The ECJ on trademark registration in bad faith
On 27 June the European Court of Justice (“ECJ”) ruled in case C-320/12 with regards to bad faith of the applicant for a trademark registration in a Member State, in case he knows or may know of the existence of a prior foreign mark which is likely to be confused with the mark applied for.
The litigation in issue was instigated between Malaysia Dairy Industries Pte. Ltd (“Malaysia Dairy”) and the Ankenævnet for Patenter og Varemærker (Danish Patents and Trademarks Office Appeal Board, the “Appeal Board”) and regarded the following facts. Malaysia Dairy – a company producing and marketing a milk drink in a plastic bottle – obtained the registration, in Denmark, of such package as a three-dimensional trademark (the “Malaysia Dairy Trademark”), which was already registered in Malaysia too. That registration was opposed by the Japanese company Yakult which first registered as a shape trademark in Japan and other EU Member States the plastic bottle of its well-known drinking yoghurt (the “Yakult Trademark”). In particular, Yakult claimed that, pursuant to Article 15 (3)(3) of the Danish Law on trademarks, Malaysia Dairy acted in bad faith at the time that its application for registration was filed, because it knew or should have known the existence of the Yakult Trademark abroad.
After a first reject by the Danish Patents and Trademarks Office, Yakult’s application was granted by the Appeal Board which canceled the registration of the Malaysia Trademark because “actual or presumed knowledge of a mark in use abroad for the purposes of Article 15 (3)(3) is sufficient to establish that the applicant is acting in bad faith, even if it can be assumed that the applicant had acquired at an earlier point in time a registration of the mark applied for in another country”. Malaysia Dairy brought an action against this decision before the Maritime and Commercial Court (Sø- og Handelsretten) which confirmed the position of the Appeal Board. Afterwards, Malaysia Dairy appealed against that judgment before the Danish Supreme Court (Højesteret) which decided to stay the proceedings and to refer three questions to the ECJ for a preliminary ruling on the interpretation of Article 4(4)(g) of Directive 2008/95/EC on the approximation of the laws of the Member States relating to trademarks (the “Directive”), which allows Member States to provide that a trademark shall not be registered (or, if registered, shall be declared invalid) if “the trademark is likely to be confused” with another “which was in use abroad on the filing date of the application and which is still in use there, provided that at the date of the application the applicant was acting in bad faith (…)”.
Firstly, the referring court asked if the concept of “bad faith” might be filled out in accordance with the national law of the Member States or should be interpreted in a uniform way at Community level. The ECJ leans towards this second option, stating that such concept “is an autonomous concept of European Union law which must be given a uniform interpretation in the European Union”.
In light of the answer to the first question, the Danish Supreme Court asked whether knowledge or presumed knowledge on the part of the applicant of a mark in use abroad at the time that its application is filed, which is likely to be confused with the trademark applied for, is sufficient to establish “bad faith”, or whether it is necessary to take account of other subjective factors in relation to the applicant. According to the ECJ, “the fact that the applicant knows or should know that a third party is using such a sign is not sufficient, in itself, to permit the conclusion that that applicant was acting in bad faith”. Therefore, it is necessary to make a case-by-case assessment and to take into consideration “all the relevant factors specific to the particular case which pertained at the time of filing the application for registration”.
Finally, the referring court asked whether article 4(4)(g) of the Directive allowed Member States to introduce specific protection of foreign marks, based on the fact that the applicant knows or should know a foreign mark. The judges reply negatively, finding that Directive 2008/95 prohibits Member States from introducing grounds of refusal or invalidity of the trademarks other than those set out in the same Directive.