Safe harbour hosting defences for trade mark infringement were significantly qualified by the European Court of Justice (ECJ) in 2011. Host websites such as eBay can generally avoid being jointly liable with users who infringe trademarks when advertising goods but there exist important limitations on this type of defence following the conclusion of L'Oréal v eBay .
The implications are wider than simply limiting the defence for online auction sites such as eBay so all host operators should take note. The judgement is good news for brand owners.
L'Oréal v eBay
In July 2011 the ECJ finally handed down its judgement in L'Oréal v eBay. L'Oréal had brought proceedings against eBay after it objected to the sale of various products including parallel imports, counterfeit cosmetics, not for resale tester products, samples and unpackaged goods. The cosmetics firm was unhappy about the auction website’s response to its concerns. eBay invoked the safe harbour defence when the case was heard in the High Court which held that the website was not jointly liable for the acts of its users.
A number of issues were referred by the High Court to the ECJ for guidance. The ECJ ruled that general defence offered by Article 14(1) of the Ecommerce Directive that providers will not be liable for the trade mark infringements of their users’ remains intact if they do not have knowledge or seek to remove the offending adverts expeditiously. However, sites that actively help promote or optimise infringing activities, eBay Shops for example, will not be able to rely on the defence as such promotion would imply constructive knowledge of the infringement.
In addition, the ECJ held that Article 11 of the Enforcement Directive means national courts can order the operator of an online marketplace to take measures that, not only to bring an end to infringements by users, but also prevent further infringements of that kind.
Implications of Qualifying the Hosting Defence for Trademark Infringement
The ruling of the ECJ puts considerably more pressure on hosting websites to not simply tacitly ignore repeated trademark infringements until they are brought to their attention by brand owners. It also limits the safe harbour defence where there is some element of active involvement by the host site, such as optimising the infringing advert. The implied widening of injunctive relief for brand owners is a significant threat to all types of hosts that fail to adequately deal with trademark infringements.
If you need assistance to ensure your website policies and procedures are regulation compliant, Rollingsons has experienced lawyers who can assist you. For more information please contact James Crichton via e-mail jcrichton@rollingsons.co.uk or by telephone on 0207 611 4848.
