Trademark revocation for lack of serious use: a new strategic weapon

In December 2019, Ordinance No. 2019-1169 and its implementing decree No. 2019-1316 entered into force, transposing Directive 2015/2436 known as the “Trademark Package”. This reform substantially modified French trademark law by allowing new categories of trademarks to be filed, by modifying procedures and by extending the powers of the National Institute of Industrial Property (INPI).

A few years later, the study of the case law highlights a consequence of this transposition anticipated by specialists but insufficiently anticipated by trademark owners: the strategic use of trademark revocation for lack of genuine use.

APPLICATION FOR REVOCATION FOR LACK OF GENUINE USE DESPITE THE ABSENCE OF INTEREST IN BRINGING PROCEEDINGS

The registration of a trademark with the INPI gives its owner a monopoly on the use of this sign to designate the goods and services for which the trademark is registered. This only makes sense to the extent that this mark is actually exploited. Otherwise, there is no justification for third parties to be deprived of the possibility of using it. This is why the Intellectual Property Code provides in Article L 714-5 that:

« The proprietor of the trademark who, without just reasons, has not made genuine use of it, in respect of the goods or services for which the trade mark is registered, for an uninterrupted period of five years shall be liable to forfeit his rights. » 

It was already provided for by French law that the proprietor of the mark had five years after its registration to make genuine use of it. However, the reform brings a novelty of great importance by now providing that any person, without having to justify an interest in bringing proceedings, can make this request for forfeiture for lack of serious use before the INPI.

The absence of a need for an interest in bringing proceedings is strategic since a company can fully monitor the use that one of its competitors makes of its trademark and request its cancellation after a lack of use for 5 years. The fact that the competitor is the applicant does not, in itself, constitute an attitude of bad faith. It consists in the intention to illegitimately prevent a third party from using a sign necessary for his activity. As the INPI regularly points out, bad faith is characterized by proof of unfair intent and cannot arise from the mere fact that the competitor is the applicant.

There are therefore now many applications for forfeiture for lack of serious use before the INPI. The vast majority of decisions rendered in this context actually pronounce the revocation of at least partial of the trademark.

Indeed, the INPI assesses the use of the mark quite strictly since the demonstration of the use of the mark for similar goods or services is not sufficient to justify the use of the registered goods or services. The trademark owner must therefore be able to prove the use of:

• to guarantee the consumer the identity of origin of the goods and services (this is a use “as a trademark“, a contrario the use of the sign in a simple internal document is not enough),
• the sign as registered or in a version that does not alter its distinctive character (beware of figurative marks used with new logos, etc.),
• on a specific date (e.g. by attaching the corresponding invoices to an advertisement),
• for the goods or services designated in the registration (and not for similar products)
• by himself or by an authorized third party (contract with a licensee attached to the proof of use by the latter …).

The constitution of a proof of use file is therefore a tedious, time-consuming work, monopolizing part of the human resources of the trademark owner.

ANTICIPATE THE INCREASED RISK OF FORFEITURE FOR LACK OF GENUINE USE

As a result of this trend, new reflexes must be acquired by trademark practitioners but also by the owners themselves.

ANALYZE THE BRAND PORTFOLIO AND CONSIDER PARTIAL WAIVER

Trademark owners are strongly advised to monitor their rights portfolio and verify that they can fully justify the use of trademarks that have been registered for more than five years. In this context, it is important to keep a complete file of proof of use that meets the criteria listed above. As a reminder, it should be verified that the use can be proven for each registered product and service.

Otherwise, a strategic reflection is necessary according to the needs of the trademark owner. For example, the latter may prefer to partially renounce his trademark for goods and services which he does not ultimately use in order to avoid advertising and the cost that would result from an application for revocation against him.

BUILD A FILE OF PROOF OF USE BEFORE ANY OPPOSITION OR LITIGATION

In the context of opposition proceedings to the registration of a trademark, the INPI now has a strengthened role regarding the examination of evidence of use of the earlier mark on which the opposition is based. It will be deemed registered only for goods and services for which genuine use can be proved by the opponent. If it was previously sufficient for him to demonstrate the use of the mark for one of the goods or services on which the opposition was based, he must now prove the use for each of the goods and services on which the opposition is based. Otherwise, it will be considered inadmissible and will be exposed to the revocation of its trademark. The trademark owner wishing to oppose must therefore ensure that he will be able to provide all the proof of use that will be requested.

The lack of genuine use also weakens the trademark owner wishing to bring an infringement action before the courts. Indeed, the defendant in the infringement action will most likely ask the owner of the trademark that summoned him to provide evidence of genuine use of it (unless the said trademark was registered less than 5 years ago). Otherwise, the claim for infringement will be considered inadmissible.

The trademark proprietor must therefore be aware of the fact that, in any proceedings, he will probably be asked in return to prove his use. Before even considering sending a formal notice to stop acts of counterfeiting, he must therefore check that he has a solid file of proof of use. Otherwise, he is directly exposed to forfeiture for lack of serious use.

MAKE SURE YOU UPDATE YOUR CONTACT INFORMATION

It often happens that the contact details of the trademark owner are not up to date with the INPI. This can be very problematic since the INPI informs the holder of the application for revocation against his trademark by simple mail sent to the address he has. If the contact details are not up to date, the holder never receives this simple letter, yet the procedure before the INPI is ongoing. The proprietor of the trademark will therefore not be able to defend himself. Unfortunately, it happens regularly that the INPI ends up pronouncing the revocation of a trademark without even the owner of it having been informed of this procedure and therefore has not defended himself. It is therefore particularly important to check that the contact details available to the INPI are up to date.

TAKE CARE OF YOUR DEPOSIT

If the trend was previously towards trademark registration covering the widest possible list of goods and services, it is different today. For all new trademark applications, it will now be necessary to designate only the goods and services that will actually be used. While it is always tempting to use general language to include as many goods and services as possible, care should be taken to ensure that the designation is sufficiently clear and precise to allow any person to determine on that basis the scope of protection conferred.

More than ever, the monopoly granted to the trademark owner is “challenged”. The latter must, at each stage of the life of his trademark, question the use he makes of it, has made of it or plans to make of it. The brand has certainly grown and is now an integral part of the strategic management of the company.

By Ginestié Magellan Paley-Vincent, France, a Transatlantic Law International Affiliated Firm.  

For further information or for any assistance please contact france@transatlanticlaw.com

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