featured image

All questions

Overview

Technology-related litigation has increased in both number and importance in Brazilian courts in recent years. The jurisdictions related to more heavily litigated advanced technology markets are intellectual property (including patents related to specialized products and activities, such as telecommunications and devices), copyright, prevention of unfair competition (consisting of various types of claims arising from applicable to software and trade secret protection) and data protection, which is an increasing trend in Brazilian courts.

With the introduction of new technologies in telecommunications structures and equipment, there have been lawsuits related to standard essential patents and other types of patents, where the rightholders usually request a provisional injunction to immediately stop a company from producing, offering or sell products containing the protected technology.

In addition, unfair competition disputes can encompass a broad spectrum of claims, as the legal definition of unfair competition claims under Brazilian law includes the use of fraudulent means by a company with the aim of ripping consumers off a competitor. publishing false information that could damage a competitor’s image or brand, trade style violations (which are generally not considered trademark infringement in Brazil), and even the use of commercially sensitive information by a competitor or ex- employee of a company.

Typical fraudulent means include a company attempting to impersonate or associate itself with a competitor in order to confuse consumers, thereby illegally attracting customers, or to trick consumers into believing that the product or a competitor’s service is inferior or even harmful. For example, there has been a case where a mobile phone antivirus warned users that a competitor’s antivirus app was malicious (that is, contained a virus), causing users to remove the competitor’s product.

As will be explained in detail below, the number of lawsuits related to personal data has increased in recent years, especially since the Brazilian General Data Protection Act (LGPD)2 entered into force in August 2020. Individuals, associations and public bodies are already filing charges under the provisions of the LGPD to stop companies from collecting or processing certain personal data, to obtain compensation or to have companies take action to comply with the LGPD , among other purposes.

In addition, with regard to civil society organizations, there has recently been a significant increase in the number of collective actions of these types of entities against technology companies, especially those that manufacture and sell devices such as mobile phones, or those that develop or offer applications or app stores where users buy or obtain apps for their devices.

Some examples include lawsuits filed by civil associations that question the “freemium” model of app and game distribution, where customers download an app or game for free and then make purchases within the app itself. Some have questioned the methods of making these in-app purchases (particularly after news reports that unsupervised children using mobile phones or tablets could make such purchases) and the loot box model for mobile games.

In addition, there are many lawsuits in both civil and criminal fields related to requests for data, content or disclosure of information when the data is stored on servers (which may be physically located in Brazil or abroad) or within applications. It is common for law enforcement agencies and for claimants to request subscription information or other types of data from customers contracting cloud-related services – especially from large corporations – or even content related to websites, systems or cloud storage from Internet application providers.

Certain law enforcement authorities have the authority to request customer subscription information (including only name and identification information, address and names of parents), but Internet service providers are only required to disclose other types of identifying information, such as Internet Protocol (IP) addresses, upon receipt of a valid court order from a judge, in accordance with the provisions of the Brazilian Civil Rights Framework for the Internet,3 Decree No. 8.771/2016 and Law No. 12.850/2013. If a specific company does not collect certain types of subscription data, it is not obligated to make its data public.

Authorities and plaintiffs may also request the removal of websites or other content that is deemed infringing. Such requests are often directed to Internet application providers, which may be a hosting company, a social media company, or any other company that enables users to generate and publish content through apps, websites or other online services, and not to the users or customers using the allegedly created and published infringing content.

To address this issue, the Civil Rights Framework for the Internet has created an explicit safe harbor provision under which the civil-law internet application provider can only be held liable for infringing content if, upon receipt of a valid court order to material, the provider does not take the appropriate measures to comply with the removal order to the extent possible under the limitations of its service. The civil rights framework for the internet states that the safe harbor provision does not apply to copyright infringement claims, which are to be governed by a separate law (to be passed), but there are already court rulings stating that the internet application provider must at least be made aware of the alleged copyright infringement before he can be held liable for it, otherwise his business model could not even exist as he could be held liable for any type of copyright problem caused by his users .

For this reason, companies that use social media applications, such as Meta or ByteDance, or companies that provide hosting services, such as AWS, Microsoft, or Google cannot be held generally liable for user-generated content unless they do not take appropriate action to remove content upon receipt of a court order. However, depending on the service provided by the company, it may be impossible for the company to remove specific content or to remove it without disruption that would negatively impact other content, which is a defense argument that is made in cases like this. is used.

The same defense (with regard to the technical inability to comply with a court order) is used by companies whose services include end-to-end encryption. For example, while it is becoming less common, there are still judges ordering WhatsApp to make users’ private conversations public. accessible via WhatsApp, but only to the people involved in the conversation). Brazilian courts are increasingly recognizing this particular aspect of certain services and applications as a benefit to users and a valid defense for such requests.

Finally, audio and video streaming services have also seen an increase in the number of different types of claims being litigated. The Brazilian Central Bureau of Collection and Distribution (ECAD), the national copyright collection agency under the Brazilian copyright law4 and Decree No. 9.574/2018, is very active in negotiating agreements with companies that provide streaming services, such as Netflix, Spotify, Google (YouTube), Amazon (Prime Video and Amazon Music) and many others, as well as filing lawsuits against companies that do not pay collective royalties for streaming musical works or for musical works embedded in audiovisual works. This is especially true after a 2017 Supreme Court precedent recognized the internet as a public space and streaming as an act that involves the payment of royalties for public performances. Rightsholders of audiovisual or musical content are also increasingly suing streaming companies that claim their works are being exhibited without permission and there have been instances where individuals depicted in such content have sued alleging that they never gave permission. to showcase the content.