August 15, 2022
The claimant, Heitec AG, has been trading since 1984 under the name Heitec. It is the owner of an EU registered trade mark for HEITEC, which claimed seniority from 13 July 1991 and was registered on 4 July 2005.
The defendant, Heitech Promotion GmbH, has been trading since April 2003 under the name Heitech. It owns a German figurative trade mark containing the word HEITECH (the German HEITECH Mark), which was registered on 4 February 2003 and which it has used since 29 September 2004 at the latest. It also owns an EU figurative mark containing the word HEITECH (the EU HEITECH Mark), which was registered on 20 November 2008 and which it used from 6 May 2009.
In 2004, Heitech wrote to Heitec proposing that the parties enter into a coexistence agreement. Heitec did not reply.
In July 2008, EUIPO told Heitec about Heitech’s application for the EU HEITECH Mark. Heitec did not take action to oppose the application.
In April 2009, Heitec wrote to Heitech warning against its use of the Heitech name and the EU HEITECH Mark. Heitech responded by again proposing a coexistence agreement.
In December 2012, Heitec issued proceedings in the German courts against Heitech for infringement of its trade name, Heitec, and of its EU mark for HEITEC due to Heitech’s use of the signs “Heitech” and “Heitech Promotion” (the Signs), as well as its use of the German HEITECH Mark and the EU HEITECH Mark. It did not serve the proceedings on Heitech at this time.
In September 2013, Heitec wrote to Heitech to inform it that it was not willing to enter into a coexistence agreement and offering a licence instead. It also informed Heitech of the legal proceedings. The documents were finally served on Heitech in May 2014.
Heitec’s claim was dismissed at first instance. Heitec appealed and the action was dismissed on the grounds that Heitec was time-barred. The appellate court said that Heitech had used the Signs for an uninterrupted period of at least five years and that Heitec had acquiesced to that since, although it was aware of this use, it had not taken sufficient measures to stop it within a period of five years. The appellate court said that the first instance proceedings had not interrupted the limitation period because they had not been served on Heitech until after five years had elapsed since Heitec had sent the warning letter. The appellate court also held that acquiescence had not ended when the warning letter was sent since it had taken Heitec a further three years to issue the proceedings.
Heitec appealed to the Federal Court of Germany, which said that the outcome depended on whether Heitec was time-barred from bringing its claims under Articles 54(1) and (2) and Article 111(2) of the Trade Mark Regulation (207/2009/EC). It also referred four questions to the Court of Justice of the European Union in relation to the conditions for “acquiescence” under Articles 9(1) and (2) of the Trade Mark Directive (2008/95/EC) and Article 111(2) of the Regulation.
The CJEU was asked whether merely sending a warning letter to the alleged infringer, without initiating legal proceedings, could end acquiescence.
The CJEU held that the concept of “acquiescence” means that the proprietor of an earlier mark/right takes no action even though it is aware of the use of a later mark and could, in fact, act against it to remedy the alleged infringement of its rights (C‑482/09 Budějovický Budvar EU:C:2011:605). If the proprietor of the earlier mark/right has acquiesced in this way for a period of five consecutive years, it is time-barred from seeking a declaration of invalidity or opposing the use of the later mark.
As for interrupting the five-year period of limitation in consequence of acquiescence, pursuant to Budějovický Budvar, the bringing of an administrative or court proceedings before the expiry of that period will be considered to end acquiescence because by taking this action, the proprietor of the earlier mark/right is unequivocally expressing its wish to oppose the use of the later mark and to remedy the alleged infringement of its rights.
Where, as in this case, the issuing of proceedings is preceded by a warning letter, with the requirements of which the proprietor of the later mark does not comply, that warning letter may interrupt the period of limitation in consequence of acquiescence provided that, following the unsatisfactory response to that warning letter, the proprietor of the earlier mark/right continues to express its opposition to the use of the later mark and takes the measures available to it to enforce its rights.
If, however, the proprietor of the earlier mark/right does not then bring administrative or court proceedings within a reasonable time, it must be inferred that it has failed to take the measures available to it to put an end to the alleged infringement of its rights and that no interruption of the acquiescence period has occurred.
The CJEU said that to find that sending a warning letter is sufficient to interrupt the period of acquiescence would allow the proprietor of the earlier mark/right to circumvent the acquiescence regime by repeatedly sending a warning letter every five years. This would undermine the objectives of the regime.
The CJEU was also asked whether the period of acquiescence can be halted by the proprietor of the earlier mark/right issuing court proceedings seeking a declaration of invalidity of the later mark or opposing the use of that mark before expiry of that period, but not serving such proceedings on the defendant until after that date.
The CJEU considered the date on which court proceedings are deemed to have been brought, noting that, according to case law, the date is the date proceedings are issued, but only if the claimant has not subsequently failed to take steps to effect service on the defendant.
Generally, the issuing of court proceedings will reflect a genuine wish of the claimant to assert its rights, which would be sufficient, in principle, to end acquiescence, the CJEU said. However, in certain situations, the conduct of the issuing party may raise doubts as to the serious nature of the proceedings. That will be the case where, owing to a lack of diligence by the claimant, the proceedings are not served on the defendant in accordance with national laws on service. In that situation, the issuing party cannot claim to have put an end to acquiescence. It is only by completing the process of issuing proceedings in accordance with the requirements of national law that the issuing party will have unequivocally expressed a clear and serious intention to assert its rights.
The CJEU said that it is for the national court to decide the date on which the issuing of court proceedings is completed through service on the defendant. In this case, if that date is found to be after the expiry of the limitation period of acquiescence, it is for the national court to assess whether that was mainly due to Heitec’s conduct, which the CJEU said could be characterised as a lack of diligence. If that is found to be the case, the national court would have to conclude that Heitec’s action was time-barred.
Finally, the CJEU held that where the proprietor of an earlier mark/ right is time-barred from seeking a declaration of invalidity of a later mark and from opposing the use of that mark, that proprietor is also time-barred from bringing ancillary or related claims, such as claims for damages, the provision of information or the destruction of goods. The CJEU said that to find otherwise would be contrary to the objectives of the regime for limitation in consequence of acquiescence. (Case C-466/20 Heitec AG v Heitech Promotion GmbH EU:C:2022:400 (19 May 2022) — to read the judgment in full, click here).