Extensive possibilities to take action against bad faith trademark filing

A trademark that has been applied for with an unfair purpose can be subsequently declared invalid as an application in bad faith. For example, if the application was made in order to unfairly harm the interests of third parties. Or for a purpose other than to distinguish one's own goods or services. The Court of Justice ruled on this matter in the Koton case.

Above on the right the older clothing brand KOTON, on the left the later depot STYLO & KOTON. An opposition was successful for clothing, but not for the organisation of travel (class 39): KOTON was not registered for that class. That is why the trademark owner invoked the nullity of STYLO & KOTON.

As in any trademark case, all circumstances are taken into account, especially the commercial logic of the application (why?) and the chronology of the circumstances (when?). Invalidity may be invoked by any party with an interest, not only by the proprietor of a similar trade mark.

For a long time, the Lindt & Sprüngli ruling of 2009 was considered the rule for bad faith: the well-known chocolate manufacturer registered an image of a golden rabbit with a red bow as a trademark. This shape had also been used by many other producers for a long time. According to the Lindt & Sprüngli judgment, an application is in bad faith if the applicant has an improper prevention motive, for example if he already knows that he will not use the trademark, if others have been using a similar sign for identical or similar goods for some time, and if the applicant himself does not have a legitimate objective. In Koton, the court has abandoned that somewhat strict rule. In the words of the Court: this rule only applies in the specific situation of that judgment: in the case of a trade mark application where there is knowledge of the use by a third party of a similar sign for identical or similar goods, so that there is a risk of confusion.

The new bad faith rule of Koton is more widely applicable. To put it simply, if there is something unfair about the deposit, a third party can take a nullity action. For some trademark owners this is a bit of a shock: is the validity of the trademark suddenly in jeopardy?

Maarten Haak