CJEU places limits on invoking banking secrecy in Coty case

National laws cannot allow banks to invoke banking secrecy in an unlimited and unconditional manner in order to refuse to hand over an account holder’s information, Europe’s highest court has ruled in a counterfeiting case brought by Coty.

The Court of Justice of the European Union (CJEU) was ruling on a dispute over an alleged counterfeit bottle of perfume that Coty bought on an online auction website in 2011 from an account holder using an alias.

It incorporated the name Davidoff Hot Water, the rights to which Coty exclusively licenses. The ‘Davidoff Hot Water’ Community trademark, covering perfume products, was registered by Zino Davidoff in 2008.

Coty paid the sum for the product into the individual’s account with the Stadtsparkasse bank.

The beauty products brand then contacted the bank for the account holder’s details in order to follow up its infringement claims, but the bank refused. It said it was bound by German national laws on data protection preventing it from handing over the individual’s personal details.

Following the refusal, Coty filed a claim at the District Court of Magdeburg requesting the bank to hand over the information in accordance with article 8 of Directive 2004/48/EC on the enforcement of intellectual property rights.

Article 8 states that judicial authorities “may order the information on the origin and distribution networks of the goods or services which infringe an intellectual property right” to be provided.

The German court ruled in favour of Coty and ordered the bank to hand over the details of the account holder. But the bank appealed against the decision and the Naumburg Higher Regional Court subsequently overturned the ruling.

Coty appealed against that decision and the case went to the Bundesgerichtshof, Germany’s highest court.

But the court decided to stay the case in 2013 and asked the CJEU to answer whether article 8(3)(e) of the directive should be interpreted as precluding a national provision that allows a banking institution to refuse, by invoking banking secrecy, to provide information about the name and address of an account holder.

Yesterday, July 16, the CJEU ruled that it should: “Article 8(3)(e) ... must be interpreted as precluding a national provision ... which allows, in an unlimited and unconditional manner, a banking institution to invoke banking secrecy in order to refuse to provide ... information concerning the name and address of an account holder.”

The case will now head back to the Bundesgerichtshof for a final ruling. Neither Coty nor Stadtsparkasse had responded to a request for comment at the time of publication, but we will update the story should either party get in touch.