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The use of seals of approval that are protected trademarks is not permitted without corresponding licensing agreements. That was the verdict of Germany’s Federal Supreme Court, the Bundesgerichtshof (BGH), on December 12, 2019 (Az.: I ZR 173/16, I ZR 174/16, and I ZR 117/17).
Seals of approval can engender confidence among consumers in the quality of products. We at the commercial law firm MTR Rechtsanwälte note that third parties are not allowed to take unfair advantage of their good name and reputation by using the seal without an appropriate licensing agreement with the trademark proprietor.
In three rulings form December 12, 2019, the BGH reinforced the rights of a proprietor of a trademark consisting of a seal of approval. The latter had the seal of approval registered as an EU trademark in 2012. The producers and distributors of the tested products were given permission to advertise using the seal of approval on condition that they acquire the appropriate license.
In the three cases that came before the BGH, mail-order companies had promoted products using the seal of approval without having concluded an appropriate licensing agreement. At the same time, the products were to some extent different in terms of size or color from the tested goods. The items in question were baby products, slatted frames, bike helmets, and pillows.
The trademark proprietor took the view that this advertising infringed its EU trademark rights. Its legal action was successful in all three cases before the BGH, which found that the trademark-protected seal of approval enjoyed a high degree of brand recognition. The Karlsruhe judges ruled that the use of the seal of approval conveyed information to consumers about the nature and quality of the products. The court went on to state that those wishing to benefit from the good name of the seal of approval must be prepared to pay for this, i.e. conclude an appropriate licensing agreement; otherwise, they are committing a trademark infringement. The BGH held that under these circumstances unfair advantage has been taken of the good name and reputation of the mark in question.
The judges further clarified that the seal of approval may only be used in relation to the product that has been specifically tested. Even if the products are only distinguishable in terms of their size or color, use of the label is not permitted.
Protecting one’s brand is as important as the penalties for trademark infringements are severe. Lawyers with experience in the field of trademark law can offer advice.