ECJ clarifies interpretation of Article 19(1) of the Community Design Regulation

Can the holder of a registered Community design (RCD) bring infringement proceedings against the holder of a later RCD, or does it need to first obtain the cancellation of the later design? Does the fact that the alleged infringer owns a RCD mean that the holder of the earlier design does not have locus standi until such time as the registration of that later design is cancelled? Does the holder of the later design enjoy a right of use so that the exercise of that right, until such time as it has been declared invalid (by OHIM or a Community design court in the context of a counterclaim for a declaration of invalidity), cannot be deemed to be an infringement of the earlier RCD?

The answers to these questions should be found in the Community Design Regulation (6/2002), but the regulation does not contain any provision that expressly answers them. Its key provision in this respect - Article 19(1), entitled "Rights conferred by the Community design", is worded as follows: "A registered Community design shall confer on its holder the exclusive right to use it and to prevent any third party not having his consent from using it." Since both the holder of the earlier RCD and the holder of the later RCD enjoy, in principle, an exclusive right to use their respective design, the question arises as to whether the term 'any third party' within the meaning of Article 19(1) should be interpreted as including a third party that holds a later RCD for an allegedly infringing design.

Many authors and the Community Trademark and Design Courts of most EU member states tend to believe that the regulation does not preclude the holder of an earlier RCD from bringing infringement proceedings to prevent the use of a later RCD. The majority of commentators also consider that any Community Design Court, when confronted with such disputes, should recognise the locus standi of the owner of the earlier RCD. Moreover, if the court finds that the later design does not produce on the informed user a different overall impression (and, therefore, infringes the earlier RCD), it should prohibit its use without waiting for the cancellation of that design.

In some EU countries, however, there is a relatively well-established jurisprudence regarding the interpretation of the national trademark and design laws that points in a different direction. The Spanish courts, for instance, consider that the owner of a Spanish registered trademark that wishes to prohibit the use of a later registered trademark on the grounds that it infringes its earlier right can do so only if (previously or simultaneously to the infringement proceedings) it successfully obtains a declaration of invalidity of the allegedly infringing trademark.

Against this background, on February 16 2012 the Court of Justice of the European Union (ECJ) issued its decision in Celaya Emparanza y Galdos Internacional SA v Proyectos Integrales de Balizamiento SL (Case C-488/10), a reference for a preliminary ruling by the Juzgado de lo Mercantil No 1 de Alicante and No 1 de Marca Comunitaria (ie, one of the Spanish Community Trademark and Design Courts). The case involved infringement proceedings brought by the holder of an earlier RCD against the holder of a later RCD. The defendant argued that the allegedly infringing design had also been registered at OHIM and, therefore, it enjoyed a right of use until such time as the registration of that design was cancelled. The Spanish court, unsure as to the interpretation of Article 19(1) of the regulation, decided to stay the infringement proceedings and referred questions to the ECJ.

The ECJ’s answer is clear:

"Article 19(1) of the [regulation] must be interpreted as meaning that, in a dispute relating to infringement of the exclusive right conferred by a [RCD], the right to prevent use by third parties of the design extends to any third party who uses a design that does not produce on informed users a different overall impression, including the third-party holder of a later [RCD]. Moreover, this interpretation does not imply the declaration of invalidity/cancellation of the later registered design, in so far as this later [RCD], use of which is prohibited pursuant to Article 19(1) of the [regulation], remains valid until such time as it has been declared invalid by OHIM or a Community design court in the context of a counterclaim for a declaration of invalidity."

The arguments put forward by the ECJ in support of its conclusion are quite persuasive:

• The wording of Article 19(1) does not make any distinction on the basis of whether the third party is the holder of a RCD. Therefore, it does not preclude the holder of a RCD from bringing infringement proceedings to prevent the use of a later RCD that does not produce a different overall impression on the informed user.
• Article 19(1) must be interpreted in the light of the priority principle, under which the earlier RCD takes precedence over later RCDs, since it follows from Article 4(1) that a design is to be protected by a Community registration to the extent that it is new and has individual character. Therefore, where two RCDs are in conflict with each other, the design that was registered first is deemed to have met those conditions for obtaining protection before the design that was registered second. Thus, the holder of the later RCD may be afforded the protection conferred by the regulation only if it can demonstrate that the earlier RCD fails to meet one of those conditions, by seeking a declaration of invalidity.
• Only an interpretation of the term ‘any third party’ within the meaning of Article 19(1) as encompassing the third-party holder of a later RCD is capable of ensuring attainment of the objective of effective protection of RCDs pursued by the regulation, as well as the effectiveness of infringement proceedings, since the substantive features of the procedure for the registration of Community designs established by the regulation amount to an essentially formal, expeditious check, which - unlike the registration procedure under the Community Trademark Regulation (207/2009) - does not require any substantive examination as to compliance with the requirements for protection prior to registration, and does not provide for any stage during which the holder of an earlier registered design can oppose registration.

The ECJ seems to have clarified once and for all the scope and effect of Article 19(1) in court proceedings brought by the holder of a RCD against the holder of a later RCD.

It remains to be seen whether the ECJ's position will have a domino effect and lead the courts to adopt a similar approach in disputes relating to the infringement of the exclusive right conferred by an earlier registered Community trademark (CTM) by a later registered CTM. Two of the three arguments invoked by the ECJ in support of the present judgment seem to apply mutatis mutandis to those disputes. However, the fact that the ECJ expressly emphasised the differences between the substantive features of the procedure for registration of Community designs and those laid down by the Community Trademark Regulation for the registration of CTMs suggests that the same principle is not automatically and necessarily transposable to the CTM system.

Joao Miranda de Sousa, Garrigues, Madrid