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Internet service providers ordered to block websites selling counterfeit goods

This follows a recent ruling at the English High Court: Richemont International SA (and Others) v British Sky Broadcasting Limited (and Others) [2014] EWHC 3354 (Ch)

In this case Richemont (the owner of the Montblanc and Cartier trade marks among others) and two subsidiaries applied for an injunction against the five major UK internet service providers (ISPs) (BSkyB, BT, EE, TalkTalk and VirginMedia) who together provide 95% of internet services in the UK. The injunction was to force the ISPs to block certain websites solely advertising and selling counterfeit Richemont products; for example www.cartierlove2u.com.

The case was recognised by the Court as a test case and was thought to be the first case in the EU which related to a request that ISPs block websites on trade mark grounds (with the possible exception the Court noted of a case in Denmark).

The judge, Mr Justice Arnold, stated that the application raised five main questions:

  1. Does this Court have jurisdiction to make an order of the kind sought?
  2. If the Court has jurisdiction, what are the threshold conditions, if any, which must be satisfied if the Court is to make an order?
  3. Are those conditions satisfied in the present case?
  4. If those conditions are satisfied, what are the principles to be applied in deciding whether or not to make such an order?
  5. Applying those principles, should such orders be made in the present case?

Counsel for Richemont argued that Article 11 of the Directive on the Enforcement of Intellectual Property Rights (2004/48/EC) gave an intellectual property right-owner the general right to “apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right”; even though no corresponding section has been transposed into English law.

It was further noted that the Courts have inherent jurisdiction (s37 of the Senior Courts Act 1981) and therefore have the right to grant an injunction if it is “just and convenient to do so”.

Richemont also argued that the Court was compelled to give effect to Article 11 (and thus grant the injunctions) under the Marleasing doctrine (i.e. that national courts are under a duty to interpret national law in a way that gives effect to European law).

Mr Justice Arnold granted the order sought by Richemont requiring the ISPs to block the offending websites.

The argument raised by the ISPs that complying with the order would be unduly burdensome and costly was rejected. Drawing on the comments of Buckley LJ in Norwich Pharmacal Co. v Customs & Excise Commissioners (1974) he stated:

“It is not a long step from this to conclude that, once an ISP becomes aware that its services are being used by third parties to infringe an intellectual property right, then it becomes subject to a duty to take proportionate measures to prevent or reduce such infringements even though it is not itself liable for infringement.”

Roy Crozier, partner in the Intellectual Property Group said: The decision is a welcome recognition of the problems brand-owners face when dealing with the reality of online counterfeiting where infringers are often based outside of the EU and are very difficult to identify. However, obtaining injunctive relief is expensive and counterfeiters readily move from website to website as and when their listings or accounts are removed, or in this case when access to a website is blocked. As such the decision provides a further option to brand-owners, but the decision is unlikely to be of practical application in most cases of online counterfeiting.”