Writing in International Law Office, Mads Marstrand-Jorgensen (Norsker & Co) discusses the recent ruling of the Maritime and Commercial Court in H-D Michigan Inc v MC Parts by Mr Frank Jensen (V-70-06), 15 April 2008.

MC mainly sold used Harley-Davidson motorcycles, spare parts and accessories. Harley-Davidson owned Danish trade mark registrations for HARLEY-DAVIDSON in Classes 18 and 25 and two Community trade mark registrations for the ‘Shield’ and ‘Bar’ device marks in the same classes. In 1998, after MC began using a self-created device mark containing, among other things, the words ‘Harley Davidson’ and ‘MC Parts’, Harley-Davidson's trade mark agent wrote to MC, objecting to its use of the words "Harley-Davidson dealer". MC wrote to the trade mark agent, seeking further elucidation, the disputed device mark appearing on its agent's letterhead. Harley-Davidson's agent responded that HARLEY-DAVIDSON was protected as a registered trade mark and that Harley-Davidson sought to ensure that only its authorised dealers used the designation. MC replied said it had expressed no wish to be an authorised dealer -- and that was the end of the correspondence.

In 2006 Harley-Davidson seized a consignment of clothing bearing MC's device mark and initiated legal proceedings. Alleging infringement, Harley-Davidson claimed damages and compensation for expenses incurred during the seizure. The court found that Harley-Davidson's representatives knew of MC’s use of its device mark since 1998, but not not consider that those rights had lapsed due to passivity. The correspondence in 1998, relating to MC’s use of the designation ‘Harley Davidson dealer’, did not concern MC's disputed device mark. Thus MC had no grounds to believe that Harley-Davidson had agreed to its use of its name and trade mark.

The court added that the use of the designation HARLEY-DAVIDSON may be lawful if the user runs a business selling Harley-Davidson's products. However, such use must be neutral and not give rise to misunderstandings. Since MC's use went further than was permitted under Section 5(3) of the Trade Marks Act, MC was ordered to pay Dkr 50,000in damages, plus Dkr15,000 in costs for the seizure and an additional Dkr34,260 for general costs. In his comment, Mr Marstrand-Jorgensen notes, among other things, that "it is debatable why eight years' passivity should not be sufficient grounds for a defence".