A Reminder for Online Retailers

Here’s one case that involves an online retailing businesses that is having a link with Trade mark Law – Jadebay Ltd and others v Clarke-Coles Ltd (t/a Feel Good UK) [2017] EWHC 1400 (IPEC).

However, overlooking the customary practice of online retailing methods, the Intellectual Property Enterprise Court followed the theoretical root of the Trade mark laws and over-turned such practices by upholding that‘re-use of a third party’s Amazon listing without consent to sell the same goods may, on appropriate facts, amount to trade mark infringement or passing off.

The factual matrix of this case lies as below:

In this matter there were two claimant, the first one was the statutory and common law owner of the Trade mark ‘Design Elements’ for the purpose of “flagpoles plastic storage box garden furniture”, while the second Claimant was the sole licensee since 2011 to sell the products of the first claimant. These products were also sold through online shopping portal namely – www.amazon.co.uk, via three listings created by the second claimant.

Usually, the common practice while listing products for sale on Amazon or any such kind of online portals are that each new listing is given a Unique Amazon Identification Number (ASIN). It is pertinent to note that an Amazon listing created by one party can be used by multiple sellers selling common product. Amazon then tends to promote the cheapest of the offerings by selecting them as the default seller, allowing consumers to review each listing in more detail.

Thus, in this case, the issue arose when the defendant listed its product under the listing created by the claimants, with a low price due to which they appeared as the default seller, attracting majority of sales from the said listing.

Interesting fact about this case is, that the claimants sued the defendants for trade mark infringement and passing off and did not even involve Amazon, who encourages sellers to use pre-existing generic ASINs where possible.

Arguments

The claimant focussed on the basic concept of rights of trademark. Firstly, the owner of the trademark has the right to prevent the third party from commercially using any sign (without the permission of the TM owner) that is ‘identical to the trade mark in respect of goods or services which are identical to those for which the mark is registered (double identity) (section 10 (1), Trade Marks Act 1994) (TMA) (section 10(1))’ or ‘ by such use of trademark that causes a likelihood of confusion or association on the part of the public (section 10(2)(b), TMA) (section 10(2)(b)).”

Secondly, the law of passing off a trade mark, which is considered as an element of Tort, the essential feature that is considered to attract this tort is the goodwill attached to the trade mark, such misrepresentation leads to likelihood of confusion among consumers due to which the claimant suffer damage as mention in the case of Reckitt & Coleman Products Ltd v Borden Inc [1990] RPC 341.

However, the defendant relied on the generality of the Amazon listing number. They claimed that since the listing was generic and did not refer to a specific brand, it could list its product under the same listing and that the brands of the competing products were significantly different as the defendant’s brand was “Feel Good UK”.

However, the claimant argued that due to the use of the same listing number namely “20ft aluminium flagpole “by Design Elements”, any consumer can link the defendant’s product as that of the claimant’s product.The defendants should have sold their products through another Unique Identity ASIN number.

The question was not whether the Defendant attached the sign or trade mark to the product or packaging itself, but whether the use of the listing in this way infringed (and/or passed off) the Claimants’ rights.

Judgement

The Intellectual Property Enterprise Court accepted the claimant’s argument and further observed that by having the same listing number and linking one’s goods to a competitor’s branded product listing would undoubtedly cause a misrepresentation and confusion among the consumers leading to Trademark infringement and passing off.

Conclusion

The present case has shown the online businesses a reality that the presence of Trade mark law is every where. It is another reminder that these businesses should consider their online marketing very carefully. Attaching products to an existing Amazon listing when the products are clearly not the same could potentially be an infringing act. Moreover, as per the Objective of Trade Mark law, that is to avoid confusion in the market place, the decision of the court was not strange and perhaps was very apt.

Author: Ms. Pratistha Sinha, Intern at Khurana and Khurana Advocates and IP Attorneys and can be reached at [email protected].

References:

[1] https://www.lexology.com/library/detail.aspx?g=55745fd6-0397-4222-9d31-a3b3a8447e19

[2] https://www.rpc.co.uk/perspectives/ip/flagging-the-risk-of-a-new-type-of-trade-mark-infringement