IP Infringement In ‘Brick And Mortar' Stores – Landlord Liability?

Author:Mr Philip Nolan, Peter Bolger and Jevan Neilan
Profession:Mason Hayes & Curran
 
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Currently, it is possible for an IP rights holder to obtain an injunction against an online intermediary whose services are used to sell counterfeit products. What was not clear was whether the same principle applied to real life marketplaces. In the recent Delta Center case (C-494/15), the Court of Justice of the European Union ("CJEU") has decided that this principle does apply and so landlords may be injuncted if their tenants sell counterfeit products.

Directive 2004/48/EC on the enforcement of intellectual property rights provides that EU Member States must ensure that rights holders are in a position to apply for an injunction against "intermediaries whose services are used by a third party to infringe" intellectual property rights.

Online Intermediaries are Subject to Injunctions

It has been the case for some time that an online intermediary, whose services are used by a third party in order to infringe intellectual property (such as selling counterfeits), may be ordered to take measures to end those infringements and to prevent further such infringements (L'Oreal and Others (Case C-324/09)). These measures may be ordered regardless of any liability of the online intermediary in relation to the facts concerned.

Facts

In this case, Delta Center sub-let various pitches in a Prague marketplace. Various rights holders identified the sale of counterfeits from those pitches and applied for an order in the Czech Republic directing Delta Center to:

refrain from concluding or extending any contracts with persons held to have infringed intellectual property rights; and refrain from concluding or extending any such contracts where the contracts do not include a restriction on infringing intellectual property rights or a clause allowing Delta Center to terminate the contract in the event of intellectual property infringement. The Czech courts refused to make these orders and ultimately the matter was referred to the CJEU.

Brick and Mortar Intermediaries also Confirmed as Subject to Injunctions

In deciding the case, the CJEU saw no difference between the established approach to online infringement and infringement in brick and mortar stores or marketplaces. Like...

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