Spanish Supreme Court: Judgment of 14 October 2014 (DENSO)

The Spanish Supreme Court has ruled – overturning its previous jurisprudence – that the ownership of a Spanish trademark registration can no longer be used by defendants in infringement proceedings as a valid defence against the infringement claims of the holder of prior trademarks.

The Supreme Court came to this result relying on two landmark decisions of the Court of Justice of the European Union (CJEU)

Point of departure: The traditional doctrine on the “right to use”

Under the Spanish Trademarks Act (Article 34.1), the registration of a Spanish trademark confers on its proprietor the exclusive right to use it in the course of trade. This provision was traditionally interpreted by the Spanish courts as a “positive right to use”, with the result that proprietors who intended to challenge the use of a younger trademark had to seek the invalidity of the said mark first. Such a claim for a declaration of invalidity could be joined with the infringement claims in the same court action, but it was considered a necessary first step and precondition for the further claims to be granted.

Background of the ruling

 The German company Denso-Holding GmbH & Co, owner of a number of IR marks designating Spain for the term “Denso”, filed together with its Spanish subsidiary an infringement action against a Spanish company which was the owner of two Spanish trademark registrations for “Denso” with a younger priority than the plaintiff’s IR marks. Given that the plaintiffs did not request a declaration of invalidity of the Spanish trademark registrations, the defendant alleged that no infringement could be assumed given that its use of the sign “Denso” was shielded by its existing Spanish trademark registrations, of which the plaintiffs had been aware.

In line with the traditional Spanish jurisprudence, the courts of first and second instance dismissed the plaintiffs’ action since the defendant’s trademark registrations had not been invalidated beforehand and, thus, the latter was considered to be entitled to use the sign “Denso” in accordance with the “positive right to use” its existing trademark registrations.

The plaintiffs filed a cassation appeal to the Supreme Court requesting that the Spanish traditional doctrine regarding the right to use be aligned with Community law and, in particular, with the unitary protection principle set forth in the Community Trademark Regulation (CTMR).

Decision of the Spanish Supreme Court

 In its judgment of 14 October 2014, the Spanish Supreme Court overturned its prior jurisprudence on the positive right to use and ruled that the ownership of a Spanish trademark registration can no longer be regarded as a defence against infringement claims on the grounds of a prior trademark. The Supreme Court came to this result relying on two landmark decisions of the CJEU in 2012 and 2013 in respect of Community designs and trademarks. In those decisions, the CJEU had clarified that the existence of later registrations does not protect their owners against infringement claims brought by the prior right holders.

Whilst the Supreme Court admitted that the precedents of the CJEU referred to conflicts concerning the enforcement of Community registrations (whereas, the case at hand concerned IR marks designating Spain), it noted that Articles 9 and 12 of the CTMR (on the rights and limitations conferred by a Community trademark) were substantially identical to the equivalent provisions contained in Articles 5 and 6 of the Trademark Directive 2008/95/EC , the wording of which ought to guide the interpretation of the national trademark laws by the competent authorities (including the courts) and that those should take the appropriate measures to achieve the result intended by the Directive. It also considered it necessary to avoid that the protection granted to the owner of the prior trademark in Spain differed from the protection granted in other Member States. Therefore, the Supreme Court granted the plaintiff’s appeal and changed its respective jurisprudence, concluding that the owner of a prior trademark with effects in Spain is entitled to prohibit third parties to use in the course of trade identical or confusingly similar signs, even if those signs are protected by junior trademark registrations, without the need to file an invalidity action against such registrations beforehand.

The Supreme Court has curtailed the traditionally broad scope of protection afforded to owners of registered Spanish trademarks on the basis of the “right to use”. From now on, holders of prior trademarks will be able to rely on this judgment to enforce their exclusive rights before the Spanish courts without the need to seek the invalidity of the defendants’ trademark registrations.