Scope Of Trademark Protection - The Italian Law Perspective

This article states as follows:

"1. The proprietor of a registered trademark has the right to exclusive use of the trademark. The proprietor shall be entitled to prevent all third parties not having his consent from using:

"a) any sign which is identical with the trademark in relation to goods or services which are identical with those for which the trademark is registered;

"b) any sign where, because of its identity with, or similarity to, the trademark and the identity or similarity of the goods or services covered by the trademark and the sign, there exists a likelihood of confusion on the part of the public, which includes the likelihood of association between the sign and the trademark;

"c) any sign which is identical with, or similar to, the registered trademark in relation to goods or services which are not similar to those for which the trademark is registered, where the latter has a reputation in the Member State and where use of that sign without due cause takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trademark.

"2. In the cases mentioned in paragraph 1, the proprietor of the trademark may, in particular, prevent all third parties from affixing the sign to the goods or to the packaging thereof; offering the goods, or putting them on the market or stocking them for these purposes under that sign or offering or supplying services thereunder; importing or exporting the goods under the sign; using the sign on business papers and in advertising."

2. The first level of protection (letter a) concerns the use of a sign which is identical with the trademark in relation to goods or services which are identical with those for which the trademark is registered. This always constitutes infringement of the earlier trademark and the proprietor of said trademark need only demonstrate that the two marks are identical and that the goods or services under the infringer’s sign belong to the same category of goods for which the infringed trademark is registered.

This provision was introduced into trademark law by Legislative Decree 19 March 1996, no. 198 to bring Italian legislation into line with Art. 16, paragraph 1 of the TRIPs Agreement, whereby: "In case of the use of an identical sign for identical goods or services, a likelihood of confusion shall be presumed". With regard to this provision, Law 29 December 1994, no. 747, in authorising the Government to harmonise domestic legislation with the TRIPs Agreement, stipulated (in Art. 3, letter a, no. 1) that "a presumption of infringement" be introduced into trademark law. It does not seem that the wording of the decree may be criticised for not corresponding to the content of the authorisation. On the basis of said authorisation the legislator could have established absolute presumption which, not admitting contrary evidence (i.e. evidence that, although the marks and the goods or services under the marks are identical, there is no confusion) would have been – as with all absolute presumption – sheer fiction. It would have had exactly the same effect as the article which was then adopted¹. The new provision thus follows almost to the letter Art. 5, paragraph 1, letter a of the Directive (and, for what concerns novelty, Art. 4, paragraph 1, letter a), which it was decided not to adopt when the Directive was implemented (by Legislative Decree 4 December 1992, no. 480)².

There are, however, some difficulties in determining exactly the scope of application of the new law especially with regard to the concept of the "identity" of the marks and of the goods or services bearing the mark to which the law refers. One author contends that this situation would arise "every time there is perfect identity between marks and between goods or services bearing the marks"³. This would seem to imply that if there is any change or addition to the sign of the infringer, or if it is placed on goods which are not completely the same as those stated in the registration, this rule may not be applied. As regards this restrictive interpretation it has, moreover, been observed that the concept of absolute identity is unworkable in practice. It has, therefore, been suggested that the law be interpreted as referring to substantial identity. In order to reduce the margin of discretion in the application of the law itself, the evaluation of substantial identity must be firmly linked to criteria consistent with trademark law, in that marks which have the same "distinctive character" must be considered "identical"⁴, even if, in so doing, there is the risk that a good number of the cases of similarity between marks will risk being adjudicated on the basis of this rule, rather than on the basis of letter b of Art. 1, paragraph 1⁵.

As for identity between goods, it seems necessary to follow the judgement of the public. If the public does not distinguish between goods, said goods must be considered "identical". Those which the public regards as being different, even if they belong to the same category of goods, are to be deemed non-identical⁶.

The need to refer, as the (first) term of comparison for the purposes of this evaluation, to the infringed trademark, to how it has been registered and to the goods or services indicated in the registration involves, on the other hand, considering any partial nullity or revocation which limits the scope of its protection. In particular, once the five year period since the granting of the certificate has expired, only the categories of goods not affected by the (partial) revocation for non-use will need to be considered.

As to the importance of Art. 1, paragraph 1, letter a some of the "justifications" of Art. 1bis, paragraph 1 (corresponding to Art. 6 of the Directive) seem to have a limited effect. The article states that the proprietor of a trademark cannot object to a series of descriptive uses of its mark nor to the use of the "name and address" of other subjects in business activity, even though this behaviour may, in an abstract sense, come within the scope of protection of the trademark itself, provided that the third party use "is in accordance with honest practices, and, therefore, not as a trademark but only as description".

3. The second level of protection concerns the use of a sign which is identical with, or similar to, the registered trademark in relation to goods or services which are identical with, or similar to, those covered by registration. In this case protection is granted when the use of the infringer gives rise to a "likelihood of confusion which includes a likelihood of association between marks".

The relevant confusion is that which concerns the business origin of the goods or services and arises when consumers believe that the goods or services under the infringer’s sign have been placed on the market by the proprietor of the infringed trademark or that, at any rate, the proprietor has authorised their sale (so-called confusion in a wider sense)⁷. The limit of similarity is also interpreted from this viewpoint in that "for the purposes of the extension of trademark protection, goods are to be considered similar which, when bearing the same trademark or similar trademarks, may reasonably lead the consumer to believe that they originate from the same firm"⁸.

A more disputed point is what the "likelihood of association" actually consists of. This idea has been developed by Benelux case law which, on the basis of this criterion, holds that trademark protection may be extended beyond the limit of likelihood of confusion as to origin, encompassing all cases in which the public is able to make a connection, an "association", between the infringing sign and the infringed trademark, even if this association does not concern the origin of the goods or services for which the trademark and the sign are used from the same source or from connected sources⁹. In Italy this interpretation has been followed in a number of rulings¹⁰. It has, however, been rejected by the European Court of Justice which held that, according to the Directive (and therefore to the domestic laws implementing it), the reference to likelihood of association serves to specify the extent of the likelihood of confusion, in the sense expressed in the tenth "whereas" of the Directive, where it is considered as only one of the factors leading to likelihood of confusion¹¹. Even after the ECJ decision, a small number of rulings in Italy have continued to refer to the idea of "likelihood of association" borrowed from Benelux case law¹².

4. A further problem much debated in Italy is that of determining whether the likelihood of confusion must be evaluated in a concrete fashion , i.e., taking into consideration all factors that influence the public judgement or – as an authoritative Italian scholar has maintained – whether we must "compare the signs per se and, on the basis of the goods indicated in the registration and considering the structure of that market given and the widespread opinions of the public, determine the range of exclusive use of the trademark", according to an "a priori, abstract evaluation"¹³.

The law states that the existence of likelihood of confusion must be assessed considering everything which may influence public opinion in the individual case. It speaks of confusion "for the public". The Directive, too, referred of this matter. In the above mentioned tenth "whereas" it underlines how the assessment of the likelihood of confusion "depends on numerous elements and, in particular, on the recognition of the trademark on the market, of the association which can be made with the used or registered sign, of the degree of similarity between the trademark and the sign and between the goods or services identified". This clearly demonstrates that such an assessment must also be carried out on the basis of the importance that each trademark actually has in the eyes of the consumer.

This theory highlights, at any rate, the importance of registration in determining the scope of trademark protection. It would be illogical to give a used trademark a more limited scope of protection than a (yet) unused trademark. From this point of view, the only restriction which appears to be justified is that which derives from possible partial revocation due to non use, which reduces this scope with regard to the categories of goods or services. From every other aspect, and in particular the semantic aspect, it seems reasonable to consider registration as a sort of "dowry" of the trademark which may be increased by use – extending the field within which a likelihood of confusion or, in the case of acquired repute, advantage/detriment ex. Art. 1, paragraph 1, letter c, may arise - but not reduced¹⁴. Therefore, in order to determine if infringement has taken place both an abstract and a concrete analysis must be carried out: the former by comparing the mark and how it was registered with that of the infringer and the identity or similarity of the goods of the infringer with those for which registration is (still) effective to see if this may lead to a hypothetical likelihood of confusion. The latter is aimed at assessing whether this likelihood of confusion actually exists for the public or rather if the use of the later sign leads to unfair advantage or detriment. Protection is granted if one or the other analysis is proven.

5. The third level of protection concerns trademarks which have a reputation. Art. 1, paragraph 1, letter c (worded in terms which comply with the Directive) provides protection for these marks which leaves aside the likelihood of confusion as to origin and, thus, also protects the trademark against forms of parasitic linkage to its repute.

The first problem which arises in this regard is that of establishing which trademarks qualify for extended protection , i.e., when a trademark can be said to be reputed. In Italian legal theory there are authors who tend to recognise this protection only for trademarks of high repute (which in Italy are known as "marchi celebri")¹⁵. On the other hand, there are writers who, basing their arguments upon the preparatory work of the Directive¹⁶, have claimed that the expression "trademarks which have a reputation" "encompasses both famous marks in the real sense of the word and those which are simply well-known"¹⁷.

This second idea was accepted by the ECJ in its ruling of 14 September 1999, in Case C-375/97 (General Motors). The ruling concluded that in order to classify a trademark as reputed, qualifying it to receive "extended" protection , it need only be " known by a significant part of the public concerned by the products or services covered by that trade mark" without it being necessary for "the trade mark (to) be known by a given percentage of the public so defined". The fact that the trademark is very well-known seems to come into consideration rather in deciding whether the advantage or detriment provided as an alternative by the law exist in that "the stronger the earlier mark's distinctive character and reputation the easier it will be to accept that detriment has been caused to it".

The Court, therefore, seems to recognise that protection beyond the limit of confusion as to origin is not an exception but must be recognised for all trademarks that are well-known in their sector and with respect to which advantage or prejudice could arise due to the use by a third party of a sign which is identical or similar, even failing likelihood of confusion as to origin, at least in a wider sense. Therefore, most probably, this could also be due to simple psychological "recall" of the trademark in question. The premise for this "extended" protection seems, therefore, to be that the trademark having a reputation is a symbol of a collection of information and suggestions which are brought to the mind of consumers whenever they recognise a reference to that trademark in the sign of the third party.

On the basis of this definition of reputed trademarks, the debate as to the importance to be given to the notion of "likelihood of association" spoken of earlier may be superseded or rather put to one side. It is clear that the need for additional protection beyond that against confusion may arise only for trademarks which convey a message benefiting the good or service for which the infringing trademark is used even if consumers are not confused, i.e. they do not connect that good or service to the same company which produced goods or services bearing the original trademark (or to a connected source). If, as appears to be the case, all these trademarks are considered as having a reputation they are thus qualified to receive this extended protection on the basis of letter c of Art. 1, paragraph 1, whatever the extent of the "likelihood of association" ex letter b.

6. In Italy, too, the question remains open as to determining whether trademarks having a reputation may be protected beyond the likelihood of confusion only when the other’s sign is used in relation to goods or services which are dissimilar to those bearing the infringed trademark – as stated by Art. 1, paragraph 1, letter c and, previous to that, by Art 5.2 of the Directive – or whether this protection may be invoked in all cases in which the advantage and detriment provided by the law arise, even if the sign of the infringer is used (in a non-confusing way) for identical or similar goods or services.

The problem was recently dealt with in Italy by the Court of Milan with regard to the use of an "ironic and playful" (as the ruling puts it) version of the extremely famous Lacoste crocodile used to distinguish articles of clothing. After ruling out the likelihood of confusion, the Court considered whether Art. 1, paragraph 1, letter c could be applied. It decided that it could not on the basis that "this provision is to be considered as applying to the special protection of trademarks which have a reputation for use on dissimilar goods … in the case in question this cannot be recognised for the identity of the goods for which the trademarks concerned are used"¹⁸. The same Court, however, applied the same article of law in holding that the non-authorised parodic use on dissimilar goods (shirts) of a sign identical to a reputed Italian trademark registered for petroleum products (the Agip six-legged dog, which was accompanied on the shirts by the words "acid self area") constituted infringement¹⁹. Quite apart from the concrete evaluation of the cases in question, it is evident that they were treated differently, even though both concerned unfair advantage being gained from the message linked to another’s trademark.

The ECJ has already ruled more extensively, albeit only in an obiter dictum contained in a previous ruling, where Art. 5.2 of the Directive and the corresponding article on novelty are summarised, stating that they "permit the proprietor of a trade mark which has a reputation to prohibit the use without due cause of signs identical with or similar to his mark and do not require proof of likelihood of confusion, even where there is no similarity between the goods in question"²⁰. This, however, is not an explicit stance and we must, therefore, await a remittal by a domestic court. Due to the lack of an express remittal the ECJ recently refused to rule on this point in the Adidas case where the problem had been raised by only one of the private parties²¹.

7. It still remains to be determined in which situations the unfair advantage or detriment of Art. 1, paragraph 1, letter c come into play allowing the well-known trademark to be protected even if there is no likelihood of confusion.

In particular, detriment seems to arise when the sign of the infringer conveys a message to the public which, in addition to bringing to mind the infringed trademark and, therefore, the message conveyed (a recall which constitutes the conditio sine qua non of protection) contains other factors which "tarnish" the latter message. From this point of view, detriment may exist not only when the sign of the infringer is used in relation to goods or services which are cheap or of poor quality but, more generally, when it is used in ways which are inconsistent with the image of the infringed trademark (as in the Agip case), since, often, it is this very consistency, i.e., the fact that the trademark recalls a certain "style", which contributes greatly to the market value of the trademark itself²².

As to unfair advantage, the parasitic linkage of the goods or services of the infringer to the image of the infringed trademark and its repute is essentially what needs to be considered. The advantages that the infringer gains from this kind of linkage obviously concern trademarks which convey an evocative message, or those which are connected to top quality goods or services. More generally, the use of a trademark which is already well-known in another sector for the launch of a new product brings considerable savings on advertising costs²³. It is clear that, here too, (obviously when this phenomenon actually takes place) the effect of the message that the trademark conveys to the public is important, an effect that is parasitically exploited by the infringer.

So-called cybersquatting, the adoption of another’s famous trademark as a domain name on the Internet, is somewhat similar to this last instance if it serves to distinguish activities where there is no likelihood of confusion and, therefore, protection of its indication of origin may not be invoked. In Italian case law, for instance, the adoption of the name Peugeot as a domain name was held to be infringing when used for a site which had nothing to do with cars²⁴. It is clear that the user may be induced to visit a site simply because its name corresponds to another’s trademark and that this may constitute per se an advantage for the proprietor of the infringing domain name, given that the value of a site often depends simply on how many hits it receives, a number which affects, for example, the price of advertising on the site itself²⁵

Lastly, it is also worth considering parody as in the two cases regarding the Lacoste crocodile and the Agip six-legged dog mentioned previously. Parody, by definition, establishes a connection with the message which the parodied trademark conveys. This connection benefits the author of the parody which is based on the trademark (and therefore on the exploitation of the parodied trademark’s renown) and which is often detrimental to this trademark, especially if the parody is vulgar or, at any rate, creates in the minds of the public associations between the trademark and features which are foreign to the message originally inherent in it which may therefore tarnish it.

It must be remembered that the law makes the protection of the reputed trademark conditional to advantage and detriment and to the fact that the third party uses it "without due cause". Probably this "due cause" can only be found in the "justifications" listed in Art. 1bis, paragraph 1 of the Italian Law, corresponding to Art. 6 of the Directive.

1 See FLORIDIA , "L’attuazione italiana dei TRIPs (Illustrative report drawn up by appointment to the Ministerial Commission), in Il dir. ind., 1996, 419ff, which bases its justification for the adopted solution on the "right to determine the appropriate way of implementing the provisions of the TRIPS Agreement in the context of domestic legislation – Art. 1, paragraph 1 of the Agreement itself".

2 For the reasons behind this choice see VANZETTI, La nuova legge marchi¹, Milano, 1993, 18-20.

3 See, in relation to Art. 5, paragraph 1, letter a of the Directive, OLIVIERI, La prima direttiva CEE (n. 89/104) in materia di marchi d’impresa , in Riv. dir. civ., 1990, II, 315ff, 330.

4 See GALLI, Commento agli artt. 1-5, in AA.VV., Decreto legislativo 19 marzo 1996, n. 198. Commentario by AUTERI in Nuove leggi civ. comm., 1998, 71ff, 78-79.

5 See VANZETTI-DI CATALDO, Manuale di diritto industriale³, Milano, 2000, 194-195.

6 See GALLI, Funzione del marchio e ampiezza della tutela , Milano, 1996, 171.

7 VANZETTI-DI CATALDO, Manuale di diritto industriale³, cit., 196-197.

8 VANZETTI-DI CATALDO, Manuale di diritto industriale³, cit., 205.

9 Starting from the ruling issued in the "Union" case (Benelux Court, 20 May 1983, in Ing. – Cons., 1983, 191ff and in Rev. Crit. De Jur. Belg., 1987, 51ff., with note VAN BUNNEN, L’apport de la Cour Benelux à l’appréciation des critères d’atteinte à la marque). On the concept of likelihood of association in the case law and legal studies of the Benelux countries, see in full GALLI, Funzione del marchio e ampiezza della tutela, cit., 190ff.

10 See, in particular, the Court of Naples (order), 13 May 1996, in Giur. ann. dir. ind., 1997, 801ff., in Riv. dir. ind., 1996, II, 228ff., with note FRANZOSI, and in Il dir. ind., 1997, 193ff., and the Court of Naples (order), 5 November 1998, in Giur. ann. dir. ind., 1998, 939ff.

11 The ECJ, 11 November 1997, in Case C-251/95 (Puma). Following this, the ECJ confirmed its reasoning with the ruling of 29 September 1998, in Case C-39/97 (Canon); ruling 22 June 1999, in Case C-342/97 (Lloyd) and with the ruling of 22 June 2000, in Case C-425/98 (Adidas).

12 See Court of Naples (order), 11 July 2000 soon to be published in Giur. ann. dir. ind., 2000. This order, however, was reversed by Court of Naples (order), 13 September 2000 also soon to be published in Giur. ann. dir. ind., 2000.

13 SENA, Il nuovo diritto dei marchi³, Milano, 2001, 74.

14 See SPOLIDORO, La tutela cautelare e di merito, in MARASA’-MASI-OLIVIERI-SPADA-SPOLIDORO-STELLA RICHTER, Commento tematico della legge marchi, Torino, 1998, 367. More fully see GALLI, La protezione del marchio oltre il limite del pericolo di confusione, Paper at the Segni e forme distintive: la nuova disciplina Convention, Milan, 16-17 June 2000 and VANZETTI-GALLI, La nuova legge marchi², Milano, 2001.

15 See, in particular, FLORIDIA, La nuova legge marchi. Il commento , in Corr. giur., 1993, 268ff especially 269-270; FAZZINI, Prime impressioni sulla riforma della disciplina dei marchi, in Riv. dir. ind., 1993, I, 159ff., 161; and LA VILLA, Introduzione al diritto dei marchi d’impresa, Torino, 1994, 21-28 and – in relation to the Directive – SORDELLI, Significato e finalità della Direttiva C.E.E. sul ravvicinamento delle legislazioni degli Stati membri in materia di marchi registrati n.89/104, in Riv. dir. ind., 1989, I, 14ff (26).

16 See, in particular, VANZETTI, Commento alla Prima Direttiva C.E.E. del 21 dicembre 1988 sul ravvicinamento delle legislazioni degli Stati membri in materia di marchi d’impresa, in Nuove leggi civ. comm., 1989, 1443-1444.

17 Expressly stated in VANZETTI-DI CATALDO, Manuale di diritto industriale³, cit., 29-30 and 207-210; see also GALLI, Funzione del marchio e ampiezza della tutela, cit., 211-212; and SENA, Il nuovo diritto dei marchi³, cit., 88.

18 Court of Milan, 12 July 1999, in Giur. ann. dir. ind., 1999.

19 Court of Milan, 4 March 1999, in Giur. ann. dir. ind., 1999.

20 The ECJ, 11 November 1997 in Case C-251/95 (Puma). GIELEN, A Benelux Perspective – SABEL v. Puma emphasises this statement in EIPR, 1998, 109ff, 111.

21 The ECJ, 22 June 2000, in Case C-425/98 (Adidas). Among the Italian scholars, in favour of the protection of reputed trademarks beyond the likelihood of confusion also for similar goods or services see GALLI, La protezione del marchio oltre il limite del pericolo di confusione, cit. and MANSANI, La funzione di indicazione d’origine del marchio nell’ordinamento comunitario, Milano, 2000, 15-17.

22 See GALLI, La protezione del marchio oltre il limite del pericolo di confusione, cit.. In particular U.S. studies have concentrated on this phenomenon with regard to anti-dilution legislation: see SWANN-DAVIS, Dilution, an Idea Whose Time Has Gone; Brand Equity as Protectible Property, the New/Old Paradigm, in 84 TMR (1984), 269ff.; HARTMAN, Brand Equity Impairment – The Meaning of Dilution, in 87 TMR (1997), 418ff.; and SWANN, An Intuitive Approach to Dilution, in 89 TMR (1999), 907ff..

23 See DRESCHER, The Transformation and Evolution of Trademarks – from Signals to Symbols to Myth, in 82 TMR (1992), 301ff., especially 331-332.

24 Court of Vicenza (order), 6 July 1998, in Giur. ann. dir. ind., 1998, 769ff.. See also Court of Vicenza (order), 22 March 2000 and Court of Reggio Emilia (order),30 May 2000, both in AIDA, 2000. In legal studies see BETTINGER, Trademark Law in Cyberspace – The Battle for Domain Names, in IIC, 508ff., especially 526ff and in Italy the section dedicated to domain names in the collection by GALLI, Segni distintivi e industria culturale, published annually in AIDA.

25 See the rulings of the Court of Viterbo (order), 24 January 2000, in Foro it., 2000, I, 2334ff and of the Court of Genova (order), 13 October 1999, ibid and in Dir. Inf., 2000, 346ff., with note D’ARRIGO. The first highlighted how the use as a domain name of a sign which is similar to another’s famous trademark allows the party so doing to "avoid the risks of remaining unknown to – or little explored by – the vast public of Internet users", which is extremely advantageous since "the reason why a (business or information) site is opened is to have as many visitors as possible who, by accessing the site itself (even if just passing through) may read and view the advertising displayed by the owner of the site (the so-called "banner" – rectangular adverts similar to normal advertising posters) which may sell these spaces to third parties benefiting from data supplied by the various providers or suppliers of programs". In turn the Court of Genova was called upon by the licensee of the trademark "Alta Vista" which, as is well-known, identifies one of the most famous search engines on the Internet. The licensee claimed that the domain name "altavista.it" had been adopted by a non-authorised subject. This subject contended that the site identified by this domain name concerned only the real estate market. The court held (in the appeal against the injunction issued to protect the plaintiff) that "even admitting that the Abx site (the appellant: editor) was solely willing to give information regarding the real estate market … the immediate consequence of misleading users, by exploiting the repute of the Alta Vista name, is to ‘capture’ on its site users directed to the search engine with the same name, thereby spreading advertising messages on the relative pages and gaining credit with the advertisers for having a wide advertising range which otherwise would be completely beyond the scope of the appellant".