The Community Trade Mark Tribunal of Spain has recently handed down a Judgment that tackles an interesting topic: the links between selective distribution systems and the exhaustion of trade mark rights.

The claimants, trade mark owners in the exclusive field of luxury perfumes and operating through a selective distribution system, brought a claim against certain companies that re-sold these perfumes on the Internet. Those products were previously acquired by respondents from licit sources. The respondents argued that claimants’ trade mark rights were exhausted, so they were not entitled to bring a trade mark infringement case.

The Court found that the claimants’ trade mark rights were not exhausted and confirmed that the on-line commercialisation made by the respondents harmed the goodwill of claimants’ trade marks. According to the Court, this constitutes “legitimate reason” to oppose further commercialization of the goods in the sense of article 13.2 of the Community Trade Mark Regulation.

According to the Judgment, the claimants successfully evidenced that the specific conditions in which the on-line re-sale of the products was made could entail a “serious devaluation” of the claimants’ brand image.

The full text on the Judgment (in Spanish) has been published by the economic Spanish newspaper Expansión, is accessible here.