Case-study on overcoming opposed “bad faith” trademarks in Ukraine. Digest # 03, 2018

Alexander Fomenko

Trademark Counsel

This Article covers a common issue of the so-called “bad faith trademark filings” in which a trademark is filed for unfair purposes, such as taking advantage of the fame of another person’s trademark while it might be not yet registered in Ukraine in a particular class.

Under the legislation of Ukraine, there is no particular definition of bad faith, while the following provisions of the Law of Ukraine “On the Protection of Rights to Marks for Goods and Services” could be used to address the issue:

According to para 2 of Article 6, legal protection shall not be granted for marks that are deceptive or liable to mislead as to goods, services, or the person that produces a good or renders a service.

Para 3 of the Article 6 reads as follows: designations shall not be registered as marks if they are identical or misleadingly similar to such an extent that they can be confused with trade names that are known in Ukraine and belong to other persons, who have acquired the right to the said names before the date of filing the applications to the Institution with respect to identical or similar goods and services.

The earliest stage when any action against a bad faith application is taken up in line with the said provisions, is the stage of the trademark application examination, as in accordance with Article 10 of the Law, any person has the right to submit to the examination a grounded objection to the application in respect to the unconformity of the applied mark with the requirements of granting legal protection.

The Examination considers the objection if it has been received not later than five days prior to the date of making a decision on the application.

However, as it is not foreseen by the legislation currently in force, the information as to the five days period is not published in open sources, which is a serious obstacle to tackling the issue. Consequently, in a case of late objection filing, it would not be taken into consideration by the Examiner, and the decision on grant protection to the “bad faith” application may be issued.

A registered trademark however, can only be cancelled through long-lasting and much more expensive court proceedings.

In this respect the Madrid System has the definite advantage, because for International registration in Ukraine there is an opposition period for applications which passed the substantive examination without issuing the provisional refusal.

Examination of the International application starts approximately within 4 months from the date of designation to Ukraine. And if the provisional refusal is not issued for the pending international application within 7-9 months, the application enters the opposition period for three months and this information is published in the Madrid Monitor.

Nevertheless, it is recommended to proceed with filing the opposition well in advance before the opposition period, so that it would be considered at the substantive examination stage and the refusal could be issued within a shorter time frame.

However, if the trademark is already registered, according to Article 19 of the Law, it may be fully or partially invalidated through court proceedings if the certificate was granted as a result of filing an application with the infringements of rights of other persons and if invalidated, considered to be null and void from the date of application filing.

Alternatively, another possibility could be considered to terminate the trademark registration on the ground of non-use after the 5-year grace period from the registration date (due to recent adoption of the EU-Ukraine Association Agreement, the grace period for non-use deemed to be 5 years, while the 3-year grace period was previously provided by the law in Ukraine).

Though, pre-trial settlement of such disputes is not required in Ukraine, the parties may reach an amicable settlement either by assignment and transfer of the right or requesting early termination of the trademark registration.

The following examples of bad faith were carefully selected from the cases handled by the Attorneys of the IPR GROUP, as described below “bad faith trademark filings” also resulted in refusals to grant trademark protection to the actual brand holders.

1.The Ukrainian PTO issued the partial provisional refusal decision in respect of the Application No. m201517628 filed by Hesse GmbH & Co. KG for the trademark for all applied goods in class 02, on the ground of similarity to TM , Application No. m201513914, and TM , Application No. m201513912, both earlier applied for goods in class 02 and services in class 35 on behalf of the Ukrainian individual.

However, on November 22, 2016, the Ukrainian PTO also issued the provisional refusal decisions in respect of both cited applications, as they were considered to be liable to mislead as to the person who produces the goods and renders the services due to the presence of the goods of Hesse GmbH & Co. KG in the market, and considering the fame of the applicant’s company as the actual manufacturer of the goods under the applied designation. It should be noted that trademarks in Ukraine are not examined only as to their similarity to prior trademarks, but also as to the goods and services which are already available in the market.

In line with the said provisions of the Law, we filed grounded objections with the PTO against registration of the cited marks setting forth that such registrations would not   comply with the criteria for protectability, i.e. misleading as to the actual manufacturer of goods.

Furthermore, a warning letter was sent to the adverse party with the demand to withdraw the applications, as Hesse GmbH & Co. KG intended to file a cancellation lawsuit on the grounds of non-compliance with the criteria for protectability in case of possible registration of these marks.

The adverse party agreed not to proceed with the applications and filed petitions on withdrawal of the trademark applications.

Finally, in order to overcome the provisional refusal in respect of the trademark application of Hesse GmbH & Co. KG, we filed the objection with the PTO with arguments that the opposed applications were no more obstacles to registration of the applied mark and consequently, the trademark was registered in classes 01, 02 and 03 with the Certificate of Ukraine No. 226086.

2.The Ukrainian PTO issued the provisional refusal decision for all applied services in class 35 in respect of the International registration No. 1313024 filed by Shimano, Inc. (JP) for the trademark , because it was considered by the Examination to be confusingly similar to the trademark , Certificate No. 135007, owned by a Ukrainian individual, earlier registered for goods in class 28 and services in class 35.

We noticed that in the course of examination prior to granting the right of protection to TM on November 05, 2009, the Ukrainian PTO issued the provisional refusal in respect of this application as it was considered to be misleading as to the manufacturer of goods – Shimano, Inc.

Nevertheless, we should note that the refusal was partial and only in respect of the goods in class 28, which were related to bicycles and fishing equipment, which are manufactured and offered for sale by Shimano, Inc.

Consequently, the final decision was issued on granting the rights protection in respect of the rest of the applied goods in class 28 and for all applied services in class 35, as the applicant did not contest the provisional refusal.

In our Objection to the provisional refusal we provided a solid set of arguments and evidences that SHIMANO brand is widely-known to a relevant circle of consumers in Ukraine, who can identify the goods and services with the applicant’s company – Shimano, Inc. – Japanese manufacturer of cycling components, fishing tackle and rowing equipment.

Moreover, apart from the fact that the applicant is the actual manufacturer of the goods, one important aspect is that the services in class 35 relate to introduction of the goods into civil circulation.

We drew attention of the Examination to the fact that Shimano, Inc. is the right holder of a huge portfolio of trademarks with the element SHIMANO, which were earlier registered worldwide and in Ukraine for goods which are offered by the company.

It is worth mentioning that the fame of the applicant is very important in addressing such issues. Therefore, we made a separate emphasis on the high quality and innovative products, which are designed, patented and manufactured by Shimano, Inc., and described in brief the unique history of the company’s development, which scored Number 43 in the Forbes list of Innovative companies and Number 150 in Top Multinational Performers.

Our arguments were accepted and the Office issued the final decision on granting the rights protection to TM (IR 1313024) in respect of all applied services in class 35.

As to the adverse trademark , termination of its registration is expected shortly.

3.The application of MEIZU TECHNOLOGY CO., LTD. for the trademark , designated to Ukraine under the International registration No 1326631, was partially refused for all applied services in classes 35 and 45, because it was considered by the Examination to be confusingly similar to the following earlier trademarks:

TM , Certificate No. 189087, previously owned by the Ukrainian individual in class 45 and TM (Cyrillic transliteration for ME IZU), Certificate No. 191450, owned by the Ukrainian individual in class 35.

In order to overcome the refusal, we filed the objection with the Office grounded on arguments on the fame of the applicant along with a solid set of evidences of a massive surge in popularity of MEIZU mobile phones among the consumers in Ukraine.

As MEIZU TECHNOLOGY CO., LTD. has earlier achieved trademark protection in Ukraine in respect of class 09, i.e. for the goods, which are offered in the market, we insisted that in no way the applicant shall be deprived the rights in classes 35 and 45, considering further expansion of the business activity not only in sales but also in providing services.

Our Objection resulted in the final decision on granting right protection issued for the trademark in respect of all applied services in classes 35 and 45.

4.The Ukrainian PTO issued the provisional refusal decision for all applied goods in class 08 in respect of the International registration No. 1187408 filed by Dorco Co., Ltd. (KR) for the trademark DORCO Sleek7.

The main obstacle in registration of the trademark of the Korean manufacturer of razors was the trademark , Certificate No. 54552, which was earlier registered by a Ukrainian individual in classes 03, 05, 08 without any obvious intent to use the mark.

The best strategy considered, was to proceed with a non-use cancellation of the cited trademark through the court, while the parties had not reached an amicable settlement of the dispute.

To consider the legislation of the home countries of the mentioned brand owners, it should be noted that the concept of bad faith is not clearly defined in the legislation of either as well. However, in these countries the regulations provided to address the issue of “Bad faith trademark filings” either by means of opposition at the stage of Examination or cancellation after trademark registration.

We trust that this observation of legislative aspects and example cases could be useful for better understanding of the issue and identifying ways of addressing it properly. While in order to avoid facing such situations, it is recommended to secure the right to a trademark and proceed with the application filing timely. In this respect the practice should be adopted in the company of close cooperation of the marketing department with In-House Counsels or Attorneys.