Last month the Court of Justice of the European Union (CJEU) clarified the definition of “stocking of goods” within the meaning of EU trade mark law. On 2 April, it judged that the mere storage for third parties of goods that infringe trade mark rights does not in itself constitute an infringement by Amazon of those rights. This will only be the case if the infringing goods are stocked for the purpose of offering them on the market in the EEA.
The trade mark owner Coty Germany (Coty) distributes perfumes worldwide and is a licensee of, among others, the EU trade mark DAVIDOFF for perfumes, among other products. It discovered ‘Davidoff’ perfumes on the Amazon Marketplace section of the Amazon website – where third parties can offer their goods for sale – that had not been placed on the market in the EEA with its consent. In the event of a sale, the contract is concluded between the third party and the purchaser. Third parties may also avail themselves of the ‘Fulfilment by Amazon’ scheme, under which goods are stored in an Amazon warehouse and passed to external couriers by an Amazon group company.
Coty alleged that the two Amazon group companies responsible for Amazon Marketplace infringed its trade mark rights by stocking infringing goods. The District Court of Munich ruled in favour of Amazon in the first instance and dismissed the trade mark infringement claim, a decision that was upheld on appeal. Coty then appealed to the German Federal Court, which referred the following question to the CJEU:
“Does a person who, on behalf of a third party, stores goods which infringe trade mark rights, without having knowledge of that infringement, stock those goods for the purpose of offering them or putting them on the market, if it is not that person himself but rather the third party alone which intends to offer the goods or put them on the market?”
The CJEU’s answer is ‘no’. It is not Amazon that uses the DAVIDOFF trade mark in its own commercial communications, but rather the third party seller, who is consequently the party liable. The CJEU emphasizes that the expression “using”, within the meaning of the EU Trade Mark Regulation, involves active behaviour and direct or indirect control of the act constituting the use. Only a third party with direct or indirect control of the act constituting the use is effectively able to stop such a use and therefore comply with prohibition inherent in trade mark rights.
With this decision the CJEU strengthens its case law, under which intermediaries, such as online marketplaces and warehouse keepers, are safeguarded from claims by trade mark proprietors for trade mark infringement.
Although the CJEU has judged in other cases that internet intermediaries could also be held liable within the meaning of the E-Commerce Directive in cases where they play a more active role, in this case the trademark holder will need to prove that the intermediary has some control over the stored content allowing them to obtain actual knowledge that the content infringes a third party’s trade mark rights, despite which they have failed to act quickly to remove or prevent access to it. As most online market places have sophisticated notice and takedown procedures in place for infringements, it is highly recommended to cooperate with the relevant intermediary by following the applicable notice and takedown procedure.
In conclusion, the CJEU’s decision is not a surprising one, but it emphasises once again that trade mark law is not the applicable legal area to hold intermediaries liable. In case of an internet intermediary, trade mark proprietors are more likely to succeed in addressing the infringement through a notice and takedown procedure and working together with the relevant intermediary to combat the infringement.
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