Court of Appeal of Düsseldorf, Decision of 28 September 2010, I-20 U 41/09

Free Software and Open Source Software programs (F/OSS) allow the general public to copy, distribute and modify the copyright-protected source code within the limits of the respective public copyright license. In a recent decision, the Court of Appeal of Düsseldorf clarified the relationship between the "General Public License" (GPL) and trademark law and confirmed that the GPL does not provide authorization for the use of third party trademarks.

One of the F/OSS programs subject to the proprietary GPL is "xt:Commerce", a program for the administration of online shops, marketed by xt:Commerce GmbH (xt:Commerce). xt:Commerce claimed infringement of its Community trademark

Please click here to view xt:Commerce's Community trademark

by the defendant who develops software programs for supplementing the "xt:Commerce" software and advertised his programs and services with "xt:Commerce SEO ADMIN MODUL", "xt:Commerce SP 2.1a Update" or "xt:C MORE THAN A SHOP SYSTEM." In order to develop the programs the defendant had used xt:Commerce's source code in accordance with the terms of the GPL.

The Regional Court of Düsseldorf rejected the infringement claims. On appeal, the Higher Regional Court of Düsseldorf granted the requested injunctive relief, holding that the defendant's use of the signs "xt:Commerce" and "xt:C" infringed xt:Commerce's trademark rights pursuant to article 9 (1) (b) Community Trademark Regulation (CTMR).

The court said that the defendant had used the signs "xt:Commerce" and "xt:C" in the course of trade in a way establishing a likelihood of confusion with xt:Commerce's Community trademark. The sign "xt:C" contained the dominant distinctive element of the trademark "xt:Commerce". The letter "C" was a commonplace abbreviation for "Commerce." Internet users would therefore wrongly assume that "xt:C" was the short form of the trademark "xt:Commerce."

The court rejected the defendant's argument that he used the trademark merely as a legitimate reference to his offer of supplementary software and services for xt:Commerce's software. The court pointed out that under article 12 CTMR, a distributor of services, accessories and spare parts is not permitted to create the misleading impression of a commercial relation between himself and the trademark owner. The defendant therefore should have emphasized that "xt:Commerce" is a third party trademark used by him merely for describing the intended purpose of his own offer. Instead of the prohibited form of use "xt:Commerce SEO ADMIN MODUL" the defendant could have chosen a permissible descriptive reference such as "SEO ADMIN MODUL is a computer program that supports online shop-systems such as "xt:Commerce."

xt:Commerce's trademark rights were not exhausted either. The defendant did not use the trademark for the distribution of an unmodified copy of the software "xt:Commerce" - an act that would have been subject to exhaustion. Rather, he created modified copies of the original source code. The right of copying, other than the right of distribution, is not subject to exhaustion. It is exclusively reserved - under copyright law as well as under trademark law - to the owner.

Finally, the court confirmed that the GPL does not contain consent for trademark use – neither expressly nor implied. Rather, the license merely regulates copyright. The court held that such a limitation to copyright law without any corresponding permission for the use of trademarks does not render the GPL useless. The developers of F/OSS programs could still market their modified versions under different names.

The relationship between consent under copyright and under trademark law in the context of the use of F/OSS programs raises various legal and socio-political questions. Like the widely used GPL, many public licenses contain no rules for the use of the corresponding trademarks. Many voices in the open source community call for a maximum degree of unfettered freedom, demanding free use of trademarks and title rights along with the free use of the F/OSS source code. Granting maximum freedom where copyright of F/OSS programs is concerned is desirable for advancing the development of source code, and hence of technical progress. But in the context of trademark law, such a permissive practice would run contrary to its protective functions. The function of trademarks as guarantors of origin and quality would be substantially impaired if it was freely permissible under trademark law to market any number of different versions and modifications of an original computer program. For it would then be impossible for users to derive the necessary conclusions from a mark about the commercial origin of the corresponding software program as well as its properties and quality.