In Sun Microsystems Inc v M-Tech Data Ltd  EWHC 2992 (Pat), Mr Justice Kitchin held that Sun Microsystems Inc was entitled to summary judgment in respect of the parallel import of computer equipment by M-Tech Data Ltd. He rejected M-Tech’s defences that the products were first put on the market within the European Economic Area (EEA) by Sun and that Sun’s exploitation of its marks were contrary to European Community competition law.
M-Tech purchased Sun disk drives from a broker in the United States and imported them into the United Kingdom. It sold them to a company called KSS Associates. Sun contended that the disk drives were put on the market by M-Tech in the United Kingdom without its consent. Sun sued M-Tech for trade mark infringement and sought summary judgment.
The Judge accepted Sun’s evidence that the drives were first placed on the market in China, Chile and the United States and noted that M-Tech had not put forward any evidence that they had subsequently been imported into the European Economic Area by Sun or with its consent, prior to their importation by M-Tech.
He held that Articles 5 to 7 of the Trade Marks Directive (89/104/EEC) (now Directive 2008/95) setting out the scope of the concept of Community exhaustion, as interpreted by the European Court of Justice in Zino Davidoff SA v A & G Imports  joined cases C-414 to 416/99 Ch 109, made it clear that the placing of goods bearing a registered trade mark on the market outside the European Economic Area did not exhaust the proprietor’s right to oppose the importation of those goods without his consent; and the proprietor retained the right to control the initial marketing of those goods in the EEA. Consent to the marketing of the goods in the European Economic Area could not be inferred from mere silence, or from the fact that the goods carried no warning of a prohibition against importation into and sale in the EEA.
In relation to Article 81 of the EC Treaty, the Judge held that the disappearance of the independent secondary market in Sun hardware was not attributable to the offending network of agreements between Sun and its authorised distributors but to the inability of the traders to ascertain the provenance of the Sun hardware in which they were dealing. Furthermore, there was no connection between the enforcement by Sun of its rights and the requirement to buy hardware from within the network wherever possible.