Friday 30 September 2016

Infringement of an EU trademark... but not in the whole of the EU

The Court of Justice of the European Union has recently delivered its judgment in case C-223/15, combit Software (judgment of 22 September 2016, ECLI:EU:C:2016:719) concerning the interpretation of the unitary character of the European Union trademark in relation to the scope of infringement actions against confusingly similar signs.

In the case that prompted the Oberlandesgericht Düsseldorf to make a reference for a preliminary ruling, that court considered that a company’s use of the word sign “Commit” for computer programs gave rise, on the part of the average German-speaking consumer, to a likelihood of confusion with the EU trademark “combit”.  However, in the German court’s view, there was no such likelihood of confusion on the part of the average English-speaking consumer, who could easily understand the conceptual difference between the English verb “to commit” and the term “combit”, comprised of the letters “com” for computer and “bit” for binary digit.

In those circumstances, the Oberlandesgericht Düsseldorf asked the CJEU for guidance as to which of those two consumer groups should be taken into account in order to assess the likelihood of confusion, and whether the EU trademark should be considered as infringed throughout the whole of the EU or whether the Member States should be differentiated individually.  

In response to the referring court’s question, the CJEU indicated that where there is a likelihood of confusion in one part of the European Union, it must be concluded that the EU trademark has been infringed, even if that likelihood of confusion does not exist in other parts of the EU. This solution is in keeping with the approach followed for oppositions to EU trademark applications, where the existence of a likelihood of confusion with an earlier trademark in one part of the European Union will suffice in order for the application to be refused.     

The Court of Justice nevertheless goes one step beyond the question referred by the German court and analyses the consequences of the declaration of infringement. Here, the CJEU is supported by the case-law established in its earlier judgment of 12 April 2011, DHL Express France (C-235/09, ECLI:EU:C:2011:238).  In that judgment, the Court of Justice had ruled that a prohibition on proceeding with acts which infringe or would infringe an EU trademark must, as a rule, extend to the entire area of the EU.  However, it established the exception (paragraph 48 of the judgment) that where the defendant proves that the use of the sign at issue does not affect, particularly on linguistic grounds, the functions of the trademark in part of the EU, the EU trademark court must limit the territorial scope of the prohibition that it issues.

Based on that reasoning, the Court of Justice has now concluded that in a situation such as the one raised by the Oberlandesgericht Düsseldorf, the EU trademark court must issue an order prohibiting use of the infringing sign for the entire area of the European Union with the exception of the part in respect of which there has been found to be no likelihood of confusion. In the CJEU’s opinion, this solution, which initially seems to contradict the principle of the unitary character of the EU trademark, is imposed by the need for exclusive rights to be exercised only in cases where the use of a similar sign by a third party adversely affects the functions of the trademark.

Author: Carlos Morán

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