On 6th March 2024, the giant retail platform Amazon was defeated by a Supreme Court decision which ruled Amazon had infringed UK and EU trade marks by targeting British consumers from  its US “amazon.com” website.

This case was brought by Lifestyle Equities, who own registered trade marks in the UK and the EU for the words ‘Beverly Hills Polo Club’ and its logo. It was brought at a date when the UK was still part of the EU and although it concerned the targeting of UK consumers, reference was made to EU trade marks (because at the time EU rights covered the UK).

Lifestyle Equities claimed that Amazon had targeted UK customers via its US website by advertising, offering for sale and selling certain US branded goods to these consumers and therefore they had infringed their UK and EU trade marks.

In the US, a third party (unrelated to Lifestyle Equities) owned US trade marks for a ‘Beverly Hills Polo Club’ logo mark and sold Beverly Hills Polo Club products. It was this third party’s products that were being sold to UK consumers by Amazon, but Lifestyle Equities had not consented to this.

Trade Mark Infringement

This occurs when a trade mark that is identical or similar to a registered trade mark is used, without consent, in the course of trade, in relation to identical or similar goods and services to those covered by the registered trade mark.

Examples of what ‘in the course of trade’ means are: using the trade mark on packaging, using the trade mark as a company name or using the trade mark in advertising, etc.

Lifestyle Equities’ claim of infringement centred around Amazon’s use of the words ‘Beverly Hills Polo Club’ and the associated logo, in the UK, in the course of trade.

A key consideration in this case was that trade marks are territorial rights; a UK trade mark only provides trade mark protection to the owner of the mark (against its unauthorised use) in the territory where the mark is registered.

The issue at hand was that the marketing and sale of goods on the internet has no territorial boundaries. A website can be viewed by anyone, anywhere in the world, and internet consumers are free to choose where they buy products from if the website has shipping options in place to the territories where the consumers reside.

Targeting

In order for Lifestyle Equities’ case to be successful they needed to show that “targeting” had taken place.

The Court needed to consider:

If a non-UK website can be accessed from the UK, and does not block sales to the UK, does that mean that the website is “targeting” UK consumers?

Drilling down further:

What tools are made available on the the non-UK website that facilitate and tailor the purchasing process to UK consumers?

At the High Court, Amazon were successful following the dismissal of Lifestyle Equities’ claim of infringement. The Judge considered no “targeting” had taken place and that consumers would have deliberately searched for Beverly Hills Polo Club products and would have known they were buying US products (prices on the website would have been in US Dollars, the products would have been shipped from the USA and there would have been costs associated with this).

Case law precedent of (Blomqvist v Rolex SA) (which had established that sales of goods to EU consumers prior to their importation into the EU were acts of trade mark infringement) was dismissed by the High Court, with the Judge limiting this to only those applications involving Customs and the destruction of counterfeit goods and that the case had not analysed the alleged use of the sign in the course of trade.

At the Court of Appeal, this decision was overturned. The Judge found that although the US products were primarily directed at US consumers, they were not restricted to them, with Amazon’s website providing a mechanism that made it easy for consumers in the UK to purchase these (for example, the product page and search results stated “Delivers to UK” and “Ships to UK”, a pop-up box appeared telling the consumer that the products could be shipped to the UK and the “Review your Order” page converted the price of the products to GBP).

The Court of Appeal therefore found that “targeting” had taken place and set this out as follows:  “The purchaser is located in the UK, the shipping address is in the UK, the billing address is in the UK, the currency of payment is GBP and Amazon will make all the necessary arrangements for the goods to be shipped to and imported into the UK and delivered to the consumer in the UK.”

The Judge also found that the Blomqvist case had been misinterpreted by the first instance court – the case had clearly set out that the sale of products, under a registered trade mark, by an overseas-based website to a consumer in the UK or the EU constituted “use” of that trade mark in the course of trade, in the relevant territory, and was therefore trade mark infringement.

This decision was appealed by Amazon to the Supreme Court, where the Court of Appeal’s decision was upheld.

How Does This Affect My Business?

It is not uncommon for businesses to grow their international trade by allowing consumers, from outside of their territory, to purchase goods from their website, such as a UK business allowing customers from the USA to purchase its products without having to build a US-specific website.

This decision means these businesses need to be careful in targeting international consumers when offering products for sale that bear another party’s registered trade mark(s) in the territory they are shipping branded products to, unless they are specifically authorised to do so.

If a business is selling products bearing a third party registered trade mark then it is often advisable to have requisite authorisation in place (for example, a licence arrangement). This authorisation will set out how the trade mark can be used and where it can be used.

If this issue affects your business in any way, then please get in touch with us now for a FREE consultation and let us help you.