PARIS — It was a red-letter day for Christian Louboutin as the brand said that the European high court had ruled that Amazon could be held liable for the sale of counterfeits, whether distributed by it or sold on its marketplace by third parties.
In a preliminary ruling rendered and published on Dec. 22, the Court of Justice of the European Union ruled that Amazon could be considered as making use of the trademark registered by Christian Louboutin across the E.U. if a visitor of the site had the impression that the retailer was distributing the French brand’s footwear itself.
This liability would not be automatic but would be applicable since Amazon makes no distinction between its own listings and those of third parties; and offers support to third-party vendors through services such as warehouse storage and shipping.
The European court also considered that Amazon was different from eBay, since all listings on the auction platform were made by its users and not by the site itself, whereas Amazon is both a reputable retailer and distributor of third-party products.
The luxury French shoemaker welcomed the decision as “a preliminary interpretation paving the way for better brand protection,” in a statement announcing the court ruling.
Alexis Mourot, group chief executive officer of Christian Louboutin, said the ruling was a “victory for all brands defending their know-how” and reiterated the luxury brand’s commitment to defending “[its] creativity, [its] uniqueness and to preserving the relationship of trust” with consumers.
The French luxury footwear brand had filed two successive complaints against Amazon in 2019, one at the Luxembourg District Court and the other at the Brussels Companies Court in a bid to curtail the use of its trademark, its signature red sole, in Amazon’s commercial communications and to stop the sale of counterfeit products after several warnings since 2016 failed to be addressed by the e-commerce behemoth.
Both national jurisdictions had referred to the European court for a preliminary ruling on whether the operator of a marketplace could be held liable for trademark infringement resulting from a third-party listing.
The resulting preliminary ruling of the CJEU is not a verdict in itself but clarifies how to interpret laws and regulations harmoniously across the European Union. Now, the ball is back in the Belgian and Luxembourg courts, which will now be able to proceed to rule on their respective cases.
Scott Steinberg, senior associate solicitor at Fox Williams LLP, commented that the Dec. 22 ruling was “likely to entail more work for online marketplaces and, as a result, we may see online marketplaces increasing their charges,” resulting from a need to differentiate their own offers for sale clearly from those of third parties and the ensuing potential for liability.
“Overall, the CJEU’s judgment should mean that fake products should no longer appear in the same way as products which Amazon is itself selling,” he continued, calling the ruling a “potentially good news for brand owners.”
Describing the decision as “another victory in the fight against the scourge of counterfeiting,” Christian Louboutin group general counsel Xavier Ragot said it would “benefit all companies that strive for excellence and all consumers looking for authentic and quality products.”
An Amazon spokesperson told WWD the company “will study the court’s decision. Amazon makes it clear to customers who they are buying from when they are shopping in our stores by displaying seller information.”
The European high court’s preliminary ruling can also read as a fresh blow against Amazon, which reached a deal with the European Commission on an unrelated antitrust investigation.
The executive arm of the European Union had launched investigations in 2019 and 2020 on Amazon’s use of non-public marketplace seller data and a possible bias in its Buy Box and Prime programs that favored its own retail business and sellers using its logistics and delivery services.
– With contributions from Rhonda Richford