Dynamic injunctions: A useful judicial tool against online infringement of IP rights and acts of unfair competition
This article has been also published on Darts-ip (reference number: darts-949-866-J-it-2).

The Court of Rome recently issued a dynamic injunction ordering the removal of any content amounting to unfair competition from any website “currently existing or not yet available.

With a decision issued on October 23, 2020 (the “Decision”), the Court of Rome issued a dynamic injunction to prevent online acts of unfair competition.

The Decision was issued in the context of an urgent proceeding brought by Novaliq GmbH, a German company leader in the business of ophthalmic products (“Novaliq”) against Ismaco, an enterprise active in the business of on-site machining (“Ismaco”)

Background

In July 2019, Novaliq reached out to Ismaco to acquire a significant quantity of F6H8, a chemical compound necessary to make an ophthalmic product (the “Compound”). However, when Novaliq discovered that the Compound was of poor quality and potentially harmful to the eyes, it decided not to conclude the transaction.

As a consequence, Ismaco started an online and offline denigratory campaign, spreading false and slanderous messages through different kinds of media. Among other things, Ismaco registered and used the website “dry-eye.eu” (the “Website”) in order to disseminate false news, such as that Novaliq’s eyedrops were harmful to health and that Novaliq was involved in illegal trafficking of products harmful to health.

Unfair competition and trademark disparagement

The Rome court issued a preliminary injunction designed to provide dual protection: first the goal was to grant protection against unfair competition practiced by Ismaco in violation of Article 2598 No. 2 of the Italian Civil Code, pursuant to which “whoever disseminates news and opinions on the products and activities of a competitor, capable of bringing the competitor into disrepute […]” commits an act of unfair competition.

In addition, The Court of Rome – referencing its recent decision issued on September 18, 2020 (Betty Blue/Franchi case) – also granted a dynamic order designed to protect the competitor’s trademark itself against the denigration and damages resulting from the unfair conduct.

The Court of Rome pointed out the extremely serious and harmful nature of “disparagement of a company’s trademark or commercial name [that] simultaneously causes damage to the company’s commercial activity, its corporate name, and the trademark’s market value and also lessens the value of investments the company has made in trademark enhancement.

This is in line with an order issued by the same court on September 19, 2020, when a dynamic injunction was granted to protect the trademark “Elisabetta Franchi” from further unfair and harmful conduct on the part of the brother of the famous fashion designer. In the Franchi case, The court expressly affirmed that, given the circumstances, the reputation of the busines activity identified by the “Elisabetta Franchi” trademark prevailed over the freedom of expression granted by the Italian constitution to Mauri Franchi, brother of the fashion designer, given the modality he used to exploit such freedom to the detriment of his sister’s trademark.

Dynamic injunctions: A modular judicial remedy

Upholding Novaliq’s requests, the Court of Rome issued a “dynamic injunction” and ordered the removal of “the entire content of the website and/or of any other website, currently existing or not yet available, even with different second and top level domains, which is directly or indirectly attributable to the defendants – including through third parties who are defendant’s successors or who are in any way connected with, or controlled by, or agents of, or act under the direction and on behalf of the defendants.

Moreover, the Court ordered the removal from all social media of any denigratory content regarding Novaliq containing wordings similar to those indicated by way of example in the Decision itself (e.g., “fraudulent medical device manufacturing/outsourcing”; “contaminated and fraudulent production of eye drops”), no matter the language used.

More importantly, the Court expressly provided that “this order is also directed at any company that operates social networks, to which the plaintiff shall report in writing the contents to be removed.” This means that if the plaintiff identifies illegal activity further to the activity already sanctioned with the dynamic injunction, the plaintiff can notify the digital platform or hosting provider, as expressly mentioned by the court in the Franchi case, asking to those entities to enforce the order immediately, with no need for additional legal proceedings

It is easy to see how the dynamic injunction, given its flexibility and modular effect, may become a strategic legal tool in a lot of cases of online IP infringement and unfair competition. The scope of applicability of this tool shall not be limited to copyright infringement. Indeed, dynamic injunctions began cropping up a few years ago as a remedy that provides copyright holders the opportunity to give prompt and flexible responses when claiming online infringement of their rights.[1] Relatedly, the two cases described here indicate that with certain preconditions in place this judicial remedy may be utilized in a broad number of cases.

However, the responsibility for fair and correct application of this tool rests on the shoulders of the rightsholder, as long as further enforcement of the dynamic injunction does not require screening by a judge. Rightsholders must avoid the temptation to proceed to malicious enforcement of the dynamic injunction, going beyond the limits of the order. Also, third-party providers, such as digital platforms or hosting providers, will probably play a role in evaluating compliance with rightsholders requests using the dynamic injunction.

[1] See, inter alia, the dynamic injunctions issued by the Court of Milan on June 18, 2018 against some Italian internet access providers, which were ordered to adopt any technical measures necessary to prevent anyone from sharing unlawful contents like those mentioned in the order, “both using the domain name [*] and any other alias accessible through any domain name, within a maximum of ten working days from the receipt […] of the specific report of the violations by the complainant […].”

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