Last Updated on December 8, 2020 by LawEuro
Neutral Citation Number: [2018] EWCA Civ 86
Case No: A3/2017/4345
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
INTELLECTUAL PROPERTY ENTERPRISE COURT
EU TRADE MARK COURT
HIS HONOUR JUDGE HACON (sitting as a
Judge of the High Court)
[2016] EWHC 2563 (IPEC)
Royal Courts of Justice
Strand, London, WC2A 2LL
Date: 01/02/2018
Before:
LORD JUSTICE LEWISON
and
LORD JUSTICE KITCHIN
– – – – – – – – – – – – – – – – – – – – –
Between:
(1) AMS NEVE LIMITED
(2) BARNETT WADDINGHAM TRUSTEES LIMITED
(3) MARK CRABTREE Appellants/Claimants
– and –
(1) HERITAGE AUDIO S.L.
(2) PEDRO RODRIGUEZ ARRIBAS Respondents/Defendants
– – – – – – – – – – – – – – – – – – – – –
– – – – – – – – – – – – – – – – – – – – –
Jonathan Moss (instructed by Pannone Corporate LLP) for the Appellants
Jacqueline Reid (instructed by Clarke Willmott LLP) for the Respondents
Hearing date: 7 December 2017
– – – – – – – – – – – – – – – – – – – – –
Judgment Approved
Lord Justice Kitchin:
1. This is an appeal by the claimants against that part of the order of His Honour Judge Hacon made on 1 November 2016 in which he declared that the Intellectual Property and Enterprise Court (the “IPEC”), in its capacity as an EU trade mark court, had no jurisdiction to hear a claim by the claimants against the defendants for infringement of EU trade mark No. 1 108 063 (“the 063 EU trade mark”) arising from the use by the defendants of signs identical with or similar to that trade mark in the UK.
The background
2. The first claimant, AMS Neve, is an English company which makes a range of audio equipment and sells and supplies that equipment in the UK and elsewhere. The second claimant, BW Trustees, is established in England and is the trustee of the AMS Neve executive pension scheme. The third claimant, Mr Crabtree, is a director of and shareholder in AMS Neve. BW Trustees and Mr Crabtree are the owners of the 063 EU trade mark and two UK registered trade marks. All of these trade marks are exclusively licensed to AMS Neve.
3. The first defendant, Heritage Audio, is a Spanish company which sells and supplies audio equipment in Spain and, so the claimants assert, elsewhere. It has a website, the Heritage Audio website, which the claimants say is targeted at the UK and the wider EU market. The second defendant, Mr Arribas, is domiciled in Spain and is the sole director of Heritage Audio.
4. In these proceedings, which were issued on 15 October 2015, the claimants contend that the defendants have infringed their registered trade marks and have passed off their products as and for those of the claimants by advertising, offering and exposing for sale and selling and supplying in the UK imitations of the AMS Neve products under and by reference to signs which are identical with or confusingly similar to each of the claimants’ registered trade marks. In support of this allegation the claimants rely upon, among other things, the contents of the Heritage Audio website; the contents of a Heritage Audio Facebook and Twitter presence; an invoice issued by Heritage Audio to an individual in London in respect of the supply of audio equipment; a chain of emails between Mr Arribas and a retailer in London concerning the potential supply by the defendants of audio equipment to that retailer; and the contents of a telephone conversation between a solicitor acting for the claimants and what the claimants contend was a UK distributor of the defendants’ products called SX Pro.
5. As for the Heritage Audio website, the claimants point to, among other things, screen shots displaying for the purposes of trade audio equipment under and by reference to the signs complained of; the fact that the contents of the website are written in English; a section entitled “where to buy” which lists distributors in various countries including SX Pro in the UK; terms of sale which make it clear that the defendants accept orders from “the European Community” and will ship to countries within the EU; and a “frequently asked questions” page which includes the following sections:
“How can I place an order?
Once you’ve decided to purchase one of our products, you can place an order using PayPal. PayPal will guide you through the buying process and will offer you different paying methods. You may use your PayPal account or a credit card.
You can also send us your orders to sales@heritageaudio.net . We will confirm your order and provide you with further details. Orders from the European Community where an exemption applies must include a valid VAT Registration number and must be placed by email.”
“What kind of shipping method do you use?
We only ship our goods using UPS or FedEx. Shipping fees cover our shipping costs, package, labour and insurance. Check our “Terms and Conditions” file to find out more about delivery times and fees.”
6. For their part, the defendants do not dispute that they have used the signs complained of but maintain that they have only ever sold their products in Spain and that, although it is true that their products can be bought through independent outlets in other territories, including the UK, they have never themselves advertised, offered for sale, sold or supplied any products in the UK. They contend they have never appointed a UK distributor and that the parts of the website upon which the claimants rely are obsolete.
7. On 3 May 2016 the defendants issued an application pursuant to CPR Part 11 for a declaration that the IPEC did not have jurisdiction to try the claim. That application came on for hearing before Judge Hacon on 27 July and 11 October 2016.
The judgment of HH Judge Hacon
8. In his judgment given on 18 October 2016 ([2016] EWHC 2563 (IPEC)), Judge Hacon found on the evidence before him that the claimants had established at least a good arguable case first, that the Heritage Audio website was directed and, I would infer, targeted at the UK among other territories; and secondly, that Heritage Audio had, through this website, advertised and offered its goods for sale in the UK under and by reference to the signs complained of.
9. The judge also found that the claimants had established a good arguable case that Mr Arribas was liable as a joint tortfeasor for any acts of Heritage Audio in the UK in respect of which the court had jurisdiction.
10. The next issue was jurisdiction. Here the judge began with the claims for infringement of the UK trade marks and passing off. He held that the IPEC did have jurisdiction to hear these claims pursuant to the special jurisdiction provisions of Article 7 of Regulation (EU) No 1215/2012 of 12 December 2012 (the “Brussels Regulation (recast)”). Although the defendants were domiciled in Spain, they could be sued in the courts of the place where the damage resulting from their tortious acts had occurred and, in the case of the national intellectual property rights in issue, the place where the damage had occurred was the place where the rights subsisted. The UK trade marks and the right to protect goodwill and prevent passing off subsisted in the UK and so the IPEC did have jurisdiction in respect of these claims. The defendants have not appealed against this finding or the judge’s consequential order.
11. The judge then turned to the claim for infringement of the 063 EU trade mark. He held that the position was governed, not by the Brussels Regulation (recast) but by Council Regulation (EC) No 207/2009 on the Community trade mark (codified version) (the “CTM Regulation (codified version)”) as amended by Regulation (EU) No 2015/2424 of the European Parliament and Council. Here, focusing his attention on the Heritage Audio website and Article 97(5), the provision upon which the claimants relied, the judge held that only the courts of the place where the defendants had taken steps to put the offending signs on the website or had taken a decision to that effect had jurisdiction to hear the claim. That place was Spain and accordingly the IPEC had no jurisdiction. He made a declaration to this effect and it is against this part of his order that the claimants now appeal.
The appeal
12. The claimants contend on this appeal that the judge has failed properly to understand and apply the provisions of the CTM Regulation (codified version) and that had he done so he would have found that the IPEC did have jurisdiction to hear the claim for infringement of the 063 EU trade mark. Alternatively, they invite us to make a reference to the Court of Justice for a preliminary ruling as to the proper interpretation of the CTM Regulation (codified version) and its application in circumstances such as those the subject of these proceedings.
13. The defendants respond that the judge came to the right conclusion and that he did so for the right reasons. They also contend that the correctness of the judge’s conclusion is confirmed by more recent authority and that it is neither necessary nor appropriate to refer any question to the Court of Justice.
14. In addressing these arguments it is helpful to have in mind at the outset the key parts of the legislative framework governing jurisdiction. The Brussels Regulation (recast), which replaced Council Regulation (EC) No 44/2001 (the “Brussels Regulation”), sets out general provisions concerning jurisdiction in Section 1. Article 4(1) of that section (formerly Article 2(1) of the Brussels Regulation) provides:
“Subject to this Regulation, persons domiciled in a Member State shall, whatever their nationality, be sued in the courts of that Member State.”
15. Special jurisdiction provisions are contained in Section 2. Article 7(2) of that section (formerly Article 5(3) of the Brussels Regulation) provides:
“7. A person domiciled in a Member State may be sued in another Member State:
…
(2) in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur;”
16. Jurisdiction in respect of EU trade marks is governed by a different regime. The CTM Regulation (codified version) codified the earlier Council Regulation (EC) No 40/94 on the Community trade mark (“the CTM Regulation”). The CTM Regulation (codified version) was later amended by Regulation No 2015/2424 which came into force on 23 March 2016. Among other things, this updated the terminology of the CTM Regulation (codified version) and replaced the term “Community trade mark” by the term “European Union trade mark”. The CTM Regulation (codified version), as so amended, has now itself been codified by Regulation (EU) 2017/1001 of the European Parliament and of the Council on the European Union trade mark (“the EUTM Regulation”) which came into force on 1 October 2017.
17. As I have mentioned, the judge approached the issue of jurisdiction in respect of the 063 EU trade mark on the basis that it was governed by the CTM Regulation (codified version) as amended by Regulation No 2015/2424. The parties are now agreed that this was not strictly correct in light of the dates of the activities complained of. However, this error (if such it was) is of no consequence for the relevant provisions of the CTM Regulation (codified version) have in all material respects been carried through the amended version of that regulation into the EUTM Regulation.
18. The CTM Regulation (codified version) addresses the issue of jurisdiction in respect of Community trade marks (as they were then called) in Title X. Article 94 of Section 1 of that title (formerly Article 90 of the CTM Regulation) deals with the application of Union rules on jurisdiction and reads, so far as material:
“Article 94
Application of Regulation (EC) No 44/2001
1. Unless otherwise specified in this Regulation, Regulation (EC) No 44/2001 shall apply to proceedings relating to Community trade marks and applications for Community trade marks, as well as to proceedings relating to simultaneous and successive actions on the basis of Community trade marks and national trade marks.
2. In the case of proceedings in respect of the actions and claims referred to in Article 96:
(a) Articles 2 and 4, points 1,3,4 and 5 of Article 5 and Article 31 of Regulation (EC) No 44/2001 shall not apply.”
19. Article 96 (formerly Article 92 of the CTM Regulation) provides that Community trade mark courts have exclusive jurisdiction in respect of, among other things, claims for infringement of Community trade marks. Such claims are therefore outside the scope of the general EU rules on jurisdiction.
20. Article 97 (formerly Article 93 of the CTM Regulation) addresses international jurisdiction and provides, so far as relevant:
“Article 97
International jurisdiction
1. Subject to the provisions of this Regulation as well as to any provisions of Regulation (EC) No 44/2001 applicable by virtue of Article 94, proceedings in respect of the actions and claims referred to in Article 96 shall be brought in the courts of the Member State in which the defendant is domiciled or, if he is not domiciled in any of the Member States, in which he has an establishment.
…
5. Proceedings in respect of the actions and claims referred to in Article 96, with the exception of actions for a declaration of non-infringement of a Community trade mark, may also be brought in the courts of the Member State in which the act of infringement has been committed or threatened, or in which an act within the meaning of Article 9(3), second sentence, has been committed.”
21. As in the case of the Brussels Regulation (recast), infringement proceedings can therefore be brought in the courts of the Member State of the defendant’s domicile. Alternatively, pursuant to Article 97(5), infringement proceedings can be brought in the courts of a Member State in which acts of infringement had been committed or threatened. But in this case, the extent of the jurisdiction is limited by Article 98 (formerly Article 94 of the CTM Regulation), which provides, so far as relevant:
“Article 98
Extent of jurisdiction
…
2. A Community trade mark court whose jurisdiction is based on Article 97(5) shall have jurisdiction only in respect of acts committed or threatened within the territory of the Member State in which that court is situated.”
22. A claimant therefore has an option. It can sue in the court of the Member State of the alleged infringer’s domicile in respect of infringements anywhere in the EU. Alternatively, it can sue in the courts of a Member State where an infringement has been committed or threatened, but only in respect of the infringements or threats in that territory.
23. In the present case, the claimants chose to sue the defendants in England in respect of their activities in this territory. As I have explained, the judge found that the claimants had established a good arguable case that the defendants had advertised and offered for sale their audio products through the Heritage Audio website and further, that this website was directed at the UK among other territories. In light of the decisions of the Court of Justice in joined Cases C-585/08 and C-144/09 Pammer v Reederei Karl Schlüter GmbH & Co. KG and Hotel Alpenhof GesmbH v Heller [2010] ECR I-12527 and Case C‑324/09, L’Oréal SA and Ors v eBay International BV and Ors [2011] ECR I-6011, [2011] RPC 27, the judge’s further finding that the claimants had established a good arguable case that the defendants had in this way advertised and offered for sale their audio products in the UK was, I think, inevitable.
24. Advertising goods and offering them for sale under and by reference to an EU trade mark which is registered in respect of those goods are activities in respect of which the proprietor of that mark has exclusive rights under Article 9 of the CTM Regulation (codified version). In these circumstances the claimants might be forgiven for thinking that the IPEC, in its capacity as an EU trade mark court, had jurisdiction to hear the claim in respect of the defendants’ activities in the UK pursuant to Article 97(5) of that regulation. However, the judge was persuaded that it did not. In his judgment he referred to two decisions of the Court of Justice: Case C-523/10 Wintersteiger AG v Products 4U Sondermaschinenbau GmbH [2012] ETMR 31; and Case C-360/12 Coty Germany GmbH v First Note Perfumes NV [2014] ETMR 49.
25. Wintersteiger concerned a company which was established in Austria and made and sold around the world ski and snowboard servicing tools and accessories. It was the owner of an Austrian registered trade mark consisting of the word “Wintersteiger”. The mark was also protected in other territories of the EU including Germany.
26. Products 4U, a company established in Germany, made and sold ski and snowboard servicing tools and accessories, including accessories for Wintersteiger tools. In December 2008 it reserved the keyword (or AdWord) “Wintersteiger” on the Google search engine although it restricted its reservation to searches carried out on the German top-level domain, “google.de”. Each time a user entered the word “Wintersteiger” into the google.de search engine, he or she would receive a link to Wintersteiger’s website together with, on the right hand side of the screen, an advertisement for the products of Products 4U. The google.de website could be accessed from Austria.
27. Wintersteiger began proceedings in Austria for an injunction, claiming that, by placing the advertisement on the google.de website, Products 4U had infringed its Austrian trade mark. It relied upon Article 5(3) of the Brussels Regulation as conferring jurisdiction upon the Austrian court. For its part, Products 4U contested the jurisdiction of the Austrian court and, in the alternative, infringement of the Wintersteiger trade mark. It contended that the google.de website was directed exclusively at German users and the advertisement in issue was therefore intended only for German customers.
28. The first instance court found that, although the google.de website could be accessed in Austria, it was in fact directed only at Germany and the Austrian courts did not have jurisdiction to hear the claim. On appeal, the Oberlandsgericht Linz found that it did have jurisdiction but held that Wintersteiger had no claim. On further appeal to the Oberster Gerichtshof, the court referred a number of questions to the Court of Justice for a preliminary ruling. By those questions the court asked, in essence, what criteria were to be used to determine jurisdiction under Article 5(3) of the Brussels Regulation to hear an action relating to an alleged infringement of a trade mark registered in a Member State through the use, by an advertiser, of a keyword identical to that trade mark on the website of an internet search engine operating under a top-level domain different from that of the Member State where the trade mark was registered.
29. In answering that question, the Court explained that, in accordance with its established jurisprudence, the expression “the place where the harmful event occurred or may occur” in Article 5(3) was intended to cover both the place where the damage occurred and the place of the event giving rise to it, and that the defendant might be sued, at the option of the claimant, in the courts at either of those places.
30. The Court then addressed the place where the damage had occurred and held (at [29]) that an action for infringement of a trade mark registered in a Member State through the use by an advertiser of a keyword identical to that trade mark on a search engine website operating under a top-level domain of another Member State could be brought before the courts of the Member State in which the trade mark was registered. This court would be best able to determine what damage had been caused to the proprietor of the protected right as a result of its infringement.
31. The Court turned next to the alternative, that is to say the place where the event giving rise to the damage had occurred. Here it reasoned (at [33] to [38]) that the relevant event was the activation by the advertiser of the technical process displaying the advertisement and not the display of the advertisement itself; and further, that the place of establishment of the advertiser was the place where the activation of the display process was decided. That place was definite and identifiable and most likely to facilitate the taking of evidence and the conduct of the proceedings. The Court then ruled:
“39. In view of all the foregoing considerations, Article 5(3) of Regulation No 44/2001 must be interpreted as meaning that an action relating to infringement of a trade mark registered in a Member State because of the use, by an advertiser, of a keyword identical to that trade mark on a search engine website operating under a country-specific top-level domain of another Member State may be brought before either the courts of the Member State in which the trade mark is registered or the courts of the Member State of the place of establishment of the advertiser.”
32. Coty concerned proceedings before a German court by a German company, Coty, against a Belgian company, First Note. Coty produced and sold a perfume in a bottle based upon a three-dimensional EU trade mark. In these proceedings it complained that First Note had infringed that trade mark and was guilty of unfair competition by selling in Belgium to a German distributor perfume in a bottle which was similar to that protected by the trade mark. The German distributor was a not a party to the proceedings.
33. The claim was dismissed at first instance and on appeal on the basis that the German court had no jurisdiction. On further appeal, the Bundesgerichtshof referred two questions to the Court of Justice, the first of which is relevant to this appeal. This question asked, in essence, whether the expression “the Member State in which the act of infringement has been committed” in Article 93(5) of the CTM Regulation meant that, in the event of a sale and delivery of a counterfeit product in one Member State (here Belgium), followed by a resale by the purchaser in another Member State (here Germany), the courts of the latter Member State had jurisdiction to hear an infringement action against the original seller which did not itself act in that state.
34. Advocate General Jääskinen delivered his opinion on 21 November 2013. His analysis fell into two parts: first, whether the case law on the interpretation of Article 5(3) of the Brussels Regulation was applicable; and secondly, whether jurisdiction could be conferred on the basis of where the damage had occurred, including damage caused by a third party who was not a party to the proceedings.
35. In addressing the applicability of the case law on the interpretation of Article 5(3), the Advocate General noted the referring court’s view that the determination of the Member State in which a purported act of infringement had been committed within the meaning of Article 93(5) of the CTM Regulation depended both on the place of the event giving rise to the damage and on the place where the damage had occurred, as it does in the case of Article 5(3). He pointed out (at [27]) that the express statement in Article 90(2)(a) of the CTM Regulation to the effect that Article 5(3) of the Brussels Regulation was not to apply to infringement actions precluded a joint interpretation of the two provisions. A little later (at [31]), he explained that the place where the act of infringement was committed was a narrower concept than the place where the harmful event had occurred and further, that it seemed to point to active conduct, and that this would be more meaningful if applied to the place of the event giving rise to the damage.
36. The Advocate General turned next to the second possibility, namely whether jurisdiction was conferred on the basis of where the damage had occurred. Here he explained (from [38] to [43]) that the rule of jurisdiction laid down in Article 93(5) was based upon the principle of territoriality and was expressed in narrow terms; that it should be construed restrictively; and that there were pointers in favour of an interpretation which limited fragmentation of proceedings and the avoidance of forum shopping.
37. The Advocate General then expressed his opinion at [44] and later in similar terms at [71(1)]). For present purposes I need only cite [44]:
“44. I therefore consider that the answer to the first question referred for a preliminary ruling should be that, for an alleged act of infringement to be regarded as having been committed in a Member State for the purposes of art.93(5) of the Community Trade Mark Regulation, and thus to make it possible to establish the jurisdiction of the courts of that Member State, it is not sufficient that the defendant participated indirectly, by means of an act taking place in another Member State, in the infringement of the rights relating to the Community trade mark which was committed in the former Member State by a third party who is not a defendant in the proceedings before the courts.”
38. The Court of Justice gave judgment on 5 June 2014. It was also of the view that the expression “the Member State in which the act of infringement has been committed” in Article 93(5) of the CTM Regulation had to be interpreted independently of the concept of “the place where the harmful event occurred or may occur” and in light of its own wording, context and purpose. This pointed to the need for active conduct on the part of the alleged infringer, as the Court explained at [34] to [35]:
“34. With regard to the wording of Article 93(5) of Regulation No 40/94, the concept of ‘the Member State in which the act of infringement has been committed’ implies, as the Advocate General stated in point 31 of his Opinion, that that linking factor relates to active conduct on the part of the person causing that infringement. Therefore, the linking factor provided for by that provision refers to the Member State where the act giving rise to the alleged infringement occurred or may occur, not the Member State where that infringement produces its effects.
35. It should also be noted that the existence of jurisdiction under art.93(5) based on the place where the alleged infringement produces its effects would conflict with the wording of art.94(2) of that regulation, which limits the jurisdiction of Community trade mark courts under art.93(5) to acts committed or threatened in the Member State where the court seised is situated.”
39. The Court continued (at [36] to [37]) that the origin and context of the CTM Regulation confirmed the intention of the EU legislature to derogate from the rule on jurisdiction provided for in Article 5(3) of the Brussels Regulation. It followed that Article 93(5) of the CTM Regulation conferred jurisdiction solely on the courts in the Member State in which the defendant committed the wrongful acts. All of this reasoning was then reflected in its ruling at [38]:
“38. In the light of the foregoing, the answer to Question 1 is that the concept of the ‘Member State in which the act of infringement has been committed’ in Article 93(5) of Regulation No 40/94 must be interpreted as meaning that, in the event of a sale and delivery of a counterfeit product in one Member State, followed by a resale by the purchaser in another Member State, that provision does not allow jurisdiction to be established to hear an infringement action against the original seller who did not himself act in the Member State where the court seised is situated.”
40. Returning now to the judgment of HH Judge Hacon, he held that, in the circumstances of the present case and in the light of the decisions of the Court of Justice in Wintersteiger and Coty, it was necessary to draw a distinction between, on the one hand, the place where steps were taken to put a sign on a website (or the taking of a decision to that effect) and, on the other hand, the place where the sign was displayed on the website. Only the courts of the former had jurisdiction, especially where locating the action in that place was likely to facilitate the taking of evidence and the conduct of the proceedings. There being no real dispute that the defendants organised the Heritage Audio website from Spain, it followed that the IPEC had no jurisdiction to hear the claim for infringement of the 063 EU trade mark.
41. I am not persuaded that the judge’s conclusion necessarily follows from Wintersteiger or Coty. I think a convenient starting point is the acts of which complaint is made. In these proceedings it is the advertisement and offer for sale in the UK through the Heritage Audio website of audio products bearing the offending signs. It is these acts in the UK which are said to infringe the 063 EU trade mark. Does the IPEC, in its capacity as EU trade mark court, have jurisdiction to hear this claim? It seems to me to be strongly arguable that it does. The acts complained of have been performed within the territory of the Member State in which the court is situated.
42. Coty was a very different case. There the proprietor of an EU trade mark sought to establish the jurisdiction of the courts in Germany to hear a claim for infringement against a Belgian company, as the sole defendant, arising from the activities of that company in Belgium. The Court of Justice held that Article 93(5) of the CTM Regulation conferred jurisdiction on the courts of the territory where the alleged infringement had occurred. The relevant linking factor related to active conduct by the alleged infringer in that territory. In that case there was no such activity for the defendant had done nothing in Germany. By contrast, the claimants in the present case say that requirement is amply satisfied for the judge has found that they have a good arguable case that the defendants have advertised and offered for sale the allegedly infringing products in the UK.
43. I acknowledge that in Wintersteiger the Court of Justice held that, in the circumstances of that case, the place where the event giving rise to the damage had occurred was the place where the advertiser had activated the technical process which led to the display of the advertisement, and that was the place of establishment of the advertiser. But, once again, that was a very different case. It was concerned with the infringement of a national registered trade mark arising from the reservation by an advertiser of a keyword identical to a trade mark on a search engine website, where the reservation was limited to searches carried out in a Member State which was different from that in which the mark was registered. Further, the Court was concerned with the proper interpretation of Article 5(3) of the Brussels Regulation, the meaning of the expression “the place where the harmful event occurred or may occur” and the identification of the place where the event giving rise to the damage had occurred. However, we are concerned with the jurisdiction rules of the CTM Regulation (codified version) and, in particular, the meaning of Articles 97 and 98 and the expression “the Member State in which the act of infringement has been committed”. As the Court of Justice made quite clear in Coty, the meaning of that expression has to be interpreted in light of its own wording, context and purpose.
44. I come next to the two more recent authorities which the parties have drawn to our attention: first, the decision of the Court of Justice in Joined Cases C-24/16 and C-25/16 Nintendo Co. Ltd. v BigBen Interactive GmbH and BigBen Interactive SA given on 27 September 2017; and secondly, the decision of the Bundesgerichtshof in the case of Parfummarken BGH I ZR 164/16 given on 9 November 2017.
45. Nintendo concerned a claim made in Germany by Nintendo Co Ltd (Nintendo) against BigBen Interactive SA (BigBen France) and its German subsidiary, BigBen Interactive GmbH (BigBen Germany). Nintendo makes and sells around the world the Wii video game console and is the owner of various Community designs for accessories for those consoles. In these proceedings it complained that BigBen France had made accessories to which those designs had been applied and had sold those accessories to BigBen Germany and through its website to various customers in France, Belgium and Luxembourg. BigBen Germany then sold those accessories via its website and in other ways to customers in Germany and Austria. It was said that BigBen France and BigBen Germany had in this way infringed Nintendo’s exclusive rights conferred by Article 19 of Council Regulation (EC) No 6/2002 on Community designs (the “Community Designs Regulation”).
46. The Landgericht Düsseldorf found infringement and ordered BigBen France and BigBen Germany to cease using the designs throughout the EU. It also upheld Nintendo’s supplementary claims against BigBen Germany for, among other things, the supply of information, accounts and documents. But in the case of BigBen France, it limited the scope of its judgment in relation to the supplementary claims to BigBen France’s supplies of the goods in issue to BigBen Germany. All parties appealed to the Oberlandesgericht Düsseldorf which referred three questions to the Court of Justice for a preliminary ruling, the third of which has particular relevance to this appeal and concerned the law applicable to the supplementary claims. By that third question the referring court asked, for the purposes of Article 8(2) of Regulation No 864/2007 of the European Parliament and of the Council (the “Rome II Regulation”), how the place in which the act of infringement was committed was to be determined in cases in which the infringer (a) offered goods that infringed a Community design on a website which was directed at Member States other than the one in which the person damaged by the infringement was domiciled; or (b) had goods that infringed a Community design shipped to a Member State other than the one in which it was domiciled.
47. The Community Designs Regulation provides, so far as relevant:
“89. Where in an action for infringement or for threatened infringement a Community design court finds that the defendant has infringed or threatened to infringe a Community design, it shall, unless there are special reasons for not doing so, order the following measures:
(a) an order prohibiting the defendant from proceeding with the acts which have infringed or would infringe the Community design;
(b) an order to seize the infringing products;
(c) an order to seize materials and implements …
(d) any order imposing other sanctions appropriate under the circumstances which are provided by the law of the Member State in which the acts of infringement or threatened infringement are committed, including its private international law.
2. The Community design court shall take such measures in accordance with its national law as are aimed at ensuring that the orders referred to in paragraph 1 are complied with.”
48. Article 8(2) of the Rome II Regulation reads:
“2. In the case of a non-contractual obligation arising from an infringement of a unitary Community intellectual property right, the law applicable shall, for any question that is not governed by the relevant Community instrument, be the law of the country in which the act of infringement was committed.”
49. It can be seen that the third question was drafted on the premise that the various forms of relief sought in the supplementary claims were not governed by Article 89(1)(a) to (c) of the Community Designs Regulation but instead fell within the scope of the sanctions referred to Article 89(1)(d) of that regulation, and that Article 8(2) of the Rome II Regulation was applicable to them.
50. Advocate General Bot delivered his opinion on 1 March 2017. He considered that the concept of the “country in which the act of infringement was committed” in Article 8(2) of the Rome II Regulation should be given the same meaning as the concept of the “Member State in which the acts of infringement or threatened infringement are committed” in Article 89(1)(d) of the Community Designs Regulation. He also observed that the wording of this latter concept was almost identical to that of Article 93(5) of the CTM Regulation which had been interpreted by the Court of Justice in Coty, and that this case law should be applied in interpreting Article 8(2). He thought that to decide otherwise would run counter to the principle of legal certainty in proceedings where legal certainty was required by reason of the complexity and multiplicity of places in which the effects of damage arising from the act of infringement can arise. As to what the meaning of these provisions is, he reasoned as follows at [57] to [58]:
“57. In this respect, in Coty Germany the Court ruled that ‘the concept of “the Member State in which the act of infringement has been committed” implies … that that linking factor relates to active conduct on the part of the person causing that infringement. Therefore, the linking factor provided for by that provision refers to the Member State where the act giving rise to the alleged infringement occurred or may occur, not the Member State where that infringement produces its effects’.
58. Thus, regard must be had to the place of the active conduct on the part of the person causing the infringement in determining the law applicable to the supplementary claims made by Nintendo which fall within the scope of Regulation No 6/2002. A difficulty could arise in determining that active conduct in the present case in so far as several Member States are affected by the acts of infringement. However, I consider that there is a single act giving rise to that infringement, which is located in a single Member State, namely in France. It should be borne in mind that the goods at issue in this case were manufactured in France. Without that manufacture, it is clear that the act of infringement would quite simply not have existed and the goods would never have been sold on the markets of the different Member States.”
51. The Court of Justice gave judgment on 27 September 2017. It made no reference to Coty but explained that the concept of the law of the “country in which the act of infringement was committed” in Article 8(2) of the Rome II Regulation must be given an independent and uniform meaning throughout the EU that takes into account its context and the objective of the rules of which it forms a part. It followed, as the Court explained at [98], that it must be interpreted as meaning that it refers to the country where the event giving rise to the damage occurred, namely the country on whose territory the act of infringement was committed. However, it continued, and as the Advocate General had himself observed, proceedings relating to intellectual property are especially complex and infringing acts may be carried out in several Member States; and further, the Rome II Regulation aims to ensure predictability of the outcome of litigation, legal certainty as to the applicable law and the uniform application of the regulation in all Member States. It then explained at [103]:
“103. In the light of those objectives, where the same defendant is accused of various acts of infringement falling under the concept of ‘use’ within the meaning of Article 19(1) of Regulation No 6/2002 in various Member States, the correct approach for identifying the event giving rise to the damage is not to refer to each alleged act of infringement, but to make an overall assessment of that defendant’s conduct in order to determine the place where the initial act of infringement at the origin of that conduct was committed or threatened.”
52. The Court then addressed the issue of a website used to make offers for sale targeted at consumers in several Member States and reasoned at [108]:
“108. In such circumstances, it must be held that the event giving rise to the damage is the conduct by which an operator offers for sale allegedly infringing goods, inter alia by placing an offer for sale on its website. Accordingly, the place where the event giving rise to the damage occurred within the meaning of Article 8(2) of Regulation No 864/2007 is the place where the process of putting the offer for sale online by that operator on its website was activated.”
53. Finally, the Court answered the third question at [111]:
“111. In the light of all the foregoing considerations, the answer to the third question is that Article 8(2) of Regulation No 864/2007 must be interpreted as meaning that the ‘country in which the act of infringement was committed’ within the meaning of that provision refers to the country where the event giving rise to the damage occurred. Where the same defendant is accused of various acts of infringement committed in various Member States, the correct approach for identifying the event giving rise to the damage is not to refer to each alleged act of infringement, but to make an overall assessment of that defendant’s conduct in order to determine the place where the initial act of infringement at the origin of that conduct was committed or threatened by it.”
54. This decision was, of course, in a context rather different from that the subject of the appeal before this court. However, it appears that the reasoning it embodies has now been applied by the Bundesgerichtshof in Parfummarken to resolve a jurisdictional issue in a claim for infringement of EU trade marks. We have been provided with an unofficial translation of that decision which has been prepared by the parties. The relevant facts of the case, as I understand them, can be stated quite shortly. The claimant was established in Germany and owned or was the exclusive licensee of a series of EU trade marks of great repute. It issued proceedings in Germany against the defendants, a company established in Italy and its chairperson, alleging that they had infringed one or more of those trade marks by, among other things, maintaining a German language internet presence and supplying a list of prices and products from Italy to Germany.
55. The Bundesgerichtshof held that the defendants’ German language internet presence did not provide a proper basis for invoking the international jurisdiction of the German courts. Indeed, the German courts would not have had jurisdiction even if the defendants’ internet presence had been targeted at commercial fragrance vendors in Germany and allowed them to place orders. In light of the decision of the Court of Justice in Nintendo, it was necessary to identify the location of the event which had caused the damage and that was the place where the defendants had started the process of publishing the offer on their website, that is to say, Italy. Nor could the international jurisdiction of the German courts be justified on the basis of the list of prices and products. In determining the damage causing event in a case where the same defendant was accused of a variety of infringements in different Member States it was necessary to make an overall appraisal of the defendant’s conduct to determine the location to which its original activity could be traced.
56. I recognise that the decision of the Court of Justice in Nintendo may be said to provide powerful support for the conclusion that the placing by an undertaking in Member State A of an advertisement on a website targeted at consumers in Member State B is not sufficient to confer jurisdiction on an EU trade mark court in Member State B under Article 97(5) of the CTM Regulation (codified version). Indeed it seems the Bundesgerichtshof has reached this conclusion in Parfummarken, and a decision of that court in this area must be afforded considerable respect.
57. On the other hand, I am also conscious that there has not been a decision of the Court of Justice to this effect and I believe there are substantial arguments why this conclusion may not be correct. First, the legislative scheme embodied in Articles 94 to 98 of the CTM Regulation (codified version) appears to confer jurisdiction in respect of proceedings for infringement of an EU trade mark both upon the courts of the Member State in which the defendant is domiciled and upon the courts of the Member State in which the act of infringement has been committed, but in the latter case only in respect of the infringements in that territory. It may be thought inherent in this legislative scheme that a defendant which has activated in the Member State in which it is domiciled infringements of a particular kind which are carried out in several other Member States may be sued in any one of those other Member States in respect of the particular infringements which have taken place in that territory.
58. Secondly, the Court of Justice has held in Coty that Article 93(5) of the CTM Regulation must be interpreted independently of the concept of “the place where the harmful event occurred or may occur” in Article 5(3) of the Brussels Regulation and in light of its own wording, context and purpose. So interpreted, the concept relates to active conduct on the part of the person causing that infringement and the provision confers jurisdiction upon the courts in the Member State in which the defendant has committed the alleged unlawful act. In the online environment, I believe the decisions of the Court of Justice in Pammer and L’Oréal provide support for the conclusion that the advertisement and offer for sale of goods bearing a sign identical to a registered EU trade mark through an online marketplace targeted at consumers in a Member State constitutes use of the sign in that Member State within the scope of Article 9 of the CTM Regulation (codified version) and active conduct within the meaning of Article 97(5) of that regulation in that territory.
59. Thirdly and as I have explained, Article 97(5) and Article 98(2) of the CTM Regulation (codified version) must be read together and make clear that an EU trade mark court whose jurisdiction is based on Article 97(5) only has jurisdiction in respect of acts committed in that territory. If it be correct that, where a defendant in Member State A has targeted an advertisement at consumers in Member State B and has in that way used a sign identical with an EU trade mark in Member State B, jurisdiction is only conferred by Article 97(5) on the courts of Member State A as the territory in which the defendant activated the process of publishing the advertisement, it would seem that neither the courts of Member State A nor those of Member State B would have jurisdiction under that provision. The courts of Member State B would not have jurisdiction because the process of publishing the advertisement was activated in Member State A; and the courts of Member State A would not have jurisdiction because the infringement took place not there but in Member State B. It may be thought this is a result which the EU legislature cannot have intended.
60. In all of these circumstances I have come to the conclusion that the assistance of the Court of Justice is required as to the proper interpretation of Article 97(5) of the CTM Regulation (codified version). I would therefore refer to the Court of Justice the following questions for a preliminary ruling:
In circumstances where an undertaking is established and domiciled in Member State A and has taken steps in that territory to advertise and offer for sale goods under a sign identical to an EU trade mark on a website targeted at traders and consumers in Member State B:
i) does an EU trade mark court in Member State B have jurisdiction to hear a claim for infringement of the EU trade mark in respect of the advertisement and offer for sale of the goods in that territory?
ii) if not, which other criteria are to be taken into account by that EU trade mark court in determining whether it has jurisdiction to hear that claim?
iii) in so far as the answer to (ii) requires that EU trade mark court to identify whether the undertaking has taken active steps in Member State B, which criteria are to be taken into account in determining whether the undertaking has taken such active steps?
Lord Justice Lewison
61. I agree.
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