Calculating the five-year period of non-use of EU Trade Marks

In the case of Husqvarna AB v. Lidl Digital International Gmbh & Co. KG, (Case C607/19) decided by the Court of Justice of the European Union (the “CJEU” or the “Court”) on 17 December 2020, the Court delivered a preliminary ruling concerning the determination of the five-year continuous period of non-use of an EU trademark in a counterclaim for its revocation. Particularly, whether to calculate this time from the date on which the counterclaim is filed or from the date of the last hearing in the appeal on merits.

The preliminary ruling related to Article 51(1)(a) of Regulation 207/2009 and Article 58(1)(a) of Regulation 2017/1001 which concern the grounds of revocation of an EU trademark (previously known as ‘Community’ trademark). Notably Regulation 207/2009 was repealed, with Regulation 2017/1001 starting to apply from 1 October 2017. Both these articles hold that an EU trademark shall either be declared revoked:

• on an application being made to the European Union Intellectual Property Office (the “EU IPO”) or

• on the basis of a counterclaim in infringement proceedings, relating to a number of reasons - one such reason being non-use of the mark for a continuous period of five years, which is what transpired in this particular case. Husqvarna AB (“Husqvarna”) manufactures appliances and tools for gardening and landscaping purposes. They had registered a three-dimensional EU mark on 26 January 2000 for sprinklers for irrigation. Lidl Digital International Gmbh & Co. KG (“Lidl”) offered for sale a spiral hose, sprinkler nozzle and a coupling sleeve from July 2014 until January 2015.

Husqvarna brought an action against Lidl with the view that the product marketed by the latter constituted an infringement of its trademark. Their intention was to chiefly put a stop to the infringement and to also obtain damages. Lidl’s counterclaim was a request for the revocation of Husqvarna’s right in the EU trademark, alleging non-use of that mark for a continuous period of five years, basing itself on the aforementioned Article 51(1)(a) and Article 58(1)(a) of the respective regulations.

The German Regional Court hearing the case had dismissed Lidl’s counterclaim and upheld Husqvarna’s claim. Following this dismissal, Lidl appealed the judgement before the German Higher Regional Court. Following its last hearing on 24 October 2017, soon after Regulation 2017/1001 started to apply, this court set aside the judgement of the Regional Court and declared Husqvarna’s rights in the mark being disputed as revoked from 31 May 2017.

The Higher Regional Court had considered that the relevant date for the purposes of calculating the continuous period of five years of non-use was from the last hearing before it in October 2017, and not in September 2015 when Lidl had filed its counterclaim. This court had concluded that goods protected by the mark were no longer marketed as from May 2012. It held that on the day the counterclaim for revocation was filed in 2015, the continuous period of five years had not passed. Yet, this court still held that such period had indeed elapsed as at the date of the last hearing in October 2017.

In turn, Husqvarna brought an appeal on a point of law before the German Federal Court of Justice. The question that cropped up at this stage was on how to determine the relevant date for the purposes of calculating the five-year period of non-use. According to this court, neither of the mentioned articles indicated the relevant date from when this five-year period was to be calculated, specifically in cases of a request for revocation of rights stemming from the EU trademark by means of a counterclaim.

After due consideration of German law on this procedural matter, the Federal Court of Justice took the view that the relevant date should be that of the last hearing before the court hearing the appeal on the merits. Nonetheless, this court decided to stay proceedings and refer to the CJEU to ask inter alia from when this five-year period is to be calculated in the case of a counterclaim for revocation of rights in an EU trademark that is filed prior to the expiry of the five-year period of non-use referred to in Article 51(1)(a) of Regulation 207/2009 and Article 58(1)(a) of Regulation 2017/1001. More specifically, which of these dates was it to consider:

• date on which the counterclaim was filed, or

• date of the last hearing in the appeal on the merits.

The CJEU in turn noted how Article 55(1) of Regulation 207/2009, holds how from the date of the application for revocation or from the counterclaim, the EU trademark is deemed not to have the effects that come with this trademark. By way of example, such effects would include the proprietor of the trademark being able to prevent all third parties which do not have their consent, from making use of this mark within the course of trade. Article 55(1) continued to state that an earlier date than the date on which the grounds for revocation occurred could be fixed in the decision, upon the request of any one party. However, there is no similar provision allowing the possibility of fixing a later date than when the counterclaim was filed, exceptionally or otherwise.

Following such reasoning, the CJEU saw that in the occurrence of a counterclaim for revocation, the continuous period of five years of non-use as per Article 51(1)(a) of Regulation 207/2009 would not be consistent with the consequences of revocation, if this period were to be considered from the date of the last hearing of the appeal on merits. Furthermore, the CJEU held that the counterclaim can only be successful if the circumstance leading to it would have been established on the date when this same counterclaim was filed.

In observations submitted by the Italian Government and the European Commission, it was pointed out how the merits of a counterclaim for revocation alleging a five-year period of nonuse cannot depend on the length of national proceedings. That is to say, this five-year period cannot be calculated on the date of the last hearing of the appeal on merits, as understandably such times would invariably vary from one Member State to another, if not even within the Member State itself.

In giving its ruling, the CJEU decided to address the question solely within the scope of Regulation 207/2009, basing this decision on how on the date when the counterclaim was filed, Regulation 207/2009 was still applicable. This does leave the door open for the CJEU to address the situation discussed within the scope of Regulation 2017/1001.

The CJEU finally ruled that within the scope of Article 51(1)(a) of Regulation 207/2009, in the case of a counterclaim for revocation of rights in an EU trademark, the relevant date for the purposes of determining whether the continuous five-year period has ended, is the date on which the counterclaim was filed.