CASE LAW SUMMARY
England and Wales High Court of Justice (Chancery Division) – 21 May 2013 – "Interflora versus Marks & Spencer"
"Google Adwords" is a pay-for-use referencing service offered by Google that allows businesses to publish an advertisement with a link to a website that is accessed when the search engine user types in one or more predefined terms. This service is the main source of revenue for the Internet giant.
A case related to this referencing system opposed Interflora, known around the world for the delivery of flowers, and Marks & Spencer, which offers, in particular, services that rival Interflora's.
Marks & Spencer had "purchased" the terms and expressions "INTERFLORA", "INTERFLORA FLOWERS", "INTERFLORA DELIVERY" and "INTERFLORA.COM" through the Google Adwords service in order to use these terms for its own flower delivery services.
Interflora, which owns the INTERFLORA trade mark, registered inter alia in the United Kingdom and the European Union, sued its competitor for infringement before the High Court of Justice in 2009. The High Court of Justice referred a series of preliminary questions to the Court of Justice of the European Union (CJEU).
In decision C-323/09 of 22 September 2011, the CJEU was invited to determine whether the use of a business's trade mark by a third party in the framework of a keyword-based referencing system adversely affected the trade mark's functions, i.e. indication of origin, advertising and investment.
With regard to the indication of origin, the CJEU held that there is adverse effect "if the advertisement does not enable reasonably well-informed and reasonably observant internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the advertisement originate from the proprietor of the trade mark or from an undertaking economically connected to it or, on the contrary, originate from a third party."
It also ruled against a potential prejudice to the trade mark's advertising function, stating that, "The selection of a sign identical to another entity’s trade mark, in the context of a referencing service (…) does not, moreover, have the effect of denying the proprietor of that trade mark the opportunity of using its trade mark effectively to inform and win over consumers".
Nevertheless, taking into consideration Interflora's widespread reputation, the CJEU held that the investment function of its trade mark would be altered to the extent that "the use by a third party (…) affects that reputation and thereby jeopardises its maintenance," adding that this prejudice is not proven if the use thereof only obliges the trade mark proprietor to adapt his efforts and strategies to obtain and maintain such reputation.
Further to the responses of the CJEU, the High Court of Justice rendered its judgment on 21 May 2013.
The High Court of Justice held that the acts of Marks & Spencer adversely affected the indication of origin of the INTERFLORA trade mark on the grounds that a reasonably informed or attentive internet user would not be able to determine, or would have difficulty in determining, whether the services proposed in the advertisements at issue originated from the owner of the INTERFLORA trade mark, a company that is economically related, or a third party.
This decision can be explained in particular by the fact that Interflora grants user licenses for its trade mark to many distributors, and Marks & Spencer had at no time informed Internet users in its advertisement of its independence from the Interflora network, leading to believe that Marks & Spencer was related to Interflora.
Contact: Gwénaël TOUSSAINT