Oracle victorious in grey trading legal battle


Oracle victorious in grey trading legal battle

Alex Scroxton

The Supreme Court has ruled that Oracle has the right to be first to market Sun server hardware in the European Economic Area before third-party remarketers, overturning a previous judgment in favour of UK-based importer M-Tech.

Back in 2010, M-Tech won a major victory against Oracle in the Court of Appeal after a judge agreed that it was impossible "for independent traders to differentiate between genuine Sun goods first marketed in the EEA and those first marketed outside the EEA."

M-Tech claimed Oracle deliberately withheld its serial number database from the channel and since it could therefore not tell whether or not the kit was grey market material, Oracle had no business trying to enforce its trademark rights.

The case hinged on a shipment of Sun servers than M-Tech imported into the UK, which were first sold in China and later purchased by M-Tech from a US-based broker.

Oracle was ordered to pay costs of £85,000, and at the time commenters suggested that the ruling would have major implications across Europe.

However, in a judgment handed down on 27 June, Lord Sumption restored the original judgement against M-Tech, saying the vendor "cannot be prevented from enforcing its right to control first marketing ... simply because it is alleged that [it] proposes to withold information about the provenance of its goods.

"The exercise of Sun's rights was not an abuse of rights in EU law," he added.

M-Tech's lawyers told Bloomberg the firm was "surprised and disappointed" at the reversal. Oracle had not commented on the judgment at the time of writing.

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