The Court of Justice of the EU has held, in its decision on the Louboutin-Amazon case, that the operator of an online e-commerce platform may be held liable for trademark infringement if its communication, storage and delivery activities concerning the infringing products, offered for sale on the platform, lead users to believe that such products are sold directly by the operator itself; does this decision mark a change of course for the CJEU regarding the liability of e-commerce platforms for trademark infringement?
Christian Louboutin, a well-known French designer of luxury footwear and bags, owns trademark registrations for the red sole featured in many of his shoe models; one of such registrations is for a trademark of the European Union (see image).
In 2019 Mr. Louboutin had brought two proceedings, before national courts in Belgium and Luxembourg respectively, claiming that Amazon had used his trademark on its e-commerce platform without his consent. Mr. Louboutin showed that Amazon had been active in advertising products infringing his trademark, that the platform operator had displayed advertisements of products sold by Amazon grouped together with those of products sold by third party sellers on the platform, and that it had included all the advertisements in its own commercial communication. Amazon’s activity could not therefore, according to Mr. Louboutin, be considered that of a mere intermediary.
In both proceedings Mr. Louboutin had therefore asked the courts to bar Amazon from using his trademark and order the company to pay the ensuing damages.
Both the national courts had stayed proceedings and referred to the Court of Justice of the European Union (CJEU) some preliminary questions, aiming essentially to establish whether Article 9 (2) (a) of EU Regulation 2017/1001 reproduced below:
2. Without prejudice to the rights of proprietors acquired before the filing date or the priority date of the EU trade mark, the proprietor of that EU trade mark shall be entitled to prevent all third parties not having his consent from using in the course of trade, in relation to goods or services, any sign where:
(a) the sign is identical with the EU trade mark and is used in relation to goods or services which are identical with those for which the EU trade mark is registered;
is applicable to the use that Amazon made, in its own communication as described above, of the trademark owned by Mr. Louboutin, considering that Amazon’s business model entails on the one hand the uniform presentation of both its own offers and of the ones of third parties, with no differentiation as to their respective origins, and on the other, it offers third-party sellers additional services consisting in particular in the storage and delivery of the products, informing potential customers that Amazon performs such services. The national judges also asked whether, in assessing the applicability of the above provision, account should be taken of the perception of users of the platform.
The decision of the Court of Justice of the European Union
The two proceedings C-148/21 and C-184/21, by which the courts of Belgium and Luxembourg had submitted their preliminary questions to the CJEU, were joined together by the court.
On 22 December 2022 the CJEU issued a single judgment that essentially answers the questions in the affirmative: according to the court, use of a trademark by the operator of an e-commerce platform can be forbidden by the holder of the trademark on the base of the above-mentioned provision, upon condition that the operator’s activities cause the normally informed and reasonably attentive user of the platform to establish a link between the services of the operator and the trademark. Such a circumstance, according to the decision, occurs in particular when the user comes under the impression that the operator of the platform is selling on its own behalf the products bearing the trademark.
The decision points out that for the purpose of assessing the likelihood that the user will establish a link between the services of the e-commerce platform operator and the mark infringing a third party’s right – and specifically that the user could believe that it is the operator selling on its own behalf and under its own name the products bearing such a mark – it is especially relevant that the operator:
- presents in a uniform way to users the offers published on its platform, with its own advertisements and the ones of third-party sellers being visualised at the same time
- adds its logo to the set of ads
- offers product storage and shipping services to third-party sellers.
CJEU case law has denied that the presence on an e-commerce platform of products bearing counterfeit trademarks may be considered “use of the trademark” infringing third-party rights by the platform’s operator: essentially, the court had held that the mere act of providing the technical wherewithal for the use of a mark did not imply that the provider of the service was making use of the mark for the purposes of the application of Article 9 of EU Regulation 2017/1001.
In the Louboutin-Amazon decision, the CJEU explains that the difference between this case and previous ones lies, on the one hand, in the actions undertaken directly by Amazon in communicating to the platform’s users the availability of products bearing Mr. Louboutin’s trademark, without differentiating the advertisements concerning products sold directly by Amazon from those concerning products sold by third parties, and presenting all advertisements as originating from Amazon; but the difference lies also, on the other hand, in Amazon’s carrying out services of storage and delivery to the end client of such products.
The judgment has raised discussions among trademark experts also because it can appear to contradict the court’s own case law. However the decision itself points out that the questions submitted by the national courts in the Louboutin-Amazon case expressly asked that some aspects be evaluated which the court had had no opportunity to consider in previous cases.
In principle, the decisions tends to strengthen the enforcement of trademark right holders also on online platforms; in practice, it must be borne in mind that the CJEU’s role is limited to answering the questions regarding the interpretation of European Union laws submitted by national courts, and it is now up to those courts to issue the final decision on the merits of the two proceedings that gave rise to the case before the CJEU.