Nokia Corp v Wärdell (C-316/05)

25 April 2007

Sara Sparring

Mr. Wärdell (“Wärdell”) had imported adhesive “flash stickers” into Sweden for attaching to mobile phones. A number of the flash stickers bore the mark NOKIA. Nokia, which holds Community trade mark rights in the mark NOKIA for mobile phones and accessories to mobile phones, brought a trade mark infringement action against Wärdell before the City Court of Stockholm. Wärdell stated that he had no knowledge that the flash stickers would bear the NOKIA mark at the time of the purchase. The City Court of Stockholm found that Wärdell had arranged for the import of the flash stickers into Sweden and that Wärdell’s dealings with the flash stickers constituted trade mark infringement in an objective sense. The City Court considered that there was a risk Wärdell might infringe again and therefore issued a prohibition on continuing infringement with a penalty attached.

Wärdell appealed and the Svea Court of Appeal found that Wärdell had committed an act of infringement and there was some risk that he might commit the same infringement of Nokia’s trade mark rights in the future. However, noting that Wärdell had never committed such acts before and that he could be accused only of carelessness, the Svea Court of Appeal found no reason to regard the import of the flash stickers as part of a continuing trade mark infringement. The mere fact that Wärdell in the future might commit an infringement of Nokia’s trade mark rights could not justify a prohibition with a penalty attached. The Svea Court of Appeal therefore altered the City Court of Stockholm’s judgment and dismissed Nokia’s action.

Nokia appealed to the Swedish Supreme Court. Nokia argued that the mere fact that Wärdell objectively infringed Nokia’s trade mark rights was sufficient to impose on Wärdell a prohibition with a fine attached. Following a request for a preliminary ruling from the Swedish Supreme Court, the ECJ issued its first ever decision on the interpretation of Article 98 (1) of the Community Trademark Regulation.

The questions referred to the ECJ were the following:

(1) Is the condition relating to special reasons in the first sentence of Article 98(1) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark to be interpreted as meaning that a court which finds that the defendant has infringed a Community trade mark may, irrespective of the other circumstances, refrain from issuing a specific prohibition of further infringement if the court considers that the risk of further infringement is not obvious or is otherwise merely limited?

(2) Is the condition relating to special reasons in the first sentence of Article 98(1) of the Regulation on the Community trade mark to be interpreted as meaning that a court which finds that the defendant has infringed a Community trade mark may, even if there is no such ground for refraining from issuing a prohibition of further infringement as contemplated in Question 1, refrain from issuing such a prohibition of infringement under national law and that a penalty may be imposed on the defendant if he commits a further infringement intentionally or with gross negligence?

(3) If the answer to Question 2 is no, must specific measures, by which a prohibition is for example coupled with a penalty, be taken in such a case to ensure that the prohibition is complied with, even where there is clear that a further infringement is covered by a statutory general prohibition of infringement under national law and that a penalty may be imposed on the defendant if he commits further infringement intentionally or with gross negligence?

(4) If the answer to Question 3 is yes, does this apply even where the conditions for adopting such a specific measure in the case of a corresponding infringement of a national trade mark would not be regarded as fulfilled?”

In reply to the first question, the ECJ held that Article 98(1) is to be interpreted as meaning that the mere fact that the risk of further infringement or threatened infringement of a Community trade mark is not obvious or is otherwise merely limited does not constitute a special reason for a Community trade mark court not to issue an order prohibiting the defendant from proceeding with those acts.

Turning to the second question, the ECJ held that Article 98(1) is to be interpreted as meaning that the fact that the national law includes a general prohibition of the infringement of Community trade marks and provides for the possibility of penalising further infringement or threatened infringement, whether intentional or due to gross negligence, does not constitute a special reason for a Community trade mark court not to issue an order prohibiting the defendant from proceeding with those acts.

Answering the third question, the ECJ stated that Article 98(1) is to be interpreted as meaning that a Community trade mark court which has issued an order prohibiting the defendant from proceeding with infringement or threatened infringement of a Community trade mark is required to take such measures, in accordance with its national law, as are aimed at ensuring that the prohibition is complied with, even if the national law includes a general prohibition of infringement of Community trade marks and provides for the possibility of penalising further infringement or threatened infringement, whether intentional or due to gross negligence.

In reply to the fourth question, the ECJ held that Article 98(1) is to be interpreted as meaning that a Community trade mark court which has issued an order prohibiting the defendant from proceeding with infringement or threatened infringement of a Community trade mark is required to take, from among the measures provided for under national law, such as are aimed at ensuring that that prohibition is complied with, even if those measures could not, under that law, be taken in the case of a corresponding infringement of a national trade mark.

Effective measures should thus be taken, which may even require that such measures would in effect provide a higher level of protection to Community trade marks than to national trade marks. Such increased protection may prompt mark owners to file Community trade marks instead of national registrations. The Swedish Supreme Court now awaits further submissions from the parties.