UK – Samsung liable for trade mark infringement over digital watch faces developed by third parties

A recent judgment that caught this Kat's attention was delivered by the High Court of England & Wales further to a trade mark infringement claim brought by members of the Swatch group of watch makers against Samsung (Montres Breguet S.A. and others v Samsung Electronics Co. Ltd. and Samsung Electronics (UK) Limited [2022] EWHC 1127 (Ch)).  The claim related to digital watch faces / watch face apps that could be downloaded to Samsung's smartwatches from the Samsung Galaxy App store ("SGA store").  

This case provides useful insights on the role and responsibilities of online service providers.    

The decision

Swatch's claims were that 23 of their registered trade marks had been infringed by 30 watch face apps being made available in the SGA store. Samsung admitted that those apps had been downloaded around 160,000 times in the UK and the EU.  The details of the trade marks and apps in issue are set out in appendixes to the judgment.  Although these apps were developed by third party app developers, Swatch maintained that Samsung was closely involved in, and controlled, the whole process by which the apps were made available.  Their claim was thus that Samsung would be liable as a primary tortfeasor. 

Having considered each of the elements of the tests for infringement under Article 9(2) of the EUTM Regulation, the court held that Swatch had established trade mark infringement in either the digital watch face, the app name, or in some cases both the face and the app name.  Samsung was thus held liable as a primary tortfeasor. 

Of particular interest to this Kat were the court’s discussion of use. 

Use in an online environment

The court first set out a recap on case law illustrating what constitutes “use” in an online environment, including the decisions of the Court of Justice of the European Union in Google France [2010] RPC 19, L’Oréal v eBay [2011] RPC 27, and Coty Germany v Amazon Services Europe [2020] ETMR 27.

Samsung contended that it did not use the signs at all.  It simply provided a vehicle, in the form of the SGA store, through which third party app developers provided apps.  Meanwhile, Swatch sought to distinguish the present case from the above three cases on the basis that there was both active behaviour and control by Samsung, and use in its own commercial communication. 

Having considered all the relevant evidence, the court held that: (a) there was active behaviour by Samsung in relation to the apps and control by it of their availability; and (b) Samsung was using the apps, and the signs contained in them, in its own commercial communication.  The court took into account a number of features as a whole to reach this conclusion, including the following: 

• Assistance provided by Samsung to make it easier for app developers to create apps. 
• The SGA store provided an environment under which apps could be uploaded, stored and downloaded by customers.
• Samsung hosted developer conferences to inspire and showcase the capabilities of apps built on Samsung devices.
• Samsung entered into licensing arrangements with all app developers before they were permitted to use any of its development material or upload apps to the SGA store.
• The watch face apps can be perceived as a key part of both the cosmetic design and working mechanism of the smartwatch itself, rather than as an app that can conveniently be accessed through the smartwatches. 
• The watch face apps were designed exclusively for, and operated only on, Samsung smartwatches.

Going forward from the perspective of operators of online services

This case is a demonstration that the courts of England & Wales may be prepared to depart from CJEU guidance in cases like Google France and L’Oréal v eBay, and find online intermediaries liable for trade mark infringement, even where the intermediary may simply be a vehicle for hosting apps developed by third parties as it was the case here.  Only this week, Advocate General Szpunar advised the CJEU to rule out that Amazon would be using Louboutin’s trade mark in connection with third-party listings on its marketplace.

This UK case is good news to brand owners, especially where third party app developers are backed up by little to no assets.  It would therefore make sense to go after the operator of the online app store instead.  

Having said that, this Kat wonders what more operators can do to avoid intermediary liability of this sort.  Would operators need to scrutinize apps developed against all registered trade marks in the jurisdiction?  This appears to be quite a heavy burden that would be imposed on the operators of online services unless artificial intelligence and technology could be of assistance.