A deep dive into website “targeting” law and its application to banner ads in the UK case of Argos v Argos

1st May 2017

In February 2017 the UK High Court handed down its judgment in an online trade mark infringement case. The Judge gave a thorough examination of the law relating to the “targeting” test. This test is used in the EU to determine if use of a sign on a website is being made in a particular country. The case is notable for its deep dive into the relevant law, and for being the first case looking at this test in the context of banner ads.

Argos UK Limited (Argos), a UK-based retailer, sued Argos Systems Inc. (ASI), a US-based provider of software. Argos alleged that ASI had infringed its ‘ARGOS’ mark through ASI’s use of the domain name argos.com in conjunction with banner ads displayed on the website via Google AdSense. Some of these ads were for Argos itself, because Argos participated in Google’s AdWords program. The Deputy Judge found that by signing up to the Google AdWords Ts&Cs Argos had given express consent to ASI’s use of argos.com in conjunction with display of the claimant’s ads. It was relevant that Argos did not object, and could not have objected, to ASI’s use of ARGOS in its domain name, without more; a claimant may still be able to object to a use which was neither pre-existing nor lawful by itself, despite taking part in the AdWords program.

Aside from the consent issue, the Deputy Judge also found that neither the whole nor any sufficient part of ASI’s was targeted at the UK. Accordingly ASI did not use the sign ‘ARGOS’ in the UK. Although ASI had no presence outside the Americas, 89% of its website’s traffic was from the UK. This appeared to result from UK users typing argos.com into the address bar expecting it to be the claimant’s domain name. As a result, Argos argued that ASI was conducting a secondary ad-based business in the UK. ASI argued that the traffic was fleeting and trivial, as 85% of UK users left ASI’s site after 0 seconds, with almost none clicking beyond the landing page. The Court found that this, combined with the American-style buildings on the landing page, ASI’s contrasting logo and Americanised spelling, meant a UK user would conclude that the website was not aimed at them. The Deputy Judge also considered the correct legal approach to the question of intention, the role of banner ads in targeting, and whether there is a need to show the whole website is directed at UK users:

• There was some evidence that ASI had intended to direct a particular version of its website to the UK. The Deputy Judge’s view was that the enquiry should be directed at the effect of the website on users when viewed objectively, even where the website operator’s subjective intention was to the contrary (although he did not go so far as to say evidence of intention was necessarily irrelevant).
• Argos relied on evidence that some of the banner ads displayed on argos.com were for UK businesses, such as retailer John Lewis. The Deputy Judge considered there was inadequate evidence of what ads had appeared in real-world scenarios, and that given the high bounce rate it was likely average UK internet users did not look at the ads anyway. Even if they had, and they considered the ads were directed at them, his view was this would not have led users to conclude the website itself was directed at them.
• The Deputy Judge’s view was also that there was no hard and fast rule that to demonstrate targeting to the UK a claimant needs to show the entirety of the website was so targeted. If the evidence showed that some part of the website were so configured as to attract a substantial number of UK users, it may be appropriate to have regard to that part of the website alone, even if, viewed globally, the website is clearly not directed to UK users.

Originally published in BrandWrites 8th Edition, May 2017.