Since its introduction into Russian trademark law in 2002, the principle of exhaustion of trademark rights has not been given as much attention by the legal community as it has in 2009 and 2010. Before the Russian Higher Arbitrazh Court issued a decision in early 2009 which questioned the very type of exhaustion of rights principle adopted by Russia, the Russian state authorities and courts regularly interpreted the respective Russian law provisions as declaring national exhaustion of trademark rights principle. Both, the right holders and legal practitioners, had to face the grim fact that despite the absence of any substantial change in law, the approach of Russian courts and state authorities to the interpretation of the principle of exhaustion of trademark rights fairly quickly became controversial to such an extent that speculations about a possible shift to international exhaustion of trademark rights principle emerged.
The Russian court practice on exhaustion of trademark rights can be mainly divided in two types of cases relating to parallel imports into Russia by unauthorized dealers:
- administrative actions initiated by the Russian customs against the unauthorized importers; and
- civil actions taken by the right holders against the unauthorized importers.
Following the introduction of the principle of exhaustion of trademarks into Russian trademark law in 2002, Russian arbitrazh courts regularly considered such cases in favor of the right holders, applying the national exhaustion of trademark rights principle.
This approach was changed in February 2009 by the Higher Arbitrazh Court in the so called "Porsche" case. In this case, the court decided that the Russian customs authorities could not confiscate a used Porsche which was imported into Russia without Porsche's consent. The Higher Arbitrazh Court expressed that Russian customs authorities should refrain from initiating administrative actions against parallel importers of original (not clearly counterfeit) goods in order to maintain a balance of private and public interests. The lack of administrative actions by the Russian customs authorities should be compensated by civil actions initiated by trademark owners - the lawfulness of such actions was, however, not challenged in the case. Therefore, although civil proceedings were available for trademark owners, in absence of a clarification by the Higher Arbitrazh Court, the relevant court practice was controversial.
Recent court practice gives, however, certain grounds for optimism with respect to the prospects of civil proceedings against parallel importers.
In a case initiated by Societe Anonyme des Eaux Minerals d'Evian (Evian) against an unauthorized importer LLC Monolit Invest (LLC Monolit), both Courts of First and Second Appeal held LLC Monolit liable for trademark infringement and therefore annulled the decision of the Court of First Instance in favor of the importer. The Courts of Appeal stated that the import of Evian's products without Evian's consent constituted an infringement of the exclusive rights of Evian in its trademark - no matter whether the products were marked with the trademark by the importer or by third parties.
Positively, in its decision of 5 August 2010 the Higher Arbitrazh Court upheld this decision. The court said that there were no legal grounds for amending or setting aside the decision rulings because there was no breach of uniformity in the interpretation and application of legal provisions by the courts.
This case may prove to be a considerable step forward in clarifying Russian court practice relating to parallel imports and in giving right holders a way to protect their trademark rights against unauthorized importers in civil proceedings in Russia. Although Russia does not have a case law system and court precedents do not have an obligatory effect, the position of Higher Arbitrazh Court is usually respected and followed by the courts of lower instances which gives right holders an additional strong instrument in protecting their interests in the absence of administrative mechanisms of enforcement.