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CTMs and geographical limits on relief - a question for the ECJ

Case C-235/09 DHL Express France SAS v Chronopost SA is a reference to the European Court of Justice for a preliminary ruling on a number of questions. Explaining this reference, Sarah Bailey (Simmons & Simmons) writes:

"The request for a preliminary ruling was made by the French Supreme Court in a matter where Chronopost (the French post office’s rapid courier service) and DHL are fighting about which of them has the right to use the term WEBSHIPPING for class 35, 38, 39 and 42 services.

Chronopost commenced infringement proceedings against DHL based on its French national trade mark and CTM registrations. In its defence, DHL claimed that WEBSHIPPING was invalid for lack of distinctive character and that, in any event, it should be revoked for non-use within the statutory period.

At first instance, the Paris High Court found the French registration to be valid but revoked it for non-use as from the end of the five year period following registration. It found that DHL had infringed the registration in the period up to the date at which the revocation was deemed to have taken effect, and ordered it to pay 5,000 euros in damages.

As regards Chronopost’s CTM, the High Court requested expert evidence on the meaning of SHIPPING for the English speaking public in the EU at the date of filing the CTM in 2000.

On appeal, the Paris Court upheld the first instance decision insofar as it found the French registration to be valid and found that the CTM was also valid. It confirmed the revocation of the French registration. (At the date of the appeal decision, the statutory 5 year period had not yet expired for the CTM.) It also found that DHL had infringed Chronopost’s French and Community trade mark rights.

The interesting point which has generated the reference is in relation to the prohibition measures ordered by the court. Chronopost requested an EU-wide injunction, subject to a penalty for failure to execute.

The Appeal Court, sitting as a second instance Community Trade Mark Court, found in a poorly drafted decision that such an order would not be appropriate and limited the prohibition, subject to a daily penalty of 1,500 euros, to France. It came to this decision on the basis that, in accordance with Article 98 of Council Regulation 40/94 (in force at the time), in order for it to make such an EU-wide order with a penalty provision, it would need to have access to the relevant national rules.

The Court then rather bizarrely went on to say that as the risk of confusion had only been assessed in relation to French consumers, this was another reason why it would be inappropriate to order an EU-wide prohibition and penalty.

In its appeal to the Supreme Court, Chronopost argues that the Appeal Court has violated Articles 1 and 98 of Council Regulation 40/94 and that the prohibition subject to a penalty payment should apply across the EU.

In making its request for a preliminary reference, the Supreme Court is seeking confirmation of its initial view that the Appeal Court got it wrong when limiting its order to France.

In the discussion of the issues under consideration, the Court referred to the ECJ’s decision in the Nokia case (13 July 2006 C-316/05) and draws from it the principle that a Community Trade Mark Court is under an obligation to order such measures as may be necessary to ensure that a prohibition is compiled with.

It seems to me that the questions it is posing are as follows:

Should a prohibition on further use of an infringing trade mark ordered by a Community Trade Mark Court be deemed automatically to cover all Member States? If the answer to this question is no, can this problem be got around by the Community Trade Mark Court hearing the infringement case specifically ordering the prohibition in relation to the countries in which the acts of infringement are committed or threatened?

In the event that the order of the Community Trade Mark Court covers all or part of the EU, either by operation of law (question 1) or as a result of a specific order (question 2), are the coercive measures which it applies by virtue of its national legislation applicable within the Member States in which the prohibition is to have effect?

If the coercive measures ordered by the Community Trade Mark Courts do not have effect outside its national jurisdiction, can the Court get around this by making orders by virtue of the relevant national rules applicable in the Member States where the prohibition is to apply?

Perhaps what is really at issue here is whether aspects of national law (such as the French practice of granting injunctions subject to daily penalties for breach) can be applied EU-wide, when other member states do not have such provisions (for example, in the UK, if an injunction is breached, the parties return to court for the remedy - it is not present by the judge granting the injunction)".

Posted by: Blog Administrator @ 13.13
Tags: ecj reference,
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