CJEU gives guidance on use of a trade mark in online advertising

CJEU applies a strict approach to interpreting 'use' of a trade mark under the EU Trade Mark Directive in law firm online advertising dispute.

Introduction

Last month, in mk advokaten GbR v MBK Rechtsanwälte GbR (C-684/19) the CJEU applied a strict approach to the interpretation of the term "using" under Article 5(1) of Directive 2008/95/EC ("the Directive") (now Article 10(2) of Directive 2015/2436) in the context of online advertising. This provision of the Directive gives trade mark owners the exclusive right to prevent third parties using their mark without their consent. The case involved two German law firms that both had the combination of letters "mbk" in their name.

Factual background

The  claimant law firm (MBK Rechtsanwälte GbR) owns a German trade mark for its name "MBK Rechtsanwälte", registered for legal services. The defendant law firm (mk advokaten GbR) operated under two names "mbk rechtsanwälte" and the Dutch translation "mbk advokaten". After the claimant brought a claim for trade mark infringement, the Regional Court in Düsseldorf ruled in October 2016 that the defendant was prohibited from using "mbk" in its name for the provision of legal services. Non-compliance with this judgment would result in a fine.

Decision under appeal

Subsequently, evidence came to light that when the search term "mbk Rechtsanwälte" was entered into Google, the results would display several company referencing websites that advertised the legal services of the defendant. The claimant took this to mean that the defendant was not complying with the Regional Court's ruling, and therefore made a request to the court that the defendant be fined accordingly.

The defendant's submissions on internet advertising were that it had only registered itself on the Das Örtliche directory and had withdrawn all signs containing "mbk" from that registration in any case. It further submitted that it had fulfilled all of its obligations arising from the Regional Court's final order as it had not approached any other websites for advertising.

The Regional Court upheld the claimant's request, following German case law that states that where an online advertisement infringes another party's rights, the party that ordered the advertisement must arrange for it to be deleted from that website, and also determine whether the advertisement has been reproduced by any other websites. If the advertisement has been reproduced, they must make a serious attempt to have those reproductions deleted. This is based on the reasoning that such reproductions of the advertisement are benefiting the party whose goods or services are being advertised, as in the current case with the defendant's reproduction of the advertisement on the Das Örtliche directory.

The defendant appealed this decision to the Higher Regional Court in Düsseldorf which referred the case to the CJEU, questioning the compatibility of the German case law with the principles outlined in the CJEU's judgment in Daimler (C-179/15) (see below).

Question referred for preliminary ruling

The Higher Regional Court referred the following question to the CJEU for a preliminary ruling:

"Is a third party referenced on a website in an entry that contains a sign identical with a trade mark "using" that trade mark, within the meaning of Article 5(1) of Directive 2008/95, if the entry was not placed there by the third party itself, but was reproduced by the website’s operator from another entry that the third party had placed in infringement of the trade mark?"

CJEU decision

The CJEU ruled in favour of the defendant, referring to its own line of case law and specifically following Daimler (C-179/15). The principles in Daimler (C-179/15) are compatible with German case law in so far as agreeing that a party ordering online advertising containing a sign which is identical or similar to another party's trade mark would constitute use under Article 5(1) of the Directive. However, such use cannot be found where the advertisement has been reproduced by websites "on their own initiative and in their own name" (i.e. without consent of the advertiser or any direct/indirect dealings with them). A party therefore cannot be held liable under Article 5(1) of the Directive on the sole basis that they are benefiting financially from the reproduction of their advertisement.

The CJEU referred the case back to the Higher Regional Court to assess the defendant's conduct and determine whether or not the websites in question had reproduced the online advertisements by order and on behalf of the defendant. If this was not the case, the claimant was not justified in bringing its action under Article 5(1) of the Directive.

The CJEU went on to say that even if the claimant had not been justified in bringing its action against the defendant,  there was still an option, where appropriate, to claim restitution for financial benefits on the basis of national law and an action against the website operators themselves (Google France and Google (C-236/08 to C-238/08) and Coty Germany (C-567/18)).

Comment

This case confirms that a defendant will only be responsible for infringing content that it has actively placed online, and its subsequent removal, but any further, independent use of that mark (e.g. by a website operator featuring in a Google search result) will not be deemed 'use' of the mark by that original defendant under EU law. The conflicts between national law and EU law at play can evidently cause strategic issues and it is therefore important to ensure that any potentially conflicting laws are considered so that a claim is brought against the most appropriate party/parties. The case also serves as a useful reminder for trade mark owners to have watch services in place to monitor for any third party infringing activities.

With many thanks to Chris Tang, trainee solicitor, for his contribution to this article.