Editor's note: Italian company Bulgari, S. p. A. (Hereinafter referred to as Bulgari) Sue Spanish company VICINANZA TRADIND, S. L. Unauthorized removal of traceability codes and distribution of genuine products BVLGARI The perfume infringes its EU trademark rights. Read on for the verdict!

[background] Italian company Bulgari, S. p. A. (Hereinafter referred to as Bulgari) Sue Spanish company VICINANZA TRADIND, S. L. Unauthorized removal of product traceability coding (Figure 1) After the distribution of genuine goods BVLGARI The perfume infringes its EU trademark rights. FIG. 1 The EU Trademark Court of Alicante ruled in favour of the plaintiff's claim, Found that the act of removing the product traceability coding resulted in the exhaustion of trademark rights principle (principle of exhaustion) No longer applicable, Defendant distribution BVLGARI The action of the product infringes the plaintiff's EU trademark rights. The court held that the removal of product traceability coding had a direct impact on product reputation, because "The conduct showed that the defendant's market operation was defective" . simultaneously, Also for the product may come from the European Free Economic Area (European Economic Area) In addition to provide strong evidence, That is, it is not put into the market by the trademark owner or the third party authorized by the trademark owner. however, The Court of First instance judge held that the defendant was engaged in a selective distribution system (selective distribution system) The act of selling a branded product outside the designated scope, No infringement of plaintiff's trademark rights. The reason is that, No proof, The defendant distributed to it BVLGARI Retailer of product, Failure to comply with the conditions of sale set to protect the reputation of the mark. Both parties appealed against the decision of the first instance.

[discover] The EU Court of Appeal for Trademarks first confirmed, Removing the traceability code of the product and releasing it into the market violates Bulgari Trademark right. And further points out that, The plaintiffs did not prove that the products in question came from outside the European Free Economic Area, But the defendants also failed to provide evidence that the products they sold came from the European Free Economic Area, Therefore, it is determined that the defendant shall not claim the principle of exhaustion of trademark rights. In addition, Remove product traceability coding, It can be regarded as the product through parallel import (parallel imports) Access to the European Free Economic Area market. The appellate court also noted, As long as it can be proved that a trademark use harms the value of the trademark, Damage the trustworthiness and quality image of products using the trademark, Or undermine the trademark's ability to attract the relevant consumer public, It can be determined that the use of the trademark infringes the trademark right and can not claim the principle of exhaustion of rights. See EU Trademark Court 2016 years 5 month 6 Day control 116/16 Number judgment (Case number: ECLI: ES: APA: 2016: 1272) . secondly, The appellate court reversed the trial court's decision that selling products outside the territory designated by the selective distribution system did not constitute trademark infringement. The appellate court ruled that, The defendant shall not claim that only the end retailer accepting its supply is required to meet the conditions of sale of the selective distribution system, They are therefore exempt from liability for the products they provide. The appellate court made that clear, As a distributor, The defendant shall "Explicitly require their end retailers to comply with the conditions of sale of the selective distribution system, Otherwise, the supply will be stopped" . See Court of Appeal, Barcelona 2014 years 10 month 29 Judgment of day (Case number: ECLI: ES: APB: 2014: 11516) . Therefore, Appellate decision, The act of selling products outside the scope defined by the selective distribution system infringes the trademark right. The reason is that, The defendant, who was the distributor, did not take any control at the time of the actual supply, Nor is it required that the retailer receiving the supply take any measures to protect the trademark BVLGARI Value and reputation. [comment] What we can conclude from this verdict is the following: First of all, The EU Trademark Court has followed the criteria set in previous decisions, That is, the act of removing the traceability code of products is regarded as the recognition of products entering the European Free Economic Area market through parallel imports, In the absence of evidence to the contrary, It can be determined that the behavior infringes the trademark right. secondly, Violation of product traceability coding "Eu trade mark regulation (No. 207/2009) " The first 13 article 2 Provision of paragraph. If it can be proved that the act harmed the inherent image of the trademark, reputation, Credibility or quality, etc, It can be found to constitute infringement. Finally, Although we cannot simply conclude that selling products to retailers outside the scope of the selective distribution system necessarily constitutes infringement, But as long as the distributor does not do his utmost to uphold the value and reputation of the trademarks of the products they distribute, It shall bear the liability for damage to the image of the trademark.

author: Joaquín ROVIRA, Compiled by lawyer Elsabry: Li Fangqian, The source of Aisabri interns: Esabaril (ELZABURU) Intellectual property rights