Online marketplaces, such as eBay, allow users to sell a vast range of products. Some of those products maybe counterfeits or parallel imports and consequently infringe the trademark of an intellectual property owner. The extent to which the online marketplace operator is required to provide assistance or bear responsibility for dealing with such infringement has come under scrutiny many times.

In the latest development a judgment from the Court of Justice of the European Union provides guidance.

1) Trademark and intellectual property owners that they may only rely on their rights, both off and when a commercial activity is being carried out. So, an individual re-selling a few unwanted birthday presents over eBay is not infringing. When the sale due to their volume, frequency or other characteristics become commercial will the seller will be infringing by trademark law.

2) EU trademark laws apply to offers for sale of parallel imported trademarked goods located in third states (i.e. non-EU/EEA states) as soon as it is clear that those offers for sale are targeted at consumers in the EU. It is for national courts to assess, in each case, whether an offer for sale is targeted at consumers in the EU.

3) Where an online marketplace operator advertises (for example via Google’s AdWords) the sale (by its users) of trademarked goods on its marketplace, using a keyword which is identical to that trademark, then that operator may be liable for infringing the proprietor’s trademark unless the advertising enables a reasonably well-informed and reasonably observant internet user to ascertain – without difficulty – whether the goods concerned originate from the proprietor of the trademark or, on the contrary, a third party. This means that marketplace operators using trademarks as keywords on internet referencing services will need to ensure somehow that their online advertisements make it clear that the goods being resold on the marketplace are being sold by persons other than the actual intellectual property owners.

4) The Court confirmed that if a seller uploads an offer for sale that contains signs similar or identical to a registered trademark, such that it would amount to trademark infringement, the marketplace operator may escape liability through the 200 E-Commerce Directive exemption, which exempts an “information society service” provider (such as an online marketplace operator) from liability for information/data stored by it on behalf of the recipient of its services, except where: (i) it has provided the seller with some sort of “active” assistance, such as optimising the presentation of the offer for sale or promoting the offer for the seller; or (ii) the operator was aware of factors or circumstances on the basis of which it should have realised that the offer for sale in question was unlawful, and upon becoming aware, it failed to act expeditiously to remove or prevent access to the offer for sale. Although marketplace operators will not be required to actively monitor of all the data of each of their customers in order to prevent any future infringement of intellectual property rights.

5) Any injunction against a marketplace operator that has committed trademark infringement must not be such as to create barriers to legitimate trade. In other words the injunction cannot have a general and permanent prohibition on the sale of goods bearing the relevant trademark on that marketplace. It must be “effective, proportionate and dissuasive” preventing for example, specific sellers (whose infringing activities are known) from continuing their activities on the website both now and in the future, for example, by deleting an infringing seller’s account. National courts could also order operators to take measures to make it easier to identify sellers (presumably, so that trade mark proprietors can go after them directly if they sell infringing products). Such measures may themselves have implications for data protection and contractual issues between operators and their users.

All articles are for general purposes and guidance only and do not constitute legal or professional advice.

Copyright 2010 Anassutzi & Co Limited. All rights reserved. Information may be shared or reproduced only if accompanied by the author’s name and bio.