Bloomberg is reporting today that a district court in Dusseldorf, Germany, has granted an injunction preventing Samsung from distributing the Galaxy Tab 10.1 throughout the European Union (EU), except for the Netherlands.
The information appears to have come originally from the Deutsche Presse-Agentur news service, which cited – according to Bloomberg – ‘unidentified people involved in the court negotiations’. Other outlets are also reporting the story, citing the same original source.
However, Bloomberg also claims that an Apple spokeswoman, Kristin Huguet, confirmed the report ‘in a phone interview’. It is not clear with whom this interview was conducted, or whether it has been reported in greater detail elsewhere.
We are presently a little sceptical of the Bloomberg report, in part because it is unclear to us that a German court necessarily has the power to issue – or to enforce – an injunction covering the entire EU, although this may depend upon the basis for the injunction. Despite the existence of a largely pan-European patent application and grant process, maintenance and enforcement of European patents operates on a country-by-country basis. Thus an EU-wide injunction based on patent rights is not likely. However, there are trade-based laws relating to unfair competition and/or misleading or deceptive conduct, that do operate across national borders within the EU.
According to a CBS report, ‘[b]ecause Germany is part of the EU, the ruling carries beyond its national borders,’ although the mere fact that Germany is part of the EU is not sufficient, and it will depend upon exactly which laws are being invoked. For example, the CBS report also refers to ‘patent wars’, although as noted above this is not generally a basis for any EU-wide order.
In fact, according to FOSS Patents blogger Florian Mueller, Apple’s German action is based on a Community Design Registration (which protects the physical shape of a product, but not its function) and unfair competition grounds, on the basis that Galaxy Tab is an iPad imitation. As we noted in an earlier comment, this type of ‘misleading conduct’ would be very difficult to establish under Australian law, because the overall distribution, marketing and sales activities of Apple and Samsung mean that it is highly unlikely that someone wishing to buy an iPad2 would end up inadvertently acquiring a Galaxy Tab 10.1. This is not a case of Samsung ‘passing itself off’ as Apple – it wishes and intends to be recognised as a competing brand.
In the absence of relevant intellectual property rights, such as the Community Design relied upon by Apple in Europe, it is not ‘unfair competition’ merely to market a product that has a similar function and appearance to that of a competitor, on the basis that this is what consumers want. For conduct to become unfair, misleading or deceptive, something more is required, such as creating a false impression that there is some formal connection between the ‘original’ product or its supplier, and the competitor’s product.
In its article, Bloomberg also states that ‘[i]n Australia, Samsung has agreed not to introduce a version of its Galaxy tablet computer until an Apple lawsuit there is resolved’ which, as we have reported previously, is not an accurate characterisation of the current agreement forged between Apple and Samsung outside the Federal Court in Sydney.
Under the pressure of the ‘24-hour news cycle’ there is a trade-off between speed and accuracy of reporting. We will keep an eye on how this develops.