Disputes over intellectual property heard by ECJ jump 60% in a year

An increased determination by businesses to protect their intellectual property (IP) assets has led to a sharp rise in the number of IP cases being heard by the European Court of Justice (ECJ) in the last year says City-headquartered law firm RPC.

The number of IP cases heard by the EU’s highest court jumped to 69* in 2014 from 43 in 2013.

RPC says the increase in IP disputes reaching the ECJ is partly driven by the continued development of new disruptive digital technologies that many established businesses fear threaten the value of the content or trademarks they own and even constitute the theft of their IP.

Jeremy Drew, Partner and Head of the IP and Technology Group, at RPC comments: "E-commerce businesses and apps are evolving at such a pace that UK and other national laws just cannot keep up. If national courts can’t definitively answer whether a new online business is illegally using someone else’s IP then the cases have to be referred up to the ECJ.

"Obviously that is an expensive process so it shows how much value businesses now put in their IP that they will fund so many cases all the way to Europe.

"The irony is that the ECJ can take so long to decide a case that once there is a final judgment the commercial landscape has changed completely and the ECJ ruling can either be redundant or come too late to change the facts on the ground.

"The additional delays in getting cases heard at the ECJ can be a significant problem as the ECJ is being asked to make rulings on some of the most significant commercial cases of our time."

Examples of landmark intellectual property cases that have moved to the ECJ include:

• Marks and Spencer’s vs Interflora: M&S, the UK retailer, was sued by Interflora, the flower delivery network, for trademark infringement after M&S bid for the use of trademarked "Interflora" as a "keyword" for their website.
• Louis Vuitton claimed Google had infringed upon its trademarks by selling LVMH trademarked brands names through its Adwords service. The ECJ ruled in favour of Google
• ITV vs TVCatchUp: ITV ultimately won its case to prevent TVCatchUp live streaming ITV’s programmes on its website

Ben Mark, Legal Director at RPC, says that there are also more complex cases being brought as an increasing number of businesses are looking to protect their IP across borders. An increase in cross border trade (partly through online commerce) means there is an increased chance of coming across a competitor with a similar trademark as a business expands into new markets.

Ben comments: "Traditionally businesses would focus more on litigation to protect their IP in their home countries. But with the increase in cross border transactions, due to the rise of e-commerce, businesses are becoming increasingly protective over their ‘brand’, even in markets where they don’t currently have a substantial presence.

"The two big business trends of the last two decades – globalisation and digitisation – continue to drive the flow of cases to the ECJ – unfortunately the infrastructure of the ECJ just can't cope with the number of complex cases it has to hear. The resulting prolonged periods of legal uncertainty can have a significant commercial impact on the businesses concerned."

Rubik's Brand Limited, creators of the Rubik’s cube – recently sued the ECJ over delays in its case – a legal battle that originates in 2006.

Ben adds: "The EU wants to help create a better playing field for content and digital businesses – putting proper resources into the ECJ, to cut any delays, would be one simple step towards achieving that."