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Is use of a CTM in one EU country enough to defend a non-use challenge?


5th Jul 2012

On 5th July 2012, Advocate-General Sharpston issued her opinion in Case C-149/11 Leno Merken v Hagelkruis Beheer B.V. (the “ONEL” case) – a reference by the Regional Court of Appeal in The Hague to the CJEU concerning whether use of a CTM which has been on the register for 5 years in one EU Member State is enough to protect it in the event of a non-use attack.

By the reference, the Court has essentially been asked to define the territorial area of the Community in which a mark must have be used to satisfy the requirement for a CTM to be put to ‘genuine use’ and, in particular, whether it is sufficient for a CTM owner to have used the mark in only one EU Member State.

In a rather non-committal opinion, the AG explains that use in only one member state might be enough, depending on the facts at issue and the particular characteristics of the market for the goods / services. But in the AG’s view, whether the use has been in just one Member State or in several of them is irrelevant. The real issue for consideration is whether a brand owner’s use has been sufficient for the mark to have a “commercially relevant presence” in the Community in the context of the market for the goods / services. No guidelines or suggestions on number of countries, percentage market share etc. have been put forward to help courts or those considering a non-use attack to assess whether a brand owner’s use has achieved such a commercially relevant presence.

Following recommendations made by the Max Planck Institute early this year, it was thought the use in one Member State would continue to be sufficient for genuine Community use. The AG’s opinion is therefore likely to come as a disappointment to, and a source of uncertainty for, brand owners.

We now await the decision of the CJEU. If it follows the AG’s opinion, which is often the case, it seems that the geographical extent of a brand owner’s use of a CTM will remain just one the factors to be considered when assessing whether a brand owner can demonstrate genuine use of its CTM. There may therefore be a need for brand owners to prove more substantial use in one member state or use in more than one Member State in order to defeat a non-use challenge. It remains to be seen whether it will become more challenging to defend an attack where there is a greater potential Community market e.g. for everyday goods / services, than where the market is a niche one for more specialised goods / services.

In light of the uncertainty surrounding the issue of genuine use in the Community, CTM owners who are currently only using their mark in one Member State would do well to advertise more widely and explore opportunities in other Member States of the Community and to continue maintaining detailed records about their use.

This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking before any action in reliance on it.

Author
Tom Sharman
Partner
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