Trade mark infringement on eBay in combination offers?

Whilst the Court of Justice of the European Union (EuGH) in its judgment of 23.03.2010 (C 236/08 to C 238/08) in the case of Google Adwords ruled out a detrimental effect on the advertising function of the trade mark designation booked as a keyword due to the spatial-visual separation of the advertisements thereby generated from the actual search results, the Regional Court (LG) Stuttgart reached the opposite conclusion in the case of use on eBay and assumes the trade mark use initially warned against by cease-and-desist letter and therefore constitutes a trade mark infringement.

The plaintiff ANDREAS STIHL AG & Co. KG is the manufacturer of the well-known "Stihl" chainsaws and distributes these exclusively through specially trained, authorised specialist retailers. As the world market leader in the chainsaw segment, STIHL claims trade mark protection in the territory of the Federal Republic of Germany on the basis of numerous national and European "Stihl" word/figurative marks not only for chainsaws, but also for spare parts and accessories.

The defendant competitor sells chainsaws from another manufacturer together with accessories on the internet sales platform eBay. In doing so, it offers the saws on the internet sales platform eBay in combination with STIHL company accessories. Accordingly, the competitor also structured its item designations (brief description) on eBay as follows:

Petrol chainsaw chainsaws 58 cc Stihl oil case,
or
Chainsaw 25 cc chainsaw by [name addition] Stihl 2-stroke oil.

As a result, the competitor is displayed in the hit list on eBay when searching for "STIHL chainsaws". This is because the search engine functionality does not differentiate at which point in the respective offer description the trade mark STIHL appears.

The company STIHL now took action against this use and demanded discontinuance.

Court decision
The Regional Court (LG) Stuttgart decided in its judgment of 22.06.2010 (17 O 41/10) that the specific design of the contested combination offers served the purpose of exploiting the "Stihl" trade mark, which is known for very high quality, for the offer of chainsaws distributed by the competitor on eBay. The intended consequence of the competitor's eBay offer was to recommend its own offer to potential customers who search the internet for chainsaws of the "Stihl" brand using the search term "chainsaw Stihl".

In addition to the reputation-exploiting character, the LG (LG) saw in this also a rights-infringing impairment of the association function associated with well-known marks. The defendant competitor's objection raised in defence that it was entitled to offer the original Stihl oil offered in combination with its chainsaws under the trade mark name and that so-called exhaustion had therefore occurred, was rejected by the LG Stuttgart. The company STIHL had justified grounds to object to the specific use of the trade mark STIHL in the context of the contested combination offer, since its mark was in the specific case being associated with qualitatively inferior chainsaws and these cheaper products were to be sold at the expense of the trade mark proprietor's products.

Conclusion

Owners of well-known marks do not have to tolerate competitors' products from other manufacturers being combined with accessories from the trade mark proprietor's company without prior permission when there is neighbouring in the sector, if in doing so the reputation associated with the well-known mark is exploited by taking advantage of internet-specific search functionalities. Despite the Google Adwords decision of the EuGH (judgment of 23.03.2010 – C 236/08). One should pay close attention to whether the use of a well-known trade mark name on the internet in the specific case does not constitute a trade mark infringement. This is likely to be the case if the search result allows doubt about the origin of the advertised products.