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DECISION No. 249 Sofia, 22.03.2006 IN THE NAME OF THE PEOPLE The Supreme Court of Cassation of the Republic of Bulgaria, Trade College, second division in a court sitting as of the fourteenth of March two thousand and six, in a session consisting of: CHAIRMAN: KRASTYO YANACHKOV
MEMBERS: ROSITSA KOVACHEVA
LIDIYA IVANOVA
with the participation of the secretary Sofia Simeonova
and in the presence of the prosecutor
has given a hearing to the reported information by the Judge Rositsa Kovacheva
trade case No. 813/2005 The proceedings are pursuant to Art. 218a, paragraph 1, item b of the Civil Proceedings Code, initiated by a cassation claim of “Begein” Ltd. – Varna against a decision as of 8.06.2005 on civil suit No. 424/2005 of the Sofia Court of Appeal. The appellant maintains that the decision is incorrect as pronounced in violation of the material and procedural law – the parties have no argument with regard to the originality of the trademark – the commodity bears the registered trademark of “Justerini and Brooks Limited”, and the debate is whether the corpus derelicti under Art. 73 of LTGI has been realised, which is not at hand, as the prerequisite for the existence of a violation under Art. 13 of LTGI is the presence of identical or similar signs (imitation) of the registered trademark, which signs should be put on the goods, as well as the import or the export with these identical or similar signs. The appellant states that the trademark is original; it has not been proved that it has marked the commodity by applying the trademark to its goods, which it will distribute as goods bearing the appellant’s trademark, and that is why the envisioned protection in the LTGI cannot be enforced. The appellant claims that the finding of the court about a realised import under Art. 13, paragraph 2 of LTGI with the transfer of the commodity through the state border and that it is incorrect, with regard to the term “import”, to enforce the regulation of the Customs Act and in which the Court introduces its interpretation. It considers that in this case the commodity has a statute of “temporarily stored” – by only an issued customs bill of entry - and has a foreign statute and the “transit” regime could be applied to it, which excludes the field of application of LTGI. The party claims that the decision is repealed and the claim is not considered. The appellee on the cassation claim “Justerini and Brooks Limited” – London, Great Britain, legal address in Bulgaria Boyanov, Barrister-at-Law, Sofia, 24 Evtimiy Blvd. disputes the latter claim for considerations that are enlisted in the written reply. The Supreme Court of Cassation, after considering the arguments of the parties related to the exhibited cassation claims and after verifying the case details, finds the claim EQUITABLE. By decision dated 8.06.2005 on civil suit No. 424/2005 of the Sofia Court of Appeal the decision dated 16.12.2003 on civil suit No. 1034/2002 of the Sofia City Court is left effective, which acknowledges the establishment under Art. 76, paragraph 1 and Art. 13, paragraph 2, item 3 of LTGI on the claim of “Justerini and Brooks Limited” – London, Great Britain, against “Begein” Ltd. – Varna, that its right over “J&B” trademark – the brand, reg. No. 27694, by import of 1200 bottles of whisky, the appellee on the grounds of Art. 76, paragraph 1, item 2 of LTGI is convicted to discontinue any import without the consent of the appellant of goods bearing the same trademark and pronounces the destruction of the subject of violation. Considerations are exhibited that as per Art. 73, paragraph 1 of LTGI a violation of the registered trademark right is the employment in the business activity of a sign under Art. 13 of LTGI (identical or similar to the registered trademark) without the consent of its owner; the Court has specified that Art. 13, paragraph 1, item 1 of LTGI determines the scope and the contents of the right to a registered trademark, and also specified the lawful conditions, which must be present to ascertain the violation under Art. 76, paragraph 1, item 1 of LTGI. As for the disputable issue whether an import by the appellee of the aforementioned commodity is realised, the court has decided that the import under Art. 13, paragraph 2, item 3 of LTGI is the factual crossing of goods in great amounts, with commercial or production purpose, of the state border prior to the issuance of a customs direction and their submission to customs regime, including to an import regime under the Customs Act and the Regulation on the implementation of the Customs Act (prior to the issuance of a customs direction the goods have a statute of “temporarily stored goods”, they are not under customs regime and are not executed under the “import” regime). The court has accepted that the appellee has realised import with the fact of their introduction on the territory of the country, by realising in its capacity of a recipient under the original consignment notes and the customs stock-sheet the factual definition of infringement under Art. 13, paragraph 2, item 3 of LTGI – it has imported 1200 bottles of whisky of the “J&B” trademark in violation of the appellant’s rights and without its permission. The appellate instance has decided that the realised import of the commodity has no consent on the part of the trademark owner, which is included in the contents of the trademark right, pursuant to Art. 13, paragraph 1 of LTGI, which consent should have been proved by the appellee, because of which there is an infringement of the appellant’s trademark right under Art. 73, paragraph 1 of LTGI. The prohibition under Art. 15, paragraph 1 of LTGI was interpreted by the Court in the sense that after being imported by the trademark owner or with its consent, the commodity bearing the owner’s trademark can freely be regarded as a subject of commercial turnover, that the legislator gave priority to the principle of trade freedom, but the trademark owner has the right to develop or not a national market. As for the asserted violation, committed by the appellee – import of goods under a protected trademark, without the permission of its owner outside the official distribution network of the manufacturer, the so-called “parallel import”, the claim for asserting the violation was considered favourably, the appellee was convicted to discontinue the violation and the destruction of 1200 bottles of whisky of the “J&B” trademark was pronounced. The decision thus pronounced is not in conformity with the legislation. The instance has incorrectly considered favourably on its merit the claim under Art. 76, paragraph 1, item 1 of LTGI by accepting that after importing in the country whisky with the “J&B” trademark – a trademark registered by the appellant, without the appellant’s permission, the appellee has committed the aforementioned violation. For the existence of employment of a trademark in the business activity under Art. 13, paragraph 2 of LTGI, including import and export of goods under this mark pursuant to paragraph 2, item 3 of the same law, the basic norm – Art. 13, paragraph 1 pf LTGI should be present, specifying the contents of the trademark right, which in broad terms comes down to the right of the trademark owner to prohibit the use by third parties of a sign that is identical to the trademark it has registered, without its permission, or because of a similarity with the trademark or the identity of the goods or services there is a possibility of confusion of the consumers, who associate the supplied sign with the trademark registered by the appellant. To admit that the appellee has committed an infringement of the appellant’s registered trademark right under Art. 73, paragraph 1 of LTGI, and that the appellee has employed in its business activity a sign under art. 13, paragraph 1 of LTGI without the permission of the owner, there should be a violation of the prohibition for the appellee to employ a sign which misleads the consumers that they are buying whisky of the “J&B” trademark, which has been registered by the appellant. The import in the country of original whisky bearing the said trademark, which has been registered by the appellant, is no violation under Art. 73, paragraph 1 of LTGI, as there is no activity, realised by the appellee without the appellant’s permission, which constitutes illegal employment of the “J&B” whisky trademark, registered by the appellant. There is no violation under Art. 33 of LTGI, when a third party imports the original commodity, bearing the trademark registered by the appellant, and not imported goods that are marked unlawfully with someone else’s trademark (the appellant’s). The appellant’s argument for incorrectness of the conclusions of the appellate instance on the issue whether the import of 1200 bottles of whisky of the “J&B” trademark by the appellee is realised or not is unjustified, in which part the conclusions made in the appealed decision, are right. The appellee has realised “import” of the original commodity, bearing the whisky trademark registered by the appellant, but has not implemented an activity in its business activity under Art. 13, paragraph 1 of LTGI of goods with a sign that is similar or identical to the trademark registered by the appellant “J&B”, through import. As specified in a letter from the Customs Agency – RCD Varna, Port Varna, actions under Art. 78 of LTGI of supervision and detainment of goods with protected trademarks in their transfer across the state border of the republic of Bulgaria have been undertaken, which are different from the ones under Art. 78, paragraph 4 of LTGI. “Begein” Ltd. – Varna has established its identity as the recipient of the goods by an original consignment note and it was registered as a recipient as per the submitted customs bill of entry. Having in mind the Letter and the power of the consignment note not only of a shipment document, asserting a concluded contract for shipment, but also of a document that materializes the property right over the transported freight, which is also a freight managing document, and with a view to the regulation of Art. 118 of the Merchant Shipping Code, according to which only the person, whose name is mentioned in the consignment note, can exercise the rights that are materialized in it, it should be accepted that the appellee, as the owner of the consignment note, establishes its identity as a person that has the right to receive the freight and dispose of it, in favour of which a presumption for property over the transported freight is created. With the unshipping at the port of Varna of the freight, whose recipient is the appellee in the suit, which transports the goods across our state border, under Art. 78, paragraph 1 of LTGI the same goods, according to the Letter from the Customs Agency, are not transshipment goods or others, specified in Art. 78, paragraph 1 of LTGI, and the appellee groundlessly maintains that it has realised the import of the goods in the country, although there are no measures of border control under Art. 78 of LTGI imposed on the goods due to the intervention of the owner of the “J&B” registered trademark, because of which the goods have a statute of “temporarily stored goods” under Art. 57 of the Customs Act and is not under a customs regime of import. In view of the aforementioned, although the appellee has realised import of goods, this is not the import under Art. 13, paragraph 2, item 3 of LTGI, as the stipulation of Art. 13, paragraph 2 in connection with paragraph 1 of LTGI has been designed to protect the trademark right, which is used in the way regulated by the law, including through import and export of goods under this sign, which would lead to confusion of the consumers and the perception that the imported goods have been unlawfully marked with someone else’s trademark, which legal regulation is not applied in the event of an import of original goods bearing the “J&B” trademark, registered by the appellant. The import by the appellee of original goods, and not of goods marked by it unlawfully with someone else’s trademark, is not an “employment” of the trademark under Art. 13, paragraphs 1 and 2 of LTGI, for which protection by the law has been provided for, and because of that the claim under Art. 76, paragraph 1, item 1 in connection with Art. 73 of LTGI is incorrectly considered favourably, which claim is groundless. The regulation of Art. 15, paragraph 1 of LTGI, according to which a trademark owner may not prohibit its use for goods that have been released with this trademark by it or by its permission on the market in the country, is incorrectly interpreted by the court, in which regulation the court has introduced a meaning that after the first sale of the goods marked with this trademark in the country, they may be freely considered the subject of business turnover. The exhaustion of a trademark right under Art. 15, paragraph 1 of LTGI is initiated by virtue of the law and is compulsory for everybody, and that is why the trademark owner or its agent, after having released its goods on the market, which exhausts its trademark right, may not demand a restriction in the import of its goods, which will only be realised by its consent. In the listed considerations the claim under Art. 76, paragraph 1 of LTGI for asserting the fact of the violation is unjustified – the appellee has not realised “employment” of the appellant’s trademark right under Art. 13, paragraphs 1 and 2 of LTGI, the claim under Art. 76, paragraph 1, item 2 of LTGI is also groundless – for discontinuation of the violation, considered favourably with the appealed decision, which convicts the appellee to discontinue any import without the appellant’s consent of whisky of the “J&B” trademark, the demand for pronouncing the destruction of the subject of violation, where the Court has pronounced the destruction of 1200 bottles of whisky with the “J&B” trademark – original goods, and not imported goods, marked unlawfully by the appellee with someone else’s trademark, is groundless as well. Therefore the decision should be repealed and on the grounds of Art. 218g, paragraph 1 of the Civil Proceedings Code – another one should be pronounced, which rejects the claims. In view of the imposed, the Supreme Court of Cassation, Trade College, second division HAS DECIDED
THE DECISION IS FINAL | |
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