The German Federal Court of Justice (Bundesgerichtshof, BGH) has ruled that in cases of counterfeit and pirated goods, banks may be obliged under the law to disclose the identity, name and address of the account holder involved in the sale. The decision was handed down on 21 October 2015, following an earlier preliminary ruling by the European Court of Justice (BGH, Urteil vom 21. Oktober 2015, Aktenzeichen I ZR 51/12 – Davidoff Hot Water II, see the BGH press release).
The case revolved around a case of counterfeit perfume which was illicitly placed for sale under the brand of Davidoff Hot Water on the German online platform of eBay by an, at first, unidentified vendor. The brand owner (in fact, the authorized licensee) made a test purchase and then sought to sue the vendor to put a stop to this, to gain an injunction and damages. However, since the eBay offering did not include a proper name and address of the vendor, and the correspondence following the test purchase was inconclusive, the brand owner found it impossible at first to identify the person behind this. All he could find out was the bank information, though, regarding the bank account which the prospective buyer of the merchandise was supposed to pay the purchase price to.
In this situation, the brand owner turned to the bank in question and demanded to know the identity of the account holder. The bank refused to disclose this, citing bank secrecy and its confidentiality obligations to its customers.
The parties thus found themselves in a conflict of the applicable laws: On the one hand, the trade mark law clearly stipulates that in cases of a manifest infringement of rights – which was obviously the case here – the proprietor of a trade mark has a claim for information not only against the infringer but also against any third party that provided services used for right-infringing activities. In that it provided the bank account to collect the money from the sales of the counterfeit goods (unwittingly, in this regard), the bank qualified for that. On the other hand, the bank could cite its right to refuse disclosure under the banking secrecy laws.
The relevant statutory provisions can be found in section 19 subsection 2 sentence 1 no. 3 of the German Trademark Act which in turn is based on article 8 of the EU Directive 2004/48/EC of 29 April 2004 on the enforcement of intellectual property rights, and in section 383 subsection 1 no. 6 of the German Code of Civil Procedure. Fundamentally, it is a conflict of interests and constitutional rights, namely the bank account holder’s right to the protection of personal data, and the bank’s freedom of occupation, on the one hand versus the brand owner’s right to his intellectual property and to an effective remedy on the other (see articles 8, 15, 17, and 47 of the Charter of Fundamental Rights of the European Union).
The case went from the trial stage (claim granted) over the appeals stage (claim denied) up to the German Federal Court of Justice, which referred to question to the European Court of Justice (which may issue general guidelines in cases where, like here, EU legislation is touched upon). The European Court of Justice held that, considering the importance the European Union places on an effective fight against counterfeit goods and brand piracy, in a situation like this, the brand owner’s interests may indeed prevail over the bank account holder’s interest to remain unidentified, however, it should be up to the national courts of the member states to decide on the individual merits of each case.
The German Federal Court of Justice took up this preliminary ruling and, applying these principles to the case at hand, decreed that in this case the bank is indeed obliged to disclose the account holder’s identity.
This claim for information may be enforced under civil law. It is not necessary (although it would be possible to pursue this as an additional, but somewhat complicated measure) to initiate criminal proceedings first in order to obtain the necessary information.
While, unlike in some common law systems, under German procedural law there is no strict rule of precedents, in practice decisions of the German Federal Court of Justice are treated in much the same way. So it may be said that from now on, in similar cases of trade mark infringements by counterfeit goods and brand piracy, brand owners can turn to the banks and demand the disclosure of the bank account holders involved in the transactions. The position of brand owners is thus strengthened in Germany.
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Date: November 2015