Kent Gida Maddeleri San ve Tic AS v Nako Iplik Pazarlama ve Ticaret AS, the decision of the Turkish Court of Appeals numbered E. 2016/2539 K. 2017/4808 and dated 27 September 2017
The Turkish Court of Appeals (CoA) has upheld the first instance IP Court’s decision ruling for the invalidation of the ‘Nako Jelibon’ trade mark covering ‘threads’ in Class 23, on the basis that the registration would: (i) negatively affect the distinctiveness of the wellknown ‘Jelibon’ trade mark (meaning ‘jelly tots/bean’ in English), registered for ‘food’ in Class 30 and used for jelly tots/bean products; and (ii) allow the defendant to gain an unfair advantage due to the wellknown status of the ‘Jelibon’ trade mark. With this decision, the Court of Appeals has confirmed that the registration and use of a wellknown trade mark by third parties is not permitted even for different goods, even if the trade mark has a generic origin or meaning.
Article 8/4 of the Decree Law numbered 556 concerning the Protection of Trade Marks (‘Decree Law’) used to rule
that a trade mark application shall be refused upon oppo
sition by an earlier applicant or the owner of registration, if the application would take unfair advantage of or be det rimental to the distinctive character or reputation of the earlier trade mark application or registration, due to the degree of reputation achieved by the earlier sign, even if the application is sought to be registered for different goods and services. This relative refusal ground was also found as an invalidation ground as per Article 42 of the Decree Law.
The Decree Law was repealed and replaced by the Industrial Property Code numbered 6769 (IPC) on 10 January 2017. However, the same provision has been main tained in the IPC as a relative ground for refusal and inva lidation under Articles 6/5 and 25, respectively.
The defendant company, Nako Iplik Pazarlama ve Ticaret
A.S. (‘Nako Iplik’) was the owner of the trade mark, ‘Nako Jelibon’, registered in 2013 for ‘threads’ in Class 23. The plaintiff company, Kent Gida Maddeleri San ve Tic AS (‘Kent Gida’), the owner of the ‘Jelibon’ trade mark, regis tered before the Turkish Patent and Trade Mark Office (‘the Office’) for ‘food’ in Class 30 with registrations dating back to 1995, filed a court action against Nako Iplik and requested invalidation of Nako Jelibon on the basis of the wellknown status of Jelibon, pursuant to Article 8/4 of the Decree Law.
The plaintiff claimed that it has been using Jelibon in Turkey since 1985, and that it is protected by several regis trations in both Turkey and abroad and has become well known due to its extensive use and associated advertising. Kent Gida argued that Nako Jelibon’s trade mark registra tion, which includes the wellknown Jelibon trade mark, results in the reaping of an unfair benefit from the well known status of Jelibon, and dilutes and harms its distinc tiveness. Kent Gida also argued that the defendant used Nako Jelibon with the same typeface and colours of Jelibon, thus reinforcing the similarities between the signs.
The defendant responded by claiming that the main ele ment of Nako Jelibon is the phrase ‘Nako’, which is well known in its own right, and its use along with the subsid iary element, ‘Jelibon’ would not harm the distinctiveness of the plaintiff’s trade mark.
The first instance IP Court approached the case by assessing, first, the distinctiveness of the plaintiff’s trade mark. The court indicated that the phrase Jelibon cannot be considered as a generic phrase but it is a wellknown registered trade mark and has been used by Kent Gida in the food sector for many years. Accordingly, the use of this trade mark within Nako Jelibon could weaken the dis tinctiveness of that of Jelibon and cause the trade mark to be wrongfully perceived as a phrase open to use by anyone.
The first instance IP Court then considered that even
though Jelibon is primarily known in the food sector, its wellknown status exceeded the sector as a whole. Accordingly, the use of Nako Jelibon for ‘threads’ in Class 23 would allow Nako Iplik to gain unfair benefit due to the significant reputation of Jelibon. Coming to this conclu sion, the court also took into consideration the actual use of Nako Jelibon on the market and indicated that the use of the different colours in the phrase Jelibon is a reference to the plaintiff’s wellknown trade mark, so consumers would likely see an association between the signs.
On the basis of these evaluations, the court concluded that Nako Jelibon can cause harm to the distinctive charac ter of Jelibon and cause the defendant to gain unfair benefit due to the wellknown status of Jelibon as per Article 8/4 of the Decree Law. Accordingly, the court ruled for the inva lidation of the trade mark and its deletion from the registry.
The defendant appealed the decision to the CoA. The 11th Civil Chamber of the CoA examined the file and upheld the decision at first instance. Accordingly, the CoA refused Nako Iplik’s appeal and approved the first instance IP Court’s decision. As a result, Nako Iplik filed an applica tion for a review demand, which is currently pending before the CoA for the last phase of appeal, and which theoretically should include only procedural appeal grounds. The chance, therefore, that the case is overturned is low.
With its decision, the CoA reinforced the principle that wellknown trade marks shall be provided with a broad scope of protection extending to different goods and serv ices. This principle was previously adopted in several of CoA’s precedents and embodied in the provisions of the late Decree Law and the current IP Code. Indeed, even though the plaintiff’s trade mark was used specifically for jelly tots/bean products and became wellknown in the food sector, the CoA concluded that the sign cannot be reg istered in the name of another firm for ‘threads’, which is not relevant to the food sector. In doing so, the CoA con sidered the reputation of the trade mark and determined that it is so wellknown that it exceeded the food sector.
The CoA’s decision also puts forward that a wellknown trade mark which has a generic origin or is inherently nondistinctive or is in apposition to become generic by widespread use, can still be provided with a wide scope of protection, if its level of reputation justifies it. Indeed, even though Jelibon derives from the phrase ‘jelly tots/bean’ in English, and has thus a generic origin, the first instance court concluded that the reputation of the trade mark is so widespread that it cannot be considered as a generic phrase which is open to third parties’ use, even for different goods—a determination which was also approved by the CoA.
In its decision approved by the CoA, the first instance
IP Court also provided noteworthy and rather peculiar reasoning regarding the examination of wellknown status claims. One of these concerns the defendant’s claim that it is not possible for Nako Jelibon to harm the distinctiveness of Jelibon, since Nako is also wellknown in its own sector. The first instance court, without considering whether the defendant’s trade mark can be accepted as wellknown or not, indicated in general terms that, where a wellknown trade mark is used with one that is also wellknown and the degree of reputation of the senior trade mark is much more widespread than the latter so that the wellknown status of the senior one precedes and suppresses the well known status of the latter, the latter trade mark can dilute the senior trade mark and could lead to an unfair benefit. With this assessment, the court asserted that in cases where a wellknown trade mark is sought to be used with a senior wellknown one belonging to a third party, a com parison between their reputation should be made in deter mining whether there is the possibility of dilution or unfair benefit. If the senior trade mark has greater reputation, the possibility of dilution and unfair benefit would arise even if the other is also wellknown.
Another peculiar aspect of the first instance IP Court’s decision is the court’s consideration of the defendant’s actual use of the subject trade mark as a factor that increases the likelihood of confusion and association between the trade marks. This is an uncommon evaluation in that the courts generally do not take into consideration claims based on uses in invalidation actions, on the basis that the subject of these actions is trade marks as they are registered before the Office and not their actual uses in the market—this being considered the subject of an infringement action. However, in the Nako Jelibon case, the first instance IP Court adopted a different approach and indi cated that the use of the Nako Jelibon trade mark with design elements similar to the plaintiff’s could mislead consumers, which further justifies the decision to invalidate the trade mark. On the other hand, the court itself admit ted in its decision that an evaluation of the actual use is not necessary in invalidation actions.
The CoA’s decision reinforces the principle that well known trade marks shall be conferred protection even for different goods and services and sets forth that this princi ple shall be applied to inherently nondistinctive trade marks that are wellknown, if their reputation is wide spread. The first instance court’s evaluation regarding the determination of dilution or unfair benefit in case of conflicting rights on two wellknown trade marks also sets for future similar cases. Lastly, unlike the court’s general approach, the consideration of the actual use of the trade mark in the action suggests that the use of a trade mark can be taken into consideration as a factor that increases possibility of confusion (however, such evaluation is not strictly required).