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Thursday, 23 October 2014

These Shoes are Made for Freely Walking: Copyright Protection & Free Movement of Goods

With this post we are staying with on the topic of shoes and copyright, already discussed here and here, but this recent case from the commercial division of the French Cour de Cassation also raised some European Union (EU) and Berne Convention issues. The Case is Cass.Com.,12-16.844, October 7, 2014.

French catalog retailer La Redoute sold in France a particular model of flip flop shoes which Italian fashion company Tod’s believed was a copy of its own “Fiji” flip flops, which had been sold in France since 2003. The flip flops sold by La Redoute had been manufactured in Italy and sold to La Redoute by the Italian manufacturer.

Tod’s filed a copyright infringement suit against La Redoute in the Paris Tribunal de Commerce (business court) and won. The Paris Court of Appeals confirmed the judgment on October 21, 2011, and La Redoute appealed in cassation (cassation means “breaching”).  

Restriction of Free Movement of Goods in the EU?

La Redoute argued that the principle of free movement of goods within the EU prevents a product lawfully placed on the market in one EU Member State (First Member State) to be deemed infringing a model manufactured in that same Member State by a court from another Member State (Second Member State), even if it is not established that such good was considered counterfeited by the laws of the First Member State.
Tod's Fiji Flip Flops


La Redoute argued that courts of the Second Member State must appreciate whether a copyright infringement claim is valid by applying the law of the First Member State. For La Redoute, French law should not have been applied in this case, but, rather, Italian law. Of course, this would have benefitted the French retailer as French law recognizes that shoes can be protected by copyright but Italian law, the Legislative Decree No. 95 of February 2, 2001, which implemented Directive 98/71/EC on the Legal Protection of Designs, may or may not protect shoes.

La Redoute argued that the ruling of the Paris Court of Appeals should be overturned, as it violated Article 34 of the Treaty on the Functioning of the European Union (TFEU) which prohibits restriction of free movement of goods in the EU, and that the Cour de Cassation should refer this preliminary ruling question to the European Court of Justice (ECJ):

"Doesn’t the principle of free movement of goods within the EU, as established by Article 34 TFEU, impose, while taking into account the disparity in copyright protection provided to works of applied art by the laws of the various EU Member States and Article 5 of the 1886 Berne Convention, in order to avoid that a product lawfully put on the market in a first Member State be deemed infringing a model created in that State by a court in a second Member State, while it is not established that this good is infringing in its state of origin (the First Member State), that the court of the second State must appreciate both the validity of the rights claimed and the existence of facts of infringement by applying the law of the state of origin of the product? " [Exhale now].

Violation of Article 6 of the European Convention of Human Rights?

Article 17 of Directive 98/71/EC addresses the issue of the relationship of design protection laws and copyright protection law and states that “[a] design protected by a design right registered in or in respect of a Member State in accordance with this Directive shall also be eligible for protection under the law of copyright of that State as from the date on which the design was created or fixed in any form. The extent to which, and the conditions under which, such a protection is conferred, including the level of originality required, shall be determined by each Member State.”

La Redoute claimed that Article 17 thus created legal uncertainty and, as such, violated Article 6 of the European Convention on Human Rights which protects the right to a fair trial. It also asked the Cour de Cassation to refer a preliminary ruling question to the ECJ in that regard.

Cour de Cassation Not Convinced

The Cour de Cassation was not convinced by all these arguments. The court first noted that the European Court of Justice ruled in Case C-5/11, Criminal proceedings against Titus Alexander Jochen Donner [see also here] that Articles 34 and 36 of the TFEU must be interpreted as meaning that they do not preclude a First Member State from prosecuting a copyright infringement case if infringing copies of works protected by copyright in the First Member State are sold to the public in its territory, even if the sale is concluded in a Second Member State where these works are not protected by copyright.
This Cat is All for Free Movement

In the Donner case, an Italian company was selling unauthorized reproductions of furniture which were protected by German copyright law as works of applied arts, but were not at the time protected in Italy. The transporter of these goods had been found guilty of abetting copyright infringement by a German court.

The Cour de Cassation also found that Article 2 of the Berne Convention, which states that the enjoyment and exercise of rights protected by the Convention are independent of the existence of protection in the country of origin of the work, applied to this case.

The Cour de Cassation rejected the argument that Article 17 of Directive 98/71/EC creates legal uncertainty, noting that that the Court of Appeals had held that differences in the protection of copyright protection result from the sovereign right of each Member State to legislate in this particular area. For the Cour de Cassation, such disparities do not affect the right to intelligibility and predictability of the law, “if national law in this area is generally accessible.”

The Cour de Cassation further noted that La Redoute did not argue that French law is confusing, nor did it argue that legal protection in that area, in France or Italy, fluctuates in such a way that legal standards become unpredictable to the point of undermining the free movement of goods between EU Member States.

La Redoute also argued that copyright protection is not provided by the law of the Member States where the damage is suffered, nor where Plaintiff filed suit, but rather by the law of the Member State where the act which generated the infringement occurred. Therefore, French courts should have applied Italian law, since the allegedly infringing shoes had been manufactured there. For La Redoute, by applying French law, the Paris Court of Appealshad violated Article 5.2 of the Berne Convention.

But the Cour de Cassation was not convinced, as under Article 5.2° of the Berne Convention, the enjoyment and exercise of the author’s rights are “independent of the existence of protection in the country of origin of the work” and “the extent of protection, as well as the means of redress afforded to the author to protect his rights, [are] governed exclusively by the laws of the country where protection is claimed.”


La Redoute’s appeal to cassation was dismissed entirely. 


Image of the cat in the box is Dwarfed courtesy of Flickr user Quinn Dombroski  under a CC BY-SA-2.0 license.

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