Judicial Precedents have always been a core principle in our legal system. Even though such precedents are not considered as binding in the UAE, they do carry a persuasive value and the judgments delivered by the Higher Courts are usually applied by the Lower Courts.

The Intellectual Property Department of The Legal Group, Advocates & Legal Consultants is extremely proud to announce the success of its extraordinary legal team in winning a Civil law suit relating to Trademark Cancellation and succeeding in the unusual task of setting a Judicial Precedent in the UAE.

Background of the case:

Our client (TLG's client), Central Corporation, an international Company specializing in manufacturing auto-spare parts, had suffered from a trademark infringement. The Company owns a well-known trademark (CTR) which had been registered in many countries including the UAE. The said trademark was infringed upon by the other party (infringer) who had registered a look-alike trademark in the same class as that of our client's. Due to this illegal act and unfair competition trade we believed that our client's legal rights were infringed and the following damages were inflicted upon him:

1. Deception of consumers who cannot easily distinguish between genuine and imitated products.

2. Creation of an adverse effect on company income and infringement of its financial rights by selling counterfeit products to consumers who intend to buy genuine products.

3. Disruption of consumer's trust in the quality and excellence of our client's products by buying such imitated products which are of a lower quality, workmanship and specifications, believing them to be genuine products belonging to our client.

4.Infliction of damages on the consumer as a result of the damages caused by the said counterfeit products due to its bad workmanship and their lack of safety elements possessed by our products.

5. Bringing disrepute to our client and the client's products which are particularly satisfactory and attractive to the consumers due to their specifications, safety and quality workmanship.

Our client's trademark CTR had been officially registered in UAE in class 12 in 2003 while the infringer had registered the look-alike trademark in UAE in class 12 in 2008. In 2015, almost seven years after the registration of the infringer's trademark, our client became aware of the same after realizing that the infringed products, bearing similar trademark as their own, were being sold in the market.

The applicable Law and Issues of the case:

Article (17) of the Federal Law No. 37 of 1992 Concerning trademarks, (the "Law") states that, "Whoever applies for the registration of a trademark shall be deemed the exclusive owner thereof, and the ownership of a trademark may not be contested if it is used ceaselessly by the person who applied for its registration for at least five years from the date of registration without a case raised against him detesting his ownership of the mark. The owner of a registered trademark shall have the right to prevent others from using an identical or similar trademark to distinguish identical or similar or related goods or services to those distinguished by the registered trademark in a manner that may mislead the consumer public".

Thus, the Central Corporation had faint hopes regarding the successful cancellation of the infringer's trademark since five years had passed since its registration. However, our (TLG's) suggestion (to Central Corporation) was to file a Civil law suit to order the Infringer to cease & desist with their unfair competition trade practices and to legally compel them to cancel the look-alike CTR trademark.

Our case was mainly based on Article (21) of the Law, which states that "Without prejudice to the provision of Article (17), the Ministry and any concerned person shall have the right to request a judgment be passed for striking off a trade mark registered without right. The Ministry shall strike off such registration if a final and enforceable judgment is submitted thereto in this regard."

Article (10) of the Law states that "No trade mark identical or similar to an already registered mark may be registered for the same categories of products or services, or different goods or services, if the use of the requested trademark would generate an impression that such goods or services are linked to the goods or services of the owner of the registered mark or prejudicing his interests.."

Furthermore, since our client's trademark classified as a well-known trademark, it was protected by an additional layer of fortification as per the concerned International Conventions such as the Paris Convention for the Protection of Industrial Property, of which the UAE is a member state. Article 6 (3) of the Convention relating to the Well-Known Marks states that "No time limit shall be fixed for requesting the cancellation or the prohibition of the use of marks registered or used in bad faith."

Accordingly, the Court appointed an expert, specialized in Intellectual Property, particularly Trademarks, to confirm the nature of conflicted trademarks and activities of both parties such as:

  • Whether the trademarks have been officially registered in the Ministry of Economy;
  • Whether the trademark of the complainant (CTR) is indeed a well-known trademark; the date of the usage of both trademarks in UAE; the similarity and the difference between both the trademarks;
  • Whether the same cause confusion to the consumers; and
  • Whether the complainant has the right of his claim.

The expert's report clearly mentioned that the trademark CTR is indeed a famous trademark and that it should be protected according to the local laws and the international treaties, entirely supporting The Legal Group's claims. Moreover, the report confirmed that the trademark of the infringer's party was very similar to CTR and therefore the same caused confusion to the average consumers (lay man). Thus, the registration of the same in class 12 and the usage of similar colors, packaging, words etc. confirmed that the defendant had a bad intention to infringe the Intellectual Property Rights of Central Corporation. The expert also confirmed that the trademark CTR was being used prior to the infringer's trademark in the UAE and in other countries.

Judgment:

Based on the above mentioned facts, the Judgment was pronounced by the Court of the First Instance which stipulates the following:

  • Cancellation of the Trademark owned by the defendant.
  • Publish the judgment in two local newspapers; the same has to be one in English and one in Arabic, at the expenses of the plaintiff company.
  • Oblige the defendant to desist the illegal competition by infringing the Trademark owned by the plaintiff company.
  • Oblige the defendant to pay the expenses/fees as well as the amount of 1000 AED as the attorney's fees.

The defendant approached the Court of Appeal against the aforementioned judgment. However, the Court in its judgment, declined the appeal filed by the adverse party and upheld the judgment issued by the First Instance Court which was in favor of Central Corporation.

Lastly, as a result of the case, Central Corporation has been able to infiltrate the market of the imitated products by conducting raid actions with the help of the local IP Enforcement Authorities which led to the destruction of the imitated products

Thus, owing to the diligent intervention of the talented team of lawyers from The Legal Group's Intellectual Property department- the Imitation Game played by the defendants came to a grinding halt and enabled The Legal Group to win a Civil law suit pertaining to Trademark Cancellation and accomplishing their goal of setting of a Judicial Precedent in the UAE.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.