EU Court Of Justice Rules On Liability Of Internet Marketplace Operator For Trade Mark Infringements By Internet Users (L'Oréal V. Ebay)

Author:Mr Peter L'Ecluse
Profession:Van Bael & Bellis

On 12 July 2011, the Court of Justice of the European Union (the "ECJ") gave judgment in a case involving the liability of an operator of an Internet marketplace on account of trade mark infringements committed by its users (Case C-324/09, L'Oréal and others v. eBay and others). The opinion of Advocate General Jääskinen was discussed in Van Bael & Bellis on Belgian Business Law, Volume 2010, No. 12, p. 10. The case at hand pitted L'Oréal, a producer of cosmetic products, against eBay and a number of individuals selling goods on eBay before the UK High Court. L'Oréal claimed that goods were offered for sale on eBay that infringed its trade marks. In addition, L'Oréal maintained that eBay had directed consumers within the EU towards the infringing goods through the purchase of AdWords from Google comprising L'Oréal's trade marks. Moreover, L'Oréal alleged that eBay's efforts to prevent the sale of counterfeit goods on the eBay website were insufficient. The UK High Court decided to refer a number of questions to the ECJ for a preliminary ruling. Jurisdiction The ECJ noted that EU trade mark rules apply to offers for sale and advertisements of goods located outside the EU in so far as they are directed to EU consumers. Under EU trade mark exhaustion rules, such goods cannot be put on the market in the EU, unless the seller can prove that the trade mark owner gave its consent. Trade mark violations In addition, the ECJ held that the trade mark owner can prevent the sale of products, such as perfume testers and dramming bottles that are clearly marked as "not for sale". The ECJ maintained that the trade marks of such products had not been exhausted. In addition, the ECJ clarified that for products where the trade mark has been exhausted by the initial marketing in the EEA, the trade mark owner may still be able to object to the sale on eBay if the packaging was removed. For instance, this may be the case if the removal of the packaging damaged the image of the product or does away with information required to identify the manufacturer or promoter of the product. However and somewhat surprisingly, the ECJ specified that the mere fact that the removed packaging contains information required under Cosmetics Directive 76/768 does not permit the trade mark owner to prevent the sale of this product on the basis of trade mark law, even if the removal of this information could give rise to a criminal offence. Trade mark violations - AdWords Moreover, eBay had...

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