Enforcing Soft IP in Germany - Featuring Maximilian Kinkeldey and Holger Gauss from Grünecker Patent- und Rechtsanwälte PartG mbB.
In today's fast-paced digital economy, intellectual property (IP) is a prized asset for businesses and innovators alike. But with the rise of imitators, safeguarding your creations has never been more crucial. In this exclusive interview, we speak with Prof. Dr. Maximilian Kinkeldey and Dr. Holger Gauss from the renowned German law firm Grünecker Patent- und Rechtsanwälte PartG mbB. With their deep expertise in soft IP enforcement, they share insights on the complexities of protecting trademarks and designs in Germany. They discuss the legal tools available to combat infringement and ensure that your innovation remains safeguarded in a competitive marketplace.
Soft IP Landscape
Germany has long been a leader in intellectual property protection within Europe. From your extensive experience, what unique characteristics make Germany stand out in enforcing soft IP rights compared to other jurisdictions?
Germany has specialized IP judges with all competent courts, who primarily deal with trademark, design and copyright disputes. Thus, our courts are very experienced and effective. Usually, German courts do not hear experts to evaluate trademark or design infringements. Rather on the contrary, judges often consider themselves part of the relevant public as they have direct experience with the products or services (i.e. grocery items, IT products, banking services etc.) which they can rely on, e.g. when assessing the likelihood of confusion between two trademarks. In this dual role as a judge and consumer, members of German courts are well positioned when it comes to evaluating how the relevant public (including themselves) perceive the opposing marks.
Even though the German rules of procedure have somewhat changed within the past few years in order to guarantee full equality of arms for both parties, Germany still has the fastest and most efficient court enforcement system we are aware of. Preliminary injunctions can be obtained within a few days – sometimes even within hours, e.g., during trade shows.
In order to succeed in preliminary injunction proceedings it is, however, now generally necessary to prepare the proceedings a bit differently from before. For example, with the exception of counterfeit matters, a party must send a detailed warning letter to the other side before taking the matter to court, setting a reasonable deadline for a response, and must then inform the court about both the warning letter and any relevant response by the other party. Even though the preparation of the proceedings appears more complex at first glance due to the new mandatory warning letter beforehand, a German preliminary injunction is still a fast and highly efficient type of procedure to quickly stop an infringement.
Depending on the nature of the matter (e.g. in counterfeit cases), the plaintiff can also obtain a seizure order (e.g. for fast moving consumer goods or to clear a booth from infringements at a trade show). In obvious cases, claims for information about the source of the infringement and related details can be enforced through preliminary injunction proceedings, too.
Forum shopping” is possible in many cases, allowing us to choose the best court for the infringement suit at issue. This is very helpful as e.g. the urgency periods, in which preliminary injunctions are granted, can differ from court to court.
German courts have a long history and ample experience in soft IP enforcement. Therefore, other European national courts often look at and cite German Federal Supreme Court decisions as a reference.
Last but not least, German Unfair Competition Law plays an important role in the context of soft IP enforcement, and often proves to be a highly efficient, flexible and useful tool in passing-off cases where, for example, the product packaging has been copied by the infringer (however, staying clear of the original manufacturer’s brand). Where the original product packaging enjoys so-called “competitive uniqueness” in the market, a plaintiff may proceed against imitations where it can be shown that they create direct or indirect consumer deception. Products with a reputation are even protected broader against exploitation or impairment of their reputation.
Recent Trends
As the field of intellectual property law evolves, staying ahead of trends is vital. What recent developments in German IP law have had the most significant impact on enforcing soft IP rights, particularly amid globalization and technological change?
Obtaining immediate (ex parte) preliminary injunctions without a court hearing has become more difficult. To ensure equality of arms, all claims and all relevant information must usually be disclosed to the infringer in a warning letter before the trial. This is something a potential plaintiff should be aware of.
German courts can no longer grant preliminary injunctions without hearing the defendant if the statement of claims exceeds the pre-court communication, e.g., if new claims, new facts or new arguments are submitted to the court and where the infringer was not given the chance to comment.
On the other hand, a German court order to cease an infringement in a soft IP matter now puts broader obligations upon the obligations. According to several decisions issued by the Federal German Supreme Court, solely ceasing the infringing act is no longer sufficient. To comply with a court decision to cease and infringement, the defendant must now also eliminate all impacts of the forbidden act. This includes clearing references in search engines, on websites and social media where possible, and also to recall infringing products from commercial customers. Thus, the rights owners rights have been strengthened.
Challenges in Enforcement
Enforcing soft IP rights is rarely straightforward. Could you share the most common challenges your clients face during enforcement efforts in Germany, and how your expertise helps them navigate these complexities?
Well-prepared warning letters are necessary to obtain preliminary injunctions. All relevant facts strengthening the case (e.g., demonstrating the success of the client’s trademarks/products and increased scope of protection) should be collected in advance. In design infringement and passing-off matters, it can also be vital to comment on the prior art and products of competitors. This information should be gathered before sending out a warning letter.
Besides, urgency, i.e., “speed”, is up most crucial in preliminary injunctive proceedings. The urgency periods of German courts vary between one and two months. Any delay must be avoided, before and also during the court proceedings. German courts are very strict in that respect. A preliminary injunction case may even be lost if the plaintiff asks the court to extend a deadline. We are certainly aware of this complex landscape, and help our clients to safely navigate through any challenges that may come up in this respect.
We support many of our clients in investigating and combatting infringements with preliminary injunctions. Our litigation team, as well as our investigators, have a long-term experience with the German enforcement system, including the urgency requirements, and we work with high efficiency. We put major emphasis on a full and comprehensive documentation of the infringements as well as the facts that support our client’s position but ensuring the necessary speed of the actions. Besides, we have enough capacity to handle multiple cases in parallel, e.g., during a trade show. Our “personal record” in obtaining a preliminary injunction stands at 1,5 hours from filing to granting, and at obtaining 10 preliminary injunction in parallel within one day.
Enforcing cancellation claims against an infringing .de CCTLD remains a challenge, as the UDRP and other domain dispute procedures do not apply to .de domains. In addition, German case law grants claims for cancellation of a domain only in very exceptional cases. Therefore, enforcement against .de domains requires thorough preparation, strategy, and often a combination of potential enforcement measures.
Cross-Border Disputes
Intellectual property disputes often cross national boundaries, adding layers of complexity. What strategies do you recommend for effectively managing cross-border soft IP enforcement, especially within the EU?
As the EU trademark and design systems prevent German courts from rendering EU-wide decisions where the infringer is based in another EU state or has an establishment there, it may become advisable to proceed in other countries. However, in view of the effectiveness of the German preliminary injunctive system and given that Germany is an important market, it can nevertheless often make sense to obtain a preliminary injunction in German to create leverage. We have successfully applied this strategy in numerous cases and for numerous clients in the past.
Besides, we work with a great network of highly specialized law firms throughout the EU and can secure that our clients get the best and also most effective advice in other EU countries. This includes cross-border enforcement of German decisions as well as border surveillance with customs.
However, it is always important to develop a strategy that weighs all relevant factors, in particular speed, geographical range of the enforcement and practical effectiveness of enforcement against each other. So first it always needs to be established whether EU wide enforcement is possible before German courts, and if not, what other EU member state has jurisdiction for EU wide measures. In a next step, it then needs to be established whether enforcement before such other national courts are fast and efficient (e.g. whether preliminary injunctions are available, at what cost, and within which time frame) – and in many cases it has proven more effective to take the national enforcement in Germany in order to create quick and efficient precedent.
Counterfeiting and Piracy
Product counterfeiting and knock-offs pose a significant threat to IP owners, especially with the rise of digital commerce. How has the surge in e-commerce platforms affected the fight against counterfeiting and piracy in Germany, and what new approaches are you implementing?
The highly increased number of E-commerce platforms has drastically added to the existing sales channels for infringing products. Nevertheless, strong European Regulation, in particular the Digital Services Act (DSA) provides the tools to have these infringing products removed. This works well with the large players. The main issue is the volume and the identification of sometimes niche-platforms, where these goods are trending.
We are closely familiar with the e-commerce platform ecosystem and the IP protection tools provided. For example, we can conduct campaigns to have specifically trending counterfeits monitored and removed at a broad scale, using respective technology.
Regularly smaller niche-platforms are more problematic, as they are less responsive to notifications. Here, notifications to ISPs providing infrastructure for the platform or to payment service providers are helpful, too.
Technology and Innovation
Technological innovation is reshaping intellectual property landscapes worldwide. How do emerging technologies like artificial intelligence and blockchain influence the enforcement and protection of soft IP rights in Germany?
AI based monitoring is already now essential for an effective platform monitoring for infringing products. However, those tools are not perfect and have to be used carefully, as unsubstantiated notifications can cause counterclaims, which can be enforced e.g. via a preliminary injunction.
Blockchain has the potential to become a very useful tool for automated verification of the authenticity of certain products. However, its use is very limited so far.
However, blockchain can be also be used by infringers in order to make enforcement far more difficult, i.e. by using digital currencies or even counterfeit shops based on decentralised blockchain domain names, allowing complete anonymity for infringers and also making an effective enforcement of IP rights highly challenging.
Advice to Startups and SMEs
Startups and SMEs often operate in fast-paced, highly competitive environments. What key advice would you offer these smaller players to build and safeguard their soft IP portfolios in Germany's dynamic market?
Of course, budget plays a significant role for start-ups and SMEs. Nonetheless, we strongly advise to start protecting IP rights as soon as possible and to take them into account when funding.
In terms of trademarks, we usually advise to start with protecting core brands, core goods and services and core countries to comply with smaller budgets. The 6-month priority period allows to register IP rights in other countries at a later date – e.g. after another round of funding.
For registered designs, non-disclosure agreements should be used to allow registrations at a later stage. Otherwise, the publication of a product will automatically trigger the one-year grace period to register a design. Furthermore, countries like China confirm the validity of a design registration published by the holder before filing only in very exceptional cases.
Future Outlook
The world of intellectual property is constantly changing. How do you envision the enforcement of soft IP rights evolving in Germany over the next decade, and what role do you see international collaborations playing in shaping this future?
Enforcing soft IP rights in Germany is likely to undergo significant evolution in the future, given the further developments to be expected in technology, legal reforms and increasing international cooperation and sales.
A further EU-wide harmonization of copyright protection is desirable, considering the Federal German Supreme Court’s slight reluctance to grant broad copyright protection to works of applied art, such as fashion items. The same applies to the requirements and effects of cross-border enforcement on the basis of EUTMs and EU Designs.
Nonetheless, one may assume that a majority of infringement suits will only have a national effect, and that German trademark enforcement proceedings as well as the national German protection against passing-off will continue to play an important role in the future, as one of the most efficient protection eco systems that exist within the EU.
We closely follow all current and future developments, and will actively take part in shaping the future of soft IP enforcement in Germany and the EU.
Leopoldstr. 4, 80802 Munich, Germany
Tel. +49 (0)89 21 23 50
Fax. +49 (0)89 22 02 87
greiner@grunecker.de
www.grunecker.de
Grünecker Patent- und Rechtsanwälte PartG mbB
Amtsgericht München
Partnerschaftsregister 1397
