Zino Davidoff v A&G Imports, Levi Strauss v Costco and Tesco Stores Limited
Date
20 November 2001
Legislation
Trade Marks Directive (89/104) Art. 7
Keywords
Trade mark infringement; exhaustion of rights conferred by a trade mark; goods outside the EEA; nature of consent required; parallel imports
Counsel
M. Silverleaf QC, H. Carr QC, D. Anderson QC, G. Hobbs QC, D. Alexander, C. May, R. Hacon
Solicitors
R Swift, Baker & McKenzie, A. Millmore, I. Mackie, G. Heath, G. Williams
Judge
ECJ
Court
European Court of Justice
Reported
[2002] Ch 109, [2002] 2 WLR 321, [2002] 1 CMLR 1, [2002] ETMR 9, [2002] RPC 20
Summary
The English High Court, Chancery Division, (Patents Court) referred a number of questions to the ECJ in three different actions concerning trademark infringement.
In the first action between Zino Davidoff & A& G Imports, Zino Davidoff had entered into an exclusive distribution contract with a trader in Singapore, for its toiletries and cosmetic products bearing its trademarks COOL WATER and DAVIDOFF COOL WATER. The distributor had undertaken to sell the products solely within a defined territory outside the EEA and also to impose a prohibition of resale outside the stipulated territory upon its local sub-distributors, sub-agents and retailers. A& G Imports had obtained stocks of the products, had removed or obliterated the batch code on them and imported the products into the UK and began to sell them.
In the other two actions, Levi Strauss & Co. and Levi Strauss (UK) Ltd. (holder of a trademark licence from Levi Strauss & Co.) had refused to sell their Levi's 501 jeans to Tesco stores and Costco Wholesale UK Ltd. and not agreed to them becoming authorised distributors of their products. Tesco and Costco obtained the jeans from countries outside the EEA, imported them, and sold them in the UK. There was evidence that the suppliers outside the EEA were under contractual restrictions prohibiting resale to wholesalers and/or exportation. Tesco acknowledged that Levis did not wish their jeans to be sold otherwise than through authorised retailers.
The three actions contained questions regarding the nature of the consent required by the registered trademark proprietor to marketing of its products in the EEA.
Decision
The ECJ held that such consent had to be so expressed that an intention to renounce those rights was unequivocally demonstrated. Such an intention would be gathered from an express statement of consent but in some cases, could be inferred from the circumstances. The onus was on the trader to show that consent had been given. The consent could not be inferred from the mere silence of the trade mark proprietor; nor from the failure of the goods to carry any warning that their marketing in the EEA was prohibited; nor from the fact that the proprietor had not placed any express contractual restrictions on the resale of the goods in the EEA. Further, the preservation of the trademark proprietor's exclusive right could not depend on an express prohibition, which the proprietor was under no obligation to impose. Therefore it was irrelevant if the trader was ignorant of the trademark proprietor's expressed opposition to the imports.