The Civil Code states that a party which initiates a trademark action for non-use must be an interested party. A recent case clarifies the test for demonstrating legal interest in disputes involving early termination of a trademark registration for non-use.

Kazachje, a Russian company, filed an action with the Chamber of Patent Disputes for the early termination of legal protection for a combined trademark with the word element Стрижамент/STRIGAMENT.

The mark had been registered in 2003 in the name of a distillery for goods in Class 33 (ie, alcoholic beverages except beer). Kazachje alleged that the mark had not been used in the three years preceding the filing of the action. In support of its claim to legal interest, Kazachje stated that it was a producer of alcoholic beverages and was located in the Stavropol region, in which there is a mountain called Strigament. Kazachje also stated that it had filed a trademark application with Rospatent, the Russian patent office, to register the name 'Стрижамент' in Classes 32 and 33; moreover, it had paid the prescribed fees for filing an application and conducting a search of Rospatent's trademark database.

The Chamber of Patent Disputes dismissed the action, arguing that Kazachje had no legal standing in the matter. Kazachje initiated proceedings against Rospatent in Moscow before an arbitrazh (ie, commercial) court. It sought to invalidate Rospatent's decision to dismiss the case and to require Rospatent to consider the non-use action on its merits.

The Moscow Arbitrazh Court dismissed the lawsuit and the Federal Arbitrazh Court of Moscow District subsequently upheld the lower court's decision. In rejecting the claim, the courts concluded that the mere filing of a trademark application and payment of a state fee were insufficient to substantiate interest in the early termination of the distillery's trademark.

The plaintiff applied to the Supreme Arbitrazh Court, requesting a judicial review of the courts' decisions. The Supreme Arbitrazh Court overruled the decisions, invalidated Rospatent's ruling and identified a number of points that the lower courts had failed to consider.

Article 1486(1) of the code states that an application for early termination of a trademark in respect of all or some goods due to non-use may be filed with the Chamber for Patent Disputes by an interested party once three years have elapsed following registration of the mark, provided that the trademark has not been used before the filing date of the application.

In the context of Article 1486(1), any party with a legitimate interest in the cancellation of the legal protection of an unused trademark may be deemed an interested person. The Supreme Arbitrazh Court explained that the lower courts had misinterpreted this provision. Its literal meaning does not limit the circle of interested persons to those whose rights and legitimate interests are violated by the registration being challenged. A producer of goods covered by a trademark in respect of which a non-use action is filed, or of similar goods, may qualify as an interested person if they genuinely intend to use the disputed mark (or a confusingly similar mark) in its activity and have taken preparatory steps for such use - this includes a party that has submitted an application to register an identical or similar trademark. Kazachje conducted business related to goods in Class 33, which was confirmed by a licence to produce, store and deliver alcoholic beverages, as well as by information on the volume of alcohol that it produced in 2009. Kazachje had applied to Rospatent for registration of a trademark with an identical word element in respect of goods in Class 33. Therefore, the lower courts' conclusion that there was no evidence of Kazachje's intention to trade goods under the mark did not reflect the facts of the case. The Supreme Arbitrazh Court found that Kazachje could be considered an interested person.

For further information on this topic please contact Eugene Arievich or Alisa Fomina at Baker & McKenzie - CIS Limited by telephone (+7 495 787 2700), fax (+7 495 787 2701) or email ([email protected] or [email protected]).