Often commented on, the FREE v. FREE SBE decision (Paris Court of Appeal – Pôle 05 ch. 02, January 14, 2022 / n° 20/05019, S. A.S. FREE/S. A.S. FREE SBE) raises the question of the starting point of the period of limitation in consequence of acquiescence.
According to article L. 716-2-8 of the French Intellectual Property Code, the owner of a prior right who has tolerated, for a period of five consecutive years, the use of a later trademark registered while being aware of such use shall no longer be entitled to apply for a declaration that the later trade mark is invalid (…), in respect of the goods or services for which the use later trade mark was tolerated, unless the registration of the latter was requested in bad faith.
It is indeed the condition relating to the starting date of this five-year period that caused FREE to be declared inadmissible in its trademark infringement and invalidity action against the French trademark FREE-SBE.
FREE argued that it was not time-barred from bringing an action against the FREE-SBE trademark, given that the five-year limitation period only runs from the date of registration of the contested trademark and that FREE-SBE was summoned a little less than 5 years after the registration of the trademark.
While asserting that the starting point for this limitation period was “the date on which the owner of the earlier trademark acquires knowledge of the use of the later trademark and has the opportunity not to tolerate it and to oppose it“, the Court of Appeal upheld the contested judgment, which held that FREE necessarily had knowledge of the earlier trademark prior to its registration, on the grounds that FREE has a monitoring system “alerting it of any trademark applications containing the word FREE” and that FREE “systematically takes action against anyone attempting to appropriate it“.
In our opinion, this decision is questionable, insofar as, on the one hand, it results from an extensive interpretation of an exception to article L. 711-3 establishing the list of grounds for invalidity action against a trademark and, on the other hand, it may unfairly prejudice the interests of the owner of the earlier trademark, especially if he is recognized as regularly monitoring and defending his trademark.
It is constant that:
- proof of the prior owner’s knowledge of the use of the second trademark must be demonstrated by the party invoking the time limit (French IP Institute, decision on invalidity , 18 January 2023 / n°NL22-0026, CONCECPSON / M. J.D. ; Cour de cassation, Com ch.., 7 March 2018 / n°194 F-D, JASMIN, CAFE INDIGO / Mme. X), and that
- the period starts from the time when the earlier proprietor is made aware of the use of the later mark (TUE, October 23, 2013 / T-417/12, AQUAFLOW, § 21; EUIPO, decision on invalidity, April 21, 2023 /n°44 930 C, DELTA AIR LINES, Inc. / MARRIOTT WORLDWIDE Corporation).
However, conversely to the FREE / FREE SBE judgment, the European Union General Court, in its decision “AQUAFLOW” of October 23, 2013, states that ” the proprietor of the earlier trade mark must be aware of the use of that trade mark after its registration” and that “Accordingly, it is from the time when the proprietor of the earlier trade mark is made aware of the use of the later Community trade mark, after its registration, and not the date on which the application for the Community trade mark is filed, that the period of limitation in consequence of acquiescence starts running” (§ 19 and 21).
According to the European Union General Court, the use to take into account would be therefore the one that takes place after the registration of the contested trade mark and not at the time of its filing.
In addition, legal certainty requires:
- demonstration that the owner of the earlier trademark had an effective knowledge of the use of the contested mark (in this respect, see EUIPO, decision on invalidity, April 21, 2023 /n°44 930 C, DELTA AIR LINES, Inc. / MARRIOTT WORLDWIDE Corporation; TUE, April 20, 2016 / T-77/15, SKYTEC, § 30-35), the mere presumption of such knowledge not being sufficient,
- “a set of precise and concordant elements” in order to demonstrate that the prior owner was “necessarily” aware of the effective exploitation of the second trademark and, consequently, “knowingly tolerated its use” (Paris Court of Appeal, April 13, 2022 / n°075/2022, GOURMIBOX / GASTRON’HOME),
Can we really consider that FREE knowingly tolerated the use of the FREE SBE trademark? It is hardly acceptable for a trademark owner to see the means of defending his rights turned against him, depriving him of the very actions necessary to protect them.
Because “It is important, for reasons of legal certainty and without inequitably prejudicing the interests of a proprietor of an earlier trade mark, to provide that the latter may no longer request a declaration of invalidity nor may he oppose the use of a trade mark subsequent to his own of which he has knowingly tolerated the use for a substantial length of time, unless the application for the subsequent trade mark was made in bad faith” (cf. recital 12 of Directive 2008/95/EC of the European Parliament and of the Council of October 22, 2008).
It is therefore recommended to file an opposition as soon as the later trademark is published or, if not, to immediately file an invalidity action before INPI or the EUIPO, or an infringement action if the trademark is used.
The Lavoix teams remain at your disposal to defend your rights.