A cat and mouse trademark game

A premium brand such
as Cartier has been carefully cultivated
to maintain an air of prestige
and exclusivity. It is hardly surprising that when the luxury goods maker faced trademark infringement, and the threat of counterfeit products effectively damaging their brand value and reputation, they decided to fight back.

In a unique move, Cartier International have launched a legal campaign in the High Court, demanding an injunction against internet service providers (ISPs) to block websites that were illegally using their trademarked logo for selling counterfeit products. There is no doubt these trademarks should be provided with protection online, however, should the responsibility lie with the ISPs, the individual websites or should brands be targeting the individual sellers?

Making precedent

This injunction request is the first of its kind and, if accepted, it would have a major knock-on effect for all brands that suffer from trademark infringement on the internet. Cartier would set a precedent for all other brands, especially luxury brands that
are more likely to experience problems with counterfeit goods. It is likely that similar brands, such as Tiffany & Co and Hermes, would then pursue the same course of action in an attempt to reap the benefits from Cartier’s trademark protection breakthrough.

If a large number of companies followed Cartier’s lead, it would be difficult to draw the line between investing in trademark protection and instilling lengthy and costly checking processes that are likely to be one-step behind the internet-savvy counterfeit merchants. The internet is a rapidly evolving marketplace and,
just as instances of copyright infringement are difficult to track and block, so too will cases of trademark infringement.

For sites run by counterfeit merchants, ISPs would have
little trouble in identifying and blocking their websites. But when individual sellers are found to be infringing trademarks on larger e-commerce sites, such as eBay and Amazon, the ISPs are bound to face considerable opposition.

Legitimate online businesses using these e-commerce
giants as a base may feel the repercussions of the injunction, especially if entire sites are blocked, consequently damaging their reputation and halting their business. It seems unjustifiable to shut an entire site simply because one retailer is in breach of trademark law. This raises the question: would it be more logical for the brand to maintain its focus on dealing with the individual?

Fair use

Not all uses of the trademarked logo can be deemed as infringement. The Fair Use Act holds that the inclusion of trademarked content is permitted for the purpose of commentary, criticism and parody, therefore closure of websites that merely use the Cartier logo to review products could be considered unethical and a breach upon our freedom of speech.

This questions how ISPs
would monitor trademark infringement, as it could be
used as a method of damage prevention to Cartier’s brand value, as a result of counterfeit trade, or a tactic to remove negative feedback that could harm their brand’s reputation and profit margin.

The ramification of blocking a legitimate business’ site must also be considered. If use of the logo is covered under the Fair Use Act, but the site is still blocked, it could result in a legal backlash for loss of earnings as well as reputational damage. Therefore, a strict criterion must be developed to ensure reputable businesses that have not infringed on the Cartier trademark are not inadvertently blocked.

Cartier is committed to protecting its trademark and has previously sought an injunction against domain registrar Nominet to suspend the
hosting of sites that breach
their trademark rights and sell counterfeit goods. If Cartier loses its current bid against ISPs, it may return to pursuing similar domain registrars or even resorting to suing the individuals involved.

Cartier has brought to light the lengths brand owners will go to protect their intellectual property. While it may seem like assertive action by ISPs is needed to get to the root of the online counterfeit market, it may cause problems further down the line for legitimate businesses. If the injunction is rejected, premium brands such as Cartier will effectively be forced to continue the cat and mouse game embedded in trademark infringement law. SJ

Stuart Whitwell is joint managing director at Intangible Business 

*This article went to press before the decision was handed down from the High Court