Article 9(2) of the European Trademark Regulation grants the owner of a registered European Trademark the right to prevent all third-party sellers from commercially "using" the registered trademark without the owner's consent.
In that regard, it has been indisputable that the unauthorized advertisement and sale of goods carrying a registered trademark can be considered "use" within the meaning of the European Trademark Regulation and, therefore, constitute a trademark infringement.
Recently, however, the question was raised before the European Court of Justice of whether an online marketplace (in casu Amazon) can be held liable for trademark infringements when the unauthorized marketing and sale is not conducted by the online marketplace itself, but by third-party sellers of the platform.1
Christian Louboutin, a French designer of luxury footwear and handbags, best-known for his high-heeled womens' shoes brought an action before the courts of Belgium and Luxembourg against Amazon for trademark infringement of Christian Louboutin's registered trademark to the red color of the outer sole of the high-heeled shoes. (Pantone 18-1663TP).
Christian Louboutin submitted that Amazon was liable for the infringing activities by playing an active role in the use of the trademark, since Amazon displayed the third-party goods together with their own trademark, and in equal manner as the displaying of the goods originating from Amazon itself. Additionally, Christian Louboutin raised that Amazon offered the assistance in the presentation, stocking, and shipping of the third-party goods to the end users.
The European Court of Justice had previously decided in a number of cases that online marketplaces cannot be held liable for trademark infringements conducted by third-party sellers by merely displaying the goods carrying the concerned trademark on its website and on the advertising sponsored links provided by Google, when it has no actual knowledge of the infringing activity.2
The national courts, therefore, asked the European Court of Justice, whether an online marketplace could be held liable for trademark infringements when the online marketplace, in addition, carries out its own sales activities and offer the third-party sellers ancillary services, such as presentation, stocking, and shipping.
The European Court of Justice ruled that online marketplaces can be held liable for trademark infringements, if it can be determined that a well-informed and reasonably observant user of the online marketplace is not able to easily distinguish between the offers originating from the online marketplace, and on the other hand, the offers provided by the third-party sellers on the marketplace.
The European Court of Justice iterated that it is important to take all the circumstances of the situation into account, and gave the following examples of relevant circumstances for the national courts to take into consideration in the decision making:
- Whether the online marketplace uses a uniform method of presenting the offers published on its website, displaying both the advertisements relating to its own goods and those relating to goods offered by third-party sellers;
- Whether the online marketplace places its own logo as a renowned distributor on all those advertisements;
- Whether the online marketplace offers additional services to the third-party sellers consisting of inter alia storing and shipping of the goods containing the trademark.
Why is this decision important?
The Louboutin-decision paves the way for trademark owners to combat trademark infringements by holding large online marketplaces liable as an alternative or supplement to the individual third-party sellers.
Furthermore, the decision may act as a deterrent to the operators of the online marketplaces, as well as an incentive to further monitor trademark infringing goods on the online marketplaces.
It is yet to be determined, whether Amazon will be held liable for trademark infringement of Christian Louboutin's famous red color for high-heeled shoes, as the decision remains at the hand of the national courts.
1 Joined Cases C-148/21 and C-184/21 – Louboutin
2 See inter alia C-567/18 – Coty Germany and C-324/09 – L'Oréal
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