201810.23

Selling authentic products may constitute an infringement of intellectual property rights

Hyundai structured a selective distribution network for its vehicles in the European Economic Area and Switzerland. Outside this defined space, distribution is regulated by means of contracts under which vehicles may only be sold in a specific territory.
Saint-Herblain Automobiles is a French company selling cars. It collaborates with a network of distributors operated by another French company called Networks Impulxion. Saint-Herblain Automobiles buys from two Belgian companies, Quadriga and Cargonnex, which sell it Hyundai vehicles. None of the four companies mentioned here are part of Hyundai’s selective distribution network.
Hyundai required the President of the Paris court of first instance: i) to order Saint-Herblain Automobiles and Networks Impulxion to cease the sale of Hyundai vehicles not intended for the European Union market and ii) to authorize Hyundai to conduct a so-called saisie-contrefaçon in the premises of the two French companies. Under French law, saisie-contrefaçon relates to Article 7(1) of the Directive 2004/48/EC of 29 April 2004 on the enforcement of intellectual property rights, which reads:
Member States shall ensure that, even before the commencement of proceedings on the merits of the case, the competent judicial authorities may, on application by a party who has presented reasonably available evidence to support his claims that his intellectual property right has been infringed or is about to be infringed, order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement, subject to the protection of confidential information. Such measures may include the detailed description, with or without the taking of samples, or the physical seizure of the infringing goods, and, in appropriate cases, the materials and implements used in the production and/or distribution of these goods and the documents relating thereto. Those measures shall be taken, if necessary without the other party having been heard, in particular where any delay is likely to cause irreparable harm to the rightholder or where there is a demonstrable risk of evidence being destroyed.
By orders issued the same day, the president of the Paris court of first instance dismissed the first demand but ordered the saisie-contrefaçon. Hyundai then noted that its vehicles were offered for sale even though their Vehicle Identification Number indicated that they were not intended for the European Union market.
Saint-Herblain Automobiles and Impulxion Network asked the president of the Paris court of first instance to withdraw the orders, in vain. They lodged an appeal before the Paris Court of Appeal, where Hyundai succeeded. In its decision of September 20, 2018, the Court of Appeal recalled:
The sale under a registered trademark of authentic products by unauthorized sellers constitutes an infringement if the first entry into circulation of such products on the territory of the European Union has not been authorized by the owner of the trademark” (Paris Court of Appeal, Sept. 20, 2018, No. 17/14810).
This decision offers the opportunity to highlight the efficiency and promptness of the saisie-contrefaçon under French law.

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