FABRIZIO MONCALVO
Case analysis
Case Analysis
 Where
the services of an intermediary, such
as an operator of a website, have been
used by a third party to infringe a registered
trademark, can the trademark owner
obtain
an
injunction
against
the
intermediary
to
prevent
further
infringements of the said trade mark?
EU Court of Justice (Grand Chamber), Judgement, July
12,2011 Case C-324/09
PRELIMINARY INFORMATION
 L.
is a manufacturer and supplier of
perfumes,
cosmetics
and
hair-care
products.
 L.
operates a closed selective distribution
network, in which authorised distributors
are restrained from supplying products to
other distributors.
PRELIMINARY INFORMATION
 E.
operates an electronic marketplace
that allows private sellers to list goods they
wish to sell, either through auction or at a
fixed price.
PRELIMINARY INFORMATION
 The
private sellers have registered for
that purpose with e. and have created a
seller’s account with it.
 E. enables prospective buyers to bid for
items offered by sellers.
 E. charges a percentage fee on
completed transactions.
PRELIMINARY INFORMATION
 ‘Buy
It Now’ : Sellers can also set up
online shops on E. sites.
PRELIMINARY INFORMATION
 ‘Sellers
and buyers must accept E.’s
online-market user agreement: one of the
terms of that agreement is a prohibition on
selling counterfeit items and on infringing
trademarks.
The E. case
 L.
sent E. a letter expressing its concerns
about the widespread incidence of
transactions infringing its intellectual
property rights on E.’s European websites.
 L.
brought actions against E. in various
Member States, including an action before
the High Court of Justice (England &
Wales), Chancery Division.
The E. case
L.’s action before the High Court of Justice
sought a ruling:
1. FIRST, that E. and the individual
defendants (Private Sellers) are liable
for sales of 17 items made by those
individuals
through
the
website
www.E..co.uk.
The E. case
L. considers that the sale of the items
infringed its trade mark rights, since
those items were:
(a) either goods that were not
intended for sale (such as tester
products) or
The E. case
(b) goods bearing L. trademarks
intended for sale in North America and
not in the European Economic Area
(‘EEA’);
(c) some of the items were sold without
packaging.
The E. case
SECOND, L. submits that E. is liable for the use of L. trademarks
where
A.
B.
those marks are displayed on E.’s website
where sponsored links triggered by the use of
keywords corresponding to the trademarks are
displayed on the websites of search engine
operators, such as Google.
when an internet user entered the words ‘L.’ – L.’s national word mark ‘L.’ – as a
search string in the G. search engine, the following E. advertisement was
displayed in the ‘sponsored links’ section:
Advertise:
‘L.
Great deals on L.
Shop on E. and Save!
www.E..co.uk’.
THIRD, L. has claimed that, even if E. was not
liable for the infringements of its trade mark
rights, it should be granted an injunction
against E..
The high Court of justice remarks
the High Court of Justice noted that:
E. has developed a system that is intended to provide
intellectual property owners with assistance in removing
infringing listings from the marketplace.
L. has declined to participate in the above programme,
contending that the programme is unsatisfactory.
The high Court of justice remarks
E. applies sanctions, such as the temporary – or
even permanent – suspension of sellers who
have contravened the conditions of use of
the online marketplace.
The High Court of Justice concluded that a
number of questions of law first required an
interpretation from the Court of Justice of the
European Union.
The legal matter

Where the services of an intermediary, such as an
operator of a website (E.), have been used by a third
party to infringe a registered trademark, can the
trademark owner obtain an injunction against the
intermediary (E.) to prevent further infringements of the
said trade mark?’
Considerations on questions
referred
A. it is not disputed that the individual defendants (Private Sellers) have, via the
www.E..co.uk website, offered for sale, and sold, to consumers within the
European Union (‘EU’):
(a)goods bearing L. trademarks which L. intended for sale in third States;
(b)goods not intended for sale, such as tester and dramming items.
(c)Nor is it disputed that a number of those goods were sold without packaging.
Considerations on questions
referred
B. E. denies that there can be any infringement of trade mark rights
when such offers for sale are displayed on its online marketplace.
C. the owner of a trade mark exclusive rights entitling him to prevent
any third party from importing goods bearing that mark, offering the
goods, or putting them on the market or stocking them for those
purposes,
D. L. had clearly indicated to its authorised distributors that they could
not sell such items and bottles, which in any case were often marked
‘not for sale’.
Considerations on questions
referred
E. The High Court of Justice held that:
A.
the operator of the online marketplace is an advertiser;
B.
where sales are made through online marketplaces, the service
provided by the operator of the marketplace includes the display,
for its customer-sellers, of offers for sale originating from the latter;
C.
in order for an internet service provider to be kept liable, it is
essential that such provider plays an “active role” of such a kind as
to give it knowledge of, or control over, those data
The E. role
E. processes the data entered by its customer-sellers.
The sales in which the offers may result take place in accordance with
terms set by E..
In some cases, E. also provides assistance intended to optimise or
promote certain offers for sale.
the operator of an online marketplace stores offers for sale on its server,
sets the terms of its service, is remunerated for that service and
provides general information to its customers
Sometimes, the operator provides assistance which entails, in
particular, optimising the presentation of the offers for sale in question
or promoting those offers
Has E. played an “active” or a
“neutral” role regarding such
sales ?

The EU Court of Justice’s ruling on E.
Case
 the
trade mark owner may prevent that
sale, offer for sale or advertising
 testers
or
samples
(intended
for
demonstration to consumers) are not
considered as “put in the market”
 the
trade mark owner may oppose the
resale of an unboxed
The EU Court of Justice’s ruling on E.
Case
 the
owner of a trade mark is entitled to
prevent an online marketplace operator
from advertising (on the basis of a keyword
which is identical to his trade mark) goods
bearing that trade mark
 Exemption from liability applies only to the
operator of an online marketplace where
that operator has not played an active role
The EU Court of Justice’s ruling on E.
Case

The operator plays such a role when it provides assistance which
entails optimising the presentation of the offers for sale in question or
promoting them

operators of the online marketplace not playing an active role
cannot rely on the exemption from liability if it was aware of facts or
circumstances on the basis of which a diligent economic operator
should have realised that the offers for sale were unlawful

measures which contribute, not only to bringing to an end
infringements of those rights by users of that marketplace, but also
to preventing further infringements of that kind.
The EU Court of Justice’s ruling on E.
Case
 Those
injunctions must be effective,
proportionate, and dissuasive and
must not create barriers to legitimate
trade