Court Reversed Judgment of Nil Capiat Per Breve and Remanded Trademark Infringement Case for New Trial

The IPR Court reversed judgment of nil capiat per breve of the appellate court and remanded the case of compensation for infringement of exclusive rights to trademarks for a new trial. The grounds were, in particular, insufficiently motivated conclusions about the lack of confusing similarity between the signs and incorrect qualification of the plaintiff’s actions as an abuse of right.

The trademark owner filed a lawsuit seeking compensation for infringement of exclusive rights to trademarks.

The plaintiff was the right holder of trademarks 332894 and 634741 with the “Motor” verbal element. In support of the claim, it was stated that the defendant used the designation “motor” on its web site and in the domain name, in particular to promote the goods of third parties.

The claim was granted by the court of first instance, but the court of appeal reversed the decision, denying the claim on the basis that the defendant used for business purpose another trademark owned by the right holder.

The Court of Appeal also concluded that there were other grounds for dismissal of the claim as the plaintiff did not independently use the trademarks in defense of which the claim was filed; the designation used by the defendant is not confusingly similar to the plaintiff’s trademarks; the defendant began to actively use the domain name and the disputed designation long before the priority date of the plaintiff’s trademarks. In addition, the court agreed with the arguments of unfair activities of the plaintiff associated with the accumulation of trademarks and their non-use.

However, the Court for Intellectual Property Rights (hereinafter the IPR Court) sent the case for reconsideration, as it concluded that the appellate court had not established all the relevant circumstances and had not properly evaluated the evidence.

The IPR Court noted that it was premature to conclude that the defendant’s use of the disputed designation was lawful. Denying the claim, the court did not take into account the list of services in respect of which the trademark was registered. Meanwhile, the trademarks used by the defendant do not include services for advertising and promotion of goods in respect of which the plaintiff’s trademarks are registered.

The court also agreed with the argument about the insufficient motivation for the conclusion that there is no confusing similarity between the disputed designation and the plaintiff's trademarks. IPR Court also agreed with the argument that the plaintiff’s finding of abuse of right was groundless.

This conclusion was reached by the appellate court because the plaintiff himself does not use the disputed trademarks. However, the IPR Court noted that it should have taken into account their use by the licensee, which constitutes a lawful way of using the mark under Article 1486 of the Civil Code of the Russian Federation.

The IPR Court also pointed out that pursuant to paragraph 154 of the Resolution of the Plenum of the Supreme Court of the Russian Federation of April 23, 2019 No. 10, the non-use of a trademark by the right holder seeking protection of the right, in itself does not indicate an abuse of right. When establishing the fact of abuse of right, it is necessary to establish specific circumstances clearly indicating the presence of the purpose to cause harm to another person.