Tenants subletting pitches may be held liable for traders' sales of counterfeit goods
04 August 2016
On 7 July 2016, the Court of Justice of the European Union made a preliminary ruling concerning the interpretation of Article 11 of Directive 2004/48/EC on the enforcement of intellectual property rights (the "Enforcement Directive"). Under this provision, the Member States must ensure that holders of intellectual property rights may apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right.
The main proceedings took place in the Czech Republic and were instituted by a number of trademark proprietors against a tenant of a marketplace in Prague as the latter sublet pitches at the marketplace from which some of the traders sold counterfeits of the proprietors' brand goods.
The proceedings resulted in two preliminary questions to the Court of Justice of the European Union of which the first question was whether a tenant, as the one in question, may be considered an intermediary under Article 11 of the Enforcement Directive. The Court of Justice of the European Union replied in the affirmative to this question and noted that it did not signify whether it was a physical marketplace or an online marketplace.
The second question was whether an injunction under Article 11 may be imposed on the tenant of market halls on the same conditions as the Court of Justice formulated for online marketplaces in the L'Oréal judgment (C-324/09). The Court of Justice found that an injunction under Article 11 could be imposed but only if the injunction ensures a fair balance between the protection of the intellectual property right and such protection does not create barriers to legitimate trade.
The decision shows that even indirect participation in the infringement, for instance provision of pitches, may lead to injunctions under Article 11 of the Enforcement Directive.
The decision also shows that the assessment of whether it is an intermediary whose services are used by a third party to infringe an intellectual property right is the same irrespective of whether it is a physical or an online marketplace.
The proceedings resulted in two preliminary questions to the Court of Justice of the European Union of which the first question was whether a tenant, as the one in question, may be considered an intermediary under Article 11 of the Enforcement Directive. The Court of Justice of the European Union replied in the affirmative to this question and noted that it did not signify whether it was a physical marketplace or an online marketplace.
The second question was whether an injunction under Article 11 may be imposed on the tenant of market halls on the same conditions as the Court of Justice formulated for online marketplaces in the L'Oréal judgment (C-324/09). The Court of Justice found that an injunction under Article 11 could be imposed but only if the injunction ensures a fair balance between the protection of the intellectual property right and such protection does not create barriers to legitimate trade.
The decision shows that even indirect participation in the infringement, for instance provision of pitches, may lead to injunctions under Article 11 of the Enforcement Directive.
The decision also shows that the assessment of whether it is an intermediary whose services are used by a third party to infringe an intellectual property right is the same irrespective of whether it is a physical or an online marketplace.
