The Lush v Amazon judgment of 10 February 2014 considers the extent to which online retailers can use trade marks, in the context of both keyword advertising and their own website's search engine, to generate sponsored advertisements within search engine results which direct consumers to products not originating from the trade mark owner.
Lush manufactures and supplies cosmetics, including colourful soaps and 'bath bombs', under the Lush brand. The online shopping retailer Amazon sells via its website both its own goods and the goods of third parties. Lush branded products are, however, not available from amazon.co.uk.
Lush owns the Community trade mark for 'Lush' in respect of cosmetics and toiletries, including soap, and sued Amazon for trade mark infringement in the following scenarios:
Internet advertising and bidding on keywords via Google AdWords
- the consumer types the word Lush, or an expression containing Lush, into a search engine such as Google
Amazon had bid on certain keywords, in particular ones including ‘lush’, within the Google AdWords service so as to trigger a sponsored link advertisement appearing on the Google search engine results page whenever a consumer typed ‘lush’ into the search box. If a consumer clicked on the relevant link he was taken to the amazon.co.uk website and presented with the opportunity to browse or purchase equivalent products to Lush Soap. In some cases the Lush mark appeared in the search results. In others the Lush mark did not appear but sponsored advertisements to equivalent or similar products to those sold by Lush, such as 'Bomb cosmetics' or 'Bath Bombs', which were available for purchase on the Amazon website. There was no overt message either within the advertisement or on the Amazon site that Lush products were not available from Amazon, nor that the Lush Bath Bomb was not available for purchase on the Amazon website.
The leading case on keyword advertising Google France has held that:
the function of indicating origin will be adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to in the ad originate from or are connected with the proprietor of the mark or, on the other hand, from a third party.
Infringement therefore occurs where the average consumer may erroneously think that the goods advertised emanate from the trade mark proprietor. The judge noted, citing Interflora v Marks & Spencer, that he can make up his own mind on such questions without the need for expert evidence or the evidence of consumers.
It was held that Lush had established infringement in cases where the Lush mark appreared in the search results. The average consumer seeing the ad would expect to find Lush soap available on the Amazon site at a competitive price. Such consumer was likely to think that Amazon was a reliable supplier of a very wide range of goods and he would not expect Amazon to be advertising Lush soap for purchase if it were not in fact available. On the facts of the case, the average consumer would not, without difficulty, ascertain that the goods referred to by the ad were not the goods of or connected with Lush.
The situation was different in relation to sponsored advertisements which did not include the Lush mark. Consumers, familiar with such ads, are used to seeing them from competing suppliers. Since Lush were brand conscious and had made great efforts to build up a reputation in the Lush name, average consumers would expect an advertisement for Lush products to include some reference to the Lush mark, in order to distinguish that ad from the ads of others which they might expect to see on the results page of a Google search.
Searches using Amazon's own search engine
- the consumer types the word Lush into the search facility on the amazon.co.uk website.
This related to the operation of Amazon’s own website. If, for example, a consumer searched for the word ‘Lush’ in the relevant “department” of Amazon’s UK site, after the letters ‘lu’ are typed, a drop down menu appeared offering various options such as ‘lush bath bombs’ or ‘lush cosmetics’. If the consumer clicked on these, a new page offered similar products to those available from Lush without any overt reference to the Lush item not being available.
Infringement was also established in this scenario. The Lush registered trade mark appeared on the amazon.co.uk website in various places. In this scenario both the search engine operator and the advertiser were one and the same, and the purpose and effect of Amazon’s use of the Lush mark was to induce consumers to purchase non-Lush products. Amazon's search engine had been designed in order to maximize the sale of goods from the site.
The average consumer was unlikely to know how the drop down menu had the content which it displayed, but he was likely to believe that it was intended to be helpful to him and was in consequence of searches that had been carried out. Such an average consumer typing Lush into the search box would not think that the drop down menu reference to Lush Bath Bombs was a reference merely to products which were similar to or competitive with the Lush product.
The absence of any reference to Lush on the display of the goods themselves did not absolve Amazon.
Amazon's search facility assumed the consumer intended to search for Lush products and, without a further indication that such products are not available, offered competing products to the consumer. In these circumstances the average consumer would not ascertain without difficulty that the products he was shown were not Lush products. Indeed Amazon was using the Lush trade mark as a generic indicator of a class of goods, conduct which the judge considered attacked head on the ability of the mark to act as a guarantee of origin.
There was use in the course of trade, such as to affect the functions of the trade mark. As well as damaging the origin function of the Lush trade mark the judge also held that Amazon's use damaged both the advertising function and the investment function of the Lush trade mark. In relation to the advertising function, the quality of attracting custom was damaged by Amazon's use of the Lush mark to attract the attention of consumers and attempt to sell to them the goods of third parties whilst at the same time making no effort at all to inform the consumer that the goods being offered are not in fact the goods of Lush. In relation to the investment function, Lush had built up an image of ethical trading. To preserve this image it had taken the decision not to allow its goods to be sold on Amazon because of the damage that it perceived there would be to that reputation. Some consumers , for example, might regard negatively Amazon’s attitude to UK taxation.
Cosmetic Warriors Limited and Lush Limited v Amazon.co.uk Limited and Amazon EU SARL  EWHC 181 (Ch): John Baldwin QC sitting as a Deputy Judge