On November 8 2011 the advocate general of the European Court of Justice (ECJ) presented his conclusions in Case C-488/10, a request for a preliminary ruling by Spain's Community design court (Alicante Commercial Court Number 1), lodged in the context of a Community design infringement action brought by Celaya Emparanza y Galdós Internacional SA (CEGASA) against Proyectos Integrales de Balizamientos SL.
CEGASA learned that Proyectos was marketing a product that, in its view, infringed on its registered Community design protecting a road beacon. CEGASA sent Proyectos an extra-judicial demand to cease; Proyectos not only did not stop marketing the product, but proceeded to register the shape of the product as a community design.
CEGASA sued Proyectos before the Alicante Commercial Court Number 1 for the infringement of its design. In its defence, Proyectos claimed that the allegedly infringing product was properly protected by its own registration, thereby conferring on Proyectos a right to use it and preventing CEGASA from prohibiting such use, unless the design was expressly declared invalid.
In this context, the Spanish court raised two issues before the ECJ. It asked whether the plaintiff may bring an infringement action of its design directly against the holder of an infringing design subsequently registered, or whether – as alleged by the defendant – it may do so only if that second design is simultaneously declared invalid.
As stated by Advocate General Paolo Mengozzi, the problem posed by the Alicante commercial court is a matter of doctrinal and jurisprudential debate in Spain. In terms of trademarks, there is a jurisprudential trend set by the Supreme Court whereby a national trademark confers on its holder a ius utendi ('right to use'), so that trademark infringement actions may be successfully brought only if invalidity actions against the infringer's trademark are also brought previously or simultaneously. However, the advocate general discouraged the applicability of the referred case law to designs because, as opposed to trademarks, designs are granted almost automatically and without a check as to whether they conflict with previous rights or opposition proceedings. The speed and ease of the registration process for Community designs could lead to a high risk of abuse if, as in the case of trademarks, their registration conferred on their holders a right to use them.
According to the advocate general, a conflict exists here between two aspects of legal certainty:
- on the one hand, that due to the plaintiff (ie, the holder of the prior design), whose properly registered design would be weakened if it were required to obtain the invalidation of the defendant's subsequent design in order to file infringement actions; and
- on the other hand, the legal certainty due to the alleged infringer (ie, the holder of the subsequent design), which would be acting in accordance with a registered right.
Faced with this clash of rights, the advocate general opined that the rights of the plaintiff should prevail, since the system could otherwise be seriously jeopardised.
In the advocate general's opinion, the infringer, when confronted with the threat of an infringement action against it, could simply register the infringing product as a design in order to impede the exercise of the infringed design holder's rights, thus obliging the infringed design holder to obtain a declaration of invalidity of the subsequent design in order to bring an infringement action successfully. The second design could also be registered after the filing of the lawsuit, or even after the invalidation of the subsequent design, as the infringer could continue to register very similar designs in order to continue marketing the infringing product.
If the plaintiff were forced to bring an invalidity action in order to bring infringement actions successfully, this would enable those acting in bad faith to take advantage of the system, registering defensive designs to delay judicial proceedings and to prevent the effective protection of validly registered rights.
Therefore, the advocate general ruled that the holder of a prior registered design should be able to bring infringement actions even against a third party invoking a subsequently registered design, making it unnecessary first to seek a declaration of invalidity of such subsequent design.
As additional grounds for this interpretation, the advocate general pointed to the lack of particular protection in the Community Design Regulation for these holders of subsequent registered designs, and to the fact that Community design courts lack jurisdiction to decide on the validity of registered designs in the main claim.
The second question posed by the Alicante court raised the possibility of modulating the above conclusion according to whether the invalidity of the infringer's subsequent design should be sought based on its good or bad faith. Under this point of view, bringing infringement actions without a previous declaration of invalidity may be allowed if the subsequent design was registered in bad faith or – as in the main proceedings – after an extra-judicial demand, but not if the subsequent design was deposited in good faith.
While this is an interesting approach, the advocate general considered that it would complicate to a great extent a system that the legislature sought to keep simple and effective. Furthermore, while in the regulation the infringer's intent is taken into account in determining the scope of protection of unregistered designs, this does not occur in the case of registered designs. He therefore suggested that those circumstances should not be taken into consideration.
For further information on this topic please contact Carlota Viola at Grau & Angulo by telephone (+34 93 202 34 56), fax (+34 93 240 53 83) or email ([email protected]).