You can find some interesting ideas concerning bad faith in the judgment of the General Court of July 11, 2013 (T-321/10), in which it is highlighted how violation of the principles of honesty and fairness can conduct to the nullity of the trademark.
We indicate with “A” the Company which filed contested Community (now EU) trademark application and “B” the Company who filed the nullity action against such application.
The matter arises from the filing of a Community application made by the Company A. The sign applied for was almost identical to a trademark, neither filed nor registered but used for many years in Italy from the Company B in the field of construction and engineering works.
In order to complete the description, we highlight that:
- the directors of the Company A were also members of the Board of Directors of the Company B;
- Company A held a remarkable sharing in the capital of company B;
- at the time of the filing of Community trademark application there was a dispute between the two companies in Italy.
In the exam of the case the Court cites several times the judgment of the Court of Justice of Lindt Goldhase and its details of how needed in the interpretation of the concept of bad faith
In the opinion of the Court:
“in order to determine whether the applicant is acting in bad faith the national court must take into consideration all the relevant factors specific to the particular case which pertained at the time of filing the application for registration of the sign as a Community trademark, in particular the fact that the applicant knows or must know that a third party is using, in at least one member State, an identical or similar sign for and identical or similar product capable of being confused with the sign for which registration is sought; the applicant’s intention to prevent that third party from continuing to use such a sign; and the degree of legal protection enjoyed by the third party’s sign and by the sign for which registration is sought”.
The above elements are not necessarily the only ones that must be met in presence of bad faith but they can be take into consideration in order to verify the requisite of bad faith.
In this matter it was not disputed (and was never denied during the degrees of judgment) that Company A was aware of the use of a highly similar trademark made by Company B.
The Court highlights, however, that the mere knowledge of the existence of an identical or similar mark used for identical or similar goods is not in itself sufficient to demonstrate the bad faith. In this regard it is very important to assess applicant’s intention at the time of trademark application filing. According to the OHIM, the applicant’s intention may be inferred from the factual circumstances of the case, including
“its role or position, contractual relations, pre or post- contracts he had with the other party, the existence of reciprocal duties or obligations, including honesty and fairness deriving from having held or still holding the officers of executive in the company of the applicant … and, more generally, to all situations of conflict of interest in which the applicant was”.
Among the circumstances not in favor of Company A there was not only the filing of Community trademark application after the start of the dispute with the Company B but also after the Company B had increased its volume of business and its reputation thanks to its brand. Company A, in its role as shareholder of Company B, could not be unknown of this situation.
In the light of all the items above listed, the Court upheld the decision of the Board of Appeals and confirmed the nullity of contested mark as filed in violation of the principles of honesty and fairness.