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20 April 2020
Under the previous legal framework, Decree-Law 556 pertaining to trademarks did not clearly cite application in bad faith as a grounds for opposition. However, the Turkish Patent and Trademark Office (TURKPATENT) considered application in bad faith in its opposition evaluations just as the courts had done in invalidity actions.
Trademark practice and law were harmonised under Industrial Property Code 6769 (IP Code), which came into force on 10 January 2017. The IP Code cites application in bad faith as a grounds for opposition. However, as neither the IP Code nor any other Turkish law sets out a precise definition of 'bad faith', the term is open to interpretation.
In an IP context, bad faith is a subjective state based on an applicant's intentions when filing to register a trademark. As a general rule, intentions on their own are not subject to legal consequences. For a finding of bad faith, the applicant must have performed an action that clearly evidences dishonest intent according to an objective standard. In other words, bad faith occurs when the conduct of a trademark applicant contravenes accepted principles of ethical behaviour or honest commercial and business practices.
Turkish legal doctrine acknowledges the following types of trademark application in bad faith (the interpretations of bad faith are generally based on decisions of TURKPATENT and the courts).
These trademarks arise from the intent of the applicant to register a trademark identical or very similar to a trademark used by a competitor for unjustified reasons and for the sole purpose of blocking the competitor.
The applicant's purpose is to ambush third parties' good faith. The applicant has no intention to use the trademark, but aims to gain unjustified profit from third parties by blackmail.
The applicant aims to take unfair advantage of a well-known trademark by registering the same or a very similar trademark for other goods or services, so that they may transfer the goodwill associated with that trademark to their own trademark.
Registrations by trademark owner's agent
If an agent or a representative of a trademark owner applies for registration of said mark in their own name without the owner's consent, the application is rejected on the opposition of the proprietor, unless the agent or representative justifies their action.
The bad faith issue is unclear for this type of trademark, as the applicant intends to file applications that may be subject to use in the future. As in many jurisdictions, in Turkey non-use is a ground for cancellation of a trademark and can be used as a defence against the registrant (the existence of bad faith in such filings is currently being debated).
The applicant aims to defend its trademark rights by filing a series of applications that may be similar to its main trademark. In such a way, the applicant may enlarge the protection area of its main trademark.
The applicant files a trademark that is identical to their previous trademark, both in terms of its associated goods or services and the sign itself, to circumvent genuine use requirements by this refiling.
The applicant files a trademark application knowing that the trademark is subject to absolute or relative grounds for refusal; however, concealing these grounds, the applied-for trademark is considered fraudulent.
The burden of proof of the existence of bad faith lies with the plaintiff in the proceedings, as the good faith is presumed until the opposite is proven.
According to a recent decision of the Supreme Court of Appeals, 'bad faith' in filing a trademark application is defined as "the intention of blackmailing or making an unfair profit or preventing third parties' trade activities rather than using a trademark". The Supreme Court of Appeals considers that an application to register a trademark that is similar to an earlier trademark, even when the earlier trademark is well-known, cannot be deemed to have been filed in bad faith based solely on its similarity to an earlier trademark.
This decision is in line with EU practice. In the European Union, whether an applicant acted in bad faith when filing a trademark application depends on an overall assessment that considers all of the factors relevant to the particular case. The following factors are the most relevant for the existence of bad faith according to EU case law:
As in the European Union, the above factors are commonly accepted grounds for evaluating bad faith claims and defences in Turkey. However, there are many other examples of bad faith in trademark applications.
The TURKPATENT Higher Council has determined that the refiling of a trademark subject to a cancellation action cannot be deemed to be in good faith. Moreover, the prior registration will not constitute an acquired right against the new filing. This case is also discussed before the Specialised IP Court of Ankara, which approved TURKPATENT's decision. Nevertheless, the issue of refiling a trademark (not subject to a cancellation action) remains open.
EU case law includes examples where trademarks were refiled to circumvent the law. According to EU case law, a party which files an application for a trademark that is identical to a previous trademark, both in terms of its associated goods or services and the sign itself, cannot circumvent the genuine use requirements by this refiling.
Significantly, the IP Code also states that compensation claims for damages caused by negligence or lack of good faith on the part of a trademark owner are preserved by the IP Code.
In the past, trademark invalidation decisions took effect from the filing date of the trademark. Even if a trademark was registered in bad faith, the use of the registered trademark was not considered trademark infringement or unfair competition by the courts.
Since 2010, the courts have reversed their decisions and started to accept compensation claims with regard to damages caused by trademark registrations filed in bad faith. This change of practice mirrored the IP Code – the law clearly preserved the right to claim compensation for damage caused by negligence or lack of good faith on the part of the trademark owner. Accordingly, regardless of the grounds of the invalidity against a trademark, the party whose rights are damaged due to a trademark registered in bad faith may claim compensation for such damages.
For further information on this topic please contact Elif Türkan Dinçer or Emre Kerim Yardimci at Deris Attorney At Law Partnership by telephone (+90 212 252 6122) or email (firstname.lastname@example.org or email@example.com). The Deris Attorney At Law Partnership website can be accessed at www.deris.com.tr.
The materials contained on this website are for general information purposes only and are subject to the disclaimer.
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