This is what the EU Court of Justice has affirmed in a recent decision of 18 May 2017, in the proceeding C-617/151.
The proceeding originated from a trademark infringement appeal promoted by the Danish company Hummel against Nike and Nike Retail (companies of the same group) for an alleged infringement of an international trademark by the US giant.
After the Düsseldorf Regional Court declared itself competent on the first degree, considering Nike Deutschland an "establishment", but rejecting the appeal on ground of merit, Hummel has proposed an appeal to the German court judges on the second degree who, in order to determine their jurisdiction to rule on the dispute, they had to request the intervention of the Court of Justice on the notion of “establishment” pursuant to Art. 972, first paragraph, Regulation EC 207/20093.
According to the abovementioned rule, the disputes on the European trademarks «are submitted before the courts of the Member State in which the defendant is domiciled or, in case he is not domiciled in one of the Member States, before the court of the Member State in which he has a permanent establishment».
However, the same regulation does not provide a clear and unambiguous definition of "establishment".
Therefore, the Court has preliminarily clarified that the notion of "establishment" does not have the same scope in the Regulation EC 44/2001 on the jurisdiction, identification and execution of judgments of civil and commercial matters and in the Regulation EC 207/2009 on the European trademark, pointing out that the two regulations pursue different objectives:
(i) the first aims to complete the domicile standard criteria of the defendant by providing alternative court, whereas
(ii) the second aims to strengthen the protection of the European trademarks, avoiding conflicts among judgments of the various Member States and the damage to the unitary character of the European trademarks.
Consequently, from a close examination of the issue raised by the German Judges, after stating that Art. 97 above guarantees the existence of a court within the EU for all the controversies concerning the infringement and the validity of an European trademark, it has provided unique criteria to use in order to clearly identifying the concept of “establishment”.
Therefore, it has stated that for the identification of an establishment, the existence of material clues is necessary to easily identifying their existence, such as:
- a real and permanent presence of an organization, performing a particular business activity and which is complete of staff and commercial material equipments;
- the manifestation of the company abroad over the long term as an extension of a parent company.
On the contrary, the absence of a legal representative within the establishment and the possibility that the latter is only indirectly controlled and that the subsidiary participated in the infringement is irrelevant.
The Court of Justice has added that the criteria of "establishment" is not an exception to the principle of the court of the defendant's domicile, but rather it represents the realization, placing the defendant in the most favorable conditions to defend himself.
The intervention of the European Court has been considered innovative and necessary in order to exhaustively establish, without any further doubts for the future, the elements which characterize the notion of "establishment" pursuant to Article 97, paragraph 1, of the Regulation No. 207/2009.
This interpretation represents an evolution for the international competence concerning the protection of the community trademark and the solution to a phenomenon, that of the infringement through "establishments", which is an increasingly pervasive danger for the companies of the European Union.
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1http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62015CJ0617&from=IT
2Legal context
- Subject to the provisions of this Regulation as well as to any provisions of Regulation (EC) No 44/2001 applicable by virtue of Article 94, proceedings in respect of the actions and claims referred to in Article 96 shall be brought in the courts of the Member State in which the defendant is domiciled or, if he is not domiciled in any of the Member States, in which he has an establishment.
- If the defendant is neither domiciled nor has an establishment in any of the Member States, such proceedings shall be brought in the courts of the Member State in which the plaintiff is domiciled or, if he is not domiciled in any of the Member States, in which he has an establishment.
- If neither the defendant nor the plaintiff is so domiciled or has such an establishment, such proceedings shall be brought in the courts of the Member State where EUIPO has its seat.
- Notwithstanding the provisions of paragraphs 1, 2 and 3:
- Article 23 of Regulation (EC) No. 44/2001 shall apply if the parties agree that another competent community trademark court;
- Article 24 of Regulation (EC) No. 44/2001 shall apply if the defendant appears before another community trademark court.
- Proceedings in respect of the actions and claims referred to in Article 96, with the exception of actions for a declaration of non-infringement of [an EU] trade mark, may also be brought in the courts of the Member State in which the act of infringement has been committed or threatened, or in which an act within the meaning of Article 9, paragraph 3, second sentence, has been committed.
3 http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32009R0207&from=IT
