The use of trademarks as adwords cannot be considered as taking unfair advantage from a third party´s reputation
Last February the 15th, the Spanish Supreme Court faced again a case concerning third-parties trademarks’ use as adwords on its Case 94/2017. The main novelty in the case is that the Court focused its analysis on article 12 of the Spanish Unfair Competition Law (SUCL) – unfair advantage from a third party´s reputation- allowing the Court to deepen in the relationship between SUCL and Spanish Trademark Law (STL).
Orona came up against Citylift since the latter was using its trademarks as adwords. The Community Trademark Court – now European- understood that such use was not a trademark infringement, since it did not harm any of the functions of the trademark, following Spanish- see Supreme Court Judgement in MASALTOS case February 29, 2016– and European case law – ECJ Judgements in Cases C-323/09 “Interflora” and C-324/09 “L’Oreal”, among others.
However, the CTMC considered that the behaviour fall under unfair competition rules, according to art. 12 SUCL, since the defendant profited from trademark´s owner reputation.
Citylift appealed before the Supreme Court who admitted the appeal. The Court analyses the Case Law with regards the relationship between SUCL and STL. Summing up, the Supreme Court case law requires a prior scope of protection assessment for each Law, regardless the behaviour may apparently fall within the prohibited conducts of one or another.
In the case at hand, article 12 SUCL protects the signs that, being able to be perceived by the public and to create a link with the origin of a good/service or the reputation of a given undertaking, fall outside of the STL scope.
Thus, since the signs were fully protected by the STL, a further illicitness analysis under art 12 SUCL was not appropriate.
The main consequence of this judgement is a stronger limitation of the alternatives that trademarks’ owners enjoy to prevent the use of their trademarks as adwords, unless such use also implies other types of uses that may mislead consumers or imply obtaining an undue advantage of their reputation. By the sake if completeness the same result should be expected for a claim based on art 6 SLUC.
By the way, and as we have stated in other fora it should be feasible to fight against such practices under art. 4 LCD (general clause) as a free-riding case.
Related Posts:
- Four Recent Judgments of the Spanish Supreme Court relating to Trademarks (III): “Champín”
- The Supreme Court confirms that, in the absence of a link in the mind of the consumer, the reputation of the earlier mark is irrelevant
- Commercial use in the market as evidence of unfair advantage – A brief comment on the GC decision “Master Cola”
- The Donna Karan Case or “How the Spanish Supreme Court re-construes its doctrine on damages in cases of infringement involving previously valid registered trademarks”