October 1, 2018

The claimant, Coöperatieve Vereniging SNB-REACT UA, was a Dutch organisation that provided collective representation for trade mark proprietors. It issued proceedings in Estonia against the defendant, Deepak Mehta, seeking remedies in relation to the alleged infringement of the trade mark rights of ten of its members.

SNB-REACT contended that Mr Mehta had registered internet domain names that unlawfully used signs identical to trade marks owned by those ten members, together with websites unlawfully offering for sale goods bearing the signs. SNB-REACT also argued that Mr Mehta was the owner of IP addresses corresponding to those domain names and websites, and that Mr Mehta was liable for the unlawful use of the signs through the domain names and websites. Mr Mehta denied the claims.

The matter reached the Estonian Court of Appeal, which referred two questions to the CJEU.

First, the CJEU was asked whether Article 4(c) of the IP Enforcement Directive meant that Member States were required to recognise a body collectively representing trade mark proprietors as having standing to seek, in its own name, remedies in order to defend the rights of those trade mark owners, and to bring legal proceedings, in its own name, for the purpose of enforcing those rights.

The CJEU noted that, pursuant to Article 4(c) of the IP Enforcement Directive, Member States are required to recognise IP collective rights-management bodies as able to seek remedies to enforce their members’ rights, insofar as permitted by and in accordance with the provisions of applicable law.

Further, it said, the intention behind the provision was to give not only the holders of IP the right to enforce under the Directive, but also those who had “a direct interest in the defence of those rights and the right to bring legal action”, provided that national law allowed it.

Article 4(c) therefore had to be interpreted to mean that: (i) where a body in charge of the collective management of IP rights, and recognised as having standing to represent the holders of those rights, is considered under national law as having a direct interest in the defence of those rights; and (ii) national law allows that body to bring legal proceedings, Member States must recognise that body as entitled to rely on the provisions of the Directive and to bring legal proceedings under it.

The CJEU said that it was for the Estonian court to determine whether SNB-REACT was considered to have a direct interest in the defence of the rights of the trade mark proprietors it represented, and whether national law allowed it to bring legal proceedings.

Secondly, the CJEU was asked whether the limitations of liability under Articles 12 to 14 of the E-commerce Directive (2000/31/EC) applied to the provider of an IP address rental and registration service that allowed domain names to be used anonymously.

The CJEU held that to answer this, it was first necessary to determine whether the service in question constituted a mere conduit, caching or hosting service. If the answer was “yes”, then it was necessary to consider whether the conditions under those Articles had also been met. In particular, it was necessary to consider whether the service provider’s activities were of a mere technical, automatic and passive nature, which implied that the service provider had neither knowledge of nor control over the information that was transmitted or stored.

Further, it should be considered whether or not the service provider played an active role, by allowing its customers to optimise their online sales activities, in which case the limitations on liability would not apply.

These matters were for the Estonian court to decide. (Case C-521/17 Coöperatieve Vereniging SNB-REACT UA v Deepak Mehta EU:C:2018:639 (7 August 2018) — to access the judgment in full, go to the curia search form, type in the case number and follow the link).