In trade mark law, silence - or rather inaction - can determine the fate of exclusive rights. In Lunapark Scandinavia (C-452/24), the Court of Justice of the EU (‘CJEU’) has recently clarified that national courts cannot apply non-harmonised national defences relating to inaction. The decision is a reminder that, while EU Member States enjoy some room to manoeuvre in procedural matters, the substantive limits of trade mark protection are strictly harmonised at the EU level.

Background

Lunapark owns Finnish trade mark ‘DRACULA’ filed in 2003 and registered in 2009 for confectionery goods. Lunapark imports and sells confectionary, whose packaging features the word mark ‘DRACULA’ and figurative signs depicting the character of Dracula.

Prior to Lunapark’s registration of the ‘DRACULA’ trade mark, Karkkimies Oy – Candyman Ltd (‘Karkkimies’) imported and sold confectionery products bearing the word ‘Dracula’ without Lunapark’s consent and without having acquired any exclusive right through registration or use in that word sign.

In 2019, Hardeco acquired Karkkimies and continued its business, including the import and sale of the ‘Dracula’ confectionery.

In 2020, Lunapark brought an infringement action against Hardeco before the Finnish Market Court. Hardeco relied on its and Karkkimies’ long-standing use of the ‘Dracula’ mark and argued forfeiture of Lunapark’s rights under Finnish law.

The Market Court dismissed the action. By virtue of a well-established principle of Finnish private law, an applicant must bring an action or assert his or her right within a reasonable time following the date on which the person pursuing the claim had or should have become aware of the facts on which the claim was based. The court found that Lunapark’s inactivity lasted so long that it led to the revocation of its right to bring infringement proceedings against Hardeco.

Lunapark appealed to the Finnish Supreme Court, which was unsure whether national defences could be raised against a trade mark infringement claim. The court referred the following question to the CJEU:

Does Article 10 [EU Trade Mark Directive (‘TMD’)] preclude the application, in a dispute concerning a trade mark infringement, of a national principle whereby the proprietor of a trade mark, also in cases other than those covered by Article 18(1) and Article 9(1) or (2) of [that directive], could forfeit the right conferred on him or her by Article 10(2) and (3) [thereof] to prohibit a third party from using a sign the use of which adversely affects or is liable adversely to affect one of the functions of the trade mark, on the ground that, though being aware of the use of the mark, he or she has not applied for prohibition of that use within a reasonable time? 

The CJEU’s decision

The judges recalled that a trade mark confers an exclusive right on its owner (Art. 10(1) TMD) and that the owner is entitled to prevent, under certain conditions (identity, likelihood of confusion, trade mark with a reputation) unauthorized use of this or a similar sign (Art. 10(2),(3) TMD).

This exclusive right is limited in the situations described in Art. 18(1) TMD in conjunction with Art. 9(1) and (2) TMD, namely where the defendant owns a later trade mark that cannot be declared invalid, because the claimant has acquiesced in the use of the defendant’s later trade mark for a period of five successive years while being aware of such use. In this case, the owner of the earlier mark cannot take action against the registration and use of the later mark, unless registration of the later trade mark was applied for in bad faith.

Referring to Budějovický Budvar (IPKat here) the judges confirmed that Art. 9 TMD effects a complete harmonisation of the conditions under which the owner of a later registered trade mark may maintain the rights to that mark where the owner of a conflicting earlier trade mark seeks a declaration that that later trade mark is invalid.

The judges held that this case law also applies to conflicts regarding the use of the later trade mark in infringement proceedings (i.e. it is not limited to conflicts concerning the registration of the later mark in invalidity proceedings).

Furthermore, it would undermine the objective pursued by the TMD, which is to ensure the uniform protection for registered trade marks in the legal systems of all EU Member States, if national defences could still be applied.

The Court concluded that Art. 18(1) TMD fully harmonises the conditions under which the exclusive rights conferred by a trade mark may be limited in case of inactivity of its owner and provides only for acquiescence in respect of a later registered trade mark but not in respect of a used sign which is not protected by an exclusive right.

Thus, a national court cannot limit the exercise of a trade mark right beyond what is provided for in Art. 18(1) in conjunction with Article 9(1) or (2) TMD.

For these reasons, the Court answered as follows:

Article 10 [TMD] must be interpreted as precluding the applicability of a general principle of national law which provides that the right of the proprietor of a registered trade mark to prohibit the use by a third party of a sign identical with, or similar to, that trade mark for goods identical with or similar to those for which that mark was registered is precluded, in a situation other than that referred to in Article 18(1) of that directive, read in conjunction with Article 9(1) or (2) thereof. 

Comment

The question this decision raises is its scope: Does it only apply to defences concerning forfeiture, acquiescence and the like or are national courts barred from applying any national defences that are not provided for in the TMD?

For instance, the statute of limitations is not harmonized and the conditions (especially the periods) for this defence differ from country to country. The CJEU’s reasoning indicates that all time-related defences, including the statute of limitations, cannot be raised against trade mark infringement claims.

Another question is if this judgment also applies to claims based on EU trade marks. Art. 17(1) and Art. 129(2) EUTMR provide explicit references to national law for all matters that are not covered by the EUTMR. However, it would be inconsistent to apply national defences to claims based on EU trade marks but not to national trade marks. National marks would be treated more favourably than EU trade marks without any apparent reason.

The decision also shows how important trade mark protection is. Even if you are too late to the game and a third party acquired earlier registered trade marks, it can be useful to register your own mark in order to rely on acquiescence under Art. 9 TMD, of course assuming you are applying in good faith and the earlier trade mark owner was inactive for five years after obtaining knowledge of the later registration and its use.

Source: https://ipkitten.blogspot.com/2025/09/silence-is-golden-or-at-least-does-not.html