The Court of Justice of the European Union (CJEU), in Wintersteiger AG v Products 4U Sondermaschinenbau GmbH C-523/10, has ruled that under Article 5(3) of the Brussels Regulation, an advertiser that uses a keyword that infringes a national trade mark on a country-specific top-level domain (TLD) of a Member State other than the Member State where the national trade mark is registered, can be sued in its Member State of establishment.
Wintersteiger AG is an Austrian company that manufactures and distributes ski and snowboard servicing tools. It has held a national trade mark registration for WINTERSTEIGER in Austria since 1993. Products 4U is established in Germany, where it develops and distributes worldwide ski and snowboard servicing tools. It sells, amongst other products, accessories for the tools manufactured by Wintersteiger, although Wintersteiger does not supply its products to Products 4U.
Products 4U purchased the word “Wintersteiger” as a keyword on a German search engine, i.e., a search engine using the TLD .de, that can also be accessed in Austria. When an internet user searches for “Wintersteiger” on the search engine, this keyword generated a sponsored link directing the user to a section of the Products 4U website entitled “Wintersteiger Accessories”.
Wintersteiger sought to prevent the use of the keyword by way of an injunction in the Austrian courts, on the basis that it infringed Wintersteiger’s rights in its Austrian trade mark.
The Austrian Supreme Court referred the case to the CJEU for guidance on Article 5(3) of the Brussels Regulation (44/2001/EC) as to whether it had jurisdiction to consider the case. Advocate General Villalón was of the view that the response to the Austrian Court should be that, where conduct that is liable to infringe a national trade mark occurs via the internet, Article 5(3) must be interpreted as meaning that it attributes jurisdiction both “to the courts of the Member State in which the trade mark is registered and to the courts of the Member State where the means necessary to produce an actual infringement of a trade mark registered in another Member State are used”.
The CJEU began its discussion of the referred questions by noting that the special jurisdiction rule under Article 5(3) should be dependent on a “particularly close connecting factor between the dispute and the place where the harmful event occurred.” The application of Article 5(3) should be in the interests of the administration of justice and the efficacy of the conduct of proceedings.
Applying these principles to the facts, the CJEU ruled that Article 5(3) conferred jurisdiction on either the courts of the Member State of registration of the trade mark, or the courts of the Member State of the establishment of the advertiser, when a keyword is used on a country-specific TLD of a Member State that is not the Member State where the trade mark is registered. The CJEU considered that relying on the place of establishment of the advertiser, as definite and identifiable place, allowed for an application of Article 5(3) that would facilitate the conduct of proceedings.
The CJEU did not offer an interpretation of Article 5(3) that was as broad as Advocate General Villalón had proposed. Advocate General Villalón suggested that Article 5(3) should be interpreted as granting jurisdiction to the courts of the Member State corresponding to the TLD, whereas the CJEU restricted this to the courts of the Member State of the advertiser’s establishment. Had the opinion of Advocate General Villalón been followed, trade mark holders would have enjoyed broader powers to select a jurisdiction in which to sue an infringer. As the CJEU did not follow Advocate General Villalón, this ruling serves as a reminder for trade mark owners to carefully consider the scope of their national trade mark protection in Europe.