CFI confirms rules for party substitution in opposition actions

European Union

The European Court of First Instance (CFI) has issued a decision that confirms that where a mark is transferred during the course of a trademark opposition action, the new owner of the mark can be substituted for the transferor in that action if (i) the transferor has no objection, and (ii) the court, having heard the other parties to the action, considers it appropriate.

The decision stems from a long-running argument between Gerolsteiner Brunnen GmbH, which produces soft drinks and bottled water in Germany under the trademark GERRI, and Kerry Group plc, which produces Irish mineral water under the KERRY mark. Gerolsteiner contends that there is an aural similarity between KERRY and GERRI, which could lead to customer confusion.

Gerolsteiner's infringement action against Kerry reached its conclusion when the European Court of Justice held earlier this year that a trademark owner could not stop a third party from using, in the course of trade, indications of geographical origin unless it was clear that the undertaking concerned was not acting "in accordance with honest practices in industrial and commercial matters" (see ECJ clarifies Article 6(1) defence against GI infringement claim).

In a separate action begun on June 12 1998, Gerolsteiner opposed Kerry's application to register KERRY SPRING as a Community trademark. The Office for Harmonization in the Internal Market (OHIM) rejected the opposition and a lengthy appeal process began. In December 2003 Gerolsteiner informed the CFI that it had transferred the GERRI trademark to Sinziger Mineralbrunnen GmbH and Sinziger requested permission to continue with the opposition. Kerry was invited to submit its observations but returned no objections.

The CFI held that there are no express provisions in the Statute of the Court of Justice or the Rules of Procedure of the Court of First Instance governing the substitution of one party for another in a trademark opposition action. Accordingly, Articles 115 and 116 of the Rules of Procedure on intervention apply by analogy, as decided in Hugo Boss v OHIM. The CFI held that, in particular, the new proprietor must accept the dispute in the state it is in at the time of substitution. As Gerolsteiner had agreed to the transfer and neither the OHIM nor Kerry objected, the court allowed the substitution.

Aaron Wood, Hammonds, London

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