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England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Cartier International Ltd & Anor v British Telecommunications Plc & Ors  EWHC 339 (Ch) (23 February 2016)
Cite as:  EWHC 339 (Ch)
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Strand, London, WC2A 2LL
B e f o r e :
(SITTING AS A JUDGE OF THE HIGH COURT)
| CARTIER INTERNATIONAL LIMITED
|- and -
|BRITISH TELECOMMUNICATIONS PLC
SKY UK LIMITED
TALKTALK TELECOM LIMITED
VIRGIN MEDIA LIMITED
The Defendants did not appear and were not represented
Hearing date: 16 February 2016
Crown Copyright ©
Judge Hacon :
Jurisdiction and the permissible exercise of jurisdiction
Domestic English law
"…once an ISP becomes aware that its services are being used by third parties to infringe an IP right, it becomes subject to a duty to take proportionate measures to prevent or reduce such infringements even though it is not itself liable for infringement."
Since it will become relevant, I should add that Arnold J subsequently emphasised that the analogy with Norwich Pharmacal should not be pushed too far. He had not suggested that the jurisdiction for a website-blocking injunction was derived from the Norwich Pharmacal jurisdiction, but instead directly from s.37(1), see Cartier International AG v British Sky Broadcasting Limited  EWHC 3794 (Ch), at -.
"…Apple had not infringed any legal or equitable right of Samsung's. Nor did the Court of Appeal find that Apple had acted unconscionably. Rather, the essence of the Court's reasoning was that, having created commercial uncertainty in the market, Apple had come under a duty to take reasonable steps to correct that state of affairs. That was a duty which could be enforced by the grant of an injunction."
Member States shall ensure that, where a judicial decision is taken finding an infringement of an intellectual property right, the judicial authorities may issue against the infringer an injunction aimed at prohibiting the continuation of the infringement. Where provided for by national law, non-compliance with an injunction shall, where appropriate, be subject to a recurring penalty payment, with a view to ensuring compliance. Member States shall also ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right, without prejudice to Article 8(3) of Directive 2001/29/EC.
The third sentence is of most relevance. (Art.8(3) of Directive 2001/29/EC referred to concerns copyright and related rights, see above.)
Threshold conditions for the exercise of the jurisdiction under s.37(1)
(1) The ISPs must be intermediaries within the meaning of the third sentence of art.11.
(2) The users and/or the operators of the website must be infringing the claimant's trade mark(s).
(3) The users and/or the operators of the website must use the ISPs' services to infringe.
(4) The ISPs must have actual knowledge of infringing activity. This means actual knowledge of one or more persons (who need not be identified) using the ISPs' services to infringe trade mark(s). It need not extend to knowledge of a specific infringement of a specific trade mark by a specific individual. An ISP may be given actual knowledge of infringing activity by receipt of sufficiently detailed notice of the activity and having had a reasonable opportunity to investigate the position.
Principles to be applied in the exercise of the court's discretion
(1) EffectiveEfficacy, in terms of whether the injunction would at least seriously discourage users from accessing the target website, is to be taken into account. On the other hand, rightholders are not required to show that the injunction would be likely to reduce the overall level of infringement of their rights. That said, the injunction is less likely to be proportionate if there is a large number of alternative websites which are likely to be equally accessible and appealing to the interested user.
(2) DissuasiveThe court should consider whether the injunction is likely to dissuade third parties from infringing in the future.
(3) Not unnecessarily complicated or costlyThe difficulty and cost for the ISP in complying with the injunction are factors to be taken into account.
(4) Avoidance of barriers to legitimate tradeThe injunction must be strictly targeted so that it does not affect users who are using the ISP's services in order lawfully to access information. Such an effect would create a barrier to legitimate trade.
(5) ProportionalityIn relation to the proportionality of the injunction sought – the overall criterion by which the exercise of the court's discretion is to be guided – Arnold J took the following considerations to be particularly important:(i) The comparative importance of the rights that are engaged and the justifications for interfering with those rights;(ii) The availability of alternative measures which are less onerous;(iii) The efficacy of the measures which the ISPs would be required to adopt, in particular whether they will seriously discourage the ISPs' subscribers from accessing the target websites;(iv) The costs associated with these measures, in particular the costs of implementing them;(v) The dissuasiveness of the measures;(vi) The impact of the measures on lawful users of the internet;(vii) The substitutability of other websites for the target websites.
(6) Safeguards against abuseThe injunction should contain safeguards against abuse. In Cartier I they were the following:(i) The ISPs were entitled to discharge or vary the orders in the event of a material change in circumstances, including in respect of the costs of the order, the consequences for the parties and the effectiveness of the blocking measures from time to time.(ii) The operators of the target websites were permitted to apply to the court to discharge or vary the orders.(iii) Subscribers to the ISPs were permitted to apply to the Court to discharge or vary the orders.(iv) The page displayed to users who attempt to access the blocked websites should state that access has been blocked by a court order, identify the party or parties which obtained the order and state that affected users have the right to apply to the Court to discharge or vary the order.(v) A 'sunset' clause should be included in the order so that it ceased to have effect at the end of a defined period unless either the ISPs consented to a continuation or the court ordered a continuation.
The present application
The Target Websites
(i) the website clearly offered fake goods and were infringing one or more of the Trade Marks;
(ii) the website targeted UK consumers (among others); Mr Graham referred to a number of criteria confirming UK targeting, including the possibility in each case of purchasing the fake goods in sterling; this was not challenged;
(iii) the website was identified as being popular with UK consumers and/or as being visible to internet users (I return to what was meant by 'popular' and 'visible');
(iv) the registrar, host and in some cases operator or registrant had received complaint of the sale of infringing products which had not resulted in the closing of the website.
The popularity and visibility of the Target Websites
Complaints to the hosts, registrars, registrants and operators of the websites
Notices to the defendant ISPs
Jurisdiction in this application
Threshold conditions in this application
Third threshold condition: ISPs' services must be used to infringe
Fourth threshold condition: actual knowledge by the ISPs
Full and frank disclosure
Proportionality in this application
Comparative importance of the rights engaged
The availability of alternatives
Efficacy and dissuasiveness
The cost of implementing the measures
Impact on lawful users
A further potential practical difficulty
Permission to appeal