United Kingdom: Counterfeit Goods, IP Infringement and the Duty on ISPs.

United Kingdom

Counterfeit Goods, IP Infringement and the Duty on ISPs.

The UK High Court has ordered a number of internet service providers to block access to websites selling counterfeit goods.

Internet Service Providers (ISPs) are being forced to play an increasingly significant role in the war against online infringement of intellectual property rights (IPRs). Legislative progress has been slow, so rights holders have been forced to seek the courts assistance in compelling ISPs to participate in IPR enforcement.

There have been a number of previous instances of ISPs being ordered by the courts to block access to infringing websites, and recently this trend has even been taken up by the Court of Justice of the European Union. Whereas those cases involved the infringement of IPRs in digital content (i.e. illegal downloading and streaming of music, films and TV shows), the recent case of Cartier International AG & Ors v British Sky Broadcasting Ltd & Ors (2014) instead involved online sales of counterfeit goods.

In this case, the UK High Court granted an injunction in favour of the owners of Cartier, Montblanc and IWC (collectively “Richemont”) which required the five main UK ISPs to block access to websites that were selling counterfeit versions of Richemont’s luxury goods. This blocking-injunction, based on trade mark infringement, is the first of its kind in the UK and differs from previous injunctions in two key respects, firstly because it relates to physical goods as opposed to digital content, and secondly because it concerns trademarks rather than copyright infringement.

UK legislation allows blocking injunctions in respect of copyright infringement against ISPs who had actual knowledge of someone utilising their service to infringe copyright. However, there is no equivalent legislative power when it comes to trade mark infringement. Richemont therefore argued that the UK High Court had the authority to order a blocking injunction based on the courts general power to grant injunctions where it is “just and convenient” to do so. The court agreed, and further held that it had a principled basis upon which it could exercise this general power, making reference to an earlier case where the court used its general power in making publicity orders. Significantly, these publicity orders had been made without the finding of an infringement. This led the court in Cartier to reject the ISP’s argument that the blocking injunction should not be granted as the ISPs themselves had not infringed Richemont’s trade mark rights.

This decision illustrates the increasing pressure on ISPs to assist rights holders in combating infringement of IPRs in the online environment. It also adds another string to the bow of the rights holder which will help them to take action against infringers. As the UK High Court itself has noted, its decision “is likely to be followed by other applications by Richemont and other trade mark owners, both [in the UK] and in other countries”.