Protection of merchandising articles strengthened

In a recent decision the Austrian Supreme Court changed its case law with respect to merchandising articles. In the present case the defendant sold souvenir plates showing one of the famous Lipizzaner white horses of the Spanish horse riding school in Vienna. Below the picture of the horse the text "Spanische Reitschule" (Spanish Riding School) appeared. However, "Spanische Reitschule" was registered as a trade mark for the operating company of the Spanish horse riding school in Vienna. Accordingly, the trade mark owner filed an infringement action.

However, in a very similar case, which had been decided in the mid-1990s, the Austrian Supreme Court had found that a sculpture showing a horse and bearing the text "Spanische Reitschule" did not infringe the claimant's trade mark. It ruled that consumers would only understand the text as an explanation that the depicted horse came from the Spanish Riding School. Consumers would not believe that these goods originated from the claimant itself.

The Supreme Court changed its mind here, finding that - in view of the market developments in the meantime, such as the increase of income by selling merchandising articles - the average consumer today would consider the text "Spanische Reitschule" as an indication of origin. Accordingly, the Supreme Court found that this was a use as trade mark and accordingly the trade mark of the claimant was infringed.

This decision fortunately strengthens the rights of trade mark owners for merchandising articles. However, it should be borne in mind that according to the Court of Justice of the EU in the WELLNESS case (C-495/07) merchandising articles must be used in a way to create or preserve an outlet for the goods, otherwise the trade mark for the merchandising article is not genuinely used. Although the CJEU highlighted in the WELLNESS case that the merchandising articles were given away free of charge, there might well be instances in which a merchandising article is given away free of charge, but still with the intent to create or preserve an outlet for the goods and thus the trade mark would be genuinely used.

Dr. Rainer Beetz, LL.M.