On 22 April, the Turin IP Court issued an interesting judgment (no. 2256/16) on the long-term coexistence of two identical trademarks used for identical products. The Judges looked specifically at the effects of such co-existence for the purposes of the so-called “validation” of the later trademark and the infringement of the earlier one.
Click here to view the image.
The trademarks in question were in fact identical and both used for wine. The earlier one, owned by the plaintiff, had been used as an unregistered trademark all over the country since the ‘70s and had been registered in Italy and in the EU in 2011. The defendant’s trademark had been used in turn as an unregistered trademark since the ‘90s and had been registered – with the addition of further verbal and graphic elements – as a national trademark in 2002, but had not been renewed upon expiry in 2012.
The plaintiff requested the court to ascertain the infringement of its registered and unregistered trademarks by the defendant. The latter, by way of counterclaim, requested that the plaintiff’s trademarks were declared null because they were registered when the defendant’s similar registered trademarks were still in force: in fact, despite the expiry of the latter, the defendant at the time still was entitled to make such claim, since it had not already terminated the two year-period from the expiry of the trademarks by which, pursuant to art. 12 (2) IP Code, an earlier trademark can be relied on to challenge the invalidity of the later trademark. The defendant also requested that it be in any event declared that its unregistered trademark had been “validated” in accordance with art. 28 IP Code (corresponding to the limitation for acquiescence under art. 54 EC Regulation no. 207/2009), as the plaintiff had tolerated its use by the defendant for more than five consecutive years. In the alternative, the defendant requested that the legitimacy of the coexistence between the parties’ trademarks be ascertained.
In the decision under review, the Judges pointed out first that it had been duly demonstrated in court that the two trademarks had been used in the course of trade of more than mere local significance, respectively since the ‘70s and ‘90s; the parties had then made use of the same trademark for identical products for over twenty years. The Judges also noted that it was highly unlikely that the two companies did not know each other, given the geographical proximity of the same, their participation in the same trade fairs, and the inclusion of both in a publication of the Chamber of Commerce to promote local viticulture.
In light of these circumstances, the decision in question ruled out that the plaintiff, owning the earlier trademarks, could enforce its registered or unregistered trademarks against the defendant.
With reference to the plaintiff’s unregistered trademark, the Judges explained that, being it not registered, it can be protected only in the presence of confusion among the public, and recalled the European Court of Justice decision in C-482/09 (“Budweiser”), according to which “the proprietor of an earlier trade mark cannot obtain the cancellation of an identical later trade mark designating identical goods where there has been a long period of honest concurrent use of those two trademarks where, in circumstances such as those in the main proceedings, that use neither has nor is liable to have an adverse effect on the essential function of the trade mark which is to guarantee to consumers the origin of the goods or services”. In the present case, the Court stated, the peaceful coexistence of the trademarks for more than twenty years showed that consumers were able to correctly identify the origin of the relevant products, so there was no confusion on the part of the public.
In addition, the judgment noted, the fact that the plaintiff could not claim protection against the defendant was confirmed by the ratio of the validation provision in art. 28 IP Code (although this was not applicable in favour of the defendant because it is limited to registered trademarks, which the defendant did not have): “the purpose of validation – that is the basis of other institutions of our system, such as limitation and usucaption – is to consolidate the factual situations, making them match the legal situation and eliminating a state of uncertainty. With reference to distinctive signs it should also be considered that allowing that a distinctive sign, which has been present on the market for long, is exposed to an invalidity or infringement action, means to frustrate the investments made over the years by the holder of the sign (and to ultimately allow a ‘gratuitous’ loss of wealth)“.
Regarding the infringement of the plaintiff’s registered trademarks, the judgment concluded that the defendant could oppose them with its prior use in the course of trade of more than mere local significance, which entitled it to continue such use pursuant to art. 12(1)(a) IP Code. Such prior use, notes this author, could also enable the defendant to seek the nullity of the plaintiff’s trademarks for interference with its identical earlier unregistered trademark, but the defendant had not requested that, only requesting a declaration of nullity of those trademarks for interference with its previously registered trademarks.
With reference to this last claim, finally, the Judges ruled out that the defendant’s trademarks as registered in 2002 were able to deprive the plaintiff’s 2011 applications of the novelty requirement, as the former were to be considered valid solely because they contained distinctive features in addition to the unregistered trademark, which was identical to the plaintiff’s earlier unregistered trademark.
In light of the foregoing, the Court rejected in their entirety both parties’ claims, offsetting the costs because of the mutual loses.