ISPs in the UK no longer have to shoulder the cost of implementing online blocking orders.
IP rights-holders in the UK will now generally have to pay the cost of implementing online blocking orders to protect their IP rights following a recent UK Supreme Court decision, removing that burden from ISPs. In Ireland, the cost of implementing online blocking orders generally remains on ISPs. The decision of the UK’s highest court will be of persuasive value should the issue appear before the Irish courts in the future.
THE NEW UK APPROACH TO BLOCKING ORDER COSTS
In Cartier International AG v British Telecommunications Plc, the UK Supreme Court examined the role of ISPs in implementing website blocking orders for third party breaches of trademarks and also considered where the costs of implementation should fall. Though the case concerned online trademark infringement, the same principles should apply to the costs of blocking orders to prevent online infringement of copyright, although the position in that regard has yet to be determined conclusively.
Previous UK case law viewed the cost of implementation as part of the cost of carrying on business for ISPs, similar to the position currently adopted by the Irish courts. However, in its recent decision, the UK Supreme Court focused on the innocent role ISPs generally play in the context of online infringement, where they simply provide their services as “mere conduits”. The Court drew parallels with injunctive relief of a similar nature, such as freezing orders and Norwich Pharmacal orders, where individuals looking to defend their rights can only recoup their costs from the infringers of their rights, rather than from the party against whom the order is made.
The Court did note, however, that where an ISP does more than simply provide a platform for users (e.g. where it hosts the offending materials), it would likely have to bear the costs of implementing any necessary blocking measures. The Court also emphasised that, although the rights-holder will have to bear the costs, the costs of implementing the blocking order must be reasonable and, in line with EU law, must be fair, proportionate and not unnecessarily costly. Therefore, ISPs that use more expensive mechanisms to prevent the breach of rights may have to bear a portion of the costs.
CONSIDERING CARTIER IN IRELAND
In Sony v UPC, the leading Irish case on the issue of online blocking orders, the Irish Court of Appeal found that, as UPC earned profits through its subscribers, some of whom were enabled through UPC’s services to infringe copyright, it was reasonable to expect UPC to bear the cost of implementing online blocking orders and communicating with its customers in that regard. The Court found, however, that the rights-holders (music companies in that case) should cover other costs as they would benefit from the blocking orders.
The UK Supreme Court in Cartier was critical of the argument that ISPs should bear the costs of implementing online blocking orders on the basis that they profit from the use of their services by infringers, and referred explicitly to the Irish decision in Sony v UPC in this regard. The UK Supreme Court found this line of reasoning suggested a level of moral or commercial responsibility on the part of the ISPs which goes beyond the legal standard and which ignores the commercial interests of rights-holders to protect their IP rights.
WILL CARTIER BE THE SHINING JEWEL FOR ISPS IN IRELAND?
The position in Ireland currently remains that ISPs will generally have to bear the cost of implementing online blocking orders. However, as a decision of the UK’s highest court, Cartier will certainly be a persuasive precedent when the issue next comes before an Irish court. Blocking orders remain one of the most effective methodsof preventing online copyright and trademark infringement. It is unlikely that the UK Supreme Court’s decision will dissuade rights-holders from pursuing them particularly in the UK where they are frequently used as a very effective remedy and in Ireland where their use is increasing along with complementary remedies such as Norwich Pharmacal orders. However, the shifting of the costs burden is a significant development and win for UK ISPs.