The Court of Justice of the European Union (“the Court”) today handed down judgment in Case C 323/09, Interflora v M&S. The case concerned the purchase of a competitor’s trade mark as a keyword for Google’s search engine. Unsurprisingly, the Court followed its earlier ruling in the Google France case, to the effect that selecting a trade mark as a key-word in Google was a use of that trade mark by the advertiser in respect of the advertiser’s goods or services.
The Court said the trade mark proprietor can prevent that use “if the advertisement does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the advertisement originate from the proprietor of the trade mark or an undertaking economically connected to it or, on the contrary, originate from a third party.”
The Court also said that “if the referring court’s assessment of the facts were to show that M&S’s advertising, displayed in response to searches performed by internet users using the word ‘Interflora’, may lead those users to believe, incorrectly, that the flower-delivery service offered by M&S is part of Interflora’s commercial network” the trade mark would be infringed under Art 9(1)(a) of Regulation 40/94, since “the function of the INTERFLORA trade mark of indicating origin would be adversely affected.”
The Court suggested that “the referring court may take into account that, in the present case, the commercial network of the trade mark proprietor is composed of a large number of retailers which vary greatly in terms of size and commercial profile. The Court considers that, in such circumstances, it may be particularly difficult for the reasonably well-informed and reasonably observant internet user to determine, in the absence of any indication from the advertiser, whether or not the advertiser- whose advertisement is displayed in response to a search using that trade mark as a search term – is part of that network.”
For the first time the Court has indicated what is meant by an adverse effect on the ‘investment’ function: “When the use by a third party, such as a competitor of the trade mark proprietor, of a sign identical with the trade mark in relation to goods or services identical with those for which the mark is registered substantially interferes with the proprietor’s use of its trade mark to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty, the third party’s use must be regarded as adversely affecting the trade mark’s investment function.” However, it is difficult to see how this differs from interfering with the ‘origin’ function.
Finally, the Court also held that : “the selection as internet keywords of signs corresponding to trade marks with a reputation which belong to other persons … can, in the absence of any ‘due cause’ … be construed as a use whereby the advertiser rides on the coat-tails of a trade mark with a reputation in order to benefit from its power of attraction, its reputation and its prestige, and to exploit, without paying any financial compensation and without being required to make efforts of its own in that regard, the marketing effort expended by the proprietor of that mark in order to create and maintain the image of that mark. If that is the case, the advantage thus obtained by the third party must be considered to be unfair.” This is the first indication by the Court that the use of a trade mark as a keyword may take unfair advantage and thus fall foul of Art 9(1)(c) of Regulation 40/94.
It is now for the High Court to determine whether, on the facts of the case, M&S has infringed Interflora’s trade mark.
Roger Wyand QC of Hogarth Chambers instructed by Pinsent Masons appeared for Interflora.