Plaintiff owns the German word trademark “Resistograph”, recorded for several goods in class 9, and services in class 42, specifically measuring and testing instruments for determining and analysing drilling resistance, preferably on trees.
Defendants 1) and 2), whose managing director is Defendant 3), distribute measuring and testing instruments manufactured by Defendant 1) for the diagnosis of wood, namely so-called drilling resistance measuring instruments. These instruments are advertised on the website www.i…com. The operator of the respective online shop is a company based in the United States, which is a subsidiary of Defendant 2). Defendant 2) is listed in the company details provided on the website as the contact. The drilling resistance measuring instruments are advertised on that website as follows:
In the 1990s, Plaintiff, Defendant 1) and Defendant 3) had initially worked together. In 1999 and later in 2010, there were legal disputes, in which Defendants issued two cease-and-desist declarations, stating that they would refrain from applying the labels “Resistograph” to drilling resistance measuring instruments in the course of trade, from offering them and taking them to market, owning them for the stated purposes, using this term in business documents or in advertising. Furthermore, they undertook to refrain, in the course of business with drilling resistance measuring instruments, from using the trademark “Resistograph” and from importing or exporting drilling resistance measuring instruments under this trademark.
Plaintiff considered Defendants’ advertising of the drilling resistance measuring instruments along with other information provided on the website www.i…com a violation of the cease-and-desist declarations. Furthermore, the use of the term “Resistograph” was deemed a domestic use in violation of German trademark law. The Plaintiff’s demands included that Defendants cease and desist and be ordered to pay contractual penalties.
The regional court and the appellate court found mostly in favour of Plaintiff (Higher Regional Court Karlsruhe, judgment of 25 May 2016, ref. no.: 6 U 17/15). It ruled that the acts committed by the operator of the website with the online shop are attributable to Defendants pursuant to Sec. 14 para.7 of the German Trademark Act (Markengesetz – MarkenG). The court decided that the operator of the online shop is a sales branch of Defendants 1) and 2). The German Federal Court of Justice had dismissed Defendants’ appeal on points of law.
The central theme of the dispute is the question of how to determine the economically relevant domestic nexus for a trademark in a website that is mostly geared toward other countries, and that is required for the infringement of a trademark registered in Germany, and whether Defendants used the trademark in suit domestically due to the website.
There was no option to place a direct order on the challenged website for shipments to Germany. The website primarily addressed the non-German market and was mainly written in English. The description of the sales organization listed Defendant 2) as the “Manufacturer/Head Office” even before mentioning other companies, which were provided under the categories “… Sales Partners worldwide” and “… Sales Offices”. Furthermore, the website www.i…de was provided as the contact for IML Germany, and information about trade fairs and seminars in Germany was provided in German under the heading “Upcoming dates”. The prices in the online shop were listed in US dollars. Defendants had used the word “Resistograph” as a metatag for their website.
In the Federal Court of Justice’s view, deciding whether a relevant infringing act has been committed domestically requires special findings if the challenged conduct mainly focuses on other countries. Therefore, not every offer of foreign services accessible online domestically triggers claims under trademark law in the event that there is a risk of confusion with a domestic trademark. Rather, it is necessary that the offer has a sufficient economically relevant domestic nexus (commercial effect). Whether such a nexus exists must be determined on the basis of an overall weighing of the circumstances. On one hand, the extent of the effects of the use of the trademark on the domestic economic interests of the holder of the mark must be considered. On the other, it is decisive whether, and to what extent, the infringement of the right is an unavoidable by-product of technical or organizational factors over which the party against whom infringement claims are asserted has no influence, or whether such party intentionally benefits from the domestic availability, e.g. by establishing means to place orders domestically, or to deliver to domestic recipients.
The generally existing ability to access foreign websites domestically as such therefore cannot be a criterion that is relevant for the overall weighing of the circumstances, because the owner of the website has no influence over it.
With regard to the importance of the use of the word “Resistograph” as a metatag for Defendants’ website, the German Federal Court of Justice explained that making a website easier to access domestically with the help of a metatag can only be a significant aspect for the assumption of a relevant domestic nexus if it is a circumstance over which the operator of the website has an influence. However, that is not always the case.
Search engines cannot find websites without the use of metatags. Operators of foreign websites therefore cannot be prevented from using trademarks that they legally use for their products or services abroad for advertising directed toward the public in other countries and to use them as metatags. That generally applies even when it is a trademark that is protected in Germany, as long as the advertising directed toward other countries does not have a relevant domestic nexus.
In connection with metatags, a domestic nexus of relevance for assuming trademark infringement could be justified in that the operator influences the search process specifically in Germany or does not take advantage of reasonable possibilities to exclude or limit search results on the basis of the metatag for Germany.
The appellate court did not comment on this. It was clear that Defendants had not used any ad words or key words or advertising that costs money and that would appear under the heading “Ads” before the actual list of hits. The German Federal Court of Justice did not have to address this question, however, because it believed that there was a sufficient domestic nexus due to the concurrent presence of other website features that are considered relevant.
It suffices that Defendants’ website offer is addressed to customers in Germany as well. The German Federal Court of Justice considers this as proven on the basis of the circumstances demonstrated (listing of the website www.i…de as the contact for IML Germany; references in German to trade shows and seminars in Germany). In addition, the German Federal Court of Justice took into consideration that Defendants use the top-level domain “.com” for its websites, which is customary in Germany as well, instead of using a top-level domain that indicates a different country and that could deter domestic users from accessing its websites.
The decision substantiates the significance of the comprehensive weighing of all criteria when evaluating an economically relevant domestic nexus regarding a website geared toward other countries. The use of metatags for a trademark that is protected domestically, but not abroad, is not unlawful per se. What must be considered, however, is the other internet presence of the user abroad, which can ultimately lead to the conclusion that there is, indeed, an economically relevant domestic nexus.
