Luxury brands are becoming increasingly more controlling as to where their authentic goods can – and cannot – be sold and how entities should be forced to help them fight the sale of fakes. And courts have largely been in their side. A landmark ruling from the European Union’s highest court late last year – which held that U.S. cosmetics company Coty Inc. may legally block retailers from selling its products on online platforms, such as Amazon and eBay – served as a reminder of just how far many of these sought-after names are willing (and legally able) to go to hold on to their carefully crafted auras of exclusivity.
Brands were handed another favorable ruling this April when the Düsseldorf Higher Regional Court held that Japanese luxury cosmetics company Kanebo may limit where its beauty products are sold. Specifically, the court held that Kanebo may prevent real – the European equivalent of Walmart or Target – from offering authentic versions of both Kanebo’s namesake brand products and those from sister brand Sensai, for sale in its brick-and-mortar locations, as well as on its website.
Both decisions come after Cartier, Alaia, and Net-a-Porter’s parent company, Richemont, filed suit against five different internet service providers (“ISPs”) – BT, Sky, TalkTalk, EE and Virgin Media – after they refused direct requests to block access to websites found to be selling counterfeit goods without a court order
In July 2016, the United Kingdom Court of Appeal upheld a landmark ruling from the lower court, stating that trademark holders may be granted site-blocking injunctions, thereby forcing ISPs, including website hosting platforms, to block consumers’ access to websites selling counterfeit products.
A noteworthy win in the fight against counterfeits, the ruling serves to expand the power to order blocking injunctions beyond copyright infringement to those cases of trademark infringement, as well, which is of primary concern for most brands within the realms of fashion, beauty, and luxury.
In upholding the decision, the UK Court of Appeal held that the ISPs must not only limit access to pages and sites selling counterfeits, the ISPs must bear the costs for implementing such measures.
Unsurprisingly, the ISPs in the Cartier case took issue with this, among other aspects, of the court’s decision, and as of this week, the UK Supreme Court ruled in their favor, holding that trademark owners, such as Cartier, must pay the costs of implementing court orders that require “legally innocent” ISPs to block users from accessing counterfeit-selling sites.
“While brand owners will still have to pay the cost of implementing any injunction granted, these should not be prohibitive or outweigh the benefits of obtaining a blocking order,” Louise Popple and Michael Yates, IP and media specialists from London-based firm Taylor Wessing, told WIPR. “Brand owners should therefore look to use this tool as part of their overall strategies where more conventional methods of enforcement do not work.”
* The case is Cartier, Montblanc and Richemont v BSkyB, BT, TalkTalk, EE and Virgin  EWHC 3354 (Ch).