In a landmark judgment, the Delhi High Court has directed Amazon Technologies Inc. to pay ₹339.25 crore in damages and costs for infringing upon the trademark of the luxury lifestyle brand, Beverly Hills Polo Club (BHPC). Justice Prathiba M. Singh described Amazon's actions as a "deliberate and willful infringement," criticizing the company's strategy of "obfuscation" by assuming multiple roles—intermediary, retailer, and brand owner—to evade liability for trademark violations.
Background of the Case
Lifestyle Equities C.V. and Lifestyle Licensing B.V., the plaintiffs in this case, are the registered proprietors of the BHPC trademark. Established in 1981, BHPC is renowned for its wide range of products, including garments, accessories, footwear, furniture, textiles, watches, and personal care items. The brand's distinctive logo features a charging polo pony with a mounted rider wielding a raised polo stick, symbolizing the sport of polo and epitomizing luxury and premium lifestyle products. The BHPC trademark is registered in approximately 91 countries, including India, the USA, the UK, the UAE, Germany, Nepal, and Mexico. In India, BHPC products were launched in 2007, and since the 2016-2017 financial year, the brand has consistently achieved annual sales turnovers exceeding ₹20 crore.
Allegations Against Amazon
The plaintiffs alleged that Amazon Technologies Inc. was selling apparel products under its private label 'Symbol,' which bore a horse device mark strikingly similar to the BHPC logo. This, they contended, amounted to unauthorized use and infringement of their registered trademark. Additionally, Cloudtail India Private Limited, a major retailer on Amazon's platform, was accused of retailing these infringing products, thereby facilitating their sale on the Amazon website managed by Amazon Seller Services Private Limited.
Court Proceedings and Findings
On October 12, 2020, the Delhi High Court issued an ad-interim injunction, restraining Amazon Technologies and Cloudtail India from using the infringing logo and directing Amazon Seller Services to remove the offending products from its platform. Despite this, Amazon Technologies failed to appear before the court, leading to ex-parte proceedings against the company.
During the course of the trial, Cloudtail India acknowledged its involvement in selling the infringing products between 2015 and July 2020. The company disclosed that it had generated a total revenue of ₹23,92,420 from these sales, with an estimated profit margin of approximately 20%. Cloudtail proposed a settlement, expressing willingness to accept an injunction decree and pay damages. However, mediation efforts between the parties did not yield a resolution.
Cloudtail's legal counsel argued that liability for damages should rest solely with Cloudtail, citing an Amazon Brand License and Distribution Agreement that purportedly placed responsibility for any breaches on Cloudtail. The plaintiffs, however, contended that the infringing mark was not covered under this agreement and maintained that both Amazon and Cloudtail should be held accountable.
Judgment and Implications
Justice Prathiba M. Singh ruled in favor of the plaintiffs, emphasizing that Amazon's actions constituted deliberate and willful infringement of the BHPC trademark. The court criticized Amazon's attempt to evade liability by assuming multiple roles and shifting responsibility. Consequently, the court awarded damages and costs totaling ₹339.25 crore against Amazon Technologies Inc.
The judgment underscores the critical need for e-commerce platforms to enforce stringent trademark compliance and respect intellectual property rights. It serves as a precedent, highlighting that online marketplaces cannot absolve themselves of liability by merely acting as intermediaries when they are actively involved in the sale and promotion of infringing products. This ruling is expected to have far-reaching implications for e-commerce operations in India, compelling platforms to adopt more robust measures to prevent the sale of counterfeit or infringing goods and to ensure that their private labels do not violate existing trademarks.
Conclusion
The Delhi High Court's decision in this case reinforces the importance of protecting intellectual property rights in the digital marketplace. It sends a clear message to e-commerce giants that deliberate infringement and evasive tactics will not be tolerated and that they bear responsibility for ensuring the authenticity and legality of products sold on their platforms. This landmark ruling is poised to influence future trademark infringement disputes, particularly concerning the role and accountability of online marketplaces in the global and Indian context.
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