Questions to be referred to ECJ in INTERFLORA Case

In Interflora Inc v Marks and Spencer PLC ([2009] EWHC 1095 (Ch), May 22 2009), the Chancery Division of the High Court of England and Wales has decided to refer questions to the European Court of Justice (ECJ) concerning use of a third party's registered trademark as a keyword in Google's AdWords system.

Interflora Inc, which operates the largest flower delivery network in the world, owns the UK and Community trademark INTERFLORA in respect of various goods and services including "plants and flowers" in Class 31 and "information services relating to the sale of flowers" in Class 35 of the Nice Classification. Marks and Spencer PLC (M&S) also sells and delivers flowers, but is not a member of Interflora's network. Both parties accept online orders.

M&S purchased a number of keywords in Google's AdWords system, including the term 'Interflora' and variants or misspellings such as 'Intaflora' and 'Inter-flora'. Use of these keywords triggered a sponsored link directing users to M&S's website, although the text of the sponsored link did not include Interflora's trademark. 
 

Google's AdWords system allows advertisers to purchase keywords which, when entered into Google's search engine by a user, generate a sponsored link in a separate section of the search results page. Before May 2008, Google blocked the purchase of keywords where it had been notified by a trademark owner that the word was registered. However, in May 2008, Google ceased blocking such purchases in the United Kingdom. Third parties are thus able to purchase registered trademarks as keywords, including for use in advertisements for goods and services covered by the trademark registration. 

Interflora sought an interim injunction to stop M&S and others from using the term 'Interflora' as a sponsored search term in Google's AdWords system, as well as the misspellings 'Intaflora' and 'Inter-flora'.

 

Interflora claimed that M&S's selection of the INTERFLORA mark as a keyword, and the association of those keywords with M&S's website, amounted to trademark infringement pursuant to Sections 10(1) and 10(3) of the Trademarks Act 1994 (Articles 5(1)(a) and 5(3) of the First Trademarks Directive (89/104/EEC)). In relation to Section 10(3), Interflora claimed that the acts complained of were detrimental to the distinctive character of the INTERFLORA mark and would gradually lead to INTERFLORA being used as a generic term for any flower delivery business.

Rather than grant M&S's request for a stay of the proceedings pending rulings of the ECJ on six existing references concerning the AdWords system, the court decided to refer questions to the ECJ itself. It considered that there was a risk that those rulings might not provide all of the guidance needed by the court to resolve the present case, and it was accepted by both parties that the issues concerned difficult questions of law which would require ECJ guidance at trial - particularly as to whether there was 'use' of the trademarks and, if so, whether that use was 'in relation to' identical goods and services.

 

The questions already referred did not involve Google's policy in the United Kingdom post May 2008 (which differed from other parts of Europe) and did not involve a claim under Article 5(2) of the Trademarks Directive against an advertiser, rather than against Google. It was thus appropriate to refer questions at this preliminary stage, rather than wait until trial to do so, as it would reduce delay and may obviate the need for a trial altogether.

 

The court refused to grant Interflora an interim injunction preventing M&S from purchasing the keywords pending the outcome of the reference to the ECJ. In doing so, it noted that Interflora had waited five months between the first pre-action correspondence and issuing proceedings. Moreover, on issuing proceedings, Interflora had failed to apply for either an interim injunction or speedy trial. It was thus too late for Interflora to make such a request.

 

The parties were unable to agree on the questions to be referred to the ECJ. Accordingly, the court decided to allow both parties time to address it orally and to consider its judgment in L'Oréal v eBay (handed down the same day, and also referring questions to the ECJ) before the form of the reference was finalized.