The possibility to seek
an injunction against an intermediary whose services are used by third parties
to infringe an IP right has proved an important tool in
the hands of rightholders, including in the online context.
“[i]n the digital
environment, in particular, the services of intermediaries may increasingly be
used by third parties for infringing activities. In many cases such
intermediaries are best placed to
bring such infringing activities to an end.”
However, how should responsibility for the costs
of injunctions be allocated? [here are some slides I prepared, and here's a more detailed discussion]
The UK approach to costs
In the UK, since the first copyright blocking
injunction granted in Newzbin 2 the
rule has been that, while rightholders/applicants bear the costs of application
for an injunction, internet service providers (ISPs) have to pay the
implementation costs.
The reason given is that an ISP is a commercial
enterprise that makes a profit from the provision of the services that the
operators and users of target websites use to infringe the applicants’ IP
rights. Accordingly [Newzbin
2, at 32],
“the costs of implementing
the order can be regarded as a cost of carrying on that business. It seems … to
be implicit in recital (59) of the Information Society Directive that the
European legislature has chosen to impose that cost on the intermediary.
Furthermore, that interpretation appears to be supported by the Court of
Justice’s statement in L'Oréal v. eBay at [at 139] that such measures ‘must not be
excessively costly’.”
The issue whether this approach is correct,
including from a domestic - rather than EU - law standpoint, is at the centre
of the UK Supreme Court instalment of the Cartier litigation [also the French Supreme Court has recently weighed in on this issue, as Mathilde reported here].
The Cartier case
Despite the lack of specific implementation into
UK law of the third sentence of Article 11 of the Enforcement Directive, the
provision contained in Section 37(1) of the Senior Courts Act 1981 could be in fact regarded as the appropriate legislative basis to grant jurisdiction
also in this area.
In line with his earlier judgment in Newzbin 2, Arnold J also took
the view that “the rightholders should pay the costs of an unopposed
application … [and] the ISPs should generally bear the costs of
implementation as part of the costs of carrying on business in this sector”.
However the judge did “not rule out the possibility of ordering the rightholder
to pay some or all of the implementation costs in an appropriate case.” [at 240]
The “entirely correct” decision of Arnold J was confirmed in appeal.
|
How much, did you say?! |
The Court of
Appeal decision contains the dissent of Briggs LJ (as he then was) regarding
the responsibility for the costs of an injunction. In particular, he held the
view that what has become the traditional cost allocation for intermediary injunctions
would not be correct under English law.
The Supreme Court round
The Court of Appeal decision has been subsequently appealed to the UK Supreme
Court [as The IPKat reported here]. Thanks to a very good Katfriend, the IPKat has learned something more
about this latest round.
In particular:
"The Cartier appeal
is listed for a full day in the Supreme Court next Tuesday 30 January 2018.
Presided by Lord Mance, the other four
judges will be Lord Kerr, Lord Sumption, Lord Reed & Lord Hodge.
The two key questions concern:
1. The threshold conditions for the
imposition of an order requiring ISPs to block (or attempt to block) access to
websites infringing registered trade marks.
2. Whether ISPs should be required
to bear the costs of trade mark driven website blocking.
The Internet Service Providers’
Association (ISPA) sought permission to intervene in the appeal, but such
permission was refused.
However, the Supreme Court granted
applications for permission to intervene to the following:
· The
mobile network operators;
· BPI;
· The
Open Rights Group;
· The
Motion Picture Association."
More to come: stay tuned!
The paradox is that application of the Marleasing principle results in the conclusion that an injunction can be granted against a third party in tort cases to which the Enforcement Directive has no application. A more principled approach would have been to say, as the Irish High Court did in the EMI v UPC case ([2010] IEHC 377), that there was no jurisdiction and the Government had better get on and amend the law.
ReplyDeleteAnonymous at 14:20:00,
ReplyDeleteInteresting comment about the tort and :jurisdiction," but is not the point here that the intermediary becomes a (perhaps unwitting) party to the tort, given the nature of the electronic interchange?
Tort law has an abundance of situations in which an otherwise "unknowing" party becomes involved and liable due to the transactions (i.e., passing a bad check, receiving stolen property, and the like).