Contracts concerning industrial property rights often contain non-challenge clauses. In delimitation agreements concerning trade mark law there is regularly a clause according to which the owner of the younger trade mark undertakes not to attack the earlier trade mark and its subsequent applications. In licence agreements for patents or trade marks, there is often a provision according to which the licensee undertakes not to take action against the IP right (patent or trade mark) that is the subject matter of the agreement.
In the present case, the first defendant as seller had transferred the word mark “Leinfelder” for the goods “watches and time measuring instruments; leather and imitations of leather as well as goods made of these for watches and time measuring instruments” to the plaintiff in a partial trade mark transfer agreement. This contract stated, inter alia, as follows:
“The seller undertakes neither to attack the sub-brand himself nor to assist third parties in attacking the sub-brand.”
Further, the 1st defendant as seller and the plaintiff as buyer entered into an asset purchase agreement which stated, inter alia, as follows:
“The seller undertakes not to attack both (i) registered intangible assets and (ii) the use of intangible assets itself, nor to assist third parties in such attack.”
The applicant applied for three EU trade marks with the element “Leinfelder” for the aforementioned goods.
On 10.8.2016, Dr S., a lawyer, filed applications for revocation for non-use against the applicant’s EU trade marks with the EUIPO in his own name as the defendant’s “straw man”.
The plaintiff then brought an action before the Munich courts against the vendor as defendant 1) and its managing directors and shareholders as defendants 2) to 4), according to which the defendants were to be ordered to instruct Dr S. to withdraw the applications for revocation of the plaintiff’s EU trade marks which he had filed with the EUIPO on 10 August 2016. Furthermore, the court should declare that the defendants were jointly and severally liable to compensate the plaintiff for any damage it had suffered and would suffer in the future as a result of Dr S’s applications for revocation of the EU trade marks.
The Munich Regional Court dismissed the action. The Munich Higher Regional Court dismissed the plaintiff’s appeal, referring in particular to a judgment of the ECJ of 16 November 2017, according to which national courts have no power under national law to order that an application for revocation of an EU trade mark filed with the EUIPO be withdrawn (cf. the aforementioned “Carrera” decision of the ECJ printed in GRUR-RR 2018, p. 68 et seq.).
In the appeal proceedings, the Federal Supreme Court had to assume that the non-challenge agreement reproduced above would result in an obligation of the first defendant not to file an application for revocation with the EUIPO against the plaintiff’s EU trade marks either. Therefore, the first question for the Federal Supreme Court was whether such an obligation in a non-challenge agreement is effective.
In case law and literature, the extent to which a non-challenge agreement is effective is disputed.
As far as can be seen, there is agreement that the owner of a right may undertake not to proceed on the basis of that right. In a delimitation agreement under trade mark law, the proprietor of the earlier trade mark typically undertakes not to take action against the younger trade mark and to tolerate the use of the younger trade mark in the course of trade for certain goods/services. Such an obligation is effective according to unanimous opinion. However, it is disputed whether attacks against a trade mark or other protective rights can be waived which are in the public interest and can be asserted by anyone, such as applications for revocation of a trade mark, for invalidity of a trade mark due to absolute grounds for refusal or – in patent law – for filing an action for revocation. With regard to a delimitation agreement under trade mark law, the Düsseldorf Higher Regional Court in particular took the view that obligations not to file an application for revocation of a trade mark or for a declaration of invalidity due to initial absolute grounds for refusal were inadmissible and thus void. Such applications predominantly served the public interest of cleaning up the register and were therefore not subject to party disposition (see OLG Düsseldorf, NZKart 2015, 109). The BGH agrees with the opposing opinion according to which such obligations are also effective (cf. also OLG Munich, judgement of 6.11.2014, Beck RS 2015, 18978; Ströbele/Hacker/Thiering, Kommentar zum Markengesetz, on Section 55, marginal no. 54 et seq.). Trade mark law had subordinated the enforcement of the compulsory use to the initiative of the parties. Since the relevant provisions did not contain a mandatory prohibition to keep trade marks in the trade mark register that were not used in a manner that preserved the rights, a private-autonomous agreement on the assertion of the non-use of a trade mark had to be possible in principle. In addition, the fact that trade mark law grants everyone the right to have a trade mark cancelled due to revocation does not mean that a contracting party who agrees not to make use of this right violates a statutory prohibition pursuant to Section 134 of the German Civil Code or acts immorally pursuant to Section 138 of the German Civil Code. The ECJ’s decision on this question remains to be seen.
If the non-challenge agreement in the present case is valid and accordingly contains an obligation according to which the defendants may not attack the plaintiff’s EU trade marks or have them attacked by a third party, the question further arises whether a national court may order the defendant to withdraw an application for revocation of an EU trade mark that has been filed. Indeed, in the above-mentioned decision, on which the Munich Upper District Court had relied, the ECJ denied such a power. In the case decided by the CFI, an EU trade mark had also been challenged with an application for revocation. The proprietor of the challenged EU trade mark had invoked a non-challenge agreement with the applicant and at the same time applied for a stay of the proceedings before the EUIPO on the grounds that litigation was pending before the Munich I Regional Court on the obligation not to proceed against the challenged trade mark. The ECJ ruled that a non-challenge covenant could not be taken into account in revocation proceedings before the EUIPO on the grounds of revocation. Furthermore, a national court could not order that an application for revocation of an EU trade mark filed with the EUIPO be withdrawn. The BGH takes the opposite view, according to which a national court may well order a defendant to withdraw an application filed with the EUIPO on the basis of a corresponding contractual obligation. The ECJ’s answer to this second question also remains to be seen.
The author agrees with the BGH. If there is an effective contractual agreement that an EU trade mark may not be challenged, there must also be the possibility of enforcing this obligation in court in the event of a breach of such an obligation. If the view of the ECJ in the “Carrera” decision were correct, it would not be possible to take action against such a breach of contract.
