European Union: The Court of Justice rules on trademark acquiescence (C-466/20)

In brief

Article 61 of Regulation 2017/1001 on the European Union trademark regulates the limitation of the rights conferred by a trademark as a consequence of acquiescence. According to said Article, the owner of a European Union trademark (EUTM) is not entitled to bring an invalidity action against a later EUTM if said owner has acquiesced or consented, for a period of five successive years, in the use of said later EUTM while being aware of such use (unless bad faith is in place).


Key takeaways

In the case at hand, the German Federal Court of Justice considered it was necessary a referral to the Court of Justice of the European Union (CJEU) to clarify the material scope of "acquiescence" and which circumstances triggered the interruption of the five-year period by the EUTM owner. The CJUE answered to the preliminary questions raised as follows:

  1. The effects of warning letters. One of the classic ways of interrupting the five-year period of acquiescence is to send a warning letter to the proprietor of the later mark. The question arises as to whether, if the warning letter has no effect, the trademark owner has five years from the date the warning letter was sent to take action again against the later EUTM. The CJEU ruled that such interpretation would allow the proprietor of the earlier mark to circumvent the regime for limitation in consequence of acquiescence by repeatedly sending a warning letter approximately every five years. Thus, the CJEU ruled that an act, such as a warning letter, without taking the necessary steps to obtain a legally binding solution, does not put an end to the toleration and, consequently, does not interrupt the period of limitation.
  2. On the due diligence by the EUTM owner. In the case before the CJEU, the proprietor of the earlier mark brought an invalidity action against the later mark within the five-year period from the date it was aware of the existence of the later trademark (that is before the acquiescence period had expired). However, the claim was served to the later EUTM owner after the five-year period had expired, and this was due to a lack of diligence of the earlier EUTM owner. The CJEU ruled that under these circumstances, the period of limitation may not be prevented.
  3. Whether the limitation for acquiescence also applies to related claims. Finally, the CJEU ruled that where the proprietor of an earlier mark is time-barred from seeking a declaration of invalidity of a later mark and from opposing the use of that mark, that proprietor is also time-barred from bringing ancillary or related claims, such as claims for damages, the provision of information or the destruction of goods.

The CJEU has thus shed light on the scope of the statute of limitation in consequence of acquiescence, which will surely influence the enforcement strategy of earlier trademark owners.

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