Volvo importer fails necessity test in 'volvoimport.no' dispute

In Volvo Personbiler Norge AS v Hoppestad (HR-2004-01671-A, October 7 2004), the Norwegian Supreme Court has upheld a decision ruling that the defendant's use of the domain name 'volvoimport.no' infringed Sections 4 and 6 of the Norwegian Trademarks Act.

Hoppestad is an independent importer of Volvo cars bought through authorized Swedish dealers. In 2002 Hoppestad registered the domain name 'volvoimport.no' under which it hosted a website to market and sell the imported cars.

Volvo Personbiler Norge AS, the Norwegian subsidiary of Volvo Personvagnar AB of Sweden, filed a lawsuit in 2002 claiming that the registration and use of 'volvoimport.no' infringed its VOLVO trademark pursuant to Sections 4 and 6 of the Trademarks Act. Both the District Court of Skien og Porsgrunn and the Appeal Court ruled in Volvo's favour. Hoppestad appealed to the Supreme Court, claiming that there was no risk of confusion between VOLVO and 'volvoimport.no', in particular because the website displayed a notification informing users that Hoppestad was an independent importer with no connection with the Volvo group of companies.

Hoppestad further argued that the use of 'volvoimport.no' was legal under the principle of exhaustion set out in Article 7(1) of the Community Trademark Directive.

The Supreme Court upheld the appellate court's decision. It stated that (i) VOLVO is a well-known mark protected under the KODAK doctrine (ie, increased protection for well-known marks) established in Section 6 of the Trademarks Act, and (ii) the use of 'volvoimport.no' fell within the scope of the exhaustion principle set out in Section 4 of the act, as established in the Paranova Case (HR-2004-00981-A, June 6 2004).

With regards to the principle of exhaustion, the Supreme Court followed the guidelines established by the Paranova Case, which suggest that the interests of the mark owner and the importer must be carefully balanced (see Parallel importer may use design similar to producer's mark). In doing so, the court pointed out the following:

• It is not common for car dealers to use the name of a car producer as part of their domain name. Hoppestad's use of 'volvoimport.no' may therefore cause an expectation that there is a commercial connection between Hoppestad and Volvo.
  
  
• Hoppestad exploited the goodwill in the VOLVO mark, even though its website informed users that there was no commercial link with the Volvo group of companies.
  
  
• The use of the domain name at issue was not necessary to promote Hoppestad as an independent importer. In contrast, the use of 'volvoimport.no' implied that Hoppestad was riding on the back of Volvo's marketing efforts to attract internet users to its website.

Accordingly, the Supreme Court concluded that Volvo had legitimate reasons to oppose Hoppestad's use of 'volvoimport.no' and dismissed the appeal.

Felix Reimers, Advokatfirmaet Grette DA, Oslo