Brand identity is one of the most valuable assets of any company, because it is an element capable of making a difference in today’s competitive business environment. However, it is not uncommon to encounter situations in which a company discovers that another company is using a name, logo or distinctive element that is virtually identical or very similar to its own. This use of another’s trademark, far from being a mere coincidence, can have serious legal consequences if the original trademark owner has not given the necessary authorisation.
The misuse of a trademark registered, apart from infringing exclusive rights, can mislead consumers. Consequently, such a situation creates confusion in the market and constitutes an act of unfair competition. Spanish legislation, aware of the importance of a trademark in commercial positioning, offers legal mechanisms to protect owners against this type of infringement.
What is meant by the use of another’s trademark?
We refer to the use of another’s trademark when a third party uses, without authorisation, a trademark that is identical or similar to a registered trademark. This is particularly the case when such use is for products or services similar to those covered by that trademark. It does not matter if that third party has subsequently obtained their right. In reality, priority and protection fall to whoever first registered their trademark in the official register.
The key is that the unauthorised use must create a risk of confusion or association on the part of the public. In other words, the average consumer may think that there is some kind of relationship, link or endorsement between the two trademarks when, in fact, this is not the case. This confusion can negatively affect the reputation of the original trademark and distort competition in the market.
In the event of misuse, the trademark owner has a number of legal actions at their disposal, protected by Law 17/2001 of 7 December on Trademarks. This law recognises the owner’s exclusive right to use their trademark. At the same time, the owner assumes the power to prohibit others from using that trademark without their consent in economic traffic.
Among the measures that the owner can take are:
- Request the immediate removal of the trademark from products, packaging or promotional materials.
- Prevent the marketing, import or export of goods bearing the misappropriated trademark.
- Oppose the use of the trademark in trade names or company names.
- Prohibit its use in commercial documentation, social networks, websites or advertising.
- Taking action against the use of their trademark in unlawful comparative advertising, especially if it infringes Directive 2006/114/EC on misleading advertising practices.
Incidentally, these actions can be taken through both civil and criminal channels, depending on the seriousness of the case and the damage caused.
Compensation for misuse and time limit for claims
In addition to ceasing the unlawful activity, the owner also has the right to claim financial compensation. In fact, the Trademark Law provides that, if a court determines that an infringement has occurred, compensation may be claimed for the damages caused.
This compensation may cover both direct losses (actual damages) and profits that were not obtained due to the misuse (loss of profits). The law even offers an alternative to avoid the burden of having to prove the exact impact of the damage. This alternative consists of the judicial finding of infringement being sufficient for the affected party to claim at least 1% of the profits obtained by the infringer through the use of the trademark.
On the other hand, Article 45 of the Trademark Law establishes a five-year period for bringing legal action from the moment the trademark owner becomes aware (or should have become aware) of the unlawful use by the third party. If during that time they have not taken legal action and have tolerated such use, they will lose their right to claim.
This time limit seeks to encourage diligence on the part of the trademark owner. In this way, it is possible to avoid the consolidation of situations of unauthorised use through mere passivity. It is therefore essential to act quickly as soon as a possible infringement is detected.
When is the use of another’s trademark permitted?
Although the law strongly protects the owners of a registered trademark, there are certain situations in which a third party may use another’s trademark without this constituting a legal infringement. The key point is that this use must be fair, necessary and, above all, not misleading to the consumer.
The Trademark Law (Art. 37) recognises some exceptions to the exclusive right that a proprietor has over their trademark. Specifically, it allows third parties to use another’s trademark provided that:
- It is not done ‘as a trademark’, i.e. it does not attempt to file the product as belonging to the proprietor.
- It is essential to inform the consumer about an essential aspect of the product or service offered.
A classic example is the use of a trademark to indicate the compatibility of one product with another. Think of spare parts for household appliances or ink cartridges for printers. In such cases, it may be necessary to mention the original manufacturer’s trademark to explain which devices the third party’s product works with. But be careful: just because something is necessary does not mean it can be done in any way.
Descriptive use: permitted, but with limits
One of the most common legitimate uses is known as descriptive use. This occurs when a company mentions a registered trademark solely to describe or identify a product or service.
For example: ‘Compatible with HP cartridges’ or ‘Replacement valid for Nespresso coffee machines’. Here, the use of the trademark is justified if there is no other equally clear way to communicate this information to the consumer.
Conversely, if the product is filed in a way that could cause confusion, the legal exception is lost and it may be considered an infringement. The same applies to any mention that suggests a collaboration between the two companies or to the use of the trademark name in a prominent or misleading way.
Key case law: what the courts say about the use of another’s trademark
The judicial system has made it clear that there are lines that should not be crossed. Case law has established several criteria for determining when the use of another’s trademark is legitimate or not.
A very illustrative case can be found in the conflict between a razor blade company (LA-Laboratorios) and other well-known brands such as Gillette. In this case, the razors were packaged with phrases such as: ‘These blades fit Gillette Sensor razors’. The court concluded that this use created confusion and that it was not necessary to explicitly name Gillette to describe the product, and therefore ruled that it constituted an infringement.
On the other hand, there are also rulings that support the use of another’s trademark. Such as in the case of a prize draw in which one of the prizes was a ‘ZARA gift card’ worth €1,000. In 2021, the Spanish Supreme Court ruled that this use was legitimate, as the trademark was used for informational and non-commercial purposes. It was not a covert marketing campaign or an attempt to exploit ZARA’s reputation. The intention was simply to clearly communicate the prize to the public. In this case, the use was legal in that instance.
Subsequently, in September 2023, the Advocate General of the Court of Justice of the European Union (CJEU) ruled in favour of Inditex, as the owner of the Zara trademark. The aforementioned lawyer determined that the infringer – Buongiorno Myalert – could not take advantage of the limitations of the owner’s rights set out in Article 14 of Directive 2015/2436, because such use is not included in Article 6 of Directive 2008/95, which applies to the facts.
How to protect your trademark and take action against misuse
Indeed, protecting our trademark is an essential requirement for claiming any unauthorised use of it. It is useless to discover that someone is exploiting our corporate or product identity if we have not previously registered it with the OEPM (Spanish Patent and Trademark Office) or the EUIPO (European Union Intellectual Property Office).
Once you have a valid register, if you detect misuse by third parties, the ideal course of action is to follow a two-step protocol:
- Amicable attempt: contact the infringing party with a formal cease an desist letter (e.g. by registered fax). Eventually, the problem may be resolved with a simple warning, especially if the third party was not aware that they were infringing rights.
- Legal action: if there is no response or the unauthorised use does not cease, you will have to go to court. As the owner, you can request that the use of your trademark be stopped immediately and demand payment of compensation for damages. Furthermore, you can request precautionary measures for infringement of intellectual property.
As we said, the legal deadline for initiating legal action is five years from the date you became aware of the misuse. If you let that time pass, you will lose the right to claim.
We defend your rights in cases of use of another’s trademark
At ISERN Patentes y Marcas, we have been offering effective solutions in the field of trademark register, monitoring and defence for over a century, both nationally and internationally. If you detect that a third party is using your trademark without authorisation, our specialised legal team is prepared to act quickly. We will advise you throughout the process and take the necessary steps to protect your interests and claim the compensation you are entitled to. You can count on our effective support in cases of unauthorised use of trademarks. You can visit us at any of our 12 offices and consult us without obligation.mpromiso.