On 30 November 2004, the European Court of Justice (ECJ) made a preliminary ruling under Article 234 EC in the case of Peak Holding AB v Axolin-Elinor AB C- 16/03.
In late 2000, Axolin-Elinor (Factory Outlet) marketed a particular consignment of goods with the trade mark Peak Performance contending that Peak Holding had already offered the goods for sale and thus the trade mark rights were exhausted. Peak Holding brought an action for infringement against Axilon-Elinor. The Lunds tingsrätt (Lund District Court) dismissed the application. Peak Holding appealed to the ECJ against the judgment of the Lunds tingsrätt. Two important questions were referred to the ECJ for preliminary ruling:
- Whether Article 7(1) of the First Council Directive 89/104 of 21 December 1988 must be interpreted to mean that goods with the Peak Performance trade mark can be said to have been placed on the market where the proprietor of the trade mark has imported them into the EEA with a view to selling them or offering them for sale in his own shops within the EEA without actually selling them;
- Whether the goods are to be regarded as having been placed on the market by virtue of the fact that they have been sold by the trade mark proprietor by another company in the EEA, if, upon the sale, the trade mark proprietor imposed a restriction on the buyer under which he was entitled to resell the goods in the Common Market?
The Court ruled that Article 7(1) m ust be interpreted to mean that the actual sale of the goods determines whether or not the goods shall be regarded as having been put on the market in the EEA where the proprietor of the trade mark has imported them into the EEA with a view to selling them or where his own shops or those of an affiliated company have offered them for sale. Exhaustion occurs solely by the proprietor placing goods on the market in the EEA and cannot preclude exhaustion provided by the Directive.
It is not able that in a contract of sale between the proprietor of the trade mark and an operator established within the EEA, the prohibition on reselling in the EEA does not preclude the exhaustion of the proprietors’ exclusive rights in the event of resale in the EEA in breach of the prohibition. The ruling states that under Article 5(3)(b) and (c) of the Directive, the importing of goods or offering them for sale to consumers within the EEA is not tantamount to putting them in the market within the EEA. Article 7(1) is interpreted to mean that goods bearing a trade mark cannot be regarded as been put on the market by the proprietor without the proprietor actually selling them.
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