Use of a trademark without the consent of the rightholder

General Rules on the Use of Trademarks

According to Art. 1484 of the Civil Code of the Russian Federation [1], the exclusive right to use a trademark belongs to the person in whose name the trademark is registered (the copyright holder).

The existence of an exclusive right by the copyright holder means that only he has the right, at his own discretion, to use the trademark in any way that does not contradict the law, as well as to allow or prohibit all other persons from using his trademark (Clause 1 of Article 1484, Article 1229 of the Civil Code of the Russian Federation).

An approximate list of ways to use a trademark is indicated in paragraph 2 of Art. 1484 of the Civil Code of the Russian Federation, these include, in particular, the placement of a trademark:

• on goods, including on labels, packaging of goods that are produced, offered for sale, sold, displayed at exhibitions and fairs, or otherwise introduced into civil circulation on the territory of the Russian Federation, or stored or transported for this purpose, or imported into the territory Russian Federation;
• when performing work or providing services;
• on documentation related to the introduction of goods into civil circulation;
• in offers for the sale of goods, for the performance of work, for the provision of services, as well as in announcements, on signs and in advertising;
• on the Internet, including in a domain name and other addressing methods.

However, given the breadth of the concept of exclusive right (by any legal means) and the openness of the list of methods of use, in practice questions often arise about whether any action related to the use of a trademark without the consent of the copyright holder is considered illegal.

Exceptions Due to Law or Other Regulatory Acts

The only way that is directly named in the law as an exception for using a trademark without the consent of the copyright holder is the exhaustion of the exclusive right to the trademark. So, by virtue of Art. 1487 of the Civil Code of the Russian Federation does not constitute a violation of the exclusive right to a trademark, the use of this trademark by other persons in relation to goods that were introduced into civil circulation on the territory of Russia by the copyright holder himself or with his consent (Article 1487 of the Civil Code of the Russian Federation).

In addition, due to the current economic situation, this rule does not apply to goods (groups of goods) that are included in a certain list approved by Order of the Ministry of Industry and Trade of Russia dated July 21, 2023 N 2701 [2].

According to Decree of the Government of the Russian Federation dated March 29, 2022 N 506 [3], trademarks in relation to goods that are included in the specified list can be used without the consent of the copyright holder, even if they are not put into circulation in Russia, but are put into circulation outside of it directly by the copyright holders or with their consent.

Conditions Under Which the Use of a Trademark is Deemed Illegal

The very breadth of the concept of exclusive right does not mean that any action in one way or another related to the use of a trademark without the consent of the copyright holder leads to a violation.

The scope of the exclusive right to a trademark is limited by the purpose for which it is registered in the state register of trademarks and service marks of the Russian Federation.

So, from the cumulative interpretation of Art. Art. 1477, 1481 and paragraph 3 of Art. 1484 it follows that a trademark is registered in order to individualize the goods in respect of which it is registered (these goods are indicated in the trademark certificate). Accordingly, the use of a trademark without the consent of the copyright holder in relation to the same or similar goods is considered illegal if, as a result of such use, there is a likelihood of confusion.

It should be noted that from the explanations of the Supreme Court of the Russian Federation [4] it follows that to establish the fact of violation, danger is sufficient, and not real confusion of a trademark or a controversial designation by ordinary consumers of the relevant goods. The likelihood of confusion between a trademark and a disputed designation is determined based on the degree of similarity of the designations and the degree of homogeneity of the goods for these persons. In this case, confusion is possible even with a low degree of similarity, but identity (or proximity) of the goods, or with a low degree of homogeneity of the goods, but identity (or a high degree of similarity) of the trademark and the disputed designation.

Thus, the use of a trademark is considered illegal only if the following conditions are met:

• a third party uses a trademark or a designation similar to it without the consent of the copyright holder;
• a trademark or similar designation is used in relation to goods that are indicated in the certificate of the right holder for the trademark or similar goods;
• there is a risk of confusion as a result of the use of a trademark or similar designation (for example, if in general, despite individual differences, the average consumer perceives the disputed designation as the corresponding trademark or may believe that it is used by the copyright holder or related persons).

Actions Not Recognized as the Use of a Trademark

Courts, when resolving disputes related to the use of trademarks without the consent of the copyright holder, also proceed from the above criteria and refuse to sue copyright holders if any of them is not established.

In particular, the following actions related to the use of a trademark are not recognized as a violation in judicial practice:

• Mention of the trademark for informational purposes

In case No. A40-83141/2023, the copyright holder of the trademark “Ekoraznos” (plaintiff) discovered wet wipes on sale, the distributor of which was the defendant. The copyright holder considered the fact that the packaging of the defendant’s napkins contained the slogan “We’ve passed the eco-razor from bloggers” to be a violation of the exclusive right and filed a lawsuit to ban the use of the trademark and to recover compensation for violation of the exclusive right. However, the courts of two instances rejected the claim, noting that the controversial designation “Eco-rated by bloggers” is indicated on the packaging not for the purpose of individualizing the product, but as general information about the environmental friendliness of the product and its environmental criticism from bloggers.

The Intellectual Property Rights Court supported the position of the lower courts and recognized as legitimate their conclusion that in this situation there is no likelihood of mixing the goods of the plaintiff and the defendant [5].

• Mention of a trademark in a work if it is organically integrated into the plot

In case No. A40-64050/2019, the enterprise - the copyright holder of the trademark "STOLICHNAYA" (the organizer of the production and promotion of alcoholic products) considered the demonstration of Stolichnaya vodka when showing a movie in a cinema chain to be a violation of exclusive rights. Thus, in several episodes of the film, Stolichnaya vodka was shown in close-up in the center of the frame, with its label facing the viewer. In this regard, the copyright holder filed a lawsuit against the company (the owner of the cinema chain) demanding payment of compensation for the illegal use of the trademark. However, the court pointed out that the mere mention of the plaintiff’s trademark in the defendant’s work does not constitute use of the trademark, and also pointed out that the footage of vodka was organically integrated into the plot of the film.

The Intellectual Property Rights Court supported the position of the lower courts, recognizing as legitimate their conclusion that the main purpose of a trademark is to provide potential consumers with the opportunity to distinguish services (goods) provided or provided by one person from similar services (goods) provided or provided by others persons. In this case, the scope of activity of the plaintiff and the defendant is different, and therefore there is no likelihood of confusion between the enterprise and society on the market [6].

• Mention of a trademark to characterize the advertised product

In case No. A40-47872/2015, the copyright holder of the trademark “You'll Lick Sticks” (activities for providing food and beverages) filed a lawsuit against the company (restaurant) to prohibit the use of the trademark. According to the plaintiff, the violation of exclusive rights consisted in the fact that the defendant used the phrase “sticks to lick” in the audio of an audiovisual advertisement for a chain of fast food restaurants. However, the court came to the conclusion that the restaurant did not use the controversial verbal designation to individualize its products, but only in the context of statements about their taste.

The Intellectual Property Rights Court supported the position of the lower courts, additionally noting that the mere mention of someone else's trademark does not constitute use of that mark [7].

Sources:

1. “Civil Code of the Russian Federation (Part Four)” dated December 18, 2006 N 230-FZ (as amended on January 30, 2024)
2. Order of the Ministry of Industry and Trade of Russia dated July 21, 2023 N 2701 (as amended on January 16, 2024) “On approval of the list of goods (groups of goods) to which the provisions of Articles 1252, 1254, paragraph 5 of Article 1286.1, Articles 1301, 1311, 1406.1 do not apply, subparagraph 1 of Article 1446, Articles 1472, 1515 and 1537 of the Civil Code of the Russian Federation, subject to the introduction of these goods (groups of goods) into circulation outside the territory of the Russian Federation by right holders (patent holders), as well as with their consent"
3. Decree of the Government of the Russian Federation of March 29, 2022 N 506 (as amended on June 28, 2023) “On goods (groups of goods) in respect of which certain provisions of the Civil Code of the Russian Federation on the protection of exclusive rights to the results of intellectual activity expressed in such goods cannot be applied , and the means of individualization with which such goods are marked"
4. P. 162 Resolution of the Plenum of the Supreme Court of the Russian Federation dated April 23, 2019 N 10 “On the application of part four of the Civil Code of the Russian Federation”
5. Resolution of the Intellectual Rights Court dated May 21, 2024 N C01-644/2024 in case N A40-83141/2023
6. Resolution of the Intellectual Rights Court dated February 10, 2020 N C01-1426/2019 in case N A40-64050/2019
7. Resolution of the Intellectual Rights Court dated April 11, 2016 N C01-191/2016 in case N A40-47872/2015