In a decision of April 9, 2014 (no.2013/147E.-2014/75K) the Turkish Constitutional Court ruled that Article 42/1 (c) of Decree Law no.556 -- which used to provide the non-use of a trade mark as one of the grounds of invalidity-- should be cancelled on the ground that Article 42/1(c) violated Article 91/1 of the Constitution.

In an action filed before the 4^th Istanbul Court of Intellectual and Industrial Rights, the plaintiff requested invalidation of the ORIGIN device trade mark (no.2013/20195) on the basis of its similarity to their ORJIN registered trade mark (no.99/022697). The defendant filed a counter court action requesting cancellation of the plaintiff’s trade mark on the basis of non-use. The Court accepted the main action and decided to declare the ORIGIN device mark invalid. In the meantime, the Court also accepted the counter action and ruled that the ORJIN trade mark should be cancelled for non-use in respect of all the goods with the exception of “creams”.

Upon appeal by the defendant in the main action, the Supreme Court decided to reverse the decision of the 4^th Istanbul Court of Intellectual and Industrial Rights on the ground that the risk of confusion between the disputed trade marks should have been evaluated within the scope of “creams”, which were the goods remaining in the specification of the plaintiff’s trade mark since the ORJIN trade mark had been cancelled for all the goods excluding “creams”. Accordingly, the Supreme Court accepted the retroactive effect of the non-use decision, which is contrary to the notion of cancellation.

Upon decision of the Supreme Court, the judge of the 4^th Istanbul Court of Intellectual and Industrial Rights applied to the Constitutional Court on the ground that the Article 42/1 (c) of  Decree Law no.556 regulating non-use among the grounds for invalidation of a trade mark violates the property rights protected with the Constitution, by arguing the following:  

* In Decree Law no.556, although non-use has been regulated as a ground for cancellation under Article 14, it has also been provided as one of the invalidation grounds in the Article 42 of the Decree Law no.556 which reads as: “A registered trade mark shall be declared invalid by the competent court in the following cases: (…) (c) Breach of Article 14 (However, serious use between the date of initiation of the proceedings and the expiry of five years shall not constitute a ground for invalidity. If use has been made upon realisation that proceedings are to be initiated, in such case the court shall not take into consideration the use that took place within three months prior to initiation of the proceedings.) (…)”

* Further, Article 44 of  Decree Law no.556 provides that if a trade mark is declared invalid, such ruling shall have retroactive effect. At this stage, the main problem violating the Constitution is the retroactive effect of non-use decision. Since the non-use issue becomes arguable only after expiry of five years as of the registration date or any time thereafter if there is an uninterrupted period of five years of non-use, effects of the decision ruling on the cancellation of a trade mark on such basis shall date back to the expiration of the five years period and finally the filing date of the court action instead of the application date of the trade mark subject to non-use.

* Invalidation grounds are the grounds which exist at the date of filing of a trade mark application and thus the retroactive effect of invalidation is well-grounded. On the other hand, the non-use issue, as a ground of cancellation, becomes arguable only after expiration of that five-year period and thus the non-use decision shall not have a retroactive effect. Yet, due to the rules of Decree Law no.556, since the non-use decision would have a retroactive effect (meaning that it dates back to the filing date of the non-used trademark), the trade mark subject to cancellation on the ground of non-use should not have been taken into consideration during assessment of similarity in an invalidation action.

 * Consequently, the trade mark right as a property right would have a retroactive effect as well and this would violate Article 35 of the Turkish Constitution regulating “The Protection of Property Right”.

* In addition to this, although property rights can be limited by law, limitation under Decree Law no.556 violates Article 91 of the Constitution.

The Constitutional Court has accepted the appeal of  the judge of the 4^th Istanbul Court of Intellectual and Industrial Rights and unanimously decided to cancel Article 42/1 (c) of the Decree Law no.556 with its decision dated April 9, 2014 no.2013/147E.-2014/75K

Despite this decision, it would still be possible to institute a court action on the basis of non-use under Article 14 but a non-use ruling would not have a retroactive effect.  

We are currently discussing its effect on ongoing non-use actions taken under Article 42/1 (c) as to whether the cases will be automatically refused since their legal grounds were cancelled by the constitutional court or courts will continue the actions under Article 14 and will make decisions but without retroactive effect.

This information has been kindly provided for Class 46 by Selma (Toplu) Ünlü NSN Law Firm, Istanbul, Turkey