What is the responsibility of service and product intermediaries on the Internet in relation to the improper use of registered trademarks on their platforms?
According to the E-Commerce Directive 2000/31, data hosting or hosting services are to be considered as potentially exempt from responsibility. Among this category of service providers are those e-commerce platforms which contain offers and receive requests from third parties, whether these are consumers or companies. They are true trading floors where supply and demand converge, and where operations are concluded between buyer and seller. The platform can either act passively, as a pure intermediary, or offer products of their own. Likewise, they can also limit themselves to collaborating in the process of selling the product, via the provision of logistics services to the seller and then the handling and delivering of the product to the buyer. In this latter case of cooperation, where the platform acts in the delivery process, we can refer to an active intervention, which can either be limited to the mere storage, or may also cover the stage of delivering the product to the buyer.
The case law of the European Court of Justice (TJUE – Tribunal de Justicia de la Unión Europea), such as 324/09 (L’Oreal-E-Bay, among other cases), has been establishing the scope of the responsibility of the e-commerce platforms; thus, if a platform is aware of an infringement of the use of a trademark, and fails to take the appropriate measures to foresee or prevent said infringement, the platform is consequently directly responsible before the owner of the trademark; in said ruling, the TJUE declares that it has to be understood that the platform was aware of those circumstances, whether they could be deduced or whether they were communicated by the owner of the trademark in a well-founded way.
However, the TJUE has further elaborated on the limits of responsibility in its ruling of 2nd April 2020, in case C-567 (Coty-Amazon), for scenarios where the product is sold by a third party, but the platform acts as the depositary of the products sold.
The case was in fact the following: someone used the section “Amazon Marketplace” of the website “amazon.de” to sell “Davidoff” perfume products, also contracting certain logistics services from Amazon (storing of the product through the programme “Amazon logistics”). However, the shipping to the buyer was carried out by a third party. It is important to note that the trademark rights of the goods sold were not exhausted, i.e. the products had not been previously put on the market by the owner of the trademark themselves, nor with the authorisation of this owner. It is also important to remember that, in this case, Amazon did not act as the seller but as an intermediary between supply and demand.
Thus, Coty made a test purchase, buying a Davidoff perfume, offered by a seller, off the Amazon platform. Firstly, Coty demanded that the seller ended its activity, on the basis that the trademark right, of which Coty is the owner, had not been exhausted and, therefore, it had the right to prevent the selling of the product. The demand was successful. Furthermore, Amazon handed over to Coty another 30 units, entrusted to it by another seller, the details of whom Amazon refused to reveal.
Coty commenced proceedings against Amazon Services Europe and Amazon FC Graben (logistics services) before the German regional court, with the aim of sentencing them to abstain from the possession or shipping of Davidoff Hot Water perfumes within the economic traffic of Germany. The claim was dismissed in the first instance and on appeal given that:
(1) Amazon Services Europe had not possessed nor shipped the products and;
(2) Amazon FC Graben had stored these products on behalf of the seller and other third-party sellers.
In other words, it was understood that the defendants had not actively intervened in the marketing and, therefore, they could not declare themselves the perpetrators of the infringement of the trademark right. In the appeal instance (judicial review), the Bundesgerichtshof submitted a referral for a preliminary ruling to the TJUE to determine the responsibility of the platform in this type of transaction; the responsibility, or lack thereof, of a platform lies in whether it is understood that the person who stores, for a third party, products which infringe a trademark right – but without knowledge of this infringement – possesses these products with the aim of offering them and marketing them, despite the offer of said products corresponding to a third party seller.
The ruling revolves around how article 9.2.b) of the Regulation of 207/2009 and article 9.3.b) of the Regulation 2017/1001 must be interpreted. In particular, it deals with the question of whether the operation of depositing or storing with the aim of its aforementioned sale can be considered as a “use” of the trademark in the light of said articles.
The court reminds us that the term “use” implies active behaviour and a direct or indirect control over the act constituting the use. In this sense, the owner of the trademark is able to prevent active behaviours which use the trademark (cases Daimler C-179/15 or C 129/17). But this right can only be directed against the person with the capacity to put an end to the use and abide by the prohibition (C-179/15, section 41). Equally, in relation to the operation of the e-commerce platforms, the TJUE has established that it is the sellers who use the platform to sell their products and who make use of the trademark, not the platform itself. The depositary (platform) does not necessarily have to be considered as using someone else’s trademark, while this is the case for the person who has imported and delivered said products to the platform (C-379/14).
So that the deposit of the products with identical or similar registered trademarks can be classified as “use” of these signs, it is necessary for the economic operator entrusted with the deposit to pursue the aim of offering the products or marketing them. In other words, that they have an active participation in the sale or marketing of the product in the market.
In the case described, the TJUE concludes that the defendants did not themselves put the products up for sale, nor did they market them, and for this reason it cannot be understood that they made use of the trademark Davidoff. However, the Court clarifies that this conclusion is without prejudice to the possibility of considering that the platform uses the sign or the trademark regarding the perfumes it possesses, not on behalf of those sellers but on their own behalf, or that in the event that the seller cannot be identified, the products are offered or marketed by the platform itself. This clarification can be interpreted – although this is not explicitly stated in the ruling – in the sense that, when the platform does not identify the seller, the platform may be “using” the trademark (by failing to act appropriately when it becomes aware of the offending act), and, as a result, it may be deemed as co-responsible for the infringement of the trademark.
In conclusion, the TJUE indicates that the two cited articles must be interpreted in the following way: it must be considered that a person who stores, with third parties, products which infringe a trademark right, without being aware of that infraction, who do not store these products with the aim of offering them or marketing them in the sense of articles 9.2b) of the Regulation 207/2009 and article 9.3b) of the Regulation 2017/1001, if that person does not itself pursue those aims (marketing or sale).
Eduardo Vilá
Vilá Abogados
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19th March 2021
