Online retail giant Amazon is not liable for unknowingly stocking trade mark infringing products from third-sellers, but should be checking whether products are legal, claims an adviser to the Court of Justice of the European Union (CJEU).
Amazon is currently embroiled in a case where US cosmetics company Coty.
Coty’s German subsidiary has taken Amazon to a German court for stocking Coty’s Davidoff perfume for third party sellers.
The cosmetics business said such practices violate its trade mark rights and that Amazon should be liable for stocking trade mark infringing goods.
Thereafter the German court sought guidance from the CJEU.
At the moment, companies which are not aware of trade mark infringements cannot be held responsible for storing such products for third party sellers, Manuel Campos Sanchez-Bordona said, as reported by Reuters on Thursday.
Campos Sanchez-Bordona, an advocate general at the CJEU, added that if a platform (such as Amazon) is actively involved in distributing the goods and if they operate a scheme like Amazon’s, then they should show diligence in checking the legality of goods sold on their platforms.
The court discussion opens up more debate over the scope of online retailer’s responsibility for products sold.
Under a scheme called “Fulfilled by Amazon”, the retailer stores and delivers goods for third-party sellers.
Campos Sanchez-Bordona added that companies cannot simply absolve themselves of responsibility and should be aware that without this control, they can serve as a channel for the sale of illegal, counterfeit, stolen or unethical products, as reported by Reuters.
“Amazon continues to invest heavily in fighting bad actors on our store and is committed to driving counterfeits to zero. Courts have ruled in our favour in the first two instances of this proceeding, and we are now awaiting preliminary legal clarification from the CJEU,” the company told Reuters.