The Court of Appeal has upheld the High Court’s decision in Cartier, Montblanc and Richemont v BskyB, BT, TalkTalk, EE and Virgin confirming that it is possible for trade mark owners to obtain orders against ISPs requiring them to block access to websites on which infringing articles are advertised and sold.
In his leading judgment, Kitchin LJ agreed with Arnold J and said that the UK courts had jurisdiction to make such an order by virtue of s.37(1) of the Supreme Courts Act and Article 11 of the Enforcement Directive – which it was said provided a “principled basis for extending the practice of the court in relation to the grant of injunctions” to the present case.
As with claims made under the corresponding Copyright provision (s.97A of CDPA 1988), threshold conditions must be established. The ISPs must be intermediaries; the users or operators of the website(s) must be substantially infringing the claimant's registered trade mark(s); the users or operators must use the ISPs' services to do that; and the ISPs must have actual knowledge and notice of details of infringement.
Further, blocking orders must be necessary, effective, dissuasive, not unnecessarily complicated or costly, not barriers to trade, a fair balance of competing rights and proportionate. When assessing whether a blocking order is “proportionate” an analysis of the alternative options available to the rightholder will be relevant.
By a 2 to 1 majority, the Court of Appeal also upheld that the ISPs should bear the costs of implementing the blocking orders because, amongst other reasons, such costs are part of the price which the ISPs must pay for the immunities which they enjoy under the E-Commerce Directive.
This decision leaves the door wide open for a new type of trade mark action for brand owners against intermediaries. The Court of Appeal has confirmed that intermediaries are now subject to similar obligations for trade mark infringement as under s97A for copyright infringement; where an intermediary has actual knowledge of another person using their service to infringe a registered trade mark, the Courts may be able to order an injunction against them in order to prevent the infringement.
Given the finding of jurisdiction in this case and in light of the wording of Article 11 of the Enforcement Directive, this decision could be wider in scope to catch other forms of intellectual property rights and other forms of ‘intermediaries’ such as payment providers if their service is being used to infringe and they are put on notice given the potentially wide scope of the meaning of ‘intermediaries’.
Judgment Date: 20 JULY 2016