OHIM Board of Appeal recognises new justifiable reason for non-use

European Union

In Chronopost v DHL Express (France) (Case R 2425/2013-4, January 28 2015), the Fourth Board of Appeal of OHIM has annulled a decision of the Cancellation Division upholding an action filed by DHL for the cancellation of the Community trademark (CTM) WEBSHIPPING, owned by Chronopost.

On July 6 2012 DHL filed an action for the cancellation of the CTM WEBSHIPPING (CTM No 1 909 183), which was registered on May 7 2003 in the name of Chronopost, on the grounds of non-use.

In its observations, Chronopost claimed that there were (very unusual) proper reasons for non-use - it underlined the fact that it also owns the French trademark WEBSHIPPING (Registration No 3 024 396) and that the parties have been involved in a dispute concerning these marks since 2004.

More precisely, Chronopost had sued DHL for trademark infringement before the Paris Court of First Instance, which considered that the use made by DHL of the term 'webshipping' did constitute infringement of Chronopost’s French trademark WEBSHIPPING. DHL was thus sentenced to pay damages. An appeal was filed against this decision, and the Court of Appeal upheld it. Therefore, the existence of trademark infringement was recognised by both the First Instance Court and the Appeal Court.

However, DHL continued to use the said mark, even though it had been condemned for trademark infringement, and it went even further by filing a cancellation action for non-use against the mark.

In its reply to the cancellation action, Chronopost did not file any evidence of use (which did not exist) but, rather, claimed that there were proper reasons for non-use. Its main argument was that, given the intense use which had been (and is still) made of the mark by DHL in the whole European Community in relation to identical products and services, it could not freely use its own mark, as the consumer would not understand that identical services could be provided under the same mark by the two main actors and competitors in this field of activity.

The question was thus whether an act of infringement does constitute a proper reason for non-use of a CTM.

First of all, the Board of Appeal pointed out that the concept of 'proper reason for non-use' is not limited to the situations/cases covered by the previous rulings referred to in the Cancellation Division's decision. The board noted that, although the "interminable" process for obtaining a marketing authorisation for medicinal products represents the most common and “classic” case of proper reasons for non-use, this is not the only one.

The board outlined that it was regrettable that the Cancellation Division had upheld the cancellation action merely because this case did not correspond to any of the previous decisions dealing with this question. 

The board noted that, in this case, the fact that the concerned mark was already used by an infringer completely prevented the legitimate owner from using its own mark freely, as there was a real risk of confusion in the consumer’s mind, especially as the mark was used for identical services. Moreover, the board highlighted that, by using the mark, the legitimate owner would have indirectly enhanced the value of its direct competitor’s mark, which was completely unreasonable.  

Therefore, the board concluded that ordering the cancellation of such a mark would imply that a mark could be systematically infringed until it becomes vulnerable to cancellation for non-use, which would be completely unfair.

The board’s decision is both legally founded and business-orientated, and is arguably the correct one.

Meriem Loudiyi, INLEX IP Expertise, Paris

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