On 6 February 2014, the Court of Justice of the European Union ("ECJ") handed down an interesting judgment interpreting the notion of infringement of copyright and trade mark law in the context of Regulation 1383/2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights ("Regulation 1383/2003") (Case C-98/13).
The judgment stems from proceedings between Mr. Blomqvist, a Danish citizen, and Manufacture des Montres Rolex SA ("Rolex") before a Danish court. The facts are as follows: Mr. Blomqvist had ordered a watch from an online seller based in Hong Kong. After the watch had been shipped to Mr. Blomqvist, it was detained by Danish customs under Regulation 1383/2003 (now repealed and replaced by Regulation 608/2013). The shipment was reported to Rolex for a suspected violation of its copyright and trade mark rights. Rolex confirmed that the watch was counterfeit and wrote to Mr. Blomqvist asking him to abandon the offending good for destruction.
Mr. Blomqvist refused to abandon the goods for destruction and Rolex therefore sought an order from a Danish court to oblige Mr. Blomqvist to abandon the good for destruction. In his defence, Mr. Blomqvist argued that he had legitimately bought the watch for his own personal use and that it did not breach Danish law on copyright and trade marks.
The Danish court stayed the proceedings to seek guidance from the ECJ to determine whether the Hong Kong based seller had infringed copyright or trade mark law in Denmark. In particular, the referring court requested clarification on the right of "distribution to the public" under EU Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society and the right to use trade marks "in the course of trade" under EU Directive 2008/95/EC to approximate the laws of the Member States relating to trade marks and EU Regulation 207/2009 on the Community trade mark. The referring court asked whether it was sufficient for finding an infringement of those rights if goods had been sold online and dispatched to a private purchaser with an address in the Member State where the goods are protected. Alternatively, if this is not sufficient, the Danish court questioned whether there is an additional requirement that there should be, prior to the sale, an offer for sale or an advertisement targeted at or shown on a website intended for consumers in the Member State where the goods are delivered.
As regards the infringement of the distribution right, the ECJ held that: "[d]istribution to the public is characterised by a series of acts going, at the very least, from the conclusion of a contract of sale to the performance thereof by delivery to a member of the public. A trader in such circumstances bears responsibility for any act carried out by him or on his behalf giving rise to a 'distribution to the public' in a Member State where the goods distributed are protected by copyright". The ECJ thus concluded that the online sale would constitute a "distribution to the public". In addition, the ECJ held that online sales also constitute "use in the course of trade" since these are liable to affect the functions of the trade mark (with reference to Joined Cases C-236/08 to C-238/08 Google France and Google, paragraph 49).
The ECJ furthermore considered that the mere fact that a website can be consulted from the territory of a Member State where trade marks are protected is not sufficient to conclude that the website targets consumers in that territory (with reference to Case C-324/09 L'Oréal and Others). Nevertheless, the ECJ added that such intention to sell into the territory is deemed to be proven, inter alia, "where it turns out that the goods have been sold to a customer in the European Union or offered for sale or advertised to consumers in the European Union" (with reference to Joined Cases C-446/09 and C-495/09 Philips).
The ECJ thus concluded that the holder of an intellectual property right covering goods imported into a territory where the goods are protected, enjoys protection against counterfeit goods sold through online sales "at the time when those goods enter the territory" of the Member State "merely by virtue of the acquisition of those goods". It is therefore not necessary, the ECJ confirms, for the goods to have been the subject of an offer for sale or advertising targeting consumers of that Member State.
This judgment is a relief to right holders. It confirms that customs are permitted to seize and destroy counterfeit goods sold online to EU citizens for private use.
To read the full judgment of the ECJ: click here.
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