The ECJ on the use of another person’s trademark as domain name and meta-tag

With ruling of last 11 July in Case C-657/11, the European Court of Justice (“ECJ”) affirmed that the use of a domain-name and meta-tags corresponding to a competitor’s trade name and trademark can constitute advertising pursuant to Article 2(a) of directive 2006/114/CE concerning misleading and comparative advertising, which defines advertising as “a representation in any form made in connection with a trade, business, craft or profession in order to promote the supply of goods or services” (the “Definition of “Advertising””). This conclusion of the Court therefore allows you to ask for protection against such use of your own distinctive signs not only based on the law concerning infringement of distinctive signs itself, but also on the law on misleading and unlawful comparative advertising.

The ruling was issued in the framework of a dispute between two Belgian competing companies, Belgian Electronic Sorting Technology NV or BEST NV (“BEST”) and Visys NV (“Visys”), which manufacture and distribute sorting machines incorporating laser-technology (called “laser sorters”). In 2007 Visys registered the domain name “www.bestlasersorter.com” (the “Domain Name”) for its website which was already available under the domain names “www.visys.be” and “www.visysglobal.be”. The Domain Name contained therefore the sign “best” corresponding to the competitor’s acronym (for which the latter also applied for a Benelux figurative trademark “BEST” in 2008 – the “BEST Trademark”); moreover, when the words “Best Laser Sorter” were entered in “google.be”, Visys’ website was the second search result to appear directly after BEST’s website; finally, Visys used meta-tags corresponding to the names of some of the BEST’s goods and to its trade name and to the Best Trademark (the “Meta-tags”). In light of this, Best took legal action against Visys claiming that the registration and use of the Domain Name and the use of the Meta-tags infringe its trade name and the BEST Trademark and constitute infringements of the law on misleading and comparative advertising and the law concerning the unlawful registration of domain names. In order to take its decision, the Belgian Court of Cassation, which was asked to rule on the case, stayed the proceedings and referred to the ECJ the question whether “the [Definition of “Advertising”] is to be interpreted as encompassing, on the one hand, the registration and use of a domain name and, on the other, the use of metatags in a website’s metadata”.

With the ruling in issue the ECJ firstly denies that the mere registration of the Domain Name falls within the Definition of “Advertising”, it being a “purely formal act” which does not necessarily mean the creation of any website and, in itself, “does not necessarily imply that potential consumers can become aware of the domain name” and “is not capable of influencing the choice of those potential consumers”.

A different answer is given as regards the use of the Domain Name which, according to the Court,  falls within the Definition of “Advertising” on the premise that it “is clearly intended to promote the supply of the goods or services of the domain name holder”; furthermore, the Court specifies that “it is not only by means of a website hosted under the domain name that that holder seeks to promote its products or its services, but also by using a carefully chosen domain name, intended to encourage the greatest possible number of internet users to visit that site and to take an interest in its offer”. Moreover, “such use of a domain name, which makes reference to certain goods or services or to the trade name of a company, constitutes a form of representation that is made to potential consumers and suggests to them that they will find, under that name, a website relating to those goods or services, or relating to that company”.

Finally, as regards the use of the Meta-tags, the ECJ firstly states that “such metatags, consisting of keywords («keyword metatags»), which are read by the search engines when they scan the internet to carry out referencing of the many sites there, constitute one of the factors enabling those engines to rank the sites according to their relevance to the search term entered by the internet user”; according to the Court, therefore, “the use of such tags corresponding to the names of a competitor’s goods and its trade name will, in general, have the effect that, when an internet user looking for the goods of that competitor enters one of these names or that trade name in a search engine, the natural result displayed by it will be changed to the advantage of the user of those metatags and the link to its website will be included in the list of those results, in some cases directly next to the link to that competitor’s website. (…) In the majority of cases, an internet user entering the name of a company’s product or that company’s name as a search term is looking for information or offers on that specific product or that company and its range of products. Accordingly, when links to sites offering the goods of a competitor of that company are displayed, in the list of natural results, the internet user may perceive those links as offering an alternative to the goods of that company or think that they lead to sites offering its goods (…).This is particularly the case when the links to the website of that company’s competitor are among the first search results, close to those of that company, or when the competitor uses a domain name that refers to the trade name of that company or the name of one of its products”.

Based on these statements (which are actually quite dated from a technical point of view, provided that today meta-tags are no longer so decisive in indexing), the Court therefore states that the use of meta-tags corresponding to the names of a competitor’s goods and its trade name falls within the Term Advertising “in so far as … it has the consequence that it is suggested to the internet user who enters one of those names or that trade name as a search term that that site is related to his search”. Moreover, according to the judges, such a use would be a real “promotion strategy” which “aims to encourage the internet user to visit the site of the metatag user and to take an interest in its goods or services”.