CJEU rules on jurisdiction in Google Ads trademark infringement dispute

By Novagraaf Team,
Het Hof van Justitie van de EU oordeelt over jurisdictie in geschillen over online merkinbreuk

Which court has competency when trademark infringement takes place online? A recent CJEU ruling considered this question in the context of a dispute over meta tag and Google Ads trademark infringement. Volha Parfenchyk outlines its implications. 

EU law contains several rules for determining the jurisdictional competence of the EU national courts in trademark infringement cases. According to Article 125 of the EU Trademark Regulations (EUTMR), a trademark owner can bring a trademark infringement case before the court of any member state where infringement may have been committed or threatened. However, determining the location where infringement has been committed is not always easy, particularly when it takes place online. 

Google Ads trademark infringement: The question of jurisdiction

As background, Lännen MCE, a Finnish company manufacturing and selling excavation machines (amphibious dredgers) under the ‘Watermaster’ trademark, filed a suit against two German companies (Berky and Senwatec) for online infringement. Lännen alleged Berky infringed its rights by using the word Watermaster as a meta tag in the online photo database Flickr.com to identify Berky machines. Meanwhile, Lännen alleged Senwatec infringed its rights by using Watermaster as a Google Adword term on Google.fi, in an ad linking to the Senwatec website. 

Importantly, geographical references to Finland were missing both in the advertising links and on the website of Senwatec. The latter, in particular, included a map of the countries where the company was active, and Finland was not mentioned as one of them. Lännen alleged that the mere fact that Finland was not directly mentioned as a country where its machines were sold was not relevant. Rather, because the advertisements were in the English language and thus were addressed to the international public, they targeted all public for which they were visible. 

Lännen filed the case before a Finnish court, arguing that the infringing acts took place in Finland and that therefore the Finnish court had jurisdiction. The Finnish court referred the case to the Court of Justice of the EU (CJEU) asking it to clarify whether the facts at hand were relevant to claim the jurisdictional competence in this case and whether other factors had to be taken into account.

Factors for assessing jurisdictional competence

First, the CJEU held that to determine the jurisdictional competence of the national court, the latter is not expected to conduct a full examination of the case. Instead, evidence giving rise to a reasonable presumption that acts of infringement may have been committed or threatened on the territory of a member state is sufficient for the national court of that member state to accept its jurisdiction.  

Further, reiterating its previous case law on this matter, the CJEU stated that the alleged infringement will be considered committed in the territory of the member state where the consumers or traders to whom such ads and offers for sale are directed are located. 

However, in the present case, the geographical targets for the products were not mentioned in the Google Ads. In addition, the map on Senwatec’s website was not sufficient to establish a connection with Finland. Therefore, in the absence of precise information regarding the geographical areas of the sale of products, the connecting factor with Finland, if present, must be established based on other factors. 

To establish these factors, the Court further referred to its previous case law, specifically the joined cases of Pammer and Hotel Alpenhof. This ruling contained a non-exhaustive list of factors that are relevant in assessing whether the activity is directed to a particular EU member state, namely:

  • the international nature of the activity, 
  • the use of a language or a currency other than the language or currency of the member state in which the company is established,
  • mention of telephone numbers with an international code, 
  • mention of an international clientele composed of customers domiciled in various member states,
  • an outlay of expenditure on an internet referencing service to facilitate access to the trader’s site or that of its intermediary by consumers domiciled in other member states, 
  • use of a top-level domain name (TLD) other than that of the member state in which the trader is established. 

In the Lännen case, the provision of advertisements and offers for sale on a website with a TLD other than that of the member state in which the trader is established (the last two factors) are of particular relevance. 

Concerning the use of Google Ads, the CJEU ruled that the fact that a company pays the operator of a search engine website with a national (country-code) TLD of another EU country (such as Google.fi) to display the link to its website and to show its offerings to the consumers of this country is a sufficient factor to establish the link with this country. The infringement of Lännen's trademark rights by Senwatec, according to the court, thus took place in Finland, entitling the trademark owner to sue the defendant before a Finnish national court.

In contrast, the CJEU ruled, the use of Watermaster as a meta tag in an online photo-sharing database under a generic TLD (gTLD) is not a sufficient connecting factor. A website with a gTLD (such as Flickr.com) is not intended for the public of any specific member state. In addition, the meta tag is intended only to enable search engines to better identify the images contained on that website and to increase their accessibility to the users. 

Implications of the CJEU Google Ads trademark infringement ruling

The ruling provides important clarification to the question of how to determine the jurisdiction of online trademark infringement (in the context of Google Ads and meta tags). Answering this question is vital for establishing the jurisdictional competence of the EU national courts to bring a trademark infringement claim. It is of particular importance given the significant role that the Internet and online advertising currently play in corporate commercial practices.

For more information and advice on enforcing your trademark rights online, speak to your Novagraaf attorney or contact us below.

Volha Parfenchyk works in Novagraaf’s Knowledge Management department. She is based in Amsterdam.

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