The ECJ Clarified the Concept of Pastiche: What This Means for Transactions Involving Music Assets
On 14 April 2026, the Court of Justice of the European Union (ECJ) delivered its judgment in Pelham v. Kraftwerk (C-590/23) and, for the first time, provided a detailed interpretation of the concept of “pastiche” within the meaning of European copyright law. For the M&A market, this judgment has direct practical implications.
Background to the case
In 1997, the production company Pelham GmbH used, in the song “Nur mir”, a two-second excerpt from the rhythmic section of Kraftwerk’s track “Metall auf Metall” (1977). The founders of Kraftwerk brought proceedings.
The dispute has been ongoing for almost 30 years and has given rise to two requests for a preliminary ruling before the ECJ. In its first judgment in 2019 (C-476/17), the Court held that sampling without the authorisation of the right holder may infringe the rights of the phonogram producer, unless the sample has been altered to the point of being completely unrecognisable.
After the pastiche exception entered into force in Germany in 2021 (implementing Article 5(3)(k) of Directive 2001/29/EC), a new question arose: does sampling fall within this exception, and what, in general, should be regarded as pastiche?
The ECJ’s position
The Court formulated the following definition: pastiche is a work that evokes associations with one or more existing works while differing noticeably from them, and that uses some of their characteristic elements, including by means of sampling, for the purpose of entering into an artistic or creative dialogue with them.
Such dialogue may take various forms: overt stylistic imitation, homage, or a humorous or critical statement directed at the original.
Of fundamental importance is that the Court established an objective criterion. It is not necessary to prove the author’s intention; it is sufficient that the “pastiche” character of the work is apparent to a person familiar with the original.
At the same time, the Court expressly stated that the exception is not a universal reservation for any form of creative borrowing. Hidden imitations and plagiarism do not fall within it.
Practical implications for business and M&A
1. Reassessment of IP risks relating to music catalogues
IP assets containing uncleared samples have traditionally been valued at a discount. Hip-hop and electronic music from the 1990s and 2000s are built on sampling, and a significant proportion of these samples have never undergone full rights clearance.
The ECJ’s judgment creates a new category: some samples may now be used lawfully on this legal basis. The risk is not removed automatically, but the approach to its assessment and allocation between the parties to a transaction changes.
What should be done:
- review the approach to the valuation of catalogues containing historical samples;
- identify disputed tracks as a separate risk category; and
- take into account the impact of the pastiche defence when structuring the transaction.
2. Updating IP due diligence
The standard IP checklist for music assets in the EU may need to be revised. For each item whose use may potentially be protected by the pastiche exception, a separate legal analysis is required: how persuasive the defence is, what the genre and artistic context is, and whether there is case law on similar situations
3. Revising warranties and representations
The standard wording in an SPA stating that all copyright-protected objects are used on lawful grounds may now be supplemented. In transactions involving music catalogues in the EU, a separate category of warranties may be added in relation to items where the seller relies on the pastiche defence. A separate issue is the allocation of risk if that defence does not withstand scrutiny in court.
4. Taking geographical location into account
The pastiche exception applies only in jurisdictions that have implemented Directive 2001/29, and Member States have implemented it differently. In the United States, the fair use doctrine applies; in the United Kingdom after Brexit, there is its own regulatory framework.
An asset that is lawful from the perspective of EU law may carry a separate risk in relation to the same catalogue before a US or UK court. In cross-border transactions, in particular where a European label is acquired by a US fund, a separate geographical breakdown will be required in the IP valuation.
5. AI companies
The judgment does not directly affect companies that train models on music content or develop products in the field of music generation. However, the argument concerning a “recognisable artistic dialogue with existing works” is already being actively developed in the legal positions of such companies. In due diligence of AI assets in the EU, this is a new factor that is still rarely taken into account in standard processes.
What comes next?
The German Federal Court will apply the ECJ’s test to the specific facts of the Kraftwerk case, and that decision will become the first practical reference point for practice across the European Union. The key question left open by the Court is who exactly constitutes a “person familiar with the original work” for the purposes of the objective test. Until settled practice develops, this criterion will be a source of disputes.
REVERA Polska’s conclusion
The ECJ’s judgment may affect the valuation of music catalogs, the structure of contractual warranties, and approaches to IP due diligence.
For businesses, this means a need to reassess existing transaction practices and adopt a more careful allocation of risks in deals involving music catalogs and digital assets.
Are you planning a transaction involving music assets in the EU? Contact REVERA’s lawyers for updated IP due diligence taking into account the Pelham v. Kraftwerk judgment.
Author: Inna Semenova
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