The European Court of Justice (ECJ) has recently ruled in a case where a trade mark was used by a company other than the trade mark owner as the name of a shop and company name.
The case revolves around the use of the word "Céline" which was registered in France by Céline SA (SA) in 1948, in particular for clothes and shoes. The registration has been maintained ever since. Then in 1992 Céline SARL (SARL) was registered as a company in Nancy to sell clothing under the name Céline (although the business had been operating under the name Céline at the same location since 1950). In 2003 SA discovered SARL was trading and commenced a trade mark infringement action.
As the mark "Céline" is identical and it was used without the consent of the registered holder, SA, the question focused on whether having Céline as a company and shop name constituted use "in relation to goods" in accordance with the wording of the Trade Marks Directive.
At the first instance in the Nancy Regional Court the judgement was against SARL who were instructed to change both their company and their shop names and pay €25,000 in way of damages. SARL appealed to the Nancy Court of Appeal who in turn referred the question to the European Court of Justice (ECJ).
Essentially the ECJ focused on the purpose of a company or business name in relation to goods. They reminded us that the trade mark regime is intended to enable customers to distinguish between the goods and services of various manufacturers and, to a lesser extent, to prevent free-riding on a well established reputation of another company.
Applying this to the distinction between using a word that has trade mark protection in relation to goods and using it as an identity over the door of a seller of a similar type of goods, the ECJ decided that these purposes were different. In essence they said using a name as a company is to distinguish them from other companies and to use it for a shop or business is to identify a trading entity, neither of which can be considered "in relation to goods or services" as the phrase is found in the Directive.
The ECJ continued to say that, on the other hand there is such a use "in relation to goods" where the shop name or company name is attached to or appears on goods that are sold in that shop or by that company. What this is saying is that even in this instance there would be actual products made by two different businesses which have the same mark attached. They also said that if the word is used in such a way as to establish a link between the shop name and the goods they provide, even where the mark is not attached to or appears on goods, this falls within the Directive and can be challenged by the holder of the trade mark in the work.
So their conclusion was that where you use a company (or shop) name that is the same as a trade mark, for marketing goods that are the same as the trade mark goods, then this infringes the trade mark where the name is used in relation to goods in a way that affects customers distinguishing the origin of the goods. This is a question of fact but, as it seems here, using Céline as a company and business name, would not infringe the Céline trade mark.
This is startling news for trade mark owners who are concerned about brand dilution but in the end it is the branding of the goods themselves that are a key and not the name of the business in which they are sold.