Is Amazon liable for ads from third-party sellers?
The question of whether online marketplaces are responsible for advertisements by third-party sellers was the subject of a judgment by the Grand Chamber of the CJEU in December (Joined Cases C-148/21 and C-184/21).
The questions arose in two cases brought by Christian Louboutin against Amazon concerning the sale of red-soled shoes that infringe Louboutin’s registered Benelux and EU trade marks (pictured).
The judgment is not yet available in English, so this analysis comes thanks to Google Translate and may be updated once an official translation is available!
Establishing a link
Louboutin brought infringement actions against Amazon in both Belgium and Luxembourg, based on Article 9(2)9A0 of the EUTM Regulation, alleging essentially that Amazon was responsible for the use of infringing signs on its website.
In its judgment, the Court said that the Regulation enables the trade mark proprietor to prohibit any use of their mark in the course of business by a third party. In previous decisions such as L’Oréal and Coty, the Court has found that in certain circumstances online marketplaces hosting third-party sellers are not considered to be using the mark.
However, it said the Louboutin cases are different as Amazon displays its own advertisements alongside those of third-party sellers along with its logo. It also offers additional services to customers.
Therefore, said the Court:
“for the purposes of determining whether the operator of an online sales website integrating an online marketplace itself uses a sign identical to a brand of another, appearing in advertisements relating to products offered by third-party sellers on this marketplace, it is necessary to assess whether a reasonably informed and reasonably observant user of this website establishes a link between the services of this operator and the sign in question.”
The question of whether such a link is established involves an “overall assessment” of the circumstances. This includes paying attention to how the adverts are presented, and the nature and extent of the services provided by the operator.
If an online marketplace displays its own advertisements alongside those of third parties, and applies its own logo to both, then the user might form the impression that the operator markets those products. This impression is likely to be reinforced by terms such as ‘best sellers’,'most requested’ and ‘most offered’. The impression is also likely to be created if the marketplace offers services such as handling questions from users, shipping and returns.
The cases will now return to the courts in Luxembourg and Belgium for further hearings.
Role of users
Given the growth in e-commerce and the proliferation of IP-infringing goods online, brand owners increasingly have to deal with infringements online. This judgment appears to be good news for IP owners and less good news for marketplaces such as Amazon, who may have to increase their efforts to police the advertisements of third-party sellers.
From a future gazing perspective, it is notable that the judgment stresses the importance of the users’ perception of the online marketplace. This issue was not explicitly addressed in previous decisions and may turn out to be the battleground for future disputes in this area.
To find out more about the issues raised in this blog contact Rosie Burbidge, Intellectual Property Partner at Gunnercooke LLP in London - email@example.com
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