Legal context: the concept that trade mark rights cannot be used to partition the single market is a key concept of European Trade Mark Law. There are obviously exceptions to this rule, most notably that a trade mark owner can object to the free movement of branded goods that it has put on the market, if the physical condition of the branded products have been altered or impaired in some way. However, a new exception has developed over time, in that the condition of a branded product not only covers the ‘physical’ condition of the products, but also the ‘image’ surrounding the product deriving directly from the brand itself. The case at hand is in the latest in line of such decisions, but introduces new concepts such as ‘the aura of luxury’ associated with high end branded products. However, the decision has been worded in such a way that it impacts not only on luxury products, but all branded products in our contention.
Key points: The decision introduces the concept of the ‘aura of luxury’ associated with high end branded products and that this aura can be damaged if the product is marketed in distribution channels not deemed appropriate for the brand image of the product. However, all brands have an image of some kind which can be damaged if the brand is re-marketed in an inappropriate way and thus by definition all brand owners could find some solace in this decision helping them to control the re-marketing of their products considerably.
Practical significance: the hand of all brand owners has been significantly strengthened by this decision and their control over selective channels of distributing branded product has been considerably increased.