INTA 2019: International judges discuss bad faith rules and developments

Bad faith applications were a hot topic for a panel of international judges yesterday. Inspired by efforts to harmonise trademark laws and the tremendous rise in trademark registrations by Chinese applicants – both in China and abroad – many countries are updating their trademark laws to specifically address bad faith filings. There are over 18 million registered marks in China, about 6,500 of which have been filed via the Madrid System.

In Germany, former federal patent court judge Marianne Grabrucker said that witnesses are accepted in cases where a bad faith argument is being made. “Normally we don’t have witnesses in trademark cases,” she said. However, “it’s very difficult to get a positive decision on bad faith in Germany,” so witnesses can be necessary to provide proof to meet the high standard.

For countries within the jurisdiction of the Court of Justice of the Andean Community – Colombia, Ecuador, Peru, Chile, and Bolivia – judge Hugo Gómez Apac said that “we accept every form of proof regarding bad faith trademarks,” including contracts, testimony, and witnesses.

In Canada, bad faith will be a new ground for opposition once amendments to the Trademarks Act come into effect on June 17. Managing IP covered the amendments and their implications here. Unfortunately, no one knows how the term “bad faith” will be interpreted. Even Michael Manson, judge at Canada’s Federal Court, said: “We’ll see what happens.” On an encouraging note, he did assure attorneys that “bad faith marks will be thrown out before they get to the courts”. That is, CIPO will have a process to shut them down once they have been identified.

Andrej Stec, judge at the EU General Court, has a straightforward definition: “When there is bad faith, you simply see it. If you’re not sure, it’s not bad faith.” He added that applying for a mark that is technically available but used to be well-known in the '70s, for example, “could be considered as bad faith because there is still some goodwill attached to it”.

In China, bad faith trademark registrations are one of the top complaints from foreign brands. Managing IP covered the phenomenon here. In response to these concerns, China approved amendments to its Trademark Law on April 23, 2019 that specifically aim to address the issue. The amendments will take effect on November 1 this year.

Some important changes under China’s updated law include a new use requirement, increased punitive damages available in civil counterfeiting cases, and perhaps most importantly, punitive measures for bad faith actors – including applicants and trademark agents themselves.

Yuanming Qin, IPR judge at the Supreme People’s Court in China, acknowledged that China’s first-to-file system “can cause bad faith issues”. The amendments “will create a level playing field by forbidding the abuse of rights,” he said.

Among other changes, "malicious acquisition" and stockpiling of registrations will be seen as IP abuses. Qin assured the lawyers in attendance that “trademark rights are protected in China, no matter whether it’s foreigners or natives”. He pointed to the Qiaodan case as an example of successful enforcement by a foreign entity. Managing IP covered the case here.