There is no such thing as bad publicity, some say. Or, as Oscar Wilde wrote, there is only one thing in the world worse than being talked about, and that is not being talked about.
This rule may have some merit in show business and in U.S. politics, but it is clearly inaccurate in the trade and industry business.
A recent illustration can be found in one of those never-ending French patent disputes, where judgments keep popping up every 2 to 3 years, namely Newmat v. Normalu.
In this dispute, Newmat is the patentee and original plaintiff, and Normalu the original defendant.
As a non-exhaustive summary, in October 2004, Normalu was found guilty of patent infringement at first instance. This was finally confirmed on appeal in May 2010 (in case you are wondering, yes that took a while, but only because there was a first appeal judgment which was set aside by the Cour de cassation, and the case was remitted back to the Cour d’appel).
The litigation continued for the purpose of damages computation. In January 2012, the Paris Cour d’appel issued its final ruling on damages.
A few months thereafter, Newmat published a document entitled “Legal information note on Newmat v. Normalu Barrisol – decision on patent infringement relating to a profiled part for hanging suspended ceiling”. The document contained the court order from the appeal ruling of 2010.
Normalu deemed that this internet publication was an act of unfair competition and therefore sued Newmat, to claim damages. This new branch of the litigation culminated in an appeal ruling from the Paris Cour d’appel issued in May 2015. In the ruling, the court found that Newmat was indeed guilty of unfair competition but limited the amount of damages to the minor amount of 5,000 euros.
Normalu was so disappointed with the outcome that they filed an appeal on points of law. The Cour de cassation rejected Normalu’s appeal on October 18, 2017.
Let’s have a closer look at the facts of the case.
In the first judgment of 2004 in which Normalu was found guilty of infringement, the court granted Newmat’s request that the order of the decision should be published in three journals or newspapers selected by Newmat, up to a cost of 3,000 euros per publication, to be paid by the defendant.
Such a “publication order” is a classical measure quite often ordered by the courts when there is an infringement verdict. An explicit legal basis for this type of order was in fact added to the statute in 2007 (article L. 615-7-1 of the Code de la propriété intellectuelle). It is seen as a complementary remedy to the trouble caused by the infringement.
However, Newmat did not implement this publication order. Instead, they published the abovementioned “legal information note” on their website, and published links to this note in their newsletter and on Twitter.
Normalu argued that Newmat was only authorized by the court to publish the order of the judgment in the form mentioned in the judgment, i.e. in three journals or newspapers. Newmat was not authorized to give the judgment another and arguably broader form of publicity, and should thus be held liable.
The Paris Cour d’appel disagreed and noted that the infringement judgment was public, so that Newmat was free to communicate on it as they wished. The publication order in the judgment did not restrict in any way Newmat’s ability to publish the judgment in a different manner (at its own expenses, one can add). Therefore, the only issue that the court ought to check was whether there was any abuse in Newmat’s communication, and in particular if this communication was disparaging or otherwise represented an act of unfair competition.
In other words, the Paris Cour d’appel did not see any issue in principle with the publication of the judgment on Newmat’s own initiative; but it was nevertheless necessary to check whether the contents and the form of the publication were appropriate.
At this point, the court noted that the text published on the website was neutral and did not comprise any comment – so far so good. Then the court remarked that the text published on Newmat’s website was identical to the order actually contained in the infringement judgment, but for two exceptions.
The first exception was that the part of the order relating to the designation of an expert (for the assessment of damages) was omitted from Newmat’s publication. This was found by the judges to be without any consequence, as the reader was not misled due to the omission.
The second exception was that the order of the infringement judgment referred to the company Normalu, whereas Newmat’s note mentioned “Normalu (Barrisol)” instead. Barrisol seems to be a trade name under which Normalu operates and markets its products.
Newmat explained that it was necessary to specify that Normalu was Barrisol, so that the reader coud properly understand the provided information. On the other hand, Normal argued that, in view of the well-known reputation of the Barrisol trademark, the mention added by Newmat resulted in increasing the impact of the judgment publicity, beyond the exact wording of the judgment.
On this respect, the Cour d’appel sided with Normalu, which led to the conclusion that Newmat had indeed committed an act of unfair competition.
Turning to the computation of damages, Normalu claimed that they had to launch a radio advertising campaign in May 2012 in order to mitigate the effect of Newmat’s online communication. But the appeal judges held that the link between the radio ads and Newmat’s wrongdoing was not adequately proven by Normalu. This led the court to set the amount of damages to the rather symbolic amount of 5,000 euros.
Normalu pleaded its case again in front of the Cour de cassation, but as mentioned above, the supreme court judges found no error in the 2015 appeal decision and rejected Normalu’s appeal on points of law.
In particular, regarding the principle of the online communication performed by Newmat, the court held that:
legal decisions are public; thus the provisions of article L. 615-7-1 Code de la propriété intellectuelle (per which in case of an infringement verdict, the court may order any appropriate measure of judgment publicity, such as by poster or by a full or partial publication in newspapers or online communication services that it designates, in a form to be specified and at the expenses of the infringer), do not exclude the victim’s right to proceed, at its own expenses, with any other publicity measure regarding the condemnation granted to it.
This is a relatively important point.
It means that plaintiffs do not have to ask for the court’s permission before communicating on a ruling which is favorable to them. As long as they communicate at their own expenses, they can do it directly – under the proviso that they remain completely neutral and more generally do not act in an abusive manner.
I would add that it may not be a good idea for a plaintiff to publicize a first instance judgment which is not yet final.
Concerning now the form and contents of Newmat’s communication, the Cassation judges stated that the Cour d’appel was free to appraise the facts as it did, and thus that it issued a legally valid decision.
CASE REFERENCE: Cour de cassation, chambre commerciale, October 18, 2017, Normalu v. Newmat, No. 15-27136.