Preliminary Injunctions in Austrian IP Litigation

1. Preliminary Injunctions in Austrian IP Litigation Barbara Kuchar Partner Gassauer-Fleissner, Vienna

2. Implementation of Enforcement Directive • Directive 2004/48/EG implemented in Summer 2006 • Much of Austrian law was already in compliance with Directive • NEW: Preliminary injunction to preserve edivence, Art 7 (but used to be possible under case law) • More problematic: presentation of evidence, Art 6 –„discovery“ against fundamental principles of Austrian Rules of Civil Proceedure

3. Claims of an IP Holder • Cease and desist order • Destruction of infringing objects • Payment • Reasonable royalty • Damages (actual damages; infringer‘s profits; double damages) • Legal fees generally awarded in Austria • Publication of decision • Accounting • Information (NEW)

4. Austrian PIs – General Remarks • Ex-parte hearing possible • No specific „danger“ has to be evidenced! (only entitlement to IPR + infringement) • Only evidence that is immediately available permissible • PI must not create an irreversible situation • Court may order to bring suit on the merits within resonable time • Applicant can be liable for damages if PI is reversed

5. Cease and Desist Order 1/2 • Stop continuation of infringement • Continunation presumed after 1st infringement • Burden of proof on defendant • Compliance • Settlement proposal • Prevent imminent infringement • Presumed that defendant will not infringe • Burden of proof on Plaintiff • Registration of TM: no imminent infringement yet • Drug not on market but already listed with health insurance for reimbursement : imminent patent infringement

6. Cease and Desist Order 2/2 • Enforcement Directive also requires injunction against „intermediary“ • Not explicitly implemented but deducible from general civil law/proceedural law • Problems in internet context: • What does a Host-Provider have to know? • Austrian Supreme Court: „What is obvious to the legal lay person without requiring further investigations“ • This standard could come into conflict with the Directive

7. Corrective Measures • Destruction of Infringing Goods • Directive not properly implemented: no „recall“ or „definite removal from channels of commerce“ • Recall/removal can arguably be deduced from existing provisions

8. Corrective Measures and PIs • Now possible to get PI that covers corrective measures as well (intermediary relief used to be available in relation to cease and desist orders only, except for Trademark Act) • Problem: PI must not create irreversible situation • Thus, for instance, order to remove from market and deposit infringing goods possible but no destruction before final decision • Also note Product Piracy Regulation in this context

9. Monetary Relief • In general, a creditor can secure his claim through a PI • Measures include seizure of movable/immovable property, blocking of bank accounts • In comparision to the Directive this is not even limited to infringements on „commercial scale“ • However, Directive speaks of „circumstances likely to endanger the recovery of damages“ • This includes objective circumstances as well, i.e. when the infringer is not in good financial shape • The general Austrian provisions require subjective circumstances on debtor‘s end, i.e that he conceals or squanders funds • Thus, special provisions were incorporated into the IP laws to facilitate PIs to secure the payment of damages

10. Publicity Measures • Austrian law provides for the publication of decisions on the merits • only under certain circumstances • Newspapers, TV, Website, Pop-up • Losing party carries costs • Not possible to have a PI published but Directive would generally require it („judicial decision“ and not only „Urteil“ = decision on the merits) • Failure to implement but arguably of little practical significance • Would often create an irreversible situation: How to undo the impression created by a wrongful publication? Publish again? Often not good enaugh. • Could be necessary if public interests are high, however, for instance, when fake products are dangerous

11. PI to preserve Evidence – Art 7 • Explicitly implemented • Seizure and house search in civil proceedings!!! • Not new, however: Decision of the Vienna Court of Appeal „Microsoft-Programme“ –OLG Wien 25.1.1999, 4 R 6/99b –MR 1999, 167 • A PI was granted to seize unlicensed programs installed on defendants computers. • Defendant could have deleted the programs and frustrated the possibility to compute a resonable royalty based on the number of copies. • The claim was based on Art 50 (1) (b) TRIPS that provides for a civil search to secure evidence, if necessary „inautita altera parte“. • TRIPS is self-executing in Austria, the additional provisions to put Art 50 (1) (b) into effect can be deduced from general proceedural law (since measures availbale for a PI are not listed exhaustively) • Since this decision was the only one, did not even go up to the Supreme Court and remained relatively unknown even among IP experts it was decided to codify this possibility when Art 7 was implemented.