The decision, in a case referred from the England & Wales High Court, sets out that online marketplaces such as eBay can be liable for infringements carried out on their sites if they play an active role. It also says that preventative injunctions can be awarded in certain circumstances.
But it left national courts with some leeway to decide what constitutes an active role and the nature of the injunctions that can be granted.
“I agree that this ruling is a major step forward and in the right direction; albeit has been brought to reality via the national courts in each single case,” said Guido Baumgartner, vice president global brand protection for Coty in Germany.
Baumgartner said that where there is mass production of infringements, a mass protection tool is needed.
He welcomed the CJEU’s ruling as a way to deal with such mass infringement: “Companies who have excellent IT and tools and exercise algorithm control have likewise a duty of care to use their brains and tools to better protect not only the reported infringement (notice and takedown) but to reach out to the future (no easy relisting when software and analysing tool would prevent such infringements).”
Ruth Orchard, director of the Anti-Counterfeiting Group, said the decision makes it “more difficult for marketplaces to say they’re just a trading platform and have no obligations”.
She said the decision was welcome, but added that it had come after an eight-year fight by brand owners: “It’s about time. At last the marketplaces will realise they can’t get away with it anymore.”
Baumgartner agreed that the decision sent a strong signal to online marketplaces: “They have fooled us and courts in the past about their capacity to control, filter and play an active role in monitoring and I hope this smokescreen is now over.”
Managing IP understands that another luxury goods company, LVMH, recently submitted proposals to include a duty of care in the revised EU IP Enforcement Directive.
The proposals are based on five principles, covering when a duty of care should be imposed, what it should entail, that it should be adaptable to different business models, how it should be assessed and that, if breached, it should lead to shared liability.
Meanwhile, 29 online traders and brand owners signed a memorandum of understanding in May this year for a 12-month pilot programme to fight counterfeits. Among the signatories were eBay and L’Oréal, as well as Amazon, adidas, Burberry, Lacoste, LVMH, Microsoft, Nike, P&G and Unilever.
Orchard described the MoU as “a huge step” adding: “If the law is properly enforced, everything will work.”
