Image of transparent glass of RPC building.

Amazon in the clear as it fails to hit the target

10 February 2021. Published by Ben Mark, Partner and Samuel Coppard, Associate and Matt Davies, Trainee Solicitor

The High Court has dismissed claims brought against Amazon by Beverly Hills Polo Club for alleged trade mark infringement, arising out of products sold on the US website amazon.com but which are visible to consumers in the UK and EU.

Background

Lifestyle Equities owns the UK and EU trade marks relating to "BEVERLY HILLS POLO CLUB" (BHPC) brand, including the word and logo mark (see below).  BHPC Associates LLC owns the corresponding BHPC trade mark rights in the US. 

By way of background, BHPC products were listed on amazon.com in the US with the consent of BHPC Associates.  The four business models by which BPHC products are sold via Amazon to UK and EU consumers are as follows:

  1. Amazon Exports-Retail - customers purchased products from Amazon via amazon.com to be shipped to the UK/EU;
  2. FBA Export - third parties sell via amazon.com and Amazon handles the logistics of the transaction;
  3. MFN Export - third parties sell via amazon.com but Amazon does not handle the logistics of the transaction; and
  4. Amazon Global Store - consumers on amazon.co.uk can access listings for products on amazon.com.

In short, Lifestyle Equities wished to prevent the UK and EU market from seeing the price at which such BHPC-branded products were being sold in the US, and therefore brought an action against Amazon claiming trade mark infringement.

Decision

Michael Green J dismissed the action, commenting that this was "not a normal case of trade mark infringement".

Sale of BHPC products

Despite Amazon admitting there were a handful of listings on the Amazon Global Store that were targeted at the UK before 2019, Michael Green J held that Amazon had not infringed the BHPC trade marks owned by Lifestyle Equities.  In his judgment, Michael Green J referred to the fact that, following allegations of trade mark infringement made by Lifestyle Equities back in 2018 / 2019, Amazon had successfully implemented technical restrictions that prevented BHPC products from being sold from amazon.com to UK and EU customers. 

Visibility of BHPC products

Given this, Michael Green J held that the only ongoing possible infringement was the visibility of BHPC products on amazon.com.  Therefore, the issues centred around whether using a sign on the internet meant using the sign in a relevant territory (i.e. targeting).

Michael Green J held that, whilst the traditional "average consumer" test is important to examine targeting, "all relevant factors" must be considered, including viewing figures, volume of traffic and the "subjective intent of Amazon".  Michael Green J also dismissed reliance on the "troublesome" Blomqvist decision to suggest that sales of BHPC products via Amazon Exports-Retail would establish use in the UK and EU, as there were only a handful of sales and Amazon's technical restrictions prevented sales in the UK and EU. 

Business models

Notwithstanding the minimal sales, to the extent that any damage suffered would be "almost de minimis", Michael Green J held that:

  • the sales of BHPC products through Amazon Exports-Retail and Amazon Global Store and did not infringe as Amazon's contractual Ts&Cs stated that the consumer was the 'importer of record' and gained title to the products in the US; and
  • Amazon was not the seller of BHPC products for FBA Export and MFN Export, so Amazon could not be liable for any trade mark infringement.

Comment

The decision provides an interesting analysis on the split in ownership of trade mark rights between the US and the UK and/or the EU.

Companies should be aware that, when examining targeting for trade mark law purposes, the Court will look beyond the "average consumer" test – seeking to refer to all relevant circumstances, including (but not limited to) data and subjective intention.

Further, companies should take the opportunity to consider their standard terms and conditions and specifically provisions relating to the transfer of title and import duties, which could ultimately assist in responding to a trade mark infringement claim.

The full judgment for Lifestyle Equities CV & Anor v Amazon UK Services Ltd & Ors [2021] EWHC 118 (Ch) is available here.