Germany is host to many reputable and profitable international trade fairs. They are known for having the potential to give you a competitive advantage and are respected worldwide. Not least of these fairs is the Nuremberg Toy Fair (SPIELWARENMESSE), taking place later this month.
However, German law contains quirks which can prove to be pitfalls for those whose IP portfolio is not in order or who are not aware of the local practices. With many of our clients heading out to Germany for trade fairs this year, we have spoken with Eckard Nachtwey, of Nachtwey IP in Bremen, Germany, for his advice on what you should know before attending a German trade fair.
Warning – your time at the fair may be over before it starts
Before the trade fair opens, it is common practice for those attending the fair to scout out which competitors are represented. Eckard explains, “They research which products will be displayed and whether infringements of their patents, utility models, trademarks or designs have occurred. If such infringements are detected, a so-called “warning letter” (a cease and desist letter), is prepared which is handed over to the infringer at their trade fair stand on the first day of the fair. The warning letter briefly contains the facts of the case and the purported infringement and requires them to desist from the further exhibition of the products, display of the brochures, etc., within a short period of time – usually the end of the day on which the letter is delivered”. If you receive one of these letters, you should seek legal advice as soon as possible.
Eckard goes on to explain that, where the cease and desist letter is not properly acknowledged and complied with, “the attorneys involved will swiftly apply to the competent court for a preliminary injunction to be issued”. Anecdotally, the practice is so wide-spread that “for large international trade fairs, it is regularly ensured that the relevant courts are sufficiently staffed even on Saturdays and Sundays to decide on applications for an injunction.”
Quick and efficient injunctive relief – for the applicant
As you may expect, court procedure varies from one jurisdiction to another. Eckard explains that, in respect of preliminary injunctions in intellectual property matters in Germany, “there will regularly be no oral hearing before a preliminary injunction is issued. The court does not inform the defendant that such proceedings are pending and the procedure before the court granting the application for a preliminary injunction is usually a unilateral one.” Eckard also confirms that the procedure is a quick one, making it appropriate for use during a trade fair – “Once the proprietor of the IP gets knowledge of the infringement at the trade fair, it may only take three days from the date of the warning letter until the date of delivery of the order”.
This means that not only may the defendant find themselves prevented from exhibiting at the trade fair they have travelled to and paid for, they may not have the opportunity to defend themselves against the injunction that prevents them from doing so.
Enforcement – by bailiffs
The applicant will rely on local bailiffs to enforce the preliminary injunction.
Eckard clarifies, “The defendant may not have any knowledge of the interim proceedings before the order is served at the fair. The applicant must ensure that the order is served on the defendant by bailiffs. The bailiffs will explain the obligations in the court order to the representative at the infringer’s stand (perhaps with the help of translators). They will then seek to enforce the obligation to cease and desist distributing the goods purportedly infringing the applicant’s IP rights. The obligation must be complied with from the moment of delivery of the court order. If ongoing violations of the obligation are established, further court applications (for example for administrative fines) may be submitted by the applicant without delay.”
What can you do if you do not consider that your goods have infringed the applicant’s IP rights?
Eckard explains that the German system does offer recourse for those who do not consider the goods they are presenting at the trade fair infringe the IP rights of the applicant for the preliminary injunction.
We asked him what purported infringers who have been served with a preliminary injunction by bailiffs can do. “They can submit an objection to the relevant court. This must substantiate why the order has been issued unlawfully and why it should be revoked. This must be done by a lawyer admitted in the Federal Republic of Germany. If the trade fair has not finished yet, an appointment for oral proceedings will be scheduled at short notice. Hearings can also take place after the end of the trade fair if necessary
Is the preliminary injunction binding? What happens next?
The preliminary injunction is binding, but provisional. The applicant will expect to receive undertakings and a recognition of the terms of the court order in a particular format. Eckard explains that “if the preliminary injunction is not challenged (or is challenged but confirmed by a further court order), the defendant must submit a so-called “final declaration” to the applicant within a period of 14 days from the date of service of the preliminary injunction (or further court order) on the defendant. The aim of this declaration, given by the defendant, is to confirm that the preliminary injunction is final and binding on the defendant. The applicant’s lawyer may also prepare and send a so-called “final letter” to the defendant, to which the draft of the final declaration is attached. In this case, the applicant’s lawyer is entitled to claim costs from the defendant”
What happens if no counter-application is made, or the court order is ignored?
Whilst each matter is different, Eckard tells us that “if the defendant does not provide a final declaration, the applicant is likely to file a further application to court to obtain information from the defendant on the extent of use of the infringed IP, to seek damages and the destruction of the infringing goods.”
What about costs?
The cease and desist letter, court application and “final declaration” described above will all be drafted on the basis that the defendant will pay the applicant’s costs. Eckard confirms that “this means, in the event that you receive a cease and desist letter and the applicant makes a successful application to court, a legally enforceable claim for reimbursement of the total costs according to the amount in dispute is enforceable against the defendant for the cost incurred by the applicant’s lawyer or patent attorney, as well as court fees and costs for delivery.” However, “if an objection is raised against the order and an oral hearing is held, these further costs must also be determined by the court.”
He warns – “All these costs can then be confirmed by a court order which can also be enforced abroad.”
What can you do if you think your IP rights are being violated?
Eckard is reassuring on this point – it is not only German trade fair participants who can enforce injunctive relief claims in the German courts. “Foreign trade fair participants can also make and enforce an application for a preliminary injunction against a German or foreign company taking part in a German trade fair under the same conditions”. You will need to be represented by a German lawyer to make this application.
He tells us that, “compared to other countries of the European Union, court proceedings are quite inexpensive in Germany, since court costs and the costs of the lawyer’s representative are regulated. Moreover, the costs of representation by a lawyer and/or a patent attorney in court proceedings can be reclaimed by the prevailing party under German law.”
Conclusion
If you are attending a German trade fair, it is essential that your IP portfolio is in order before you attend. We can advise you on all aspects of IP registration at UK and EU level, and work closely with European Union counter-parts to ensure frictionless service should you need assistance in another jurisdiction.