The Role Of ISPs And Intermediaries In Protecting Intellectual Property Rights
The Impact of Internet Technology on Organized Crimes and IPR
The advancement in internet have significantly given rise to communication challenges that are classless, wireless and borderless. In addition, it has also been beneficial for the criminal actors leading to an incline in worldwide organized crimes. It is a well-established fact that the members engaged in the commission of organized crimes use other Internet Service Providers (ISPs) as well as technological hijacking of personal computer systems to accomplish their goals. Despite being a mere data source, ISPs permit the carrying out of illegal activities and, further, permits illegal transactions to be carried out on their sites. Illegal trade that tends to misuse trademark are usually referred to as trademark counterfeiting and trademark piracy.
The role played by ISPs and other intermediaries in shaping the Internet has received universal recognition in the statutory instruments that regulates Intellectual property rights (IPR) on the European Union (EU) Level. In spite of considering the commission of IPR infringements, both the national and supranational courts are signifying a trend in European intellectual property where the intermediaries are obligated to implement blocking injunctions against the users of their services. On one hand, there exist the interest of the IPR holders and on the other hand, lies the right of the intermediaries to carry out their business operations freely. The rapidly growing advancement in technology and the subsequent gush of contravening acts being accomplished through internet, have left the legislators and he political powers with the responsibility to harmonize and adapt to the default system causing the courts to strike balance.
Although the trademark law is not harmonized completely in the EU, it is highly influenced by centralized decisions that are made by law and in practice. The Trademark Directive that was enforced in 1989 includes provisions related to trademark law and have been implemented by almost all the Member states. A Community-wide trademark right (CTM) was established in 1994 and was being administered by the Office for Harmonization in the Internet Market (OHIM), located in Spain. The CTM protection is applicable to marks that are registered and the unregistered marks are subject to the protection of the national laws on trademark or unfair completion of the various Member states. This is because the CTM was established to co-exist with the national rights that are applicable to the majority of the Member states.
Several contested issues arising from the OHIM that has been ruled by the EUCJ and the General Court are considered as authoritative statements while interpreting the provisions stipulated in the Trademark Directive. The rulings/decisions shall also have a binding effect upon the national registration authorities. The protection extended by the Trademark Directive for distinguishing products or services is three-fold in the course of trade. Firstly, Article 5.1(a) safeguards against using of the identical marks in respect of identical products or services. According to Savola (2014), this protection is considered as an absolute protection but in Celine S.A.R.L. v Celine S.A [2007] E.C.R I-07041, the EUCJ has interpreted that this protection sets out a rebuttable presumption of contravention. However, this interpretation is applicable in respect of traditional trademark law where the outcomes of absolute rules results in inconsistency with the traditional premise of EU law and trademark law. Therefore, Rosati (2017) states that in regards to cases that deal with core trademark law such as use of competitor’s trademark with minute changes, the protection guaranteed under article 5.1(a) shall be construed as an absolute protection.
Role of ISPs and Intermediaries in Blocking Injunctions
Secondly, according to Article 5.1(b) safeguards the use of similar or identical marks from being used on similar or identical products or services when there is a probability of creating confusion among the concerned public in respect of such products or services. In the words of Dore (2015), this provision protects the trademark owner even when the consumers are not confused about the products but are confused in assuming whether the second user of such identical or similar products or services are associated with the trademark owner by affiliation or sponsorship.
Thirdly and lastly, Article 5.2 stipulates that the Member States may provide any additional protection under circumstances when such marks are being used for any dissimilar products or services. This is subjected to an exception that that the use of such reputed marks is detrimental or disadvantageous to the distinguished reputation of such trademark. Therefore, Rosati (2017) states that a trademark owner of any reputed trademark may be entitled to all the protection stipulated under Article 5.1 (a) and 5.2, which, however, gives rise to the question of all the acts that a trademark owner is prohibited from committing.
The EUCJ has not accepted any concept of ‘use of trademark’ and has not incorporated such concept into the European Trademark Law instead; it refers to the trademark functions that are already protected. For instance in L’Oreal SA v Bellure NV [2009], E.C.R, I-12537, the court advertising and the investment function that is safeguarded under the Trademark Directive. EU trademark law is modified based on real market commerce; hence, it is making efforts to address the issues arising from the new uses of trademark including the use of trademark on the Internet.
The incline in the way of committing online piracy is attributed to the growing importance of intellectual property rights, rapid development in broadcasting or distribution of protected works as well as the increased concern for protection of such works. A new system of blocking injunctions with respect to internet has emerged that targets the inline incendiaries to implement such regime towards the users of their service. Given that the intermediaries do not consider themselves label for the commission of online infringements of intellectual property, they feel that they simply being obligated to implement such blocking injunction rule. Rosati (2017) states that the new regime has been established with the purpose to deter the users from having access to illegal online content. Injunction is a possibility for the IPR holders who make it compulsive for the intermediaries to take action against the third party on whom their services are dependent for committing infringement of the Intellectual property rights.
Trademark Law in European Legal Framework
Riordan (2017) differ his opinion from the fact that online injunction blocking is advantageous as it purports to prevent commission of infringement of IPR and accessing illegal online content. Riordan (2017) further states that it raises issues pertaining to strike a balance between such obligation and the Freedom of Information and Expression, Data Privacy Protection and the liberty to carry out business operations.
In the absence of a coordinated and standards legislation appropriate for executing injunctions, several features such as fairness, reasonability, proportionality and efficiency as stipulated under Article 3 of the Enforcement Directive required to be construed while assessing the validity of the blocking order sought by the party. According to Riordan (2017), the legal framework includes several terms that lacks clarity and are not defines harmoniously and autonomously. The lack of legal foreseeability and certainty has afflicted the decisions as well as the rules relating to internet blocking injunctions. For instance, the assessment of the Enforcement Directive made by the European Commission has given rise to several issues relating to different interpretations of evidence amount of certainty that is required for the courts to grant injunctions.
In the landmark case UPC Telekabel Wien v Constantin [C-314/12] at para 24, the CJEU had laid emphasis on the requisites and assessments of proportionality that is required to grant website blocking injunctions. The ruling addressed two issues arising from this case: firstly, whether UPC acted as an intermediary as per article 8(3) of the Infosoc Directive; secondly, whether the general order that was issued by the Austrian court was justified with respect to the basic rights of the parties to the suit.
In regards to the first question, UPC claimed that it could not be interpreted as an intermediary as they did not have any contractual relationship with the operators of the website that was alleged to have been infringed and that there was no sufficient evidence to establish that the users of UPC had acted illegally. The CJEU, thereafter, referred to recital 9 of the Infosoc Directive stating that the primary objective of this directive is to provide high level of protection to the intellectual property rights. According to Savola (2014), the court further emphasized on the implied interpretation of the effect utile of the Infosoc Directive, which does not, requires the establishment of the existence of any contractual relationship between the infringer and the intermediary.
Subsequently, with respect to the alleged infringements committed by the users of UPC, the CJEU referred to the decision given in Scarlet Extended v Sabam [C-70/10]. In this decision, the court stated that when maintaining prevention is the objective of injunction, the establishment of the fact that the users of the intermediaries have actually used the services amounting to the alleged infringement.
Protection of trademark rights under Article 5.1(a) and 5.1(b)
In regards to second question, the CJEU pointed out that the essential rules of injunctions are issues for the national law as per recital 59 of the Infosoc Directive. The CJEU asserts the countervailing rights that were at issue such as the protection extended to IP rights under Article 17 of the EUC versus the freedom of the intermediaries to conduct their business under Article 16 EUC along with the right of the users of UPC to freedom of information as stipulated under Article 11 EUC. The CJEU stated that a general order does violate the freedom of the intermediaries to conduct his business, however, it did not violate the ‘very substance’ of his freedom because the intermediary had the opportunity to select the most appropriate implementation method to establish that all reasonable measures were undertaken to avert any form of liability from such implementation. The CJEU, in regards to the inadequacy of the available measures, the CJEU stated that this requirement is fulfilled when the right to use the confined subject matter is made difficult and daunts the internet users from using the internet.
Cartier International AG and others v British Sky Broadcasting Limited and others [2016] EWCA Civ 658
Cartier and the other claimants sought an injunction against the five main ISPs in the UK for blocking the accessibility to certain websites that were being used by the operators to market counterfeit goods in contravention of the trademark rights. The High Court held that it had jurisdiction to grant injunction for blocking internet sites and the injunction would be proportionate under the given circumstances. In addition, the relief sought is justified, as it would strike a balance between the trademark rights of Cartier and the right of the ISPs to carry out their business freely as well as the right of the internet users to receive information freely. The ISPs were required to pay the expenses incurred for the implementation of the blocking orders.
The ISP challenged the jurisdiction of the court to grant injunction-blocking orders with respect to the contravention of trademark rights. The ISPs further contended that UK had implemented relevant provisions of EU law under Article 8(3) of the Information Society Directive, which empowers the courts to grant internet-blocking injunctions in respect of copyright infringement. According to Lodder, Arno and Puck (2017), UK did not implement any EU provisions pertaining to grant of injunction orders to block websites as is stipulated under Article 11 of the Enforcement Directive. The court expressly recognized that the ISPs did not themselves contravene the trademarks rights of the claimant. The court held that it had wide jurisdiction to grant an injunction order and that Article 11 has provided a legal basis to extend the general power of the court under section 37(1) of the Senior Courts Act 1981. This empowers the court to grant injunctions with respect to matters including website-blocking orders against ISPs, where the third party has used the services to commit infringement of trademark rights.
Online infringement of IPR and emerging system of blocking injunctions
Marsoof (2015) asserts that construing the words of the provisions stipulated under Article 37(1) of the 1981 Act, the court is duty-bound by the ‘Marleasing principle’ that requires the national courts to construe domestic legislation in the manner that is consistent with the EU law as far as it is practicable. The court held that in this case, the ISPs were the ‘essential actor’ that enabled its customers to have access to material on the internet and there was no need to establish that they had contractual relationship with the website operators. The intention of Article 11 is established which ensures that holders of IP rights apart from copyrights owners, are entitled to seek injunction against infringement of their IP rights.
In this case, Horwitz and Ethan (2016) points out that the UK High Court cited provisions stipulated under the Enforcement Directives and CJEU. The expenses of implementing a blocking order should be made by the ISPs unless they establish that they have undertaken all possible measures to avoid any such liability. Dinwoodie (2013) states that it is better for the ISPs undertake an action to prevent contravention arising from their services is than to take actions against the infringers. This case further demonstrates the impact of EU legislation and the CJEU jurisprudence and its application of domestic law. The underlying principles of the Enforcement Directive and Information Society Directive played a significant role in addressing the fundamental question relating to the jurisdiction of the court to grant injunction order.
Conclusion
From the above discussion, it can be inferred that there are uncertainties in the legal composition of European blocking injunctions which requires clarification and the courts that are conferred with the responsibility to apply these powers requires more effective and appropriate guidance. Nevertheless, it cannot be denied that where the statutory remedies, shaped and moulded by centuries of contrasting national legal traditions are interlinked to the global human rights along with the rapid advancement in technology that forms a harmonized and coherent supranational framework, it is obvious it will give rise to intricate issues. As long as the European courts recognize this by undertaking meticulous and severe review with respect to the relevant essential requisites for grating website-blocking injunctions, the related issues are capable of being resolved by harmonizing different national IPR regimes.
This is also evident from the Carier’s case where the decision of the case reflects the judicial importance while applying domestic law in conformity with the European Law (EU) as far as practicable. While granting a website injunction blocking order, the courts must consider the joint burden of obligations that is being borne by the ISPs providers when they are forced to implement such injunction orders. This is because the order is required to maintain a poise between the enforcement of the IP rights while ensuring that right of the internet users to receive information freely and any other fundamental rights are safeguarded while implementing such internet blocking injunction order. Therefore, although the path to harmonization and foresee ability is undoubtedly winding and long, but the significance of harmonization is worth such journey.
Reference list
Cartier International AG and others v British Sky Broadcasting Limited and others [2016] EWCA Civ 658
Celine S.A.R.L. v Celine S.A [2007] E.C.R I-07041
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Enforcement Directive at Article [3]
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L’Oreal SA v Bellure NV [2009], E.C.R, I-12537
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Trademark Directive 1989
UPC Telekabel Wien v Constantin [C-314/12] at para 24,