"Beholden to no-one" -- a new defence to IP infringement claims?

Legitimate use -- or the wrong side of the line?

No stranger to the highways and byways of the internet, the IPKat strayed across this little item on BMW-DRIVER.NET. It's called "BMW Taking on Eddie at BMW care" and it reads like this:

"Anybody read this in the paper on Sunday? My dad rang and asked had I heard the name BMWcare. I just bought the day access to Sunday Times to download it [this proves that some people are prepared to pay for access to online material, but this is not the point of this post so please read on ...]

Quote:
BMW, which declared €834m profits for the second quarter of this year, has launched a High Court action against an Irish mechanic who specialises in repairing its cars.

The German manufacturer is seeking to gain control of Eddie Ronayne’s website, BMWcare.com, and to obtain a court order preventing him from “passing off” his business as being authorised.

Ronayne, who is expected to fight the case, denies BMW’s claims that he infringed its copyright [Copyright in a domain name? Or is this another instance of journalistic license to abuse IP concepts? Never mind. Read on!] or is passing himself off as an approved mechanic. “This matter is vital to my ongoing business surviving,” said Ronayne, who is based in Cloonfad, near the Roscommon border with Galway.

Ronayne has owned the website BMWcare.com since 2006 and registered BMWcare as a business name with the Company Registration Office that year. The one-page website says that he provides a “second opinion” and is “independent” and “beholden to no-one” [Merpel's a bit puzzled here. Does 'independent' and 'beholden to no-one' mean he's not married?].

The site claims to have saved some drivers “hundreds” in repair costs. Ronayne cites several endorsements from contributors on BMW-owner websites. Although Ronayne has not filed any accounts with the CRO under that name, it is understood he claims to make at most €25,000 a year from the business. ...

BMW said its case against Ronayne concerns alleged trademark infringement [whatever happened to the copyright and passing off?] because of his use of the BMW name and logo. “BMW and its dealers invest a great deal in training and equipment in order to assure highest quality and service standards. BMW also strives to ensure that the use of the brand is consistent,” said a spokeswoman.

Large companies have a mixed record in legal actions where they have tried to stop other businesses using their logos. In 1999, BMW lost a case when the European Court of Justice found the “honest” use of trade marks by third parties was necessary to preserve undistorted competition" [and here it is: Case C-63/97 BMW v Deenik].

The nub of the ruling in that case, says the IPKat, is that

"...[The infringement provisions] of First Directive 89/104 [now Directive 2008/95] do not entitle the proprietor of a trade mark to prohibit a third party from using the mark for the purpose of informing the public that he carries out the repair and maintenance of goods covered by that trade mark and put on the market under that mark by the proprietor or with his consent, or that he has specialised or is a specialist in the sale or the repair and maintenance of such goods, unless the mark is used in a way that may create to the impression that there is a commercial connection between the other undertaking and the trade mark proprietor, and in particular that the reseller's business is affiliated to the trade mark proprietor's distribution network or that there is a special relationship between the two undertakings.".

Use of the word "BMW" was considered to be permitted on the facts of Deenik, which however dealt neither with logos nor with domain names.  In Ronayne's case it is difficult to comment with no facts other than those mentioned above. However it seems that, in principle, Ronayne can't be prevented from using "BMW" altogether if he is also indicating what he does to BMW cars for a living and is not conjuring up the impression that he and BMW are connected.  If that is the case, the responsible and non-misleading use of the same word as part of a domain name containing a word trade mark should be at least capable of being brought within the same rule.  However, use of the logo sounds like a bridge too far for the defence to cross, unless it can be used in a manner that clearly indicates the absence of a commercial connection between Ronayne and BMW.  Merpel chirps in, "what about displaying a logo together with the  words 'Broken BMW logos mended here'?"

Configure your own BMW here

BGH on the use of a well-known car maker’s trade mark in advertisements for a garage business

The German Federal Supreme Court’s (Bundesgerichsthof, “BGH") First Civil Senate on 14 April 2011 (case reference: I ZR 33/10) had to decide on a case concerning the use of a well-known car maker’s device mark in advertisements for an independent garage business. The facts of this case are reminiscent of the facts in the ECJ’s famous BMW/Deenik decision of 1999 (case-63/97). Please find this Kat's translation and summary of the BGH’s press release of 19 April 2011 below.

The claimant, the well-known German manufacturer Volkswagen AG („VW“), is the proprietor of a device trade mark which depicts the VW logo in a circle and which covers, inter alia, “cars” and “car repair and maintenance”. The defendant, ATU Auto-Teile-Unger Handels GmbH & Co. KG (“ATU”), owns several hundred independent (as in: unrelated to a specific car brand) garages.

VW took objection to the defendant’s use of the VW device mark in ATU’s advertisements for ATU’s maintenance and repair services in relation VW motor cars. The first instance court, the Regional court of Hamburg (LG Hamburg, decision of 21 February 2008, case reference: 315 O 768/07) and on appeal the Higher Regional court of Hamburg (OLG Hamburg, decision of 16. December 2009, case reference: 5 U 47/08) both decided in VW’s favour.

 The BGH confirmed the lower courts' decisions on ATU’s further appeal. The BGH took the view that ATU’s use was infringing use of the claimant’s registered device trade mark. In its advertisements for repair works of VW cars, the defendant had used a device trade mark that was identical to the claimant’s device mark for identical services. By doing so the defendant had infringed the claimant’s trade mark since the use of the well-known logo resulted in an image transfer which weakened VW’s trade mark.

Are you now wondering 'but what about the ECJ’s guidance in BMW/Deenik?', since the ECJ appeared to have taken a perhaps more liberal view back in 1999? While BMW/Deenik is not expressly mentioned in the BGH’s press release, the VW/ATU decision is clearly an interpretation of the former and this Kat hence holds any bet that BMW/Deenik is discussed in much detail in the grounds of VW/ATU which are yet unavailable. In the meantime, however, the BGH’s press release tells us the following: while trade mark law provides that a trade mark proprietor cannot prohibit a third party from using the trade mark where it is necessary to indicate the intended purpose of a service provided the third party uses the trade mark in accordance with honest practices in industrial or commercial matters. The BGH decided that in this particular case these requirements were not met in the case of ATU’s use of the VW logo since ATU could have just as well (“ohne weiteres”) used the claimant’s word marks “VW” or “Volkswagen” to describe its services and was not dependant on the to use the device mark.

Merpel now muses whether this decision implies that the advertising function of a device mark could be more worthy of protection than the advertising function of a mere word mark? Also, what would happen if the claimant had only owned a device mark without a word element or vice versa? The answers to these (and other) questions will (hopefully) be in the grounds of the decision and this Kat is very keen to see the BGH’s interpretation of “where it is necessary to indicate the intended purpose of a product or service”, (see also Article 6 TM Directive). For the purposes of informing consumers in an advertisement, use of the word mark itself will in most cases suffice and it will not be “necessary” to use the device mark. Most notably the BGH’s press release states that “in this particular case” use of the device mark was not necessary. It does not state that use of a device mark in advertisement can never be necessary. Some German observers have already criticised that this decision appears to favour brand-associated/authorised garages over independent garages. We will be able to judge once the full decision is out...

The court’s press release of 19 April 2011 can be retrieved by clicking here.