Last week the Court of Justice of the European Union ("CJEU") confirmed the relevance of commercial intention in establishing trade mark "use". Coty Germany, a distributor of high-end beauty products, asked the CJEU whether two European Amazon companies infringed its licence to the EU trade mark "Davidoff" by storing bottles of "Davidoff Hot Water" perfume for third party sellers using the Amazon Marketplace platform. The CJEU held that, regarding trade mark use in the context of infringement, the company storing the goods must do so with the aim of offering the goods for sale or putting them on the market. Hence Amazon's storage of the infringing articles did not constitute "use" and, as such, could not be an infringement of Coty's licensed rights. In coming to this conclusion, the CJEU observed that "the use, by a third party, of a sign identical or similar to the proprietor's trade mark implies, at the very least, that that third party uses the sign in its own commercial communication".
Although a victory for Amazon (and other platforms engaging in similar activities) on trade mark infringement, the CJEU made it clear that other provisions of EU law, in particular those on e-commerce and enforcement of intellectual property rights, may allow legal proceedings to be brought against an intermediary who has acted in a way which enables the unlawful use of a trade mark.
The indication that Amazon’s actions are not beyond scrutiny suggests that the CJEU is aware of the potential divergence between the treatment of online platforms enabling use of IP rights. It may raise eyebrows that, in the world of trade marks, Amazon can unknowingly be a conduit for the sale of infringing goods, whilst in the aftermath of the Copyright Directive, YouTube is an infringer as soon as it allows public access to copyright protected works without permission. The recitals of the Copyright Directive are clear that it applies to platforms whose main purpose is to "store and enable users to upload protected content with the purpose of obtaining profit therefrom". Although now decidedly an EU-27 issue, this is arguably not worlds away from the function performed by Amazon in storing and enabling the sale of infringing goods in the context of its marketplace.
This case gives practical reassurance to e-commerce platform operators that storage of infringing articles without intent to sell is not sufficient for infringing use. That said, they would do well to heed the CJEU's warning that a win on trade mark infringement does not necessarily spell immunity against a backdrop of increasing scrutiny for online platforms.
"the use, by a third party, of a sign identical or similar to the proprietor's trade mark implies, at the very least, that that third party uses the sign in its own commercial communication"