The CJEU has ruled that the mere storage of goods which infringe a trademark, without the entity storing the goods being aware of the infringement, does not count as 'stocking' them 'for the purpose of offering the goods or putting them on the market'; and so such storing is not trademark infringement.

The CJEU's judgment in Coty Germany GmbH v Amazon Services Europe Sàrl (C-567/18) followed a reference from the Bundesgerichtshof (Federal Court of Justice, Germany). It would suggest that Amazon is not liable for trademark infringement for its storage of DAVIDOFF perfume offered and sold by a third party seller using Amazon's online platform. (The DAVIDOFF goods in question had not already been placed on the market in the EU, so Coty's trade mark rights in the goods had not been exhausted, and Coty had not authorised the offer and sale).

The CJEU's ruling was confined to a narrow question of trade mark law

The CJEU's ruling concerned the interpretation of the EU Trade Marks Regulation in its previous form (207/2009) (the Regulation). This confers upon the proprietor of a 'Community' (now called 'EU') Trade Mark (EUTM) exclusive rights in respect of the mark.

Article 9(1) of the Regulation provides that the proprietor is entitled to prevent all third parties not having his consent from 'using in the course of trade' an infringing sign. Article 9(2)(b) states (by way of a non-exhaustive list) that the prohibition may include 'offering the goods, putting them on the market or stocking them for these purposes under that sign, or offering or supplying services thereunder'.

The same provisions are contained in article 9 of the updated (current) EU Trade Marks Regulation (2017/1001).

The CJEU noted that according to the division of jurisdiction between the CJEU and the national courts, the relevant national court alone has jurisdiction to find and assess the relevant facts in the case before it. The CJEU must take account of the factual (and legislative) context of the questions asked by the national court, as described in the national court's order for reference. Essentially, the CJEU's role is limited to the interpretation of the EU legislation. This is reflected in the technical nature of the CJEU's judgment in the Coty v Amazon case.

In particular, the CJEU emphasised the national court's finding that Amazon did not have knowledge of the infringing activity.

The CJEU's reasoning included that the expression 'use in the course of trade' involves, on the one hand, an active behaviour from the economic operator and direct or indirect control of the act constituting the use (paragraph 37) and, on the other hand, an economic operator pursuing the aim referred to by those provisions, specifically offering the goods or putting them on the market (paragraph 45). On the apparent facts of the present case, Amazon did not itself offer for sale or put the goods on the market; it was the seller alone who intended to carry out these acts. Amazon therefore did not pursue those aims and so its acts did not use the protected mark in the course of trade.

With this context in mind, the CJEU's judgment provides useful clarification of the concept of trademark use 'in the course of trade'.

Wider protection for brand owners was not addressed by the CJEU's ruling

In the Coty v Amazon case, Coty, which holds an exclusive licence for the EUTM for DAVIDOFF, noticed that a non-authorised seller was offering for sale its goods on Amazon online marketplace. After sending a letter of formal notice to the seller, who had undertaken to refrain from using the sign, Coty requested Amazon to return all goods bearing the DAVIDOFF mark. Amazon refused to comply with Coty's request insofar as some goods were stocked for another seller.

Consequently, Coty sued Amazon in the German courts, requesting that an order be made, subject to penalties, to refrain from stocking or distributing DAVIDOFF brand perfumes in Germany, or from causing them to be stocked or distributed.

The CJEU noted that the legislative context included certain provisions beyond those the subject of the Bundesgericht's reference. In particular:

  • The Directive on Electronic Commerce (2000/31/EC) provides, in article 14, that the provider of an information society service [i.e. Amazon] shall not be liable for the information stored at the request of a recipient of the service [i.e. the third party seller of the DAVIDOFF goods] on condition that the provider does not have actual knowledge of 'illegal activity' or, upon obtaining of such knowledge or awareness, 'acts expeditiously to remove or disable access to the information'.
  • The IP Enforcement Directive (2004/48/EC) provides, in article 11, that where there is a judicial finding of infringement of an intellectual property right, the court may issue against the infringer an injunction aimed at prohibiting the continuation of the infringement, provided such measures are fair, proportionate, not excessively expensive and do not create barriers to legitimate trade.

The CJEU declined to rule on whether Amazon's activity would breach the provisions of article 14 of the Directive on Electronic Commerce, or on whether Amazon's activity counted as that of an 'infringer' for the purposes of article 11 of the IP Enforcement Directive.

As a matter of fact, trademark owners can request an injunction against any economic operator who has facilitated infringement via a marketplace, whether online or physical, on the basis of Article 11 of EU Directive 2004/48, as the CJEU held in the Tommy Hilfiger case (7 July 2016, C-494/15).