Can Trade Names Lead to Trademark Infringement in Turkey?

There are questions concerning whether a trade name or business name can constitute trademark infringement and unfair competition, particularly in cases where the trade name is not used as a trademark. This criticism has been disputed under both the Decree Law No. 556 Pertaining to Protection of Trademarks and the Industrial Property Code (“IP Code”)[1]. The Courts has made numerous decisions regarding this topic.

The issue was discussed in the decision dated 08 February 2023 and numbered 2021/446 E.(Merits) - 2023/61 K.(Decision) issued by the Court of Cassation General Assembly of Civil Chambers, (“General Assembly”) which is the highest of the civil chambers in the Court of Cassation (“CoC”). Its decisions are taken as precedent and into serious account by the lower instance courts. They are seen as unifying decisions. It was concluded that trademark infringement may occur if there is a possibility of damage to the functions of the trademark, and that the use of a trade name as trademark is not a mandatory requirement for trademark infringement.

In General Assembly decision for this case, an evaluation was made as to whether the use of the pre-existing trademark "MESA" in the trade name of the defendant company constituted trademark infringement and unfair competition against the plaintiff’s registered trademarks. The defendant conducted business in the same scope and similar services as those covered by the registered trademarks of the plaintiff. The Court of First Instance ruled in favour of the plaintiff on the grounds that the use of the plaintiff’s "MESA" trademark in the trade name of the defendant did not constitute trademark infringement, but such act constituted unfair competition pursuant to the Turkish Commercial Code. It reasoned that the defendant did not use "MESA" as a trademark but only registered it within its trade name. The plaintiff’s appeal against the decision was accepted by the Regional Court of Appeals (“Regional Court”). Deciding for the plaintiff, the Regional Court found trademark infringement and unfair competition, and ordered the deletion of the core part i.e., "MESA" of the defendant's trade name. The defendant appealed this decision, which the 11^th Civil Chamber of the CoC reversed, stating that the use of the trade name as a trademark is needed for trademark infringement, but the Regional Court resisted the reversal decision of the CoC. The resisting decision was appealed by the defendant. In the final decision rendered by the General Assembly, the resisting decision of the Regional Court of Appeal was found to be appropriate and was upheld. It was concluded that it is not a mandatory condition for a trade name to be used as a trademark for the infringement of trademark rights. The decision was grounded on Article 7/3(e) and Article 29/1(a) of the IP Code, clearly ruling that using the sign as a trade or company name of an pre-existing trademark will be considered infringement of trademark rights. It was also held that infringement of trademark rights may also occur if there is possibility of damage to the functions of the trademarks. Therefore, it was determined that the use of the plaintiff’s registered trademark "MESA" in the trade name of the defendant company - which conducts business in scope of the same and similar services covered by the plaintiff’s trademarks - constituted trademark infringement against the plaintiff’s registered trademarks.

The Bakırköy 2^nd Civil IP Court, in its recent decision dated 12 July 2023 and numbered 2023/18 E.(Merits) - 2023/210 K.(Decision), followed the ruling of the General Assembly in its decision 08 February 2023 and numbered 2021/446 E.(Mertis) - 2023/61 K.(Decision) as precedent and adopted the same principles.

Before the enactment of the IP Code, it was accepted that the mere use of a prior dated trademark in a trade name did not constitute trademark infringement. The trademark infringement would be acknowledged if the trade name was also as a trademark. Indeed, intellectual property law scholars, academics, and authors have stated that mere use of a prior dated trademark in a trade name does not constitute trademark infringement within the meaning of Decree Law No. 556 and that trademark use of the trade name is required.[2] Article 7/3(e) and Article 29/1(a) of the IP Code explicitly states that using the sign as a trade or company name will be considered infringement. Therefore, the use of a trademark in a trade name will constitute trademark infringement, not only when the trade name is used as a trademark, but also in cases where the use poses risk to the functions of the trademark. Taking into account the above decisions, it is evident that the courts and scholars have adopted a consistent perspective that the use of a registered trademark in a trade name will constitute trademark infringement, even if the trade name is not also used as a trademark.