Lifestyle Equities CV v Amazon UK Services Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Arnold,Lord Justice Snowden,Sir Geoffrey Vos |
| Judgment Date | 04 May 2022 |
| Neutral Citation | [2022] EWCA Civ 552 |
| Docket Number | Case No: CA-2021-000592 (formerly A3/2021/0852) |
| Court | Court of Appeal (Civil Division) |
[2022] EWCA Civ 552
Sir Geoffrey Vos, MASTER OF THE ROLLS
Lord Justice Arnold
and
Lord Justice Snowden
Case No: CA-2021-000592 (formerly A3/2021/0852)
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE, BUSINESS AND PROPERTY
COURTS OF ENGLAND AND WALES, INTELLECTUAL PROPERTY LIST (ChD)
Mr Justice Michael Green
Royal Courts of Justice
Strand, London, WC2A 2LL
Michael Edenborough QC and Thomas St Quintin (instructed by Brandsmiths) for the Appellants
Daniel Alexander QC and Maxwell Keay (instructed by Hogan Lovells International LLP) for the Respondents
Hearing dates: 5–6 April 2022
Approved Judgment
This judgment was handed down by the Court remotely by circulation to the parties' representatives by email and release to The National Archives. The date and time for hand-down is deemed to be 10:30 on 4 May 2022.
Introduction
The Claimants (“Lifestyle”) are respectively the owner and the exclusive licensee of various UK and EU trade marks (“the Trade Marks”) consisting of either the words BEVERLY HILLS POLO CLUB or a logo comprising those words together with a device of a horse and rider registered in respect of various goods including clothing. The precise details do not matter. There are corresponding trade marks registered in the USA which are owned by a commercially unrelated party. The US trade mark owner markets goods identical to those for which the Trade Marks are registered under signs identical to the Trade Marks (“US branded goods”) in the USA. Lifestyle have never consented to US branded goods being placed on the market in the UK or the EU.
The Defendants (collectively “Amazon”) are all members of the well-known group of companies that operate e-commerce websites. For the purposes of this case the relevant Amazon websites are: (i) the website at www.amazon.com (described by Amazon as the US website); (ii) the UK website at www.amazon.co.uk; and (iii) the German website at www.amazon.de.
Lifestyle claim that Amazon have infringed the Trade Marks by advertising, offering for sale and selling US branded goods to consumers in the UK and the EU and that Amazon are jointly liable for the importation of US branded goods into the UK and the EU. Without admitting liability, Amazon put in place successive restrictions in 2018, January 2019 and November 2019 designed to address Lifestyle's complaint, but Lifestyle contend that the restrictions still do not go far enough. Shortly before trial Amazon made a limited admission of past infringement on a small scale in respect of one of their business models in issue, but otherwise Amazon deny any infringement.
Michael Green J dismissed Lifestyle's claims, save to the limited extent that they had been admitted, for the reasons given in his judgment dated 27 January 2021 [2021] EWHC 118 (Ch). Lifestyle now appeal with permission granted by the judge.
The claim was brought at a time when the UK was still a Member State of the EU, and it was tried shortly before the end of the implementation period under the UK-EU Withdrawal Agreement. It is common ground that the issues may be decided by reference to European Parliament and Council Regulation 2017/1001/EU of 14 June 2017 on the European Union trade mark (“the Regulation”). It is also common ground that they are unaffected by Brexit. For clarity, however, I will refer to “the UK and the EU” (as they now are) rather than just “the EU” (as it was when the claim was brought). Furthermore, I will concentrate on the UK, since the sample transactions described below all relate to the UK.
Factual background
The judge set out the facts in some detail in his judgment, although limitations in the evidence adduced by the parties prevented him from making findings on certain points. For the purposes of the appeal the relevant factual background may be summarised as follows.
The business models
Amazon operate four business models which are in issue in this case:
i) Amazon Exports-Retail. Customers shopping on amazon.com purchase products from Amazon. Amazon handle all aspects of the transaction, including processing the order and payment, and arranging for storage, shipping and delivery of the products to another country such as the UK.
ii) FBA Export. FBA stands for “Fulfilled by Amazon”. Third party sellers place their products on amazon.com and international customers buy those products from the third party sellers. Amazon handle all aspects of the transaction, including processing the order and payment, and arranging for storage, shipping and delivery of the products to another country such as the UK.
iii) MFN Export. MFN stands for “Merchant Fulfilled Network”. This model is also referred to as FBM, which stands for “Fulfilled by Merchant”. Third parties sell their products to international customers through amazon.com. In contrast to FBA Export, Amazon do not handle the storage, shipping, delivery and other logistics of exporting the product. Amazon handle payment processing.
iv) Amazon Global Store. Amazon offer a service on amazon.co.uk and amazon.de whereby a consumer on those websites can access listings for certain products on amazon.com and purchase such products. Amazon handle all aspects of the transaction including arranging shipping and delivery.
The roles of the Defendants
The involvement of each of the Defendants in these business models is as follows:
i) The First Defendant, Amazon UK Services Ltd, is a UK company. It provides fulfilment and other corporate services to the Fourth and Fifth Defendants in respect of transactions with a UK element. It is a subsidiary of the Fourth Defendant. It also provides support for sales conducted through Amazon Global Store from amazon.co.uk.
ii) The Second Defendant, Amazon Export Sales LLC, is a company incorporated in Delaware, USA. It is the seller of products sold through Amazon Exports-Retail and Amazon Global Store.
iii) The Third Defendant, Amazon.com Inc, is also a company incorporated in Delaware. It is the ultimate parent company of the other Defendants and of the Amazon Group as a whole. It has no direct involvement in any of the business models, but Lifestyle claim that it is jointly liable for the infringements complained of. (At trial Lifestyle contended that Amazon.com Inc operated the amazon.com website, but the judge found that the website was operated by Amazon Services LLC prior to 1 January 2020 and by Amazon.com Services LLC since then.)
iv) The Fourth Defendant, Amazon Europe Core Sarl, is a Luxembourg company. It operates the UK and German websites. It is therefore responsible for Amazon Global Store listings on those websites. It has no involvement in the amazon.com business models.
v) The Fifth Defendant, Amazon EU Sarl, is also a Luxembourg company. Lifestyle alleged that it also operated the UK and German websites, but this was denied by Amazon. As I read the judgment, the judge accepted Amazon's denial.
The sample transactions
Lifestyle led evidence concerning test purchases in respect of two of the four business models, namely FBA Export and Amazon Global Store, although the evidence was not complete. Due to Lifestyle's failure to obtain evidence of test purchases in respect of the other two business models before Amazon voluntarily imposed restrictions, the parties agreed that evidence of sample transactions using goods bearing third party trade marks would be adduced instead. The four sample transactions are described below.
It should be noted, however, that there appears to have been no evidence or argument before the judge concerning the question of how UK and EU consumers would arrive at the relevant listings. It appears to have been assumed that such consumers would first go to the relevant Amazon website and then search for Beverly Hills Polo Club goods. This is not necessarily correct, but in the absence of evidence it is not possible to take the matter any further.
Similarly, there appears to have been no evidence or argument before the judge as to the motivations UK and EU consumers may have had for purchasing US branded goods, even though it is common ground that some did. It appears to have been assumed that such consumers were primarily motivated by price differentials between the US branded goods and similar goods marketed by Lifestyle in the UK and the EU under the Trade Marks despite the extra costs the consumers would have to pay in respect of shipping and import duties, but whether there were other motivations does not appear to have been explored. Again, in the absence of evidence it is not possible to take the matter any further.
(1) Amazon Exports-Retail
It is common ground that the amazon.com website recognises the user's location, and therefore we are concerned with how it is seen by a UK consumer.
The home page contains a banner across the top that says in relatively large print: “Welcome to Amazon.com”. Beneath that it says: “We ship over 45 million products around the world”. In much smaller print underneath the banner it says:
“You are on amazon.com. You can also shop on Amazon UK for millions of products with fast local delivery. Click here to go to amazon.co.uk”.
Lower down are icons accompanied by the legends “Shop in 8 languages” and “Shop in 60+ currencies”. In addition, clicking on an arrow to the side of the banner brings up a replacement banner reading “Click here to shop in your local currency”.
In the top left hand corner there is a legend that says: “Deliver to United Kingdom”. If the consumer clicks on or hovers over that, a box pops up that says:
“ We...
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