Termination of distribution agreement / Alleged infringement by distributor of seller's copyright through use of photographs of seller's products / Copyright protection covers photographer but not product in the photo

The parties to this arbitration entered into a distribution agreement for TV speed reducers, together with all components relating thereto

'In 1989, Defendant [a Swedish company] announced in a letter to Claimant [a French company] that they were being forced to increase the prices at which they sold their products to Claimant.

Six months later, Claimant wrote to Defendant and formally demanded that Defendant conform strictly to the terms of the agreement by granting Claimant the prices as agreed, adding that if Defendant failed to comply with this, Claimant would demand that the arbitration confirm the termination of the contract.

In a letter dated Claimant announced that it considered the contract terminated in accordance with the terms of their formal notice.

Thereafter, Claimant returned its stock of Defendant products to Defendant.

. . .

The Arbitrator therefore concludes that, if it were the case that following the letter of . . . there was a breach of contract thereby giving Claimant the right to terminate the contract on the basis of article 14, Claimant has, in essence, forfeited the legal right to do this.

In view of the fact that Claimant cannot be regarded as having lawfully terminated the contract, it must now pay damages to Defendant.

. . .

Defendant states that Claimant infringed Defendant's copyright by using sales material with photographs of Defendant's product, and claims to condemn Claimant to refrain from this infringement.

. . .

Claimant denies that there has been an infringement of copyright and specifically denies that either the layout or the text of the sales material used by Claimant is identical or even similar to Defendant's brochure or that the photographs in their brochure were Defendant's product.

. . .

The arbitrator shall in this stage also reach a decision on the question as to whether Defendant's copyright has been infringed.

The arbitrator finds this is not the case.

Defendant explicitly said at the hearing that it would not be indicated which photographs in the brochure now being used by Claimant had been taken by Claimant and which photographs had been taken by Defendant.

Defendant's position that a number of photographs contain Defendant's products cannot serve as a basis for a finding that there has been an infringement of their copyright. In any event the taking of photos of products of a third party can never be regarded as an infringement of copyright, since the law of copyright protects the photographer and not the product in the photo. In addition, no further points were put forward by Defendant to support their position that Claimant has infringed their copyright.

If, in addition, Defendant were to indicate that they wish to base their claim on the law of tort, this would not succeed either.

The only submission made by Defendant on this subject was the possibility of confusing similarity between the products, but this submission, that was not elucidated or in any way amplified and that has also been contested by Claimant, is highly insufficient.'