On the heels of publishing its latest report detailing efforts to curb counterfeits and illicit sales on its platform, Amazon is in hot water with a legendary luxury footwear player—again.
Parisian designer Christian Louboutin, purveyor of high-heeled shoes bearing signature red soles, has filed a complaint against the e-commerce giant’s European arm, alleging that products on its marketplace violate his label’s rights to the widely recognized feature.
“Mr. Christian Louboutin is the proprietor of the position mark known as the ‘red sole’”—specifically, Pantone shade 18-1663TP—read a summary of a request for a preliminary ruling on the matter by the District Court of Luxembourg, dated March 8. According to Louboutin’s complaint, Amazon and its legion of third-party sellers regularly advertise red-soled shoes without his brand’s consent—and have been doing so continually despite his manifold attempts to stop them.
The action is the latest in a long line of defensive moves by the designer, who has been seeking to protect his lucrative brand from the e-tailer since March 2019. The shoemaker brought proceedings on behalf of his Benelux trademark before the president of the Brussels Companies Court in Belgium, seeking injunctive relief against Amazon’s businesses in Europe, and by August, the president of the court ruled in French-Egyptian designer’s favor, subjecting Amazon to financial penalty should it continue to advertise red-soled shoes. In September of 2019, he brought proceedings before the District Court of Luxembourg on behalf of his E.U. trademark, asking for similar protections across Amazon’s European marketplaces.
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Less than a year later, however, in June of 2020, the Brussels Court of Appeals set aside its earlier judgment, deciding instead that only ads relating to shoes sold by Amazon itself could be subjected to penalties. Third-party sellers—which account for more than half of the site’s sales—would be judged on their own performance and dealt with independently, the court ruled. The designer has filed an appeal against that judgment.
The designer is now lobbying the District Court of Luxembourg for an injunction against Amazon as well as damages for violating the rights conferred by his E.U. trademark. Under E.U. law, trademark holders are entitled to prevent third parties that have not obtained consent from using their marks in relation to any goods or services identical to those being sold by the owners. In this instance, the stiletto maker Amazon’s alleged improper use of the trademark consists of publishing listings for red-soled shoes on any of its online stores, as well stocking, shipping and delivering those products.
Because Amazon plays an “active role” in the infringing actions of its third-party sellers, the company should be held accountable for facilitating their misdeeds, Louboutin said. “Amazon does not merely provide a neutral service, creating the technical conditions necessary for others to commit the act constituting use,” he added. “Its commercial communication is essentially constructed on its capacity as distributor of the goods offered for sale on its sites.”
What’s more, the fact that certain goods are sold by third parties is not immediately evident, as all product listings are displayed uniformly, the designer continued. Amazon cannot therefore be characterized as just a host for these offers or an intermediary between shoppers and sellers, he claimed, and differentiation between Amazon’s own unauthorized listings and those of its third-party sellers should not be drawn.
Furthermore, Amazon’s transgressions stem from “the shipping of the infringing shoes to final consumers, owing to its active role and to the fact that it is or should be aware of the nature of the goods shipped from its distribution centers,” the complaint read.
Amazon presented its own rebuttal to the charges, raising pleas that the luxury creative’s complaint was void due to obscure wording and a lack of locus standi, or sufficient proof of harm to his brand. The online giant also submitted a counterclaim seeking a declaration that the designer’s trademark itself is void.
Amazon claims its operating method as a marketplace available to independent, third-party sellers is not unique. Because other marketplaces operate similarly and aren’t penalized for the actions of their sellers, the tech titan told the court it should receive similar treatment.
“Consumers navigating on Amazon’s websites are perfectly capable of not systematically assimilating third-party sellers’ goods and trademarks with those of the marketplace operators,” it claimed, adding that consumers understand when they are buying goods from independent shop owners, and not directly from Amazon itself. With regard to the handling and dissemination of the offending goods, Amazon said that numerous national courts “have confirmed that a supplier of services consisting in the stocking and shipping of goods does not assume any liability for any infringement of a trade mark by those goods.”
The District Court of Luxembourg summarily rejected Amazon’s plea that the designer’s claim was inadmissible, along with the counterclaim that his trademark was void. “It is not disputed that the use of a mark may take various forms,” the court said, adding that “its use may consist in stocking and putting on the market goods bearing the sign”—namely, the red soles.
The court also noted that Amazon’s business model, wherein third-party seller listings are blended with product listings for Amazon-owned wares, differs from marketplaces like eBay or Rakuten for example. These sites don’t sell their own goods but merely serve as a platform for sellers, the court said, conceding that the setup could conceivably lead to confusion for consumers, who could perceive the illicit red-soled shoes to be authorized by Amazon itself.
Ultimately, though, it’s too early for Christian Louboutin to declare victory. The District Court of Luxembourg has opted to submit three questions for a preliminary ruling on an unknown date, stemming from the proper use of the brand’s trademark.
Firstly, the court seeks to clarify whether the use of the trademark on a website is attributable to the site’s operator, or, instead, to “entities economically linked to it” like third-party sellers. Alternately, responsibility could fall on both parties.
It also hopes to elucidate whether the use of an image identical with the trademark in an ad or listing displayed in an online store is attributable to the site’s operator or the third party responsible, “if, in the perception of a reasonably well informed and reasonably observant internet user,” the operator of the site is perceived to have had a hand in the commercial communication.
Finally, the court queried whether the shipper of goods bearing an unauthorized trademark is responsible for violating that mark only if they possess knowledge of the infringement.
The court has not yet released a date for a final ruling on these questions, which will determine the outcome of the complaint.