Pago... the ECJ gave birth to a mouse

Fabio Angelini

The ECJ has today issued the long awaited decision in Pago (case C‑301/07). As you all recall the case pivoted around the “quantitative” side of the renown to be enjoyed in the EU by a mark in order to be protected against dilution.

Regrettably, rather than engaging in a sweeping review of current law/practice –as I had hoped- the decision is particularly disappointing.

The ECJ says that reputation must exist in a substantial part of the Community (“ Territorially, the condition as to reputation must be considered to be fulfilled when the Community trade mark has a reputation in a substantial part of the territory of the Community (at §27) which is a step ahead.

However, it does neither clarify the test to determine what is “substantial” -see the puzzling statement “As the present case concerns a Community trade mark with a reputation throughout the territory of a Member State, namely Austria, the view may be taken, regard being had to the circumstances of the main proceedings, that the territorial requirement imposed by Article 9(1)(c) of the regulation is satisfied ” at § 29,( OK. But why?), nor if the holding would have been the same if instead of Austria the country at issue had been, say, Latvia or Malta.

The real issue was whether or not an equivalence could be drawn between the concepts of “substantial part of the Community” and one Member State. It seems to me that after this decision the waters are still murky and one could argue one way or the other, …unless one may take an intermediate position which is that from now on, Austria is the test. Larger or equal to Austria, bingo! Smaller than Austria and you are out. But it does not seem really a good test.

In my view the ECJ lost a great chance to inject a little bit of reasonableness in the CTM system.

When the CTM regulation was first drafted, the Soviet Union was still a threatening monolith and the EU was formed by 10 countries more or less of comparable size and more or less with comparable economies (differences existed, of course, but not of the scale of today’s Union, in which there are countries whose entire population would scarcely qualify for a neighborhood of London or Rome). The European Union has changed but the law has not and the ECJ has not helped a bit…..

What does this mean for owner of a renown rademark? Well, it helps a lot because by referring to Pago and by proving renown only in a country, say UK, in theory according to Pago one may obtain an injunction in Italy w/out the need to prove renown over there ( actually not even use!). Practically, one for instance may use this decision to concentrate all the resources (lots of ads, lots of consumer surveys and so forth) one has in one single country (but make it a large one…) to obtain a declaration by a national court of renown in that country and then use it as a hammer to nail all other countries.

Of course then one needs to prove detriment or unfair advantage, but that’s another story…