Another website blocking injunction for trade mark owners

Richemont has been granted a further blocking injunction against the major ISPs for websites offering counterfeit goods for sale. This post summarises the judge's decision in granting this injunction. In the meantime, the grant of the original blocking injunction is under appeal.

Background of first website blocking injunction for trade mark owners

You may remember that back in October 2014 Cartier International AG, Montblanc-Simplo GmbH and Richemont International SA ("Richemont")successfully obtained website blocking injunctions against the UK's five biggest ISPs (British Sky Broadcasting Limited, British Telecommunications plc, EE Limited, TalkTalk Telco Limited, and Virgin Media Limited ("the ISPs"). The websites in question were selling counterfeit Richemont products which infringed Richemont's registered trade marks. This was a landmark decision in the UK because blocking injunctions had only previously been granted in cases of copyright infringement, not trade mark infringement. You can read our full analysis and comments on this decision ("Cartier I") here.

To briefly summarise, the reason why Cartier I was such a landmark decision is because the UK Government did not explicitly transpose the third sentence of Article 11 of the Enforcement Directive into UK trade mark law (unlike s97A of CDPA 1988 for copyright). Article 11 states:

"Member State shall also ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right, without prejudice to Article 8(3) of [the InfoSoc] Directive"

Arnold J explained in Cartier I that this was not explicitly transposed into UK trade mark law because s.37(1) of the Supreme Act 1981 already gives the Court the discretionary power to grant injunctions against intermediaries. S.37(1) says:

"The High Court may by order (whether interlocutory or final) grant an injunction or appoint a receiver in all cases in which it appears to the court to be just and convenient to do so."

The decision in Cartier I is currently under appeal and is due to be heard on 13 April 2016.

Second claim for a website blocking injunction for trade mark owners

The pending appeal has not stopped Richemont from pressing ahead and being granted a further blocking injunction against the ISPs for additional websites offering counterfeit Richemont goods for sale.

In following Cartier I, HHJ Hacon followed Arnold J's view that, in the context of a website-blocking application, the exercise of the court's jurisdiction under s.37(1) of the Supreme Court Act 1981 must be in accordance with Articles 3 and 11 of the Enforcement Directive, and Articles 12 and 15 of the Ecommerce Directive. This meant applying four threshold requirements before considering the court's discretion. The threshold requirements are:

1. The ISPs must be intermediaries within the meaning of the third sentence of Article 11;
2. The users and/or operators of the website must be infringing the claimant's trade mark(s);
3. The users and/or operators must use the ISPs' services to infringe; and
4. The ISPs must have actual knowledge of infringing activity. This means actual knowledge of one or more persons (who need not be identified) using the ISPs' services to infringe trade mark(s). This does not need to extend to knowledge of a specific instance of trade mark infringement by a specific individual. An ISP may be given actual knowledge of infringing activity by receipt of a sufficiently detailed notice of the activity and having had a reasonable opportunity to investigate the position.

HHJ Hacon held that Richemont had reached these thresholds. He therefore proceeded to consider the six requirements for using the court's discretion to grant an injunction: These are that the injunction must be:

1. Effective – will the injunction at least seriously discourage users from accessing the target website? The right-holders do not need to show that the injunction is likely to reduce the overall level of infringement of their rights, but the injunction may be less proportionate if there are alternative equally accessible and attractive websites to the interested user;
2. Dissuasive – is it likely to dissuade third parties from infringing in the future?;
3. Not unnecessarily complicated or costly – the difficulty and cost of compliance by the ISP must be considered;
4. Avoid barriers to legitimate trade – the injunction must be strictly targeted so it does not affect legitimate websites;
5. Proportionate in the circumstances. Things to be considered include:

                      i.        The comparative importance of the rights involved and the justification for interfering with those;

                     ii.        The availability of alternative, less onerous, measures;

                    iii.        The effectiveness of the steps the ISPs would have to take (will they seriously discourage users accessing the target websites);

                    iv.        The costs of implementation;

                     v.        The dissuasiveness of the measures;

                    vi.        Potential impact on lawful internet usage;

                   vii.        Whether other websites could be substituted for the target websites.

6. Safeguards against abuse – the injunction must safeguard against any concerned parties suffering abuse due to the injunction.

As with the thresholds, HHJ Hacon was satisfied that the website blocking injunction would meet all six of the above requirements and consequently granted a website-blocking order, the precise form of which is to be agreed.

Our Comments

In reaching his decision, HHJ Hacon applied the principles of Cartier I so this is unlikely to be the end of the story. Both parties have been given permission to appeal this decision.

Having been successful once (pending appeal) it is unsurprising that Richemont decided to bring a second claim to block further websites infringing their registered trade marks. One possible danger for Richemont is that the Court might start to look at the costs imposed on the ISPs if they are forced to implement too many injunctions and block too many websites. However, Arnold J said in Cartier I that he did not believe that implementation costs on their own should lead to the blocking orders being refused.

We said when reporting on Cartier I that it would be interesting to see if the flood gates would open in terms of trade mark owners seeking to obtain website blocking orders. Whilst this has not happened yet (there has been very little activity between Cartier I and the present case), trade mark owners might be biding their time to see how this ultimately plays out. However, if the decision remains with Richemont, this could prove to be a useful tool to help trade mark owners combat the online sale of counterfeits.