Supreme Court refers questions to ECJ in keying case

In Portakabin Ltd v Primakabin (Case C07/056HR; LJN: BF0518, December 12 2008), the Dutch Supreme Court has referred questions to the European Court of Justice (ECJ) for a preliminary ruling in a case involving the use of a registered trademark as a keyword in Google's Adwords system.

Portakabin Ltd manufactures and sells modular building units under the trademark PORTAKABIN. Primakabin sells new and used modular building units, including second-hand Portakabin units. Primakabin added the word 'Portakabin' (and misspellings of 'Portakabin') to its list of keywords in the Adwords system. A search on these keywords would lead potential consumers to Primakabin's website.

Portakabin sued Primakabin for infringement of its trademark. On March 9 2006 the District Court held that:
  • use of the word 'Portakabin' as a keyword did not qualify as use as a trademark; and
  • Primakabin did not take unfair advantage of the reputation of the PORTAKABIN mark.
On appeal, the Appeal Court of Amsterdam ordered that Primakabin link the search results on the keyword 'Portakabin' or similar words directly to the part of Primakabin's website that sold second-hand Portakabin units. However, use of the word 'Portakabin' was held not to infringe Portakabin's trademark.

Portakabin appealed to the Dutch Supreme Court. The advocate general to the Supreme Court advised it to refer several questions to the ECJ for a preliminary ruling (for further details please see ("Supreme Court advised to refer questions to ECJ in keying case"). The court followed the opinion of the advocate general and decided to refer five questions to the ECJ on the interpretation of the First Trademarks Directive (89/104/EEC) (now the EU Trademarks Directive (2008/95/EC)). 
The first question was whether use of a trademark as a keyword qualifies as use as a trademark for products or services under the directive - and, in particular, whether it would make a difference if the search results were displayed in the ordinary list of search results or in an advertising section identified as such. Furthermore, the Supreme Court wanted to know whether it would make a difference if Primakabin's own products appeared in the search results list.

If so, the second question was whether this particular use of a trademark was unacceptable because it constituted more than an indication of the characteristics of the products. The third question was whether the trademark owner's rights are exhausted where the advertiser sells (second-hand) genuine products.

The fourth question dealt with the issue of typosquatting - and, in particular, whether advertisers are allowed to use misspellings as keywords. The fifth question was whether, if use of a trademark as a keyword does not constitute trademark use, the EU member states are allowed to prevent such use where:

  • the advertiser uses the mark without due cause; and
  • such use takes unfair advantage of the reputation of the mark. 
It could take over two years for the ECJ to answer these questions. Until then, the national courts will have to rule on keying cases without guidance. One recent example is a decision of the Brussels Court of Appeal in which it was held that eBay's use of the keywords 'Ralph Lauren' and 'Polo Sport' did not constitute trademark infringement. Meanwhile, in the proceedings on the merits in the Portakabin Case (which are pending simultaneously), the Dutch court decided that use of the PORTAKABIN mark as a keyword constituted trademark use.

In 2008 both the Austrian Supreme Court and the French Supreme Court referred similar questions to the ECJ for a preliminary ruling (for further details please see "Supreme Court refers questions on keying to ECJ" and "More questions referred to the ECJ in Google Cases"). In the Austrian case, the trademark owner sued the advertiser, while in the French cases, the complaints were directed at the search engine.

The present case clearly indicates that national courts need a legal framework in order to decide what constitutes trademark infringement in keying cases. The answer of the ECJ is thus awaited with great interest.

Maria Pereira, Allen & Overy LLP, Amsterdam

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