CJEU rules in Winstersteiger on where to bring an adwords claim
snIPpets – June 2012
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Wintersteiger – Infringement sans frontières
The judgment of the Court of Justice of the European Union (CJEU) in Wintersteiger AG v Products 4U Sondermaschinenbau GmbH (Case C-523/10) tackles the tricky question of trade mark jurisdiction in the borderless world of online advertising.
Wintersteiger is a well-established Austrian manufacturer of accessories and servicing tools for skis and snowboards. Products 4U, a German business, adopted 'Wintersteiger' as a keyword for its advertising on the Google.de website. Wintersteiger sued in the Austrian courts for infringement of its Austrian trade mark registration.
The question that was referred to the CJEU related to jurisdiction. It is a general principle of EU law that a defendant should be sued in the Member State where it is domiciled. However, there are exceptions to this principle in cases of trade mark infringement or other harmful conduct when an action may also be brought in the courts 'for the place where the harmful event occurred or may occur'. This has been held to include both the place where the damage occurs and the place of the event causing the damage. Furthermore, in the case of infringement of a trade mark, the mark must be registered in the jurisdiction 'where the harmful event occurred' for there to be any infringement claim at all.
Products 4U argued that since separate Google websites were available within both the .de and .at top-level domains, the Google.de website should be considered as directed exclusively at German consumers while the Google.at website would be directed at Austrian consumers. As such, its use of the 'Wintersteiger' Adword was not a harmful event within Austria and so the Austrian courts should have no jurisdiction over the matter.
Wintersteiger responded by arguing that since the German Google.de website was accessible to Austrian consumers, who as German-speakers were also able to understand the information, then the place of infringement must be the place at which the advertising was presented consumers. A consumer in Austria could search on Google.de for the term 'Wintersteiger' and, due to the Adword, would see an advertisement for Products 4U. This meant that harm was done in the place where the consumer was and not, as Products 4U argued, in the place where the servers for Google.de were based. Since harm was done in Austria, the Austrian courts should have jurisdiction.
The Court sided with Wintersteiger and held that where infringement was alleged in relation to a national trade mark, as a result of the display of an keyword, then the Courts of that Member State should have jurisdiction to consider the infringement claim. This was the case even where online use was under a different country-specific top-level domain name. The Court also confirmed that an action could also be brought in the home jurisdiction of the advertiser who had made unauthorised use of the Adword.
The implications of the decision are largely positive. It would be very detrimental to IP enforcement in the EU if it was possible to advertise into a country from 'across the online border' by using another top-level domain and thereby fall out of the relevant jurisdiction for the purpose of trade mark infringement. However, there is also an added degree of exposure for businesses in that online advertising within a country-specific top-level domain may spill over into other jurisdictions unintentionally and potentially result in infringement in those jurisdictions.
In such a situation a claimant would still need to show clear infringement within that jurisdiction, the mere fact of an advert being accessible would not necessarily constitute infringement if it was clear, for example due to linguistic or geographical barriers, that no consumer in that jurisdiction could or would realistically access the advertised goods or services. Nonetheless, in borderline cases, for example where territories share a common-language, businesses advertising online would be well-advised to either undertake clearance in the potential spill-over jurisdiction or to take steps, such as limiting website access, which will prevent inadvertent infringement.