An Example of Trademark Infringement: The Use of a Trademark as a Business Name
Introduction
It is observed that there are changes in the legislation and judicial decisions as to whether the use of a previously registered trademark or a trademark for which a registration application has been filed can be considered as trademark infringement by third parties by using the trademark as a trade name. While the use of a trademark as a trade name by others was considered trademark infringement under Decree Law No. 556 (“Decree Law”) (abrogated) only if it led to use as a trademark, the Industrial Property Law No. 6769 (“IPL”) does not require the use as a trademark for infringement to arise. It is observed that this amendment has also led to a change in the approach of the Court of Cassation towards the disputes before it. Within the scope of this article, (i) the concepts of the likelihood of confusion and the use as a trademark will be evaluated, (ii) the provisions of the Decree Law and the IPL will be addressed, and (iii) finally, a recent decision of the General Assembly of Civil Chambers of the Court of Cassation will be analyzed.
“Likelihood of Confusion” and “The Use as a Trademark”
As it is known, the use of any sign that is identical or similar to a registered trademark and which is therefore likely to be confused by the average consumer, including the possibility of association, constitutes infringement of the trademark right. Within this framework, to claim that infringement has occurred, the use in question must take place in the same or similar field as the goods or services for which the trademark is registered. It is known that such cases where there is a likelihood of confusion1 are both an obstacle to registration and an infringement of the trademark right.
The use of a sign as a trademark in such a way as to cause the likelihood of confusion is referred to as “use as a trademark”.2 The determination of the use as a trademark is made based on an average consumer. For instance, if an average consumer, when confronted with a sign, perceives that sign as a trademark of the relevant goods and services, the use as a trademark arises.
Use of the Sign of a Trademark in a Business Name: Decree Law Period and IPL
In general, a trademark provides distinctiveness on goods or services, while a business name provides distinctiveness on the merchants who use it.3 In certain cases, it is observed that a sign registered as a trademark is intended to be used as a business name by undertakings wishing to benefit from the recognizability of the trademark.4 During the Decree Law No. 556 period, the use of a business name purely as a business title, which contains the same sign as a trademark, was not considered as infringement of the trademark right, and it was accepted that trademark infringement could be mentioned in case the title was used as a trademark.5
One of the reforms introduced by the IPL No. 6769 is that the use as a trademark is no longer a condition for the use of a trademark as a business name to be considered as infringement of the trademark right.6 In other words, under Article 7/3-e of the IPL, it is deemed sufficient to use a trademark as a business name for trademark infringement to occur, and it is not required that the use in question reaches the level of the use as a trademark.7 As a result, uses that reach the level of “use as a trademark” as defined above are no longer a condition for the determination of trademark infringement.
In the face of this change in the legal framework, in doctrine8, it is mentioned that the use of a sign in a trademark as a business name should not be considered a direct infringement of the trademark right, and it should be examined whether one of the functions of the trademark is harmed and whether there is a use that exceeds the scope of the business name.9 One view in the doctrine makes a dual evaluation and states that for the existence of infringement, (i) the business name should be used as a trademark, i.e. in violation of its function; (ii) on the other hand, for service trademarks, use as a trademark is not necessary, since even the use of the trade name by its function does not prevent likelihood of confusion10. It is also understood from the decision of the General Assembly of Civil Chambers, which will be addressed below, that the Court of Cassation has developed a practice based on these reservations stated in the doctrine and the precedent regulations, and that it does not consider the sole use of the business name as an infringement of the trademark right.
Recent Decision of the General Assembly of Civil Chambers on the Use of a Sign of a Trademark in a Business Name
According to the practice of the Court of Cassation during the Decree Law period, if the use of a registered trademark as a business name or trade name, including the same or similar phrases, reached the level of “use as a trademark”, it was said that there was an infringement of the trademark right11. With IPL No. 6769, the Court of Cassation has also changed its jurisprudence and started not to consider the use of a trademark as a mandatory element. Accordingly, the evaluations made by the Court of Cassation General Assembly of Civil Chambers (“General Assembly”) with its decision dated 08.02.2023 and numbered 2021/446 E., 2023/61 K. clearly show that the new approach introduced by the IPL No. 6769 has been implemented.
In the case subject to the decision of the General Assembly, the phrase “MESA”, which is an essential element of the claimants’ trademarks, was used in the business name of the respondent. In this context, the General Assembly first determined that the sector of service in which the respondent operates is similar to the classes of service covered by the claimants’ trademarks. Therefore, it was evaluated that there may be confusion between the trademark of the claimants and the business name of the respondent regarding the source of the service provided; and it was stated that there is a likelihood that the business name of the respondent may be perceived as a trademark during the presentation of the service, as well as the possibility of damaging the functions of the registered trademarks of the claimants, since the service provided is likely to have the function of distinguishing it from others.
Another key point within the scope of the decision is that the use as a trademark, which is considered as a condition for trademark infringement by the Civil Chamber, is not considered as a mandatory condition by the General Assembly. The General Assembly emphasized that the use as a trademark of a business name is not mandatory in order for trademark infringement to occur, based on both the explicit wording of Article 7/3-e of the IPL and the precedent regulations. Accordingly, it has been noted that trademark infringement may also occur if there is a possibility of damage to the functions of the trademarks subject to the infringement claim.
Additionally, within the scope of the decision, to be considered as a trademark infringement, it is required that the sign in the registered trademark is used as a business name “in the field of commercial activity”. The use “in the field of commercial activity” is defined as the use of the sign in the trademark to obtain economic gain. In other words, it is stated that for a business name containing the same phrase with a trademark to constitute an infringement of the trademark right, the goods or services within the scope of the trademark registration must be used in the commercial field to obtain economic gain. Based on these explanations, it is emphasized that the use of the business name in the commercial activity is wider than the use of as a trademark and includes the use as a trademark as well.
Consequently, it has been concluded that the service classes covered by the trademarks of the claimants are similar and the use of the phrase “MESA”, which is the main element in the trademarks of the claimants, in its business name by the respondent in the services in which the trademarks are registered, constitutes an infringement of the trademark rights of the claimants under Article 29/1-a of the IPL and Article 7/3-e of the IPL and that this conduct of the respondent shall be prohibited by the claimants based on their trademark rights.
Conclusion
Under the new regime introduced by IPL No. 6769, “use as a trademark” is no longer a condition for the infringement of a trademark if the sign is used in a business name. However, according to doctrine, the use of the business name with the sign in the trademark does not lead to a categorical infringement of the trademark right. Accordingly, as per the General Assembly decision analyzed in our article, for the infringement of the trademark right, the sign in the registered trademark needs to be used as a business name “in the field of commercial activity”12. In conclusion, the new provisions introduced by the IPL create a wider area in terms of the protection provided to the trademark right vis-à-vis business names.
- Tekinalp, Ünal: Fikri Mülkiyet Hukuku, 5th Edition, Vedat, Istanbul, 2012, p. 436.
- Tekinalp, ibid, p. 433.
- Although different functions have been defined for business names and trademarks since these two names are not superior to each other, the priority right should be determined: Bozgeyik, Hayri: Marka Hakkının Korunması, On İki Levha, Istanbul, 2019, p. 101.
- Such registrations are referred to as “opportunistic company name registrations” and on the evaluations and suggestions made on this issue at the time of the Decree Law, see Aydoğan, Fatih: “Markanın Ticaret Unvanına Karşı Korunması, Mevcut Hukukî Durum – Değişiklik (Madde) Önerisi – İtiraz Yolu Ve/Veya Alternatif Çözüm Yolu Önerisi”, İstanbul Üniversitesi Hukuk Fakültesi Mecmuası, Vol. LXXI, No. 2, 2013, 27-50.
- “If the phrase "Korkmaz Ticaret" in the business name is also used in the signboards and boards, business documents, and business cards of the business, this constitutes the use as a trademark and cannot be accepted as the use of the business name alone. Such use of the business name constitutes an infringement of the trademark dated earlier containing the same words..” Court of Cassation 11th Civil Chamber, 20.11.2017, E. 2016/3885, K. 2017/6316, for the decision see: Bektaş, İbrahim: “Yargıtay Kararları”, Banka ve Ticaret Hukuku Dergisi, Vol. XXXIV, No. 1, p. 207-209, 181-252.
- Çolak, Uğur: Türk Marka Hukuku, On İki Levha, Istanbul, 2018, p. 554-556.
- The new regulation is drafted under the European Union Trademark Directive No. 2015/2436.
- On the different views in the doctrine, see Yasaman, Zeynep (Yasaman H. / Ayoğlu / Yusufoğlu Bilgin / Kartal / Yüksel): Yasaman Sınai Mülkiyet Kanunu Şerhi, Volume: II, Seçkin, Ankara, 2021, p. 1750.
- Rauf Karasu (Suluk / Nal), Fikri Mülkiyet Hukuku, 4th Edition, Seçkin, 2020, p. 214; Çolak, ibid, p. 555-556.
- Uzunallı, Sevilay: Marka Hukuku, 2nd Edition, Adalet, Ankara, 2021, p. 177-178.
- For a review of the Court of Cassation’s approach during the Decree Law period, see: Berzek, Ayşe Nur: “Ticaret Ünvanı - Marka Benzerliği ve Terkin Sonucu”, Prof. Dr. Hamdi Yasaman’a Armağan, On İki Levha, Istanbul, 2017, 131-135; Durceylan, Mekin: Marka Hakkına Tecavüz Halleri, Seçkin, Ankara, 2022, p. 125.
- In a recent decision of the General Assembly of the Court of Cassation, it is seen that the Decree Law is applied due to the date of the dispute and therefore, the condition of the “use as a trademark” continues to be required: Court of Cassation General Assembly of Civil Chambers, decision dated 15.11.2023 and numbered 2022/621 E., 2023/1097 K., lexpera.com.tr (Access Date: 28.04.2024).
All rights of this article are reserved. This article may not be used, reproduced, copied, published, distributed, or otherwise disseminated without quotation or Erdem & Erdem Law Firm's written consent. Any content created without citing the resource or Erdem & Erdem Law Firm’s written consent is regularly tracked, and legal action will be taken in case of violation.
Other Contents
In today's competitive business environment, the protection of trademarks plays a vital role in maintaining the competitive advantage of businesses and ensuring consumer trust. In this context, the protection of well-known trademarks is of particular importance in preserving the commercial value and reputation of...
Today, the globalization of economic activities leads to the transfer of numerous personal data internationally during the daily operations of companies. Therefore, like many national and international data legislations, Law No. 6698 on the Protection of Personal Data (“PDPL” or “Law”) includes protective...
The relationship between the author and the product of their creative activity is protected by moral rights. The moral rights of the author set out in the Intellectual and Artistic Works Act numbered 5846 (“IAWA”) include the authority to disclose the work to the public, the authority to designate the name...
The Court of Cassation has evaluated the criteria related to the similarity of the trademark in all of these decisions, and while showing how the criteria will be applied, it has also helped to determine the boundaries of the term “likelihood of confusion”. In this article, four different 2022 decisions...
The right to property, which is one of the concepts and values underlying the liberal economic and legal system, regulates the ownership relationship between the person and goods. The scope of the term “goods,” which is the subject of the concept of property...