three members of it core team had been reached. The settlement document from the District Court of Mannheim is public.