In August, the Korean Supreme Court decided on case 2018Hu10848, an appeal from the Patent Court in a trial to confirm the scope of trademark rights. The ruling confirmed the scope of comparison permitted in such a trial, and may be interesting to anybody not familiar with such a subject matter.

What is a trial to confirm the scope of rights, and what purpose does it serve?

The Korean Trademark Act provides for a trademark right holder, exclusive licensee or interested party to request a trial to confirm the scope of rights in a registered trademark (hereafter “scope confirmation trial”). This is an inter-partes administrative trial used to determine whether the use of a specific mark on specific goods falls under the scope of — and would thus potentially infringe — a registered trademark. Scope confirmation trials are heard at first instance by the IP Trial & Appeal Board (“IPTAB”), an administrative tribunal organized under the Korean IP Office. The initial IPTAB decision can be appealed to the Patent Court, and subsequently to the Supreme Court.

There are two variations: a positive trial to confirm that specific subject matter infringes a registered trademark (where the trademark owner/licensee is the claimant seeking confirmation), and a negative trial to confirm that specific subject matter does not infringe a registered trademark (filed by an interested party using or planning to use an identical/similar trademark, where the registered trademark owner/licensee is respondent). In addition to the details of the registered trademark, the requesting party must submit a sample of the mark for comparison, as well as a list of goods on which the mark is used.

In the case that the mark for comparison includes any portion against which trademark rights would not have effect, the comparison with the registered trademark should be made on the basis of whether the mark excluding such portion(s) would cause confusion as to the origin of the goods. Portions which would be excluded are those prescribed under Article 90 of the Trademark Act, for example the bona fide use of a personal name, common name/quality/shape etc. of the relevant goods, well-known geographical place names, etc.

An unregistered mark which comes under Article 99 of the Trademark Act (relating to the right of continuous use of an unregistered mark based on fair prior use, where the mark had a source-indicating function at the time the registered trademark was applied for) may not be subject to a scope confirmation trial.

Registered trademarks are assumed to be valid if used on their designated goods. Accordingly, the subject matter for comparison in a positive scope confirmation trial may not be another registered trademark which is used on its designated goods — in such a situation, the claim would be that the mark was incorrectly registered, and an invalidation trial would be a more suitable action.

The presumed primary purpose of a scope confirmation trial is to obtain an advance official verdict on potential infringement/non-infringement, with an aim of preventing future conflict. In practice, when the non-registered mark is in use, a scope confirmation trial is often filed alongside a civil infringement suit in which an injunction, compensatory damages etc. may be sought. Vice versa, a party using an unregistered mark may file a scope confirmation trial if a civil infringement claim is brought against them. While the result obtained in a scope confirmation trial can be submitted to the court in a related civil suit, it does not have a legally binding effect. However, the result may carry weight given that the analysis in a scope confirmation trial is performed by IPTAB subject matter experts.

Background of the 2018Hu10848 case

Party A applied for the “ ” mark covering class 3 goods in November 2013, and obtained registration in January 2015. In October 2016, Party B applied for the “ ” and “ ” marks also covering class 3 goods, but the applications were finally refused based on prior mark citations, including Party A’s mark. Party B appealed the refusal decisions to the IPTAB and shortly afterwards also filed a negative scope confirmation trial to compare a different version of their mark — “ ” — with Party A’s prior registration in relation to “body soaps”.

IPTAB Decision (first instance)

The IPTAB decision was rendered in early January 2018 and confirmed Party B’s claim, ruling that Party B’s “ ” mark did not come under the scope of Party A’s registered trademark rights in “ ”. In the decision, the IPTAB compared the marks in terms of the text portions, stating that “Saboo” and “sobia” are dissimilar overall, as well as the device portions, ruling that they were sufficiently different given the large number of similar flower devices registered in class 3, meaning that any similarity had to be judged within a very narrow range.

Party A appealed this decision to the Patent Court, and a decision to uphold the appeal and cancel the earlier IPTAB ruling was rendered in May 2018.

Patent Court Decision (second instance)

In its decision, the Patent Court considered the text portions of the two marks in detail, discussing the similar pronunciation and similarity in appearance (both 5 letters long; first and third letters identical), and also commenting that the device portions of the marks could intuitively be considered as similar. The decision went on to make a detailed comparison of the packaging styles being utilized by both parties at the time (product wrapped with a black-edged green band with three rows of type in white capital letters, etc.), and also explained the history of the business relationship and conflict between the parties.

Product comparison in Patent Court decision (2018Heo1622)

 

Party B appealed the decision to the Supreme Court in May 2018.

Supreme Court decision and comment

On August 14, 2019, the Supreme Court decision was rendered, overturning the earlier ruling and remanding the case to the Patent Court for reconsideration.

In its decision, the Supreme Court affirmed that when judging similarity in a scope confirmation trial, if there is actual use on the goods it is proper to give general and broad consideration to matters relevant to commerce (such as the degree to which a mark is well-known and its relation to the goods, as well as consumer recognition), but ruled that the Patent Court had erred in giving excessive weight to features which are commonly subject to change in commerce — in this case specifically, the detailed shape or form of the goods and their packaging — overlooking the differences in appearance and designation.

The decision reinforces the relatively limited scope of comparison permitted in scope confirmation trials, stating that the Patent Court went too far in its comparison of specific characteristics of the actual goods and their packaging. A revised Patent Court decision reflecting the Supreme Court ruling can now be expected in due course.