eBay's unlawful comparative advertising held not to amount to trademark infringement

In Media Markt v eBay, the Court of Appeal of Brussels has clarified that comparative advertising that uses a third-party trademark, but does not meet the requirements of comparative advertising, does not automatically constitute trademark infringement (Case No 2009/AR/859, January 14 2014).

In 2008 eBay, one of the world’s largest electronic marketplaces, launched a campaign claiming that new products offered for sale on eBay were, on average, cheaper in comparison than new products sold by authorised retailers. The online campaign featured banners on various sites with the slogan “save 20% or more”. The banners linked to a basket containing dozens of household electronics and comparing their average price in different retail stores, including in the chains Media Markt and Saturn, with the average eBay price. eBay explicitly used the trademarks of Media Markt and Saturn.

As indicated in the preamble of Directive 2006/114/EC concerning misleading and comparative advertising, it is "indispensable, in order to make comparative advertising effective, to identify the goods or services of a competitor, making reference to the trademark of which the latter is the proprietor". Such use of a third-party trademark, without the consent of the owner, does not breach the owner's exclusive right "in cases where it complies with the conditions laid down in the directive, the intended target being solely to distinguish between them and thus to highlight differences objectively".

In the present case, the Court of Appeal found that the comparative advertising was misleading and not verifiable and, therefore, did not comply with the requirements laid down in the directive on comparative advertising, as implemented in the Belgian act on market practices and consumer protection. Such finding, however, was insufficient to automatically assume that eBay’s use of the trademarks also amounted to trademark infringement.

In particular, the court noted that, to the extent that eBay made use of the trademarks to promote offers from its own clients, such use was done in relation to goods or services identical to those for which the trademarks were registered. It was immaterial whether those goods belonged to eBay itself or to a third party-client (see the decision of the Court of Justice of the European Union (ECJ) in L’Oréal SA v eBay (Case C-324/09, July 12 2011), Paragraph 91 et seq).

In the court’s view, however, it was unlikely that eBay’s use of identical signs in relation to identical goods was likely to affect any of the trademarks’ functions - a condition added to the 'double identity' requirement by the ECJ in its case law.

As regards the investment function, it was clear to the court that eBay’s use did not substantially interfere with Media Markt's and Saturn’s use of their trademark to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty.

To the extent that eBay made use of the trademarks for its own marketplace as a store offering the same goods as those sold by Media Markt and Saturn, such use was done in relation to goods or services dissimilar to those for which the trademarks were registered (see L’Oréal SA v eBay, Paragraph 89 et seq).

In that respect, the court found that the advertisement displayed on the online banners provided - without offering a mere imitation of the goods or services of Media Markt and Saturn and without causing dilution or tarnishment - a mere alternative to the goods or services offered by Media Markt and Saturn (see the decision of the ECJ in Interflora v Marks & Spencer (C-323/09, September 22 2011), Paragraph 91). Even if the comparison was not permitted, such use fell within the ambit of fair competition and, therefore, was not without “due cause”.

Jeroen Muyldermans, ALTIUS, Brussels