CJUE RULES THAT STORAGE OF INFRINGING PRODUCTS INVOLVES AN INFRINGEMENT OF THE EXCLUSIVE DISTRIBUTION RIGHT

Return to News — Monday 14 January — 2019 byMaría Molina García
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The Court of Justice of the European Union (hereinafter CJEU) has decided on the Judgment of 19 December 2018, (Case C-572/17), about the interpretation of Article 4(1 of Directive 2001/29/EC) has ruled whether the storage of infringing copyright products for subsequent sale constitutes “distribution to the public”.

The procedure which is the subject of the preliminary ruling, began with the marketing carried out by Mr. Syed in a retail shop in Sweden in which he sold clothes and accessories with rock music motifs in which copyrights were reproduced without authorization. Additionally, Mr. Syed stored such goods in a storage facility adjacent to the shop.

In this scenario, criminal proceedings were brought against Mr. Syed, before the District Court of Sweden, for trademarks and copyright infringement caused by (i) the goods offered in the shop and (ii) the goods stored in the storage in which copyrights were reproduced. In first instance, the Court found him guilty for an infringement of the exclusive distribution rights, but only in so far as the goods located in his shop were concerned and not in relation to the goods in the storage facilities.

An appeal against that decision was lodged before the Swedish Court of Appeal, which ruled in the same way as the District Court. In this respect, the Supreme Court, having doubts about the interpretation of Article 4(1) of Directive 2001/29/EC as to whether the storage of goods that infringe copyrights could be regarded as “distribution to the public” - since neither the Swedish law nor the Directive expressly prohibits it - decided to stay proceedings and refer before the CJEU the preliminary ruling.

Finally, the CJEU held, accordingly with the case-law, that the notion of “distribution to the public” can be understood as a series of acts prior to sale, such as the storage of products with the intention of offering them for sale. Moreover, when there is reasonable evidence - such as the fact that the goods stored and those found in the shop were identical, as well as the fact that the place of storage was close to the shop - that these products are being stored for the purpose of being marketed.

In conclusion, the CJEU considers that the unauthorised storage of products infringing copyright owned by third parties is an act prior to the making of a sale which involve an infringement of the exclusive right of distribution laid down in Article 4(1) of Directive 2001/29/EC.

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