Claim for fraudulent filing

In French law, there is a general principle of law that fraud corrupts everything (” Fraus omnia corrumpit “).

Article L.712-6 of the Intellectual Property Code provides that in the case of trademarks:

“If a registration has been applied for either in fraud of the rights of a third party or in violation of a legal or contractual obligation, the person who believes he has a right to the trademark may claim ownership in court.

Unless the applicant is acting in bad faith, the claim shall be barred after five years from the publication of the application for registration. ”

Fraud, which allows the true owner to be attributed the unduly registered trademark, is defined as the fact of registering a sign, under a regular appearance, but with the knowledge of the existence of the use of an earlier similar distinctive sign and with the sole intention of harming a market player, for example, by preventing him from exploiting and distributing his products in France.

French case law, following that of the European Union, has clarified that in the case of fraudulent filings, the bad faith of the trademark owner :

“…] must be assessed as a whole, taking into account all relevant factors of the case.species existing at the time of the filing of the request for registration including the fact that the applicant knows or should know that a third party useuses an identical or similar sign for an identical or similar goods lending to confusion with the sign of
have the registration is requestedthe intention of the applicant to prevent this third party to continue to use such a sign as well as the degree from legal protection enjoyed by the sign of the third party and the sign whoseregistration is requested.” (see in particular the following cases: Paris Court of Appeal, October 7, 2016, No. 16-02.229; referring to ECJ judgment, June 11, 2009, Case. C-529/07, paragraph 39).

Thus, the Paris Court of Appeal considered that the filing as a trademark of a sign that had been used for a long time by a company operating in the textile industry to designate a range of jeans was fraudulent, particularly since :

• In view of the overall circumstances surrounding the contested filing, the applicant could not have been unaware of the use of the contested sign by the plaintiff;
• The applicant had never used the disputed sign as a trademark and had merely reserved a domain name;
• The commercial logic of the contested trademark filing was itself obscure due to the lack of evidence to establish an activity of the applicant in the clothing sector;
• The applicant had made a multitude of other similar unjustified filings.

In a recent case involving a pseudonym, Kanye West won a claim against a person who had registered the sign YEEZY for pharmaceuticals in class 5, vehicles of all types in class 12, and beer and soft drinks in class 32.

The Judicial Court, by a non-final judgment of February 8, 2022 (Judicial Court, February 8, 2022, No. 21-09.242), held that:

” M. West, whose extreme celebrity is notorious, justifies that he designates himself, is designated and is commonly designated by the public under the nickname of “Yeezy” which, without being the only one of his nicknames, benefits from a great fame and is the object of an intensive use, in particularly important commercial operations as his collaboration with Adidas, in political actions such as the announcement of his candidacy for the presidential election in the United States (“Yeezy for president”), which was relayed by the French press, or in a roundabout way in the title of one of his albums in 2015, “Yeezus”, a pun on the English pronunciation of “Jesus”.

European trademarks “Yeezy” are thus registered in many classes of goods or services, and exploited by the company Mascotte Holdings.

In this case, it follows from a cluster of evidence that there is no doubt that Mr. H. could not be unaware, at the time of filing the French trademark YEEZY n° (20)4648404, of the existence, role and notoriety of the sign YEEZY in all fields of activity, and more particularly of Mr. WEST’s future development projects.

While Mr. Harbaoui’s trademark has been registered in other good classes than those of Mr. West [ce dernier] is known to develop its activities in a growing number of fields, and is notably known for an interest in vehicles. Beverages are also notoriously used as merchandise and are therefore a predictable area of expansion for a world famous entertainment professional.

However, Mr. Harbaoui’s trademark registration does not correspond to any economic logic: it was made by a person registered in the trade directory in the field of aeronautical and space construction, for goods unrelated to this activity and moreover unrelated to each other, and was not followed by any exploitation.

Prior to this filing, Mr. Harbaoui had already filed 16 trademarks that clearly infringed on the interests of third parties, with no other intention than to take advantage of their reputation or even to create an obstacle to their activities: thus, 9 “Google” or “Google car” trademarks, 4 “Adidas” trademarks, a trademark that changed the acronym of the PSG soccer club to “Paris sporting group (PSG)”, and 2 “Universal” trademarks. Finally, the filing took place shortly after the announcement that Mr. West had become a billionaire, which Mr. Harbaoui, whose choice of the term “Yeezy” is otherwise unaccountable, obviously knew about.

It follows that Mr. Harbaoui filed the complaint in order to knowingly impede the foreseeable expansion of the plaintiffs’ business. It must, therefore, be returned to Mr. West. ”

Thus, a trademark registration can be considered fraudulent even though the the designated good(s) and/or service(s) would not be similar to those exploited under the later trademark filed in bad faith by a third party – it being specified that in such a case, the notoriety of the sign taken over plays an important role in the characterization of bad faith.

Update on fraudulent filings in China

China is a country in which a very large number of fraudulent trademarks are registered, in the name of individuals or companies that are difficult to identify.

The practice of fraudulent filings continues to grow in this territory. The Chinese authorities, aware of this scourge, are more and more attentive to these acts and are changing the rules applicable in this matter.

China’s trademark law has recently been amended and now specifically provides that a trademark application filed in bad faith must be rejected. These provisions are effective as of November^1, 2019.

Update on limitation periods for claims

Article L.712-6 paragraph 2 of the Intellectual Property Code provides that the action to claim ownership of a trademark is prescribed by 5 years, unless the applicant is in bad faith.

In such a case, such an action will not be subject to the statute of limitations, provided that the plaintiff in the action demonstrates the bad faith of the third party.

Update on the revocation action

Contrary to the practice of certain Intellectual Property Offices, for example the INPI in France and the EUIPO at the European Union level, some Offices check the availability of the sign at the filing stage.

This is particularly the case for China. The Chinese Office may then refuse to register a trademark application based on the existence of an identical or similar earlier trademark filed or registered in that territory.

However, if the cited sign is similar to a fraudulent filing, it may be appropriate to file a nullity or revocation action against this trademark in order to obtain its cancellation and thus overcome the refusal pronounced by the Office – it being specified that the time limit for filing a revocation action in China is 3 years from the registration of the litigious trademark.

The success of the proceedings will then depend on the evidence available to the plaintiff to characterize the similarities between the signs and the good(s) and/or service(s), as well as the bad faith of the owner of the litigious mark.

Point of jurisprudence

In a case opposing a company specialized in the manufacture and sale of gingerbread to its former employee, the ‘Cour d’appel de Rennes’ considered, by a decision of December 10, 2013, that the fraudulent nature of the registration of the trademark “Secrets Délices” made by the said employee 4 months after his hiring was established.

The Court of Appeal held ” that it results from the certificate [de la société] that as early as June 26, 2006, price offers for labels of the Secrets Délices range were sent to the company ETABLISSEMENTS LA MESSUZIERE. [Le salarié]a commercial company, collaborated in the design of these labels. He was aware of his employer’s ongoing development of this name. He does not provide evidence that he created this trademark.

It thus appears that he was aware of this development and that the first commercializations of SECRETS DELICES products in the medium and large surfaces were made from May to July 2006 […], then that estimates were requested for the purposes of new labelling, […] and all that before the filing by Mr. SAINDRENAN of the trademark.

The commercial flow noted by the first judges is also corroborated by an exhibit produced by the appellant (its exhibit 11) which establishes that a commercial operation was set up as of May 29, 2006 in a Leclerc store.

Knowledge through [le salarié] of the previous rights and of the beginning of use of the name of SECRETS DELICES at the time when he filed the trademark of it with the proven goal to reach the rights of his employer sign his bad faith, precision brought that the condemnation [du salarié] for a case of fraud, totally unrelated to the present dispute or the existence of the current labour tribunal proceedings, is of no interest in this case.

It should also be noted that, having registered its trademark, [the employee] does not justify any use of it for any product whatsoever. ” (Cour d’appel de Rennes, December 10, 2013, No. 2012-03.583).

The Bouchara Law firm assists you in particular in :

• Conducting prior art searches prior to trademark application;
• Monitoring your trademarks;
• Protection and defense of your trademarks before the Intellectual Property Offices (INPI, EUIPO, WIPO) and the Courts;
• Actions to defend your trademarks (opposition, invalidity action, revocation action, seizure of goods, infringement action);
• Determining the fraudulent nature of filings;
• The action to reclaim fraudulent filings;
• Possible negotiations with the applicant.