TRADEMARK LAW – The operator of an online marketplace may be held liable for counterfeit goods sold on its marketplace

CJEU, Grand Chamber, 22 Dec. 2022, C-148/21 and C-184/21. In response to two preliminary questions raised by the Luxembourg and Belgian courts, the Court of Justice of the European Union (CJEU) considers that the operator of an online marketplace such as Amazon may be held directly liable for infringement of the rights of a trademark owner resulting from an announce by a third-party seller on its marketplace.

In the present case, Mr Christian Louboutin, the designer of shoes famous for their red outsole, noticed that the sites of Amazon, the distributor and operator of an online marketplace, have offers made by third-party sellers relating to shoes with red soles.

He also noted that Amazon not only published offers on its platform, but also handled the holding, shipping and delivery of these products whereas Mr. Louboutin had never given his consent to the circulation of such products.

Considering that Amazon was infringing his trademark, Mr. Louboutin initiated an infringement action against Amazon on the basis of Article 9§2(a) of Regulation 2017/1001 before the Luxembourg and Belgian courts.

These two courts then asked the CJEU about the interpretation of that article, in particular whether the operator of an online marketplace could be held liable for infringement of a trademark owner’s rights resulting from an offer made by a third-party seller on its online marketplace.

In a judgment of 22 December 2022, the CJEU, sitting as a Grand Chamber, gave a positive answer on condition that “a reasonably well-informed and reasonably observant internet user [….] establishes a link between the services of [the platform] and the sign in question“, i.e. when he has the impression that it is the operator of that platform who “commercializes, in his own name and on its own account, the goods“.

The CJEU then provides details on how this link can be established by the user between the platform and the trademark at stake. The mere fact of “creating the technical conditions necessary for the use of a sign and being paid for that service” is not sufficient to demonstrate use of the trademark by the operator.

It must be shown that the operator is using the trademark in the context of its own commercial communication, which must be understood to mean “any form of communication to third parties designed to promote its activity, goods or services or to indicate the exercise of such an activity“.

In this respect, according to the CJEU, the following may be taken into account:

• the way in which the offers published on the platform are presented: a display showing the platform operator’s offers and those of third-party sellers at the same time, with its own logo both on the website and on all those offers “may establish a link, in the eyes of those users, between that sign and the services provided by that same operator”.
• the nature and extent of the services provided by the platform operator: the handling of user queries, the storage and dispatch of goods and the management of returns are ” likely to give the impression, to a well-informed and reasonably observant user, that those same goods are being marketed by that operator, in its own name and on its own behalf“.

It will therefore be up to the national courts to analyse the platform’s commercial communications in detail and in practice to see whether they lead users to establish a link between the platform and the product in question.