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Businesses selling goods online should take note of important recent case law to avoid the risk of getting online targeted advertising wrong and potential trade mark infringement.

The facts of the case & link to trade mark infringement

Lifestyle Equities CV (Lifestyle) made a claim against Amazon and its group companies alleging that its UK and EU trade marks for the brand BEVERLY HILLS POLO CLUB (BHPC) had been infringed due to Amazon advertising, offering for sale and selling US branded goods to consumers in the UK and the EU, via its Global Store (where goods were advertised in the US but available to purchase in the UK and EU) without its consent.

Amazon’s response to the allegations was that its US website was only targeted at US consumers, and that the UK and each EU country had their own targeted websites, so there was no infringement.

Initially the High Court ruled that there was no infringement because Amazon had not targeted UK and EU consumers, and consumers were aware that they were buying items from outside of the UK. This meant that Amazon’s use of the BHPC trade marks did not amount to “use in the course of trade” in the UK and EU and so trade mark infringement was avoided.

Lifestyle appealed the High Court’s decision.

Court of Appeal

The Court of Appeal allowed the appeal and overturned the High Court’s decision on the basis that Amazon and its group companies were using the BHPC trade marks on its website in respect of goods, which as a Global Store, were available for purchase by UK consumers, dodging any trade mark infringement activity.

The Court of Appeal confirmed that the question of whether there has been use of a trade mark in a relevant territory should be assessed objectively and that certain factors will be relevant in deciding whether that is the case or not.

Impact on businesses

This case has a significant impact on the liability of businesses operating websites globally and their potential to be liable for intellectual property infringements.

To avoid any potential infringements we recommend that businesses consider the following actions:

  • Carry out due diligence before working with third party website developers to avoid simple mistakes being made.
  • Implement geo-blocking on relevant websites, to ensure that items are only accessible to agreed target markets.
  • Include warranties and indemnities in contracts with relevant third parties where goods are being sold globally / ensure written confirmation is sought if they are being sold in individual territories only.

Next steps

You should consider conducting a legal audit of your website / online selling platform before selling any branded third party goods to avoid the risk of potential trade mark infringement. We can assist with this.

For further information please do not hesitate to contact our Intellectual Property team.