Amazon held liable for Intellectual Property infringement by Court of Appeal! What are the consequences?

The online retail behemoth, Amazon, has been found by the UK Court of Appeal to have made a trademark infringement in a recent legal battle with Lifestyle Equities CV, a Netherlands-registered company.

The case, Lifestyle Equities CV and another v Amazon UK Services Ltd and others [2022] EWCA Civ 552, reinforces the fact that the trademark owner’s consent is required where a third-party seller is based outside the jurisdiction but supplies branded goods to a person within that jurisdiction. It acts as an important case study for the area of UK intellectual property law.

High Court decision overturned

The claimant, Lifestyle Equities is the owner of the EU and UK trademarks of the online fashion brand Beverly Hills Polo Club (BHPC). BHPC wished to prevent UK and EU customers from seeing the prices which its products were being sold for in the US. Lifestyle Equities alleged that by listing products bearing the marks BHPC on the websites amazon.com-usa as well as amazon.co.uk, Amazon were infringing the rights of Lifestyle Equities by using the trademark of BHPC.

While the High Court originally ruled that there was no targeting because it determined UK customers were aware they were buying through Amazon’s Global Store, the Court of Appeal’s judgement overturns that decision. The High Court had also determined that it would not be acceptable to prevent UK customers from viewing BHPC products on the US version of the Amazon website, as this would amount to censorship.

Court findings

By selling products from the US to UK-based customers without the consent of the relevant intellectual property owners of the products, Amazon was found to have breached IP infringement.

The court took several stages of the purchase process into account when determining whether or not Amazon breached intellectual property rights. Indeed, three factors led them to the conclusion that they eventually made.

Firstly, the search results page included the phrase ‘Ships to United Kingdom’. Secondly, the product details page also said ‘this item ships to the United Kingdom’ as well as twice saying ‘Deliver to the United Kingdom’. Finally, the ‘Review your order’ page also included a billing and shipping address in the UK. This was considered by the court to be proof of acts of infringement given that Amazon stated that products shipped and delivered to the UK. As a result, saying that products ship or deliver to the UK is enough to turn an advertisement into an offer targeting the UK.

Our thoughts

The decision by the Court of Appeal provides a warning to businesses which provide e-commerce, in particular, across borders. The fact that they may have obtained consent from IP owners to sell products in certain area does not necessarily mean that they are able to sell them unrestrictedly to other areas.

IP owners may have various reasons for limiting the sale of their products to certain areas, such as pricing, IP protection and competition. This has to be respected by retailers, wholesalers or distributors. In absence of express consent, the e-commerce companies will have to mark clearly the geographical areas where the products can be sold and decline orders from outside; otherwise, they will risk being sued for IP infringement.

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