ECJ clarifies third-party use of trademark under Article 6(1)(c)

In Gillette Company v LA-Laboratories, the European Court of Justice (ECJ) has clarified the test for third-party use of a trademark in connection with spare parts or accessories for a product.

The Supreme Court of Finland made a reference to the ECJ in an action by Gillette Company against LA-Laboratories (LA) for infringement of its registered trademarks GILLETTE and SENSOR. LA also manufactures and sells in Finland razors comprising a handle and a replaceable blade, similar to the Gillette Sensor razor. LA sells its own blades under the mark PARASON FLEXOR, but affixes a sticker to the packaging bearing the words "all Parason Flexor and Gillette Sensor handles are compatible with this blade". LA claimed that this use of the GILLETTE and SENSOR marks did not infringe Gillette's rights as it fell within Article 6(1)(c) of the Community Trademark Directive, as implemented into Finnish law. Article 6(1)(c) provides that a registered mark is not infringed by:

"use of the trademark where it is necessary to indicate the intended purpose of a product or service (in particular, as accessories or spare parts), provided that the use is in accordance with honest practices in industrial or commercial matters."

The ECJ declined to deal with the interpretation of Article 6(1)(c) at the same level of detail as the questions referred by the Finnish court, as Article 6(1)(c) covers a wider category of products, not just spare parts. The ECJ therefore held that it was not necessary to distinguish or define what was a spare part or accessory (as opposed to what was an essential part of the product) or what other type of products may be caught by the directive.

The ECJ stated that the relevant test was that any use of a third party's trademark needed to be "necessary" to indicate the intended purpose of the product marketed. In particular, it would be necessary, where use in practice is the only means of providing the public with "comprehensible and complete information" as to the intended purpose of the product in order to preserve the undistorted system of competition in the market for that product.

The ECJ clarified that the further condition of 'honest use' embodied a duty for the trader to act fairly in relation to the legitimate interests of the mark owner. It would be for the national courts to determine this question. In particular, use would not be in accordance with honest practices in industrial and commercial matters if:

• an impression is given of a commercial connection between the trader and the mark owner;
  
  
• it affects the value of the mark by taking unfair advantage of its distinctive character or reputation;
  
  
• it entails the discrediting or denigration of the mark; or
  
  
• the trader presents its product as a replica or imitation of the product bearing the mark.

Use of a third party's trademark does not necessarily mean that the trader is representing that the product is of the same quality or has equivalent properties to the products of the third-party trademark owner. It is a factual question for the court whether the use is honest.

The same approach applies to judging use of a mark by a trader where the trader also markets a competing product itself, as well as the spare parts.

The ECJ has already found that the use of a third party's trademark to inform the public that the advertiser is a specialist in the products sold under the mark is necessary to preserve the system of undistorted competition (see BMW Case). In this decision, the ECJ has taken a consistent position and clarified that the directive enables third parties to use a trademark to provide the public with the information necessary for a consumer to make an informed choice of whether to buy that product.

However, there will remain cases where the courts will be asked to judge whether the trader has over-stepped its legitimate rights by making use of the third party's mark that is not in accordance with honest practices in industrial and commercial matters. The test is similar to that for comparative advertising where a trader seeks to promote its products by making references to features of a competitor's product using the competitor's name or logo.

For a discussion of the advocate general's opinion on this case, see Use of mark to inform consumers of compatibility may be permissible.

Joel Smith and Heather Newton, Herbert Smith, London