European Court of Justice Extends Injunction Granted in One Jurisdiction to Entirety of European Union
Following the Opinion of Advocate General Pedro Cruz Villalón of October 7, 2010, Court of Justice of the European Union (CJEU) has held that an injunction granted by a national court of one member state under proceedings under the Community Trademark Regulation (40/94/EEC, now replaced by 207/2009/EC) has effect, in principle, throughout the EU. DHL Express France SAS v. Chronopost SA, Case C-235/09 (CJEU, Apr. 12, 2011).
Chronopost owns a Community Trademark and French trademark for WEBSHIPPING covering services relating to logistics and data transmission. DHL Express used the word WEBSHIPPING to designate its online-accessible express mail management service. Chronopost issued proceedings in France against DHL for infringement of both its French and Community Trademarks. At first instance, the Tribunal de Grande Instance de Paris (Regional Court, Paris), which heard the case as a Community Trademark Regulation (CTM) court, found that DHL had infringed Chronopost’s trademarks and issued an injunction against DHL. It also imposed a financial penalty on DHL should DHL fail to comply with the injunction. The court declined, however, to grant Chronopost’s request that the injunction be extended to the entire area of the EU. Instead, the court restricted the injunction to French territory. DHL appealed to the Cour d’appel de Paris (Paris Court of Appeal) and Chronopost appealed on the territorial scope of the injunction. The appeal court made a reference to the CJEU requesting clarification as to the territorial scope of the injunction and the financial penalty imposed by the French court.
The CJEU noted that a CTM has unitary character, providing the owner protection against infringement across the whole of the EU. Further, the objective of Article 98(1) of the 1994 CTM Regulation (which governs the sanctions a CTM court may impose on a finding of infringement or threatened infringement) is the uniform protection, throughout the entire EU, of the right conferred by the CTM against the risk of infringement. Thus, the court explained that in order to ensure that uniform protection, a prohibition against infringement must extend to the entire area of the European Union. If the territorial scope of that prohibition were limited to the territory of a particular member state, an ongoing risk would exist that the defendant would begin to exploit the mark at issue afresh in another member state. This would force the trademark proprietor to bring separate judicial proceedings in each separate member states, which would lead to a risk of inconsistent decisions.
The CJEU acknowledged, however, that the territorial scope of a prohibition might in some circumstances be restricted. The exclusive right of a CTM owner is conferred in order to enable the proprietor to protect his specific interests in the trademark. Accordingly, the exercise of that right is reserved to cases in which a third party’s use of the mark affects, or is liable to affect, the functions of the CTM. If a CTM court held that the acts of infringement or threatened infringement are limited to a single or certain member states, for example, if the defendant proves that use of his allegedly infringing mark will not affect the functions of the claimant’s mark in other member states on linguistic grounds, then the court must limit the territorial scope of the injunction to exclude those member states.
The CJEU also held that any coercive measures ordered by a CTM court by application of its national law, such as a periodic penalty payment, must extend to the whole of the territory for which the injunction is granted. Where the national law of a member state does not contain a coercive measure similar to that ordered by the CTM court, it must achieve enforcement in accordance with its own national laws.
Practice Note: The decision is significant as a contrary ruling would have meant that CTM owners would have had to pursue infringers in multiple EU member states. However, there is still scope for difficulties concerning coercive measures, not least where a national court does not have the power to order a particular measure but needs to ensure that it is complied with in an equivalent manner.