• Judgment of the Court of 15 September 2016, C-484/14, Mc Fadden

Mr Mc Fadden, who runs a business selling and leasing lighting and sound systems, operates an anonymous access to a wireless local area network free of charge in the vicinity of his business. Access to that network was intentionally not protected in order to draw the attention of customers of near-by shops, of passers-by and of neighbours to his company. Around 4 September 2010, Mr Mc Fadden changed the name of his network from ‘mcfadden.de’ to ‘freiheitstattangst.de’ in reference to a demonstration in favour of the protection of personal data and against excessive State surveillance. At the same time, by means of the wireless local area network operated by Mr Mc Fadden, a musical work was, made available on the internet free of charge to the general public without the consent of the rightholders. Mr Mc Fadden asserts that he did not commit the infringement alleged, but does not rule out the possibility that it was committed by one of the users of his network. By letter of 29 October 2010, Sony Music, who is the producer of the phonogram, gave formal notice to Mr Mc Fadden to respect its rights over the phonogram. Mr Mc Fadden brought an action for a negative declaration (‘negative Feststellungsklage’) before the referring court. In reply, Sony Music made several counterclaims seeking to obtain from Mr Mc Fadden, first, payment of damages on the ground of his direct liability for the infringement of its rights over the phonogram, second, an injunction against the infringement of its rights on pain of a penalty and, third, reimbursement of the costs of giving formal notice and court costs. In a judgement of 16 January 2014, entered in default of Mr Mc Fadden’s appearance, the referring court dismissed Mr Mc Fadden’s action and upheld the counterclaims of Sony Music. Mr Mc Fadden appealed against that judgment on the ground that he is exempt from liability under the provisions of German law transposing Article 12(1) of Directive 2000/31.

The Landgericht München I (Regional Court, Munich I, Germany) seeks to determine whether a service, such as that provided by the applicant in the main proceedings, consisting in making available to the general public an open wireless communication network free of charge may fall within the scope of Article 12(1) of Directive 2000/31. The referring court asks, in essence, whether Article 12(1) of Directive 2000/31 must be interpreted as meaning that, in order for the service referred to in that article, consisting in providing access to a communication network, to be considered to have been provided, that access must only be made available or whether further conditions must be satisfied. Also, the referring court asks, in essence, whether Article 12(1) of Directive 2000/31 must be interpreted as meaning that the condition laid down in Article 14(1)(b) of that directive applies mutatis mutandis to Article 12(1) of the directive. Furthermore, the referring court asks, in essence, whether Article 12(1) of Directive 2000/31, read in conjunction with Article 2(b) of that directive, must be interpreted as meaning that there are conditions other than the one mentioned in that provision to which a service provider providing access to a communication network is subject. Also, the referring court asks, in essence, whether Article 12(1) of Directive 2000/31 must be interpreted as meaning that it does not preclude a person harmed by the infringement of its rights over a work from claiming injunctive relief against the recurrence of that infringement, compensation and the payment of costs of giving formal notice and court costs from a communication network access provider whose services were used in that infringement. Also, the referring court asks, in essence, whether, having regard to the requirements deriving from the protection of fundamental rights and to the rules laid down in Directives 2001/29 and 2004/48, Article 12(1) of Directive 2000/31, read in conjunction with Article 12(3) of that directive, must be interpreted as precluding the grant of an injunction such as that at issue in the main proceedings, which requires, on pain of payment of a fine, a provider of access to a communication network allowing the public to connect to the internet to prevent third parties from making a particular copyright-protected work or parts thereof available to the general public from an online (peer-to-peer) exchange platform via an internet connection available in that network, where, although that provider may determine which technical measures to take in order to comply with the injunction, it has already been established that the only measures which the provider may in practice adopt consist in terminating or password-protecting the internet connection or in examining all communications passing through it.

The Court ruled that Article 12(1) of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (‘Directive on electronic commerce’), read in conjunction with Article 2(a) of that directive and with Article 1(2) of Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and of rules on information society services, as amended by Directive 98/48/EC of the European Parliament and of the Council of 20 July 1998, must be interpreted as meaning that a service such as that at issue in the main proceedings, provided by a communication network operator and consisting in making that network available to the general public free of charge constitutes an ‘information society service’ within the meaning of Article 12(1) of Directive 2000/31 where the activity is performed by the service provider in question for the purposes of advertising the goods sold or services supplied by that service provider. According to the Court, Article 12(1) of Directive 2000/31 must be interpreted as meaning that, in order for the service referred to in that article, consisting in providing access to a communication network, to be considered to have been provided, that access must not go beyond the boundaries of a technical, automatic and passive process for the transmission of the required information, there being no further conditions to be satisfied. The Court ruled that Article 12(1) of Directive 2000/31 must be interpreted as meaning that the condition laid down in Article 14(1)(b) of that directive does not apply mutatis mutandis to Article 12(1) of Directive 2000/31. Furthermore, according to the Court, Article 12(1) of Directive 2000/31, read in conjunction with Article 2(b) of that directive, must be interpreted as meaning that there are no conditions, other than the one mentioned in that provision, to which a service provider supplying access to a communication network is subject. The Court also ruled that Article 12(1) of Directive 2000/31 must be interpreted as meaning that a person harmed by the infringement of its rights over a work is precluded from claiming compensation from an access provider on the ground that the connection to that network was used by a third party to infringe its rights and the reimbursement of the costs of giving formal notice or court costs incurred in relation to its claim for compensation. However, that article must be interpreted as meaning that it does not preclude such a person from claiming injunctive relief against the continuation of that infringement and the payment of the costs of giving formal notice and court costs from a communication network access provider whose services were used in that infringement where such claims are made for the purposes of obtaining, or follow the grant of injunctive relief by a national authority or court to prevent that service provider from allowing the infringement to continue. Finally, the Court ruled that having regard to the requirements deriving from the protection of fundamental rights and to the rules laid down in Directives 2001/29 and 2004/48, Article 12(1) of Directive 2000/31, read in conjunction with Article 12(3) of that directive, must be interpreted as, in principle, not precluding the grant of an injunction such as that at issue in the main proceedings, which requires, on pain of payment of a fine, a provider of access to a communication network allowing the public to connect to the internet to prevent third parties from making a particular copyright-protected work or parts thereof available to the general public from an online (peer-to-peer) exchange platform via an internet connection, where that provider may choose which technical measures to take in order to comply with the injunction even if such a choice is limited to a single measure consisting in password-protecting the internet connection, provided that those users are required to reveal their identity in order to obtain the required password and may not therefore act anonymously, a matter which it is for the referring court to ascertain.

Order of 19 Feb 2009, C-557/07 (LSG), see summary below “Enforcement”

• Judgment of the Court of 23 March 2010, C-236/08, Google France SARL, Google Inc c/ Louis Vuitton Malletier SA, C-237/08, Google France SARL, c/ Viaticum SA, Luteciel SARL, C-238/08, Google France SARL, c/ Centre national de recherche en relations humaines (CNRRH) SARL, Pierre-Alexis Thonet, Bruno Raboin, Tiger SARL

Facts of C-236/08

Google operates an internet search engine. When an internet user performs a search on the basis of one or more words, the search engine will display the sites which appear best to correspond to those words, in decreasing order of relevance. These are referred to as the ‘natural’ results of the search.

Google offers also a paid referencing service called ‘AdWords’. That service enables any economic operator, by means of the reservation of one or more keywords, to obtain the placing, in the event of a correspondence between one or more of those words and that/those entered as a request in the search engine by an internet user, of an advertising link to its site. That advertising link appears under the heading ‘sponsored links’, which is displayed either on the right-hand side of the screen, to the right of the natural results, or on the upper part of the screen, above the natural results

Vuitton became aware that the entry, by internet users, of terms constituting its trade marks into Google’s search engine triggered the display, under the heading ‘sponsored links’, of links to sites offering imitation versions of Vuitton’s products. It was also established that Google offered advertisers the possibility of selecting not only keywords which correspond to Vuitton’s trade marks, but also those keywords in combination with expressions indicating imitation, such as ‘imitation’ and ‘copy’.

Vuitton brought proceeding against Google, to obtain a declaration that Google had infringed its trade marks. Google was found guilty of infringing Vuitton’s trade marks by a judgment of 4 February 2005 of the Tribunal de grande instance de Paris (Regional Court, Paris), and subsequently, on appeal, by judgment of 28 June 2006 of the Cour d’appel de Paris (Court of Appeal, Paris). Google has brought an appeal on a point of law (cassation) against that latter judgment.

Facts of C-237/08

Viaticum is the proprietor of the French trade marks ‘Bourse des Vols’, ‘Bourse des Voyages’ and ‘BDV’, registered for travel-arrangement services.

Luteciel is a provider of information-technology services to travel agencies. It publishes and maintains Viaticum’s internet site.

Viaticum and Luteciel became aware that the entry, by internet users, of terms constituting the abovementioned trade marks into Google’s search engine triggered the display, under the heading ‘sponsored links’, of links to sites of competitors of Viaticum. It was also established that Google offered advertisers the possibility of selecting, to that end, keywords which correspond to those trade marks.

Viaticum and Luteciel brought proceedings against Google. By judgment of 13 October 2003, the Tribunal de grande instance de Nanterre (Regional Court, Nanterre) found Google guilty of infringement of trade marks and ordered it to compensate Viaticum and Luteciel for the losses which they had suffered. Google appealed to the Cour d’appel de Versailles (Court of Appeal, Versailles). That court ruled, by judgment of 10 March 2005, that Google had acted as an accessory to infringement, and it upheld the judgment of 13 October 2003. Google has brought an appeal in cassation against the judgment of the Cour d’appel de Versailles.

Facts of C-238/08

Mr Thonet is the proprietor of the French trade mark ‘Eurochallenges’, registered for, inter alia, matrimonial agency services. CNRRH is a matrimonial agency and holds a licence, granted by Mr Thonet, under the abovementioned mark.

During 2003, Mr Thonet and CNRRH became aware that the entry, by internet users, of terms constituting the abovementioned trade mark into Google’s search engine triggered the display, under the heading ‘sponsored links’, of links to sites of competitors of CNRRH, operated by Mr Raboin and Tiger respectively. It was also established that Google offered advertisers the possibility of selecting that term as a keyword for that purpose.

On the application of Mr Thonet and CNRRH, Mr Raboin, Tiger and Google were found guilty of infringement of the trade mark by judgment of 14 December 2004 of the Tribunal de grande instance de Nanterre, and subsequently, on appeal, by judgment of 23 March 2006 of the Cour d’appel de Versailles. Google has lodged an appeal in cassation against that latter judgment.

The Cour de cassation (French supreme court) asks, in essence, whether Article 5(1)(a) and (b) of Directive 89/104 and Article 9(1)(a) and (b) of Regulation No 40/94 are to be interpreted as meaning that the proprietor of a trade mark is entitled to prohibit a third party from displaying, or arranging for the display of, on the basis of a keyword identical with, or similar to, that trade mark which that third party has, without the consent of that proprietor, selected or stored in connection with an internet referencing service, an ad for goods or services identical with, or similar to, those for which that mark is registered.

The Cour de cassation (French supreme court)  asks, in essence, whether an internet referencing service provider which stores, as a keyword, a sign corresponding to a reputable trade mark and organises the display of ads on the basis of that keyword uses that sign in a way which the proprietor of that mark is entitled to prohibit under Article 5(2) of Directive 89/104 or, in the case where that sign is identical with a reputable Community trade mark, under Article 9(1)(c) of Regulation No 40/94.

The Court considers that Article 5(1)(a) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks and Article 9(1)(a) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark must be interpreted as meaning that the proprietor of a trade mark is entitled to prohibit an advertiser from advertising, on the basis of a keyword identical with that trade mark which that advertiser has, without the consent of the proprietor, selected in connection with an internet referencing service, goods or services identical with those for which that mark is registered, in the case where that advertisement does not enable an average internet user, or enables that user only with difficulty, to ascertain whether the goods or services referred to therein originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.

It also ruled that an internet referencing service provider which stores, as a keyword, a sign identical with a trade mark and organises the display of advertisements on the basis of that keyword does not use that sign within the meaning of Article 5(1) and (2) of Directive 89/104 or of Article 9(1) of Regulation No 40/94.

Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) must be interpreted as meaning that the rule laid down therein applies to an internet referencing service provider in the case where that service provider has not played an active role of such a kind as to give it knowledge of, or control over, the data stored. If it has not played such a role, that service provider cannot be held liable for the data which it has stored at the request of an advertiser, unless, having obtained knowledge of the unlawful nature of those data or of that advertiser’s activities, it failed to act expeditiously to remove or to disable access to the data concerned.

• Judgment of the Court of 12 June 2011, C-324/09, L’oréal SA c/ Ebay

.

L’Oréal is a manufacturer and supplier of perfumes, cosmetics and hair-care products. In the United Kingdom it is the proprietor of a number of national trade marks. It is also the proprietor of Community trade marks. L’Oréal operates a closed selective distribution network, in which authorised distributors are restrained from supplying products to other distributors. As for eBay, it operates an electronic marketplace on which are displayed listings of goods offered for sale by persons who have registered for that purpose with eBay and have created a seller’s account with it. eBay charges a percentage fee on completed transactions. eBay enables prospective buyers to bid for items offered by sellers. It also allows items to be sold without an auction, and thus for a fixed price, by means of a system known as ‘Buy It Now’. Sellers can also set up online shops on eBay sites. An online shop lists all the items offered for sale by one seller at a given time.

Sellers and buyers must accept eBay’s online-market user agreement. One of the terms of that agreement is a prohibition on selling counterfeit items and on infringing trade marks. In some cases eBay assists sellers in order to enhance their offers for sale, to set up online shops, to promote and increase their sales. It also advertises some of the products sold on its marketplace using search engine operators such as Google to trigger the display of advertisements. On 22 May 2007, L’Oréal sent eBay a letter expressing its concerns about the widespread incidence of transactions infringing its intellectual property rights on eBay’s European websites. L’Oréal was not satisfied with the response it received and brought actions against eBay in various Member States, including an action before the High Court of Justice (England & Wales), Chancery Division. Then, L’Oréal submits that eBay is liable for the use of L’Oréal trade marks where those marks are displayed on eBay’s website and where sponsored links triggered by the use of keywords corresponding to the trade marks are displayed on the websites of search engine operators, such as Google.

The referring court asks, in essence, whether, for the proprietor of a trade mark registered in a Member State of the EU or of a Community trade mark to be able to prevent, under the rules set out in Article 5 of Directive 89/104 and Article 9 of Regulation No 40/94, the offer for sale, on an online marketplace, of goods bearing that trade mark which have not previously been put on the market in the EEA or, in the case of a Community trade mark, in the EU, it is sufficient that the offer for sale is targeted at consumers located in the territory covered by the trade mark.

The referring court also asks, in essence, whether the supply by the proprietor of a trade mark of items bearing that mark, intended for demonstration to consumers in authorised retail outlets, and of bottles also bearing the mark from which small quantities can be taken for supply to consumers as free samples amounts to those goods being put on the market within the meaning of Directive 89/104 and Regulation No 40/94.

The referring court seeks, in essence, to ascertain whether the removal of the packaging of goods such as those at issue in the main proceedings infringes the exclusive right of the proprietor of the trade mark affixed to those goods, thus entitling the proprietor to oppose the resale of goods whose packaging has been so removed. The referring court asks, in essence, whether, on a proper construction of Article 5(1)(a) of Directive 89/104 and Article 9(1)(a) of Regulation No 40/94, the proprietor of a trade mark is entitled to prevent an online marketplace operator from advertising – on the basis of a keyword which is identical to his trade mark and which has been selected in an internet referencing service by the operator without the proprietor’s consent – the marketplace and goods bearing that trade mark which are offered for sale on it.

The referring court asks, in substance, how the display, on the website of the operator of an online marketplace, of signs identical with or similar to trade marks is to be regarded in the light of Directive 89/104 and Regulation No 40/94.

The referring court asks, in essence, whether the service provided by the operator of an online marketplace is covered by Article 14(1) of Directive 2000/31 (hosting), and, if so, in what circumstances it may be concluded that the operator of an online marketplace has ‘awareness’ within the meaning of Article 14(1) of Directive 2000/31. The referring court asks, in essence, whether Article 11 of Directive 2004/48 requires the Member States to afford proprietors of intellectual property rights the right to obtain against the operator of a website, such as the operator of an online marketplace by means of which their rights have been infringed, injunctions requiring the operator to take measures to prevent future infringements of those rights, and, if so, what those measures might be.

The court ruled that where goods located in a third State, which bear a trade mark registered in a Member State of the European Union or a Community trade mark and have not previously been put on the market in the European Economic Area or, in the case of a Community trade mark, in the European Union, (i) are sold by an economic operator on an online marketplace without the consent of the trade mark proprietor to a consumer located in the territory covered by the trade mark or (ii) are offered for sale or advertised on such a marketplace targeted at consumers located in that territory, the trade mark proprietor may prevent that sale, offer for sale or advertising by virtue of the rules set out in Article 5 of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks, as amended by the Agreement on the European Economic Area of 2 May 1992, or in Article 9 of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark. It is the task of the national courts to assess on a case-by-case basis whether relevant factors exist, on the basis of which it may be concluded that an offer for sale or an advertisement displayed on an online marketplace accessible from the territory covered by the trade mark is targeted at consumers in that territory.

It also considered that where the proprietor of a trade mark supplies to its authorised distributors items bearing that mark, intended for demonstration to consumers in authorised retail outlets, and bottles bearing the mark from which small quantities can be taken for supply to consumers as free samples, those goods, in the absence of any evidence to the contrary, are not put on the market within the meaning of Directive 89/104 and Regulation No 40/94.

The court also decided that article 5 of Directive 89/104 and Article 9 of Regulation No 40/94 must be interpreted as meaning that the proprietor of a trade mark may, by virtue of the exclusive right conferred by the mark, oppose the resale of goods such as those at issue in the main proceedings, on the ground that the person reselling the goods has removed their packaging, where the consequence of that removal is that essential information, such as information relating to the identity of the manufacturer or the person responsible for marketing the cosmetic product, is missing. Where the removal of the packaging has not resulted in the absence of that information, the trade mark proprietor may nevertheless oppose the resale of an unboxed perfume or cosmetic product bearing his trade mark, if he establishes that the removal of the packaging has damaged the image of the product and, hence, the reputation of the trade mark.

Later, the court said that on a proper construction of Article 5(1)(a) of Directive 89/104 and Article 9(1)(a) of Regulation No 40/94, the proprietor of a trade mark is entitled to prevent an online marketplace operator from advertising – on the basis of a keyword which is identical to his trade mark and which has been selected in an internet referencing service by that operator – goods bearing that trade mark which are offered for sale on the marketplace, where the advertising does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods concerned originate from the proprietor of the trade mark or from an undertaking economically linked to that proprietor or, on the contrary, originate from a third party. The court added that the operator of an online marketplace does not ‘use’ – for the purposes of Article 5 of Directive 89/104 or Article 9 of Regulation No 40/94 – signs identical with or similar to trade marks which appear in offers for sale displayed on its site.

It considered that article 14(1) of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) must be interpreted as applying to the operator of an online marketplace where that operator has not played an active role allowing it to have knowledge or control of the data stored.

It also added that the operator plays such a role when it provides assistance which entails, in particular, optimising the presentation of the offers for sale in question or promoting them.

The court considered also that where the operator of the online marketplace has not played an active role within the meaning of the preceding paragraph and the service provided falls, as a consequence, within the scope of Article 14(1) of Directive 2000/31, the operator none the less cannot, in a case which may result in an order to pay damages, rely on the exemption from liability provided for in that provision if it was aware of facts or circumstances on the basis of which a diligent economic operator should have realised that the offers for sale in question were unlawful and, in the event of it being so aware, failed to act expeditiously in accordance with Article 14(1)(b) of Directive 2000/31.

Finally, the court ruled that the third sentence of Article 11 of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights must be interpreted as requiring the Member States to ensure that the national courts with jurisdiction in relation to the protection of intellectual property rights are able to order the operator of an online marketplace to take measures which contribute, not only to bringing to an end infringements of those rights by users of that marketplace, but also to preventing further infringements of that kind. Those injunctions must be effective, proportionate, and dissuasive and must not create barriers to legitimate trade.