TM bodies can sue on behalf of members in own name: CJEU
The Court of Justice of the European Union (CJEU) ruled yesterday that organisations representing trademark owners can bring an infringement action on behalf of their members under their own name.
The case centres around proceedings that Netherlands-based Coöperatieve Vereniging SNB-REACT brought against an individual called Deepak Mehta at the Harju Court of First Instance in Estonia.
Anti-counterfeiting organisation SNB-REACT alleged that Mehta had infringed ten of its members’ trademarks. The organisation sought an injunction preventing any further infringements.
According to SNB-REACT, Mehta had registered domain names which were using marks identical to trademarks owned by the organisation’s members. The websites also allegedly sold goods bearing the marks.
Mehta argued that he neither registered the domain names nor used any trademarks owned by SNB-REACT’s members. Although he recognised that he owned 30,000 internet protocol addresses, he said he rented them to third-party companies.
The Harju Court of First Instance dismissed the action because, it said, SNB-REACT could not bring an action under its own name on behalf of its members. The court cited article 60 of Estonia’s trademark law (Kaubamärgiseadus) and said it could not recover compensation for any trademark infringement on behalf of its members.
In addition, the court said SNB-REACT’s evidence did not demonstrate that Mehta was the owner of the domain names and websites or that he had been unlawfully using the marks at issue.
The court concluded that Mehta’s “liability could not be established as a result of the unlawful activity of persons operating those domain names and websites”, in accordance with article 8(1) of the country’s trademark law.
SNB-REACT appealed against the decision at the Tallinn Court of Appeal.
The organisation argued that article 60 of the trademark law could be interpreted as meaning that a collective representative body has the right to bring an infringement action to defend the rights of its members in its own name.
The organisation also argued that the Harju Court of First Instance was incorrect to exclude all liability from Mehta for the services he provided to the people operating the domain names.
SNB-REACT said that article 8(1) of the Estonian trademark law applied to service providers that act only as neutral intermediaries. The organisation argued that it does not protect those that are aware of the infringement, as SNB-REACT alleged that Mehta was.
The Tallinn Court of Appeal referred the case to the CJEU as it was unsure of the compatibility of Estonian law with EU law.
The court asked the CJEU to establish whether SNB-REACT could bring an infringement action in its own name to protect its members and whether Mehta is liable for infringement even if he is renting the domain names to third parties.
Yesterday, on August 7, the CJEU said that member states are required to “recognise a body collectively representing trademark proprietors” bringing forward an action in its own name on behalf of its members.
However, the CJEU referred the case back to the Harju Court of First Instance to decide whether Mehta was liable for trademark infringement just by renting the websites to third parties.
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