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Austria: Bad faith becomes easier to prove




There is a substantial development to be noted in the interpretation of bad faith as ground for invalidity of trade marks.

Originally mere prior use by the plaintiff was not a reason for cancellation of a registered trade mark. Only qualified prior use counted, namely that for which secondary meaning could be proven. During the years this qualification of prior use was alleviated to a status of signs somehow known in the trade.

Then the concept of immorality was introduced. The test for that had two prongs. First, prior use of the sign was known or had to be known by the defendant (the owner of registered trade mark) and, second, immorality of registering that or a highly similar sign as trade mark by the defendant could be proven for example on the basis that the defendant had taken action against that prior use or threatened such action. That was then the basis for proving bad faith when this concept was introduced as a ground for invalidity in Austria due to European harmonisation of the Trade Mark Law. The mere registration alone was not held to be immoral without such intention to be proven until recently.

Now we have a decision of the Appeal Court approved by the Supreme Court of Austria (concerning the trade mark WBZ) saying that the mere application of that prior-used sign already shows the immoral intent. The aim of registering a trade mark is to allow its owner to forbid all use of that mark by third parties, also if prior used. And that qualifies as such an intent and therefore proves, together with that knowledge of that prior use, bad faith.

In that decided case there was no sign that the trade mark owner would hinder further use of the prior used signs by two other companies. The intent could have been to hinder further new competition by companies not yet on the Austrian market.

The decision has far-reaching consequences. It practically abolishes the second prong of the test namely that bad faith is really present. Once it can be proven that the trade mark owner had known or should have known of the prior use then automatically his application was in bad faith. No further proof of immoral intent is now necessary. Simple prior use alone known to the applicant (trade mark owner) is now a ground of invalidity. Bad faith has become a simple and easy ground for invalidity applicable in many cases.

Helmut Sonn

SONN & PARTNER Patentanwälte
Riemergasse 14
A-1010 Vienna, Austria
Tel: +43 1 512 84 05
Fax: +43 1 512 98 05
office@sonn.at
www.sonn.at


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