SONN Patentanwälte – IP Attorneys

Trade Mark Use with Comparative Advertising

We can report an interesting decision of the Austrian Supreme Court (Oberster Gerichtshof (OGH)), applying the decisions of the European Court of Justice (ECJ) under C-532/06 on 02 Holdings Limited and C-487/07 L'Oreal to a specific case in Austria.

The plaintiff owns Community trade marks VELUX as word mark and word and device marks and an Austrian word and device mark VELUX for skylights among other goods. It is market leader in Austria for skylights with a market share of about 85 % and is known by the consumers for its high quality. The defendant has the bigger part of the remaining market share for its skylights. Its business comprises repairing skylights and supplying exchange windows. It markets special standard exchange windows for several types of VELUX skylights, for its own skylights and also exchange windows made to measure for any kind of skylight.

In the course of its advertising campaigns it uses the trade mark VELUX in comparative advertising. It is settled case law of the CJEU (see above mentioned decisions) that such use is trade mark use and constitutes trade mark infringement. A difference in typefaces of the letters is of no importance since a word mark protects the reproductions of the word in all standard typefaces. The fact that by such use consumers are not misled as to the origin of the product is also not relevant.

However, a trade mark owner cannot hinder the use of its mark in comparative advertising if it fulfills the conditions of the Community Directive 2006/114/EC on comparative advertising. According to Art. 4 lit f of that directive such use is forbidden if it takes unfair advantage of the repute of the trade mark. This is here the case: if any skylight of any producer can be exchanged, the naming of the trade mark of the market leader is not necessary. And the taking of an unfair advantage of the repute of the market leader's trade mark is detrimental to the function of the mark to indicate origin or its value in marketing and advertising. Since with these findings such a use of a trade mark is an infringement, furthermore the defence of fair use had to be considered.

Fair use is to be found if the use of the third party's mark as designation of the kind or intended purpose is necessary, i.e. the only means to inform the public in a concise and complete manner about the intended purpose. There is no unfair taking advantage when the use of the mark is a precondition for an effective competition. Since fair use is an exception to trade mark infringement, a narrow interpretation has to be applied.

Therefore, in the present case the defendant cannot rely on fair use: this use of the mark was not necessary. The indication to the public that any existing skylight can be exchanged and that therefor made-to-measure windows are also available is sufficient to inform the public about the commercial activities of the defendant. Hence, the naming of the trade mark of the market leader is not a condition for effective competition.

Accordingly, the OGH issued the requested injunction and has forbidden the use of the trade mark VELUX in the defendant's advertisements regarding the exchange of skylights.

DI Helmut Sonn