ACTA - Civil Enforcement Summary

Lydia Grunstra
April 23, 2010
The EU released the first official consolidated draft of ACTA on Wednesday. Below is a summary of the section on Civil Enforcement and an analysis of how this latest text differs from previous leaked versions

This section features no major changes from earlier draft versions. It dictates that parties to ACTA shall make civil or administrative procedures available to right holders regarding enforcement of either IP rights or copyright and trademark rights (the type of rights implicated is still under debate). Disagreement over the scope of the treaty – whether it covers copyright, trademark, and/or patent rights – is a recurring theme throughout the text.

1. Each Party’s judicial authorities have the ability to issue injunctions to deter infringement and prevent the import or export of infringing goods. Here, the negotiators added language qualifying the judiciary’s authority to issue injunctions for infringing goods “subject to any statutory limitations under its domestic law,” perhaps acknowledging concerns about ACTA overriding the domestic law of participating countries.

2. This provision, included in earlier drafts, allows right holders to enjoin ISPs for their customers’ infringing activity, regardless of whether or not the ISPs promoted such infringement or whether their products or services were capable of substantial non-infringing uses. (“The Parties [may] shall also ensure that right holders are in a position to apply for an injunction against [infringing] intermediaries whose services are used by a third party to infringe an intellectual property right.”)

1. Under this provision, judicial authorities have the power to order the infringer to pay the right holder damages. When determining the amount of damages, judicial authorities must consider “any legitimate measure of value submitted by the right holder.” In previous versions of the treaty, Australia, Canada, and New Zealand had argued for softer language (“judicial authorities may consider…”) but the U.S. and Japan prevailed. The current language provides great deference to the right holder in determining damages.

2. This section provides a framework for the types of damages an injured right holder may receive, including “pre-established damages” (i.e., statutory damages), actual damages, or “additional damages.” This last option is a new addition to the treaty: although a footnote in the text states that “No Party is required to provide the right holders with more than one of the options” for damages listed, it implies that a Party may still choose to do so. 

Absent here are suggested clauses from previous leaked versions of ACTA mandating that damages “constitute a deterrent to future infringements.” Nevertheless, the inclusion of statutory damages achieves the same deterrent/punitive effect. Statutory damages have been a highly controversial addition to ACTA. Many countries do not currently impose statutory damages for IP infringement, and in those that do, like the U.S., the system has been criticized for allowing disproportionately high awards in relation to the harm suffered. 

3. Even where an actor did not know or have reason to know that he was infringing, he can still be held liable for actual or statutory damages. This provision is in keeping with earlier leaked texts of ACTA.

4. Right holders have the right to elect either actual or statutory damages (where available), a provision in keeping with U.S. copyright law.

5. Two options have been put forth for paragraph five of this section. Under either option, judicial authorities shall be able to order the losing party to pay the prevailing party’s court costs or attorney’s fees and “other expenses as provided for under that Party’s domestic law” (a phrase absent from previous drafts). On the one hand, this could deter right holders from bringing frivolous infringement claims that would not stand up in court. On the other hand, it will also impose a greater burden on defendants found liable for infringement.

1. At the right holder’s request, judicial authorities may order either pirated/counterfeit or infringing goods to be destroyed without compensation. The main difference between this version of the treaty and earlier drafts is that the more serious remedy, destruction (which was suggested by the U.S.), has now been added to the main text, while other alternatives (such as removing the goods from the channels of commerce) are still bracketed for discussion. 

2. “Materials and implements” predominantly used to manufacture or create the infringing or pirated/counterfeit goods may also be destroyed without compensation or “undue delay.” This could include devices or systems that have been used for infringement, even if they also have non-infringing uses.

3. The remedies listed above shall be carried out at the expense of the infringer, “unless particular reasons are invoked for not doing so.”

4. Judicial authorities “shall take into account the need for proportionality between the seriousness of the infringement and the remedies ordered as well as the interest of third parties.”

This section allows judicial authorities to order alleged infringers to provide to the judiciary or the right holder information regarding people involved in “any aspect of the infringement” (including third parties involved in the distribution or production of infringing goods or services) and the means of production or distribution channel of such goods or services. 

Two important changes here: first, the word “alleged” was added to the text. This means that judges can compel not only proven infringers, but also suspected infringers, to release sensitive information to right holders. Secondly, the new draft does away with the qualification from earlier versions that the distribution must be “on a commercial scale” in order for this section to apply. This broadens the scope of the provision to apply to individuals. 

Parties to ACTA may issue injunctions to prevent “imminent infringement.” This applies to infringing intermediaries as well (e.g., ISPs). Even before “the commencement of proceedings on the merits,” judicial authorities may seize or take samples of the infringing goods or documents “to preserve relevant evidence.” The courts must act on requests for provisional measures “without undue delay.” This phrase eliminates the possibility that courts will be held to a specific time period for responding to right holder requests (the U.S. wanted a 10 day turnaround time for such action, Mexico 20 days), but the provision still forces courts to process IP cases with unnecessary haste and prioritize them over other matters. Authorities may (but do not have to) require the plaintiff to provide “any reasonably available evidence” regarding infringement and to provide “a reasonable security or equivalent assurance” to prevent abuse of the defendant. However, the text also stipulates that “such security or equivalent assurance shall not unreasonably deter recourse to such procedures.”

This recent draft of the treaty also omits a paragraph included in earlier versions, which allowed provisional measures to be revoked upon the defendant’s request if the plaintiff failed to institute proceedings within a month. Removal of this paragraph allows right holders to request injunctions of suspected infringing goods without having to prove in a timely fashion that the goods were in fact infringing or counterfeit.

Permalink :