The Court of Appeal found that listings on Amazon’s US website targeted consumers in the UK/EU and thus Amazon had infringed Lifestyle’s UK/EU trade marks.
Michael Edenborough QC and Thomas St Quintin, instructed by Brandsmiths, for the Appellants (Lifestyle Equities)
Lifestyle Equities CV and Lifestyle Licensing BV (together “Lifestyle”), respectively the owner and exclusive licensee of various BEVERLY HILLS POLO CLUB UK and EU trade marks (the “BHPC marks”), brought proceedings against Amazon for infringing its trade marks by advertising, offering for sale and selling to UK and EU consumers goods bearing the BHPC marks which were not sourced from Lifestyle. The infringing articles, which were US BHPC branded goods, were listed on Amazon’s US website but were available for purchase by consumers in the UK and EU.
High Court Decision
The crux of the issue to be decided by the judge was whether the listings of US BHPC branded goods on the Website, which could be accessed and purchased by UK and EU consumers, amounted to use of the BHPC marks in the UK and EU. In particular, the question was whether the listings targeted UK/EU consumers, whether directly or indirectly.
Michael Green J dismissed the claim, finding that Amazon had not infringed the BHPC marks in the UK and EU by virtue of the US listings in dispute. The judge held that neither the Website nor the BHPC listings on the Website were targeted at UK/EU consumers. His reasoning was that such consumers are fully aware that they are purchasing goods on the Amazon website which is directed primarily at US consumers and not them. Further, the judge considered that UK/EU consumers will clearly have appreciated the disadvantages of ordering goods from the US targeted Amazon website for delivery in the UK but decided that they wanted to do this anyway. He considered it therefore to be largely irrelevant that Amazon facilitated the processing and shipping of the goods to the UK.
The Court of Appeal overturned the High Court’s decision and found that Amazon had used the BHPC marks in the UK and EU and thus infringed Lifestyle’s trade marks. Arnold LJ, with whom Vos MR and Snowden LJ agreed, held that the listings, which constitute advertisements and/or offers for sale, were clearly targeted at the UK. Arnold LJ relied on the fact that the Website recognises that the purchaser is located in (e.g.) the UK, the shipping and billing addresses are in the UK, the currency of payment could be GBP, the consumer was told that certain goods “ship to United Kingdom” or similar, and Amazon makes all the necessary arrangements for the goods to be imported into the UK for delivery to consumers in the UK.
The Court found that the first instance judge had erred on a number of grounds, which led him to reach the wrong finding on targeting. Firstly, he focused on the targeting of the Website as a whole and failed to analyse the targeting of each of the types of acts complained of. Secondly, the judge was mistaken in accepting that simply because the Website was directed at US consumers, the relevant listings were not targeted at UK/EU consumers. It did not follow that the Website was restricted to US consumers. Thirdly, the judge had wrongly implied a requirement for subjective intent on the part of Amazon to use the sign in the relevant territory.
Fourthly, there was no evidential basis for the judge’s finding that Amazon’s involvement in the processing and shipping of orders to UK/EU consumers was explicable as Amazon simply making the process “as painless and easy as possible” after the consumer had already made a decision to buy on the Website. Fifthly, the judge placed undue significance on the higher shipping costs and import duties which UK/EU consumers would be required to pay on the Website than if they ordered from www.amazon.co.uk or www.amazon.de in finding that these consumers were not targeted. Consumers would not necessarily be aware of these differences, and even if they were, the differences may have been offset by product price differentials.
Arnold LJ further held that even if Amazon’s advertisements and offers for sale did not constitute use of the BHPC marks in the UK/EU, Amazon’s sales of US branded goods to UK and EU consumers nevertheless constituted use of the marks within the relevant territory and thus infringed Lifestyle’s trade marks. In making this finding he disagreed with the judge’s interpretation of Case C-98/13 Blomqvist v Rolex.
This decision is helpful for businesses whose products are sold on Amazon and other online marketplaces. The principles applied by the Court of Appeal will make it easier for such businesses to prevent infringement of their trade marks in the UK. This is likely to push Amazon and its competitors to become more restrictive in their approach to global listings and shift to a stricter territorial focused business model.
By Kendal Watkinson