Periods of compensation for trademark infringement

Courtroom_European_Court_of_Human_Rights_01.JPGThe Advocate General of the European court gave an opinion in case C‑280/15  Irina Nikolajeva  v OÜ Multi Protect. The case concerns the following:

On 24 April 2010, Ms Nikolajeva filed an application for registration of a Community trade mark at the Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM). The mark for which registration was sought is the word sign ‘HolzProf’. The application for registration was published on 31 May 2010. On 14 September 2010, the trade mark ‘HolzProf’ was registered and that registration was published on 16 September 2010. On 24 April 2010, Ms Nikolajeva entered into a licence agreement under which she licensed the use of her trade mark to OÜ Holz Prof. The monthly licence fee was set at ……. On 18 June 2013, Ms Nikolajeva brought an action against Multi Protect before the referring court based on three claims. First, Ms Nikolajeva asked the referring court to declare unlawful use of her trade mark by Multi Protect. She maintained that Multi Protect infringed Article 9(1)(a) and (2)(d) of Regulation No 207/2009 by using a sign identical with her trade mark as a ‘hidden keyword’ on a website accessible through the internet. In this regard, Ms Nikolajeva pleaded that Multi Protect had infringed the exclusive rights conferred by the trade mark in the period from 3 May 2010 to 28 October 2011, a period of 17 months and 25 days. Second, Ms Nikolajeva claimed payment of …………. by Multi Protect in accordance with the provisions on unjust enrichment. That sum was calculated on the basis of the fee set in the licence agreement with OÜ Holz Prof in respect of the duration of the alleged infringement. Third, Ms Nikolajeva claimed compensation for non-material harm. She submitted that the bringing of penalty proceedings and the action before the court on account of this situation had caused her mental pain. In this respect, Ms Nikolajeva alleged that the actions of Multi Protect had led to ‘deterioration in her health’, that ‘a number of business partners had deserted her’ and that ‘the dispute had brought her negative attention’. The referring court asks whether, in the event that it declared unlawful use of the trade mark at issue in accordance with Ms Nikolajeva’s first claim, it is required to issue an order prohibiting the acts of infringement pursuant to Article 102(1) of Regulation No 207/2009, even though Ms Nikolajeva has not applied for such an order. The referring court also has doubts as to when the protection conferred by the Community trade mark comes into effect. It notes that under the first sentence of Article 9(3) of Regulation No 207/2009 the rights conferred by a Community trade mark prevail against third parties from the date of publication of registration of the trade mark. It adds that that provision opens up the possibility that reasonable compensation may be claimed in respect of acts occurring after the date of publication of a Community trade mark application, which acts would, after publication of the registration of the trade mark, be prohibited by virtue of that publication. In this regard, the referring court has doubts whether the second sentence of Article 14(1) and Article 101(2) of Regulation No 207/2009 permit rights associated with Ms Nikolajeva’s trade mark to be viewed as having come into effect at the time specified in the first sentence of Paragraph 8(2) of the Law on trade marks, that is to say, upon filing of the application for registration of the trade mark. The referring court is also uncertain about the interpretation of the words ‘reasonable compensation’ in the second sentence of Article 9(3) of Regulation No 207/2009.

In those circumstances, the Harju Maakohus (Harju District Court) decided to stay its proceedings and to refer the following questions to the Court for a preliminary ruling:

1. Is a Community trade mark court required to issue the order provided for in Article 102(1) [of Regulation No 207/2009] if the applicant does not seek such an order in his claims and the parties do not allege that the defendant has infringed or threatened to infringe a Community trade mark after a specific date in the past, or does failure to make an application to that effect and to refer to this fact represent a “special reason” within the meaning of the first sentence of this provision?

2.  Is Article 9(3) [of Regulation No 207/2009] to be interpreted as meaning that the proprietor of a Community trade mark may only demand reasonable compensation from a third party on the basis of the second sentence of Article 9(3) [of Regulation No 207/2009] for use of a sign identical with the trade mark in the period from the publication of the application for registration of the trade mark until the publication of the registration of the trade mark, but not compensation for the fair market value of what has been gained as a result of the infringement and for damage, and that there is also no right to reasonable compensation for the period prior to publication of the application for registration of the trade mark?

3. What type of costs and other forms of compensation are included in reasonable compensation under Article 9(3), second sentence, [of Regulation No 207/2009], and can this also encompass in certain circumstances (and if so, in which circumstances) compensation for non-material harm caused to the proprietor of the trade mark?

The Advocate’s position:

1) Articles 9(1) and (3), 14(1) and 101(2) of Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trade mark preclude a national provision under which the legal protection of a registered trade mark begins on the date of filing of the application for registration.

2) Article 9(3) of Regulation No 207/2009 must be interpreted as meaning that reasonable compensation may not be claimed under that provision in respect of acts occurring prior to the date of publication of a Community trade mark application.

3) The words ‘reasonable compensation’ within the meaning of Article 9(3) of Regulation No 207/2009 must be interpreted to the effect that the recovery of profits may be claimed in respect of acts occurring after the date of publication of a Community trade mark application, which acts would, after publication of the registration of the trade mark, be prohibited by virtue of that publication. The words ‘reasonable compensation’ exclude moral prejudice.

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