Contrary to the Opinion of the Advocate General, the Court of Justice of the EU has found that operators of online marketplaces might, in certain circumstances, be liable for trade mark infringement for the sale of counterfeit goods on their platforms.

Facts

Mr Christian Louboutin is a French footwear designer best-known for designing high-heeled women’s shoes. Since the 1990s, Mr Louboutin’s shoes have always had a red outer sole. The red colour is registered as an EU and a Benelux trade mark (the Marks).

The online marketplace operator Amazon advertises and sells both its own goods, which it sells and ships under its own name, and those of third-party sellers. It also offers third-party sellers additional services of stocking and shipping goods advertised on its platform while informing potential purchasers that it is responsible for those activities.

Amazon websites regularly display advertisements for red-soled shoes, which Mr Louboutin claims have been placed on the market without his consent. Mr Louboutin has issued proceedings against Amazon in both Luxembourg (C-148/21) and Belgium (C-184/21), claiming that Amazon has used a sign that is identical to his Marks in relation to goods that are identical to those for which his Marks are registered. He claims that the advertisements on Amazon’s platform form an integral part of Amazon’s commercial communication.

Both the court in Luxembourg and the court in Belgium asked the Court of Justice of the European Union whether, given Amazon’s hybrid business model, the operator of an online sales platform can be held directly liable for the infringement of the rights of trade mark proprietors on its platform under the Trade Mark Regulation (2017/1001/EU).

Decision

The CJEU noted that in cases of this kind it has already held that the use of signs that are identical or similar to trade marks in offers for sale displayed on the platform is made only by the sellers who are customers of that operator and not by the operator itself, since the operator does not use that sign in its own commercial communications (Case C-324/09 L’Oréal EU:C:2011:474 and Case C- 567/18 Coty Germany EU:C:2020:267). Merely creating the technical conditions necessary for the use of a sign and being paid for that service does not mean that the party offering the service itself uses the sign, even if it is in its own financial interest, the CJEU said. The same is true of providing storage services to the trade mark owner.

However, the CJEU noted, in Coty Germany the online marketplace operator (which was also Amazon) was not aware that the goods in question were infringing goods. Further, Amazon was not itself selling the goods.

In this case, the CJEU was being asked to consider the impact of the fact that Amazon now sells goods in its own name on its platform, as well as the significance of user perception and of the fact that Amazon’s sales offers are displayed in a uniform manner, at the same time as its own adverts and those of third-party sellers, attaching its own logo. It was also being asked to consider the fact that Amazon offers additional services to third-party sellers in connection with the marketing of their goods.

The question, the CJEU said, was whether Amazon could be said to be using the third-party’s trade mark in its own communications and is therefore liable for trade mark infringement.

The CJEU considered whether a well-informed and reasonably observant user of Amazon’s website would establish a link between Amazon’s services and the mark in question. In other words, the CJEU considered whether it could be said that the mark formed an integral part of Amazon’s own commercial communication such that the user might believe that Amazon was marketing, in its own name, the goods in question.

The CJEU said that the fact that all Amazon’s offers for sale, whether for its own sales or those of third-party sellers, were all presented in a uniform way and included its own logo, may make it difficult for users to distinguish between the origin of the offers. This might therefore give the impression that Amazon was itself marketing the goods being sold by third parties. This might establish a link in the mind of the user between Amazon and the mark affixed to the goods in question.

Further, the CJEU said, describing all offers for sale, whether from Amazon or from its third-party sellers, without distinguishing them as to their origin, as “bestsellers”, “most sought after” or “most popular” in order to promote them was likely to strengthen the user’s impression that the goods in question were being marketed by Amazon, in its own name and on its own behalf.

Moreover, Amazon’s provision of other services, such as storage and shipping services, as well as customer services, were also likely to give the user the impression that Amazon was itself marketing the goods in question, thereby creating the requisite link in their mind.

Accordingly, the CJEU ruled that Article 9(2)(a) of the Trade Mark Regulation should be interpreted as meaning that the operator of an online sales website incorporating, as well as that operator’s own sales offerings, an online marketplace, may be regarded as itself using a sign which is identical with an EU trade mark of another person for goods which are identical with those for which that trade mark is registered, where third-party sellers offer for sale, on that marketplace, without the consent of the proprietor of that trade mark, such goods bearing that sign, if a well-informed and reasonably observant user of that site establishes a link between the services of that operator and the sign at issue, which is in particular the case where, in view of all the circumstances of the situation in question, such a user may have the impression that that operator itself is marketing, in its own name and on its own account, the goods bearing that sign. In that regard, the CJEU said, the following are relevant:

• the fact that that operator uses a uniform method of presenting the offers published on its website, displaying both the advertisements relating to the goods which it sells in its own name and on its own behalf and those relating to goods offered by third-party sellers on that marketplace;
• the fact that it places its own logo as a renowned distributor on all those advertisements; and
• the fact that it offers third-party sellers, in connection with the marketing of goods bearing the sign, additional services consisting of, inter alia, storage and shipping services.

(Joined Cases C-148/21 and C-184/21 Christian Louboutin v Amazon Europe Core Sàrl EU:C:2022:1016 (22 December 2022) — to read the judgment in full, click here).