The Wundversorgung decision - proportionality and injunctive relief in Germany

In Dave's view, all nap-time injunctions
were just and proportionate 
Injunction, Injunction, what's your function?  Even for those who are unable to reminisce of the wonders School House Rock, the question still rings true.  Indeed, at this year’s Fordham IP Conference the topic of proportionality of injunctive relief was intensely debated revealing stark differences in different jurisdictions. The AmeriKat's friend, Christopher Weber (Kather Augenstein) reports on a very different view of the role of proportionality in Germany when granting an injunction.  Over to Christopher:  
"It’s well known that at least since eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) injunctions are not automatic anymore in the U.S. They are not automatic in France and many other jurisdictions, either, while Germans and German law view it as a matter of course that the infringement of an absolute right, such as a patent or trade mark, leads to the automatic granting of injunctive relief. When confronted with an allegedly apparent lack of any proportionality in that automatism, Germans tend to shrug and respond that there is the FRAND defense and a claim for compulsory licenses and possibly a grace period. This response implies that these respective tools are more than enough proportionality for our sense of justice, thank you very much. Meanwhile, the quantity of successful FRAND defences and compulsory licenses are rarely mentioned in this context … and a grace period has yet to be granted for e.g. patent infringement.  
Against this background of automatic injunctions, avid IPKat readers are aware that – to make matters worse for infringers - the meaning of cease and desist has come to include also recalling products, at least under unfair competition law. In the decisions “Hot-Sox” (dated 19 November 2015 – I ZR 109/14) and “RESCUE Tropfen” (decision of 29 September 2016 – I ZB 34/15) the Federal Court of Justice (FCJ) found that a cease and desist order includes the recall of previously sold products. The infringer is thus obliged to stop further infringement by companies downstream the distribution chain. These decisions were met and are still being met with a lot of criticism in Germany.

In any case, the relevance of these decisions could have possibly been explained away then by pointing out that there is no separate claim for recall of infringing goods under German competition law. There are, however, such claims under German patent- and trade mark law. Thus, there is a lex specialis argument that injunctions should not include recall under laws which include a special claim for this.


This hope has now been dashed by the recent FCJ decision "Produkte zur Wundversorgung" (Decision of 11.10.2017 – I ZB 96/16) on trade mark law. The trade mark owner had claimed infringement of his trade marks and subsequently obtained a preliminary injunction, which it served upon the infringer. The infringer did not recall the products already delivered to his customers and did not inform his customers about the preliminary injunction that had been issued. The trade mark owner requested an administrative fine, which was set by the Regional Court. The Court of Appeal rescinded the fine and justified this essentially by the fact that the injunction debtor is in principle not responsible for the actions of third parties. The trademark owner appealed this decision to the FCJ – which then applied the reasoning from the previously mentioned decision on competition law.

Thus, there are now aligning decisions on competition law and trade mark law by the I. Senate of the FCJ. Patent law is still notably absent and probably the X. Senate of the FCJ is now the last remaining reason for hope that injunctive relief is again pruned back.

The upshot is:
  • Cease and desist is less flexible in Germany than in other jurisdictions.  
  • It is also broader than previously thought, even in Germany.  
  • On the one hand it can be difficult for the infringer to identify which steps/measures must be taken to comply with an injunction.  
  • On the other hand, it might be difficult for the IPR owner to assess the extent of his/her liability in case the enforcement of the injunction turns out to be unfounded.  
The following part of the decision by the FCJ provides some guidance (numerous references to previous decisions omitted to improve readability):
In particular, an obligation to cease and desist is not merely an act of inaction, but also includes the obligation to take actions to remedy a previously created state of disruption if this alone is sufficient to comply with the requirement to cease and desist. This is the case if the failure to remedy the state of infringement is tantamount to the continuation of the act of infringement. Even if the infringing act giving rise to the injunctive relief is not a permanent act of the debtor, an obligation to refrain from or tolerate an act may include an obligation to perform actions if the debtor can only fulfil his obligation to cease and desist or to tolerate if he also performs actions. If products marked or presented in violation of the law have already been further distributed, the obligation to cease further distribution regularly also includes the recall of products already delivered.

(…)

A positive obligation on the injunction debtor to act does not presuppose that the decision formula already indicates that the injunction debtor is also obliged to act actively. Duty to act to be determined by way of interpretation, the titled duty to cease and desist only supplementary duties to act need not be separately titled.

A title based solely on an omission according to its decision formula may also be to be interpreted in this way, because the reasons for the decision and the grounds for the application or action must be taken into account as admissible interpretation material for this purpose. Such a title may therefore contain the obligation to do positively, which is enforceable according to § 890 ZPO, even if this has not been expressly stated in its decision formula.

The acceptance of a positive duty to act on the basis of the injunction does not violate - as the intervener of the debtor believes - the requirement of certainty regulated in Article 103 II of the Basic Law. The principle of certainty in Article 103 of the Basic Law applies solely to measures of state coercion, but not to proceedings for the enforcement of injunctive relief. Although this provides for means of order similar to criminal law, it is not based on the state's monopoly on the use of force, but serves to enforce obligations under private law between private individuals. The determinability of the scope of the title, also by way of interpretation, satisfies the constitutional requirements for a specific requirement of determinacy under enforcement law. The criminal nature of the means of order and the resulting burden on the debtor already takes account of the fault requirement existing there. Accordingly, a sanction can only be imposed if the debtor is at fault for the infringement.

If, as a result of the interpretation of the instrument of omission, the debtor is obliged to take measures by positive action to eliminate the ongoing state of disruption and to influence third parties, it does not matter whether he has corresponding claims against the third parties in question. The debtor of an injunctive relief is not responsible for the independent actions of third parties. However, this does not release him, within the framework of his positive duty to act as determined by interpretation, from exerting influence on third parties whose actions are of economic benefit to him and for whom he must seriously reckon with - possibly further - infringements. The debtor is therefore obliged to exert influence on such persons to the extent possible and reasonable. With regard to its possibilities of influencing the third party, it is only important whether the debtor has legal or actual possibilities of influencing the conduct of third parties. It is therefore sufficient for him to be able to make an actual impact.

The debtor's obligation is not only justified but also limited by what is possible and reasonable for him. On the one hand, the debtor may not remain inactive if and insofar as the interpretation of the instrument of omission results in an obligation to act positively. On the other hand, however, he does not have to do anything that does nothing to prevent further injuries and is therefore not necessary, nor does he have to take measures to prevent or rectify faults that are disproportionately detrimental to his commercial activity and therefore unreasonable for him - for example towards his customers with whom he has an ongoing business relationshi

(…)
A positive obligation on the injunction debtor to act does not presuppose that the decision formula already indicates that the injunction debtor is also obliged to act actively. Duty to act to be determined by way of interpretation, the titled duty to cease and desist only supplementary duties to act need not be separately titled.
A title based solely on an omission according to its decision formula may also be to be interpreted in this way, because the reasons for the decision and the grounds for the application or action must be taken into account as admissible interpretation material for this purpose. Such a title may therefore contain the obligation to do positively, which is enforceable according to § 890 ZPO, even if this has not been expressly stated in its decision formula.
The acceptance of a positive duty to act on the basis of the injunction does not violate - as the intervener of the debtor believes - the requirement of certainty regulated in Article 103 II of the Basic Law. The principle of certainty in Article 103 of the Basic Law applies solely to measures of state coercion, but not to proceedings for the enforcement of injunctive relief. Although this provides for means of order similar to criminal law, it is not based on the state's monopoly on the use of force, but serves to enforce obligations under private law between private individuals. The determinability of the scope of the title, also by way of interpretation, satisfies the constitutional requirements for a specific requirement of determinacy under enforcement law. The criminal nature of the means of order and the resulting burden on the debtor already takes account of the fault requirement existing there. Accordingly, a sanction can only be imposed if the debtor is at fault for the infringement.
If, as a result of the interpretation of the instrument of omission, the debtor is obliged to take measures by positive action to eliminate the ongoing state of disruption and to influence third parties, it does not matter whether he has corresponding claims against the third parties in question. The debtor of an injunctive relief is not responsible for the independent actions of third parties. However, this does not release him, within the framework of his positive duty to act as determined by interpretation, from exerting influence on third parties whose actions are of economic benefit to him and for whom he must seriously reckon with - possibly further - infringements. The debtor is therefore obliged to exert influence on such persons to the extent possible and reasonable. With regard to its possibilities of influencing the third party, it is only important whether the debtor has legal or actual possibilities of influencing the conduct of third parties. It is therefore sufficient for him to be able to make an actual impact.
The debtor's obligation is not only justified but also limited by what is possible and reasonable for him. On the one hand, the debtor may not remain inactive if and insofar as the interpretation of the instrument of omission results in an obligation to act positively. On the other hand, however, he does not have to do anything that does nothing to prevent further injuries and is therefore not necessary, nor does he have to take measures to prevent or rectify faults that are disproportionately detrimental to his commercial activity and therefore unreasonable for him - for example towards his customers with whom he has an ongoing business relationship."
The Wundversorgung decision - proportionality and injunctive relief in Germany The Wundversorgung decision - proportionality and injunctive relief in Germany Reviewed by Annsley Merelle Ward on Wednesday, April 25, 2018 Rating: 5

No comments:

All comments must be moderated by a member of the IPKat team before they appear on the blog. Comments will not be allowed if the contravene the IPKat policy that readers' comments should not be obscene or defamatory; they should not consist of ad hominem attacks on members of the blog team or other comment-posters and they should make a constructive contribution to the discussion of the post on which they purport to comment.

It is also the IPKat policy that comments should not be made completely anonymously, and users should use a consistent name or pseudonym (which should not itself be defamatory or obscene, or that of another real person), either in the "identity" field, or at the beginning of the comment. Current practice is to, however, allow a limited number of comments that contravene this policy, provided that the comment has a high degree of relevance and the comment chain does not become too difficult to follow.

Learn more here: http://ipkitten.blogspot.com/p/want-to-complain.html

Powered by Blogger.