Significant amount of moral damages awarded in trademark infringement dispute

In Judgment 3549/2012 (July 9 2012), the Multi-member First Instance Civil Court of Athens has awarded a total amount of approximately €58,000 in moral damages to Champion Products Europe Limited for infringement of its CHAMPION trademarks. This was the second round of a long-running dispute between renowned sportswear manufacturer Champion and a Greek chain of retail stores over the latter’s use of the word 'champion' in association with children's clothing.

In 2007 the retailer imported from China and offered for sale through its wide network of retail outlets children’s sleeveless pullovers predominantly displaying the word 'champion' in stylised font on the front of the garment. Champion sued the retailer, seeking, among other things, a permanent injunction and moral damages. Champion relied on its earlier word and figurative Greek and Community trademarks CHAMPION, which covered "clothing" in Class 25 of the Nice Classification.

In its defence, the retailer argued, among other things, that the indication 'champion':

• is devoid of any inherent distinctive character;
• had become a common name in the relevant sector; and
• was not used as a trademark, but merely as an embellishment.       

In September 2010 the court issued a preliminary judgment (5610/2010). It ruled, among other things, that:

• the defendant’s allegations that the CHAMPION marks lacked inherent distinctive character and had become a common name were inadmissible, since the relevant procedural requirements laid down in Articles 51(1)(b) and 52(1)(a) of the Community Trademark Regulation (207/2009) and the corresponding provisions of the Greek legislation were not duly complied with;      
• the CHAMPION marks enjoy an "outstanding reputation" among Greek consumers of garments (ie, the public at large);
• experience showed that the average Greek consumer of garments tends to perceive a single word element appearing on the garment as an indicator of origin, and not as an embellishment;
• there was a risk of confusion between the CHAMPION marks and the contested indication; and
• the defendant had attempted to derive unfair benefit from the reputation, goodwill and power of attraction of the CHAMPION marks.  

With regard to the quantification of the plaintiff’s damage, the court stayed the proceedings and ordered that the defendant disclose information in relation to the quantities of infringing garments sold. The defendant demonstrated that it had sold 3,817 infringing items during a two-month period.

On July 9 2012 the court handed down its definitive judgment. Among other things, the court:

• issued a provisionally enforceable permanent injunction preventing the defendant from manufacturing, importing, stockpiling, promoting, offering for sale and distributing any garments bearing the indication 'champion';
• imposed a monetary penalty of €2,000 per day of violation of the injunction order;
• awarded moral damages of €40,000 plus legal interest (ie, €57,648) to the plaintiff; and
• ordered that the defendant pay the plaintiff’s legal expenses.

In quantifying the amount of damages, the court took into consideration the following factors, among others:

• in 2006 the defendant had signed a cease and desist undertaking concerning the use of the CHAMPION marks, which was now deemed to have been breached; and
• in 2009 the defendant had commercialised another product (shorts) bearing indications similar to the plaintiff’s trademarks.

The amount awarded as moral damages is among the highest ever assessed in a trademark infringement case in Greece. It indicates the firm determination of the Greek judiciary to follow a stringent approach when it is established that a business entity (repeatedly) infringes the trademark rights of a competitor. The judgment is subject to appeal.

Manos K Markakis, Dontas Law Offices, Athens