Out-Law / Your Daily Need-To-Know

Ruling enables trade mark enforcement over product listings on websites

Out-Law News | 09 May 2022 | 3:47 pm | 2 min. read

The Court of Appeal has reversed a significant judgment from the High Court which limited brand owners’ ability to object to use of a trade mark on a global marketplace.

The ruling concerned when UK and EU trade marks can be said to have been ‘used’ on global marketplaces or websites. The underlying case before the courts concerned goods marketed and sold on Amazon.com which a rights holder, Lifestyle, objected to.

To determine whether Amazon was liable for trade mark infringement, the Court of Appeal had to consider whether the marketplace had ‘used’ Lifestyle’s trade marks without permission. In the context of a global marketplace or website “use” would be established if advertisements and offers for sale of products under the trade mark were “targeted” at consumers in the UK and EU.

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Tom Nener

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Context of the offer for sale and the customer journey are still key but factors such as the offer to ship to a geographical location, payment details in local currency and actually delivering the products to that location could all be determinative

The High Court previously found that Amazon only infringed a UK and EU trade mark when the goods being sold under the sign were advertised and offered for sale on its country-designated Amazon site i.e. amazon.co.uk. Anything sold on its global amazon.com website were considered to be targeted at consumers in the US notwithstanding that those products could be accessed and purchased in the UK.

The consequence of that decision was that it made it more difficult for brand owners to object to infringements on global marketplaces, or global websites. The Court of Appeal has now overturned that decision.

In his leading judgment for the Court of Appeal, Lord Justice Arnold analysed a UK customer’s journey when making a purchase on Amazon.com. He noted that the purchaser was located in the UK, the shipping address was in the UK, the billing address was in the UK and the currency of payment was GBP. Moreover, Amazon would make all the necessary arrangements for the goods to be shipped to and imported into the UK and delivered to the consumer in the UK.

Taking those factors into account, Lord Justice Arnold considered that it could not be “seriously” argued that the offer for sale on Amazon’s global marketplace was not targeted at the UK. Offers for sale on that global marketplace therefore constituted an infringement of Lifestyle’s UK and EU trade marks, the court determined.

The Court of Appeal said Lifestyle may therefore be entitled to apply for an injunction to prohibit future trade mark infringement by Amazon should the marketplace fail to provide a suitable undertaking on its own to address the infringement risk. Lifestyle will also have an opportunity to make its case for financial relief in respect of the infringement found by the court.

“Lord Justice Arnold's judgment constitutes a significant change in the assessment of whether advertisements and offers for sale on a global marketplace amount to an infringement of a trade mark in a particular territory,” said Tom Nener, brand protection expert at Pinsent Masons. “Context of the offer for sale and the customer journey are still key but factors such as the offer to ship to a geographical location, payment details in local currency and actually delivering the products to that location could all be determinative.”

According to the ruling, Amazon had taken some steps to block the sale of Lifestyle’s US branded products to the UK. However, Gill Dennis, brand protection expert at Pinsent Masons, said those measures would not now be sufficient to address unauthorised use of trade marks arising from targeted product listings in light of the Court of Appeal’s judgment.

“Lord Justice Arnold’s reliance on the standard information provided to consumers during the buying process as showing that the website was targeted to UK consumers means that the targeting threshold is relatively low,” said Dennis. “The judgment will, therefore, have implications for all global online marketplaces as it is likely to spur an increase in ‘notice and takedown’ requests in respect of use of trade marks in the UK.”

Nener said: “The High Court at first instance seemed to be swayed by arguments that removing the listings would amount to censorship of the internet and deprive customers of information which the court felt they were entitled to see. This issue was not considered to be relevant by the Court of Appeal which conducted a more dispassionate assessment of the reality of the buying process from Amazon’s website.”

Dennis added: “The broader issue in this case is the tension between the territoriality of intellectual property (IP) rights and the global nature of the internet. Following the Court of Appeal’s judgment, in the UK IP rights prevail. This is a significant shift in the balance of power of rights holders and global website operators will now need to make sure they are in a position to respond to notice and takedown requests and implement geo-restrictions without delay.”