Use of third party trademarks in advertisements, how far can you go?

Amazon EU Sàrl  and Amazon.co.uk were on 10 February held to, as joint tortfeasors, be infringing Cosmetic Warrior Ltd’s and Lush Ltd’s registered trade mark ‘Lush’. Amazon EU Sàrl, by operating the website www.amazon.co.uk and Amazon.co.uk, for being responsible for dispatching all goods bought at the website from its distribution centres in the UK. This, in respect of Amazon’s use of ‘lush’ as a keyword within Google AdWords and in various search results on the Amazon website. Amazon had bid for ‘lush’ in Google’s pay-per-click service and the Lush mark was used to direct consumers to products not originating from the trade mark owner. Cosmetic Warrior and Lush are the registered proprietor and exclusive licensee of the Community trade mark Lush, registered for cosmetics and toiletries.

Lush’s goods are not available on www.amazon.co.uk and the proprietor therefore made a complaint about two classes of sponsored link advertisements, appearing on the Google result page when consumers typed ‘lush’ into Amazon’s search box. In the first class of advertisement, the Lush mark was displayed on several places where sponsored links took the consumers to www.amazon.co.uk, where they could purchase products equivalent to those of Lush. The second class of infringement did not display the mark, but contained references to equivalent or similar products to Lush’s. Nowhere could an explicit message, stating that Lush’s products were not available for purchase on the website, be found.

Lush also claimed trade mark infringement in relation to the use of the mark during the searching process on Amazon’s website. The trade mark was featured several times on the webpage to advertise competitive products.

To establish infringement according to EU law, there need to be a use, in the course of trade, without the owner’s consent, of a sign identical to the trade mark, in relation to goods identical to those for which the trade mark is registered and the use needs to affect, or be liable to affect, the functions of the mark.

The court noted that the use of a third-party trade mark in keyword advertising amounts to use of that trade mark in the course of trade. Such use would amount to trade mark infringement if the advertisement did not clearly inform internet users whether the goods referenced in the advertisement originated from, or where somehow connected with, the trade mark owner.

Lush’s claim was upheld regarding the first class of supposed infringements, as an average consumer would expect to find Lush’s products on Amazon’s website when the advertisement was referring to the trade mark. However, no infringement was found regarding the second class of advertisements, as consumers are familiar with sponsored advertisements and accustomed to seeing this kind of advertisement from competitors. Consumers would therefore appreciate that the Amazon advertisement was one of many advertisements from competing suppliers, offering similar products to the one the consumer was first interested in.

As non of the products offered for sale at www.amazon.co.uk displayed the Lush trade mark, the exception (found in L’Oreal v. eBay (C-324/09), regarding the possibility of simply acting as an online marketplace and therefore not making use of the trade mark in the course of trade) was not applicable in this case. It was found that Amazon had used the trade mark in the course of trade when communicated the Lush sign to consumers.

It was held that the use of the Lush trade mark on the Amazon website denied its ability to act as a guarantee of origin. Consequently, it amounted to a trade mark infringement.

This judgement provides needed clarity as regards to what extent online retailers may use keyword advertising and search algorithms on their websites, to take the consumers searching for branded products to competitor’s products.

Malin Persson