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Online Counterfeiting: Good News for Rights Holders

Online Counterfeiting: Good News for Rights Holders

Published: 11.03.15 at 16:33

Copyright provides the owner with the exclusive legal right to publish, print or perform musical or literary works and films. If this material is copied, used or distributed without permission of the company or individual which holds the exclusive right to do so, this will constitute a copyright infringement. The practice of sharing or downloading infringing material from websites  is known as piracy, and it is illegal.

Around a year ago, the European Court of Justice issued an important statement: "an internet service provider may be ordered to block its customers' access to a copyright-infringing website."

Laws passed by the European Court  of Justice are particularly important because they are binding on member states, and thus will be applicable to the United Kingdom. In Austria, two companies (UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH), which held movie rights succeeded in their attempt to prohibit access to websites where their copyrighted films could be downloaded or viewed without charge. There is no obligation on the internet service providers (ISPs) to filter all infringing websites, as this would be disproportionate. However, since ISPs are necessary to distribute and access copyrighted material, they are deemed intermediaries whose services are used to infringe copyright. Therefore, they may be required to prevent piracy by blocking specific infringing websites.

In the recent case of Cartier, Montblanc and Richemont v BSkyB, BT, TalkTalk, EE and Virgin, the High Court in the UK extended such blocking orders to ISPs, which hosted websites dealing in and marketing counterfeit goods. Counterfeit goods are products, which look the same or similar and even bear the logo of well-known brands. They essentially infringe third party trade marks, which protect the reputation of a brand. They are signs of origin, which tell the consumer where the product comes from and what quality to expect from the brand owner. 

In the case mentioned above, several luxury jewellery and watch makers such as Cartier, Montblanc and Richemont sought to prevent the advertisement and sale of counterfeit goods online. Many users based in China operate what are widely referred to as 'knock-off' websites, in which the seller claims to be selling for example Cartier jewellery, when in fact the goods are counterfeit. By doing this, those running the counterfeit websites are infringing the trade mark of the well-known brands and causing considerable commercial damage. Therefore, the luxury designers and manufacturers sought to block these infringing websites from being accessible in the UK through certain ISPs, in this case, BskyB, BT, TalkTalk, EE and Virgin.

Criteria

It was decided that the ISPs were under an obligation to block the infringing websites in the UK, if certain criteria were fulfilled. The criteria were as follows:

  • The ISPs must be intermediaries
  • The people running the websites must be infringing registered trade marks by offering goods to UK customers bearing confusingly similar or identical logos and getup of the original products.
  • The website operators must use the services of the Internet Service Providers to infringe trade marks.
  • An online blocking order will only be granted if the ISPs have notice and actual knowledge of the details of the infringement.

The last criterion will be particularly difficult to satisfy, as it is virtually impossible for ISPs to monitor what all the users of their internet services are doing. Thus, online blocking orders are usually awarded where a specific request has already been made by a trade mark owner, which was ignored by the ISP.

Deciding factors and other considerations

As mentioned, online blocking orders have previously been put in place to prevent copyright infringement. In both blocking orders for copyright and trade mark infringements, costs are a very important factor in deciding whether to grant the order. For example, if granting the order obliged the ISPs to install a costly or complicated system, then it may not be granted against a smaller sized ISP, as they may not have the resources to install such a system.

Another important consideration is the principle of freedom; the freedom to conduct business and access information is crucial within the European Union. Therefore, the online blocking orders of copyright and trade mark infringing websites must strike a fair balance between the ISPs freedom of services, the consumer's freedom of accessing information online and the copyright/trade mark owners' exclusive rights. However, it must be noted that the freedom to access information and to carry out business will not extend to a right of copyright or trade mark infringement, especially as counterfeit goods are not subject to any quality regulations and could be harmful or dangerous to consumers, who buy them. 

Impact and significance

If the online blocking order is granted, this should have the effect of discouraging or indeed preventing internet users from accessing the infringing websites in order to view protected material or to buy counterfeit goods. This also protects consumers who may be misled by the infringing websites, which often adopt similar sounding domain names to the registered trade mark, leading the buyer to believe that he or she is buying from the original brand.

Furthermore, the online blocking order may deter others from infringing in the future. The idea is to protect rights holders such as film production companies or luxury brands from commercial losses, as users will be prevented from downloading copyrighted material or buying counterfeit goods from infringing websites. How effective these measures really are needs to be seen.

Written by Rebecca Viegas

Photography: some rights reserved by Ben

Article provided by students at the University of Law.

 

Please note that this article discusses the legal position in the UK at the time of publication. It provides general information only but is not to be regarded as legal advice. You must take advice from a specialist lawyer in relation to your specific circumstances. Further, you should seek additional legal advice when dealing with parties based in other parts of the world or works originating from other parts of the world as the legal position may vary.

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