Collective questions
Emily Scott examines two recent quandaries referred to the CJEU. C-521/17, Coöperatieve Vereniging SNB-REACT UA v Deepak Mehta, CJEU, 7th August 2018.
C-521/17, Coöperatieve Vereniging SNB-REACT UA v Deepak Mehta, CJEU, 7th August 2018
Key points
- A collective body has standing to bring proceedings in its own name as long as it is recognised by national law as having a direct interest in the defence of its members’ rights
- An IP address rental and registration service is exempt from liability for infringement if its activities fall within the scope of the safe harbours provided by the E-Commerce Directive and it has no knowledge or control over the information it transmits or stores, and plays no active role
In a reference from the Estonian Court of Appeal, the CJEU has considered whether a body that provides collective representation for trade mark owners has standing to bring proceedings in its own name and whether the limitations of liability for infringement set out in Articles 12–14 of the E-Commerce Directive apply to the provider of a rental and registration service for IP addresses.
The referral was made in the course of proceedings between the Claimant, Coöperatieve Vereniging SNB-REACT UA (SNB-REACT), and the Defendant, Mr Deepak Mehta, who rents IP addresses to third parties. SNB-REACT claimed that Mr Mehta had registered domain names that unlawfully used signs identical to trade marks owned by 10 of its members, and websites that unlawfully offered for sale goods bearing such signs.
The Court of First Instance dismissed the action on the basis that SNB-REACT had not shown that it had standing to bring the action in its own name, owning no rights over the trade marks at issue. In addition, although Mr Mehta was shown to own IP addresses linked to the allegedly infringing domain names and websites, it was not established that he owned them or had unlawfully used the signs. The domain names and websites were operated by a third party. Liability could not, therefore, be established.
SNB-REACT appealed the decision and two questions were referred to the CJEU; in short:
- Is Article 4(c) of the IP Enforcement Directive to be interpreted as meaning that Member States are required to recognise bodies collectively representing trade mark proprietors as persons with standing to pursue legal remedies in their own name to defend the rights of trade mark proprietors, and to bring actions before the courts in their own name to enforce the rights of trade mark proprietors?
- Are Articles 12–14 of the E-Commerce Directive to be interpreted as meaning that even a service provider whose service consists in registering IP addresses, thus enabling them to be anonymously linked to domains, and in renting out those IP addresses, is to be regarded as a service provider within the meaning of those provisions – and to whom the exemptions from liability provided for in those Articles apply?
Questions
In interpreting Article 4(c) of the IP Enforcement Directive, the CJEU confirmed that a body collectively representing trade mark proprietors is entitled to seek, in its own name, remedies for the purpose of defending the rights of the proprietors it represents and to bring legal proceedings, in its own name, to enforce those rights, on the conditions that:
- the body is regarded by national law as having a direct interest in the defence of its members’ rights; and
- the national law allows the body to bring legal proceedings for that purpose.
These are both matters for the referring court to verify.
In reiterating settled case law, the CJEU concluded that the safe harbours provided by Articles 12–14 of the E-Commerce Directive apply to an IP address rental and registration service if the service falls within the scope of those Articles (ie hosting or caching of infringing information, or acting as a “mere conduit” of it), and insofar as:
the activity is of a merely technical, automatic and passive nature, which implies that the service provider has neither the knowledge of, nor control over, the information transmitted or cached by its clients; and
the service provider does not play an active role by allowing its clients to optimise their online sales activity.
These questions of fact are for the referring court to verify.
Emily Scott is a Chartered Trade Mark Attorney at Boult Wade Tennant LLP