There remains little doubt about Amazon’s liability for third party trademark infringements following the recent ECJ judgment of 22 December 2022 in the preliminary ruling in C-148/21 and C-184/21 Louboutin ./. Amazon. Specifically, the ECJ had to decide on questions regarding Amazon’s liability for offers of counterfeit shoes designed by Christian Louboutin.
In its judgment, the ECJ held that Amazon, as the operator of an online marketplace, also uses itself the trademarks included in the offers of third-parties and is therefore liable for trademark infringements (counterfeit offers) if
- the third-party offers are presented in the same way as their own offers,
- Amazon, as the operator of the online marketplace, displays its own brand and
- provides other services for the third-party providers.
The decisive reason for the ECJ is that the offers for users of the online marketplace appear to be Amazon’s own use of the trademarks. The present case concerned high-heeled shoes designed by the French designer Christian Louboutin, which are known for their red outer sole. The application of the red colour to the outer sole of the shoes is protected as a position mark. Amazon is known to operate one of the largest online marketplaces under amazon.com and amazon.de as well as other top-level domains, on which Amazon offers goods, both directly in its own name and for its own account and indirectly by making its online marketplace available to other sellers. The shipping of the goods is either offered directly by the third-party sellers or handled by Amazon itself. The effort for the trademark owner to prevent such counterfeit offers varies significantly whether he has to address the individual sellers in each individual case or whether the online marketplace operator must take action against the third-party offers, which also includes proactively preventing similar offers. In terms of trademark law, the decisive factor is whether an online marketplace uses the trademark itself.
Use of the trademarks by an online marketplace for third-party offers
The ECJ states in its judgment that “using”, according to its ordinary literal sense, requires active conduct and direct or indirect dominion over the act of use. This requires that the operator of the online marketplace uses the trademark in such a way that a connection is established between the sign and the services it provides. A connection is given if the operator of the online marketplace advertises goods under the trademark which are sold by its customers on his online marketplace. The decisive factor is if the connection would be apparent to a normally informed and reasonably attentive user of that platform. Such a user might believe that the operator of the online marketplace is the one who sells the goods offered under the trademark in his own name and for his own account. In the specific case of Amazon, the ECJ found that with its integrated online marketplace, Amazon presents the offers in a uniform manner by displaying its own ads together with the ads of third-party sellers, as well as having its own logo appear as a renowned seller, both on its online marketplace and with all these ads. It would be difficult to distinguish between the offers of the third-party sellers and Amazon itself. This would also be reinforced if the provider of the online marketplace provided the offers with labels such as “best sellers”, “most sought after” or “most popular”. The user would understand this to mean that the advertised goods were sold by the operator of the online marketplace in its own name and for its own account.
What are the consequences for other online platforms?
With its ruling, the ECJ further clarifies the liability of online marketplace operators. This is particularly pleasing from the perspective of brand owners, who are repeatedly confronted with a large number of counterfeit products, which are also offered on large sales platforms on the internet in particular. Usually, the online marketplace operators refer complaints about such offers to the individual sellers or delete just the infringing offer without spending any additional monitoring effort for similar offers. According to the ECJ ruling, Amazon itself is liable for the infringement of the Louboutin trademark, even if the specific offers originate from third-party sellers. This obliges Amazon to act to preventing similar offers. Since the structure of Amazon’s sales platform is similar to many other sales platforms on the internet, the principles established by the ECJ can also be applied to the liability of other online platforms.