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TRADEMARK INVALIDATION DECISIONS MUST CONSIDER CURRENT CIRCUMSTANCES
A very important issue in trademark practice is: when a determination is made in a trademark invalidation action as to whether the mark's reg-istration was in any way unlawful, should the judgment be based on the facts as they existed at the time when registration was granted, or should it be based on the situation at the time when the invalidation decision is rendered?
Article 52 of the Trademark Act provides that in an invalidation action, the determination of whether there are grounds for declaring a trademark registration unlawful should be based on the legislative provisions at the time when the registration was published, while Article 54 of the Act provides that if an invalidation is granted, the registration of the trademark should be an-nulled. Thus it would appear that in principle, a determination as to whether a trademark registration complies with the law should be based on the factual situation at the time when the registration was published.
However, the proviso to Article 54 provides that if the situation that made a registration unlawful no longer exists at the time when a decision is rendered in an invalidation action, then after considering the public interest and the interests of the parties, the invalidation may be rejected. From this it would appear that the time point to be taken as the basis for determining whether a trademark registration is lawful is the time of the decision in the invalidation action.
In a 2007 judgment, the Supreme Administrative Court, addressing the issue of the applicability of Article 54 of the Trademark Act and its proviso, held that if a trademark has been in use for many years after registration, the commercial reputa-tion established through the mark's continuous use should naturally be taken into consideration, based on the doctrine of changed circumstances and the doctrine of protection of legitimate ex-pectations with regard to a registrant's reliance on its vested rights; and that when handling an invalidation action, the Trademark Authority is permitted to take into consideration changes in the factual situation that have occurred during the period from the time when the contested trademark was registered until the time of the invalidation decision. This is sufficient to show that the point of reference for the circumstances to be considered in an invalidation action is the time of the invalidation decision, for this is the logical construction of the statute according to the doctrines of changed circumstances and of legitimate expectation. The Court further stated that a situation of unlawful circumstances having ceased to exist, as referred to in the proviso to Article 54 of the Act, includes a situation in which two trademarks have become able to co-exist without risk of confusion or misidentifica-tion.