Some assembly required: The CJEU on balancing trade mark rights and freedom of expression in Inter IKEA Systems

Can a famous trade mark be used in a political campaign? Does freedom of expression constitute “due cause” for doing so? In its recent judgment in Inter IKEA Systems (C‑298/23), the Court of Justice of the EU (“CJEU”) addressed these questions.

Background

The plaintiff, IKEA, owns several Benelux and EU word and figurative marks containing the word “IKEA” for a broad range of goods and services, including “furniture, lighting, textiles and carpets”. These trade marks enjoy a reputation in Belgium and the EU.

A Belgian political party presented its political plan titled “IKEA-PLAN – Immigratie Kan Echt Anders” (meaning “IKEA-Plan – Immigration Really Can Be Different”) at a press conference concerning a reform of Belgian asylum and immigration policy. Although the speaker stated that the plan did not refer to the claimant, illustrations shown during the conference contained signs corresponding to the IKEA trade marks and characters resembling those appearing in the assembly instructions for IKEA’s products, like the following: 

 

IKEA sued the political party, its representative and the defendant, a not-for-profit association which conducted the political campaign for the Belgian political party, for trade mark infringement before the Brussels Business Court. That court only considered the claim against the defendant admissible and referred several questions to the CJEU concerning the interpretation of “due cause” for taking unfair advantage of the reputation and distinctiveness of a trade mark with a reputation, in particular with reference to the freedom of expression.

The CJEU’s decision

1. Use in the course of trade for goods and services?

The Court noted that the referring decision does not indicate whether the contested conduct was in the course of trade in order to distinguish goods and services as required by the provisions on trade marks with a reputation, namely Art. 9(2)(c) of the EU Trade Mark Regulation (“EUTMR”) and Art. 10(2)(c) EU Trade Mark Directive (“EUTMD”).

However, the referring court also asked about the interpretation of Art. 10(6) EUTMD, which is optional for EU Member States and was implemented into Belgian law. This article allows national law to protect a sign against use that takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trade mark without due cause. The CJEU held that Art. 10(6) EUTMD requires neither use in the course of trade nor use for goods and services.

Even though it is for the national court to determine whether the use was in the course of trade and for goods and services, the CJEU provided some guidance:

As a not-for-profit association, the defendant did not pursue an economic activity. However, it can act in the course of trade if it acts as an economic operator.

On the question of use for goods and services, the Court observed that a political programme for which the defendant used the “IKEA” marks does not constitute goods or services. However, use on promotional items or in promotional online content may be use for goods and services. 

In the following, the judges provided guidance on both Art. 10(2)(c) EUTMD and Art. 10(6) EUTMD:

2. Due cause under Art. 10(2)(c) EUTMD

The judges reiterated consistent case law, according to which “due cause” does not only include objectively overriding reasons but may also relate to the subjective interests of the defendant.

Recital 21 of the EUTMR and Recital 27 of the EUTMD emphasise the need to apply the EUTMR and the EUTMD in such a way as to ensure full respect for fundamental rights and freedoms, in particular freedom of expression. The Court inferred that the rights of a trade mark owner protected by Art. 17(2) of the Charter of Fundamental Rights (“ChFR”) may be limited by the need to protect the freedom of expression of a third party enshrined in Art. 11 ChFR and constitute “due cause”.

The right to freedom of expression also applies to legal persons and profit‑making companies engaged in commercial activities. It guarantees, inter alia, the exchange of cultural, political and social information and ideas of all kinds, even those that offend, shock or disturb.

The mere reliance on freedom of expression is not sufficient to constitute due cause. Rather, a balance must be struck between the rights of the trade mark owner and freedom of expression. To this end, the defendant must set out the specific grounds for use of the reputed trade mark in connection with the exercise of its freedom of expression and demonstrate that those grounds take precedence over the rights and interests of the trade mark owner.

In order to strike a balance between conflicting rights, the CJEU drew on case law of the European Court of Human Rights (“ECtHR”). The national court must determine the relative weight of the rights in the light of the particular circumstances of the case and the comparative importance of the concrete aspects of those rights, the need to restrict, or to protect, each of them, and the proportionality between the means used and the aim sought to be achieved. In particular the following factors should be considered in this balancing exercise:

a. Due cause cannot be claimed where the defendant intends to infringe the reputed trade mark.

b. Use of the reputed sign in good faith vs. in bad faith.

c. Does the use contribute to a debate in the public interest or is it merely commercial? While freedom of speech may be limited more strictly in commercial environments, political speech and matters of public interest allow little space for limitations of freedom of speech.

d. With respect to political speech and debate, the form of the expression and its potential satirical nature are important, especially if satire is used. This is a form of artistic expression and social commentary which, by its inherent features of exaggeration and distortion of reality, is naturally intended to provoke and agitate. Any interference with the right to use satire needs to be examined with particular care.

e. The damage to the trade mark owner and its exclusive right and whether this is proportionate to the interference by the defendant. The judges clarified that the trade mark owner does not need to tolerate use which is disproportionately detrimental or would even affect adversely the substance of the trade mark right.

f. The intensity, extent and methods of use by the defendant, the degree of similarity of the marks and the degree of reputation of the earlier mark.

g. The impression created by the defendant’s use, in particular that the trade mark owner agrees with or supports the political message even though the owner intends to be neutral or supports a different political message.

h. Due cause may be accepted where the sign is used to convey an idea or opinion relating to the mark, its proprietor, its commercial practices, the goods or services or where such a sign is used to initiate or fuel a debate in the public interest or where it is necessary for other reasons, such as the linguistic meaning of an element of the reputed mark or the fact that it has become a public cultural reference or part of everyday language.

The CJEU did some of the work for the national court and reviewed some of the aforementioned factors:

• The judges mentioned that “IKEA” itself has no meaning that would justify its use in the course of trade for goods and services by third parties. The mark is not a cultural reference or part of the common language.
• The defendant’s use did not feed a debate concerning IKEA or its goods and services.
• The defendant’s use concerned a debate of public interest but IKEA’s trade marks had no connection with it.
• The defendant used IKEA’s marks in a specific, IKEA-like font, colour and style.
• The defendant used the sign not only once at a press conference but several times and also online.
• It could not be ruled out that the use of the trade mark created the impression that IKEA endorsed the political message of the defendant, despite the defendant’s statement that its use of IKEA did not refer to the plaintiff.
• The highly similar or even identical use of IKEA’s trade marks may cause significant detriment to their repute and their owner.

The judges summarized that it does not appear that the interests of the defendant outweigh those of IKEA. However, this is for the national court to decide.

3. Due cause under Art. 10(6) EUTMD

If the referring court finds that the defendant did not use “IKEA” in the course of trade for goods and services, the judges also provided brief guidance on Art. 10(6) EUTMD.

The Court held that the same principles apply under Art. 10(2)(c) EUTMD with one important caveat:

The freedom of expression in the non-commercial sphere benefits from broader protection than that of strictly commercial expression. Thus, the result of the balancing exercise need not be the same as that under Art. 10(2)(c) EUTMD.

Comment

1. The case is a landslide victory – for the defendant. Of course, it may not be a victory from a legal point of view but at least a political one. The case attracted significant attention, which gave the defendant and the party it worked for a platform to promote their political message. Even if IKEA wins the legal argument, the decision might not deter political parties from exploiting famous trade marks but rather the opposite.

Therefore, it should be considered with particular care whether action should be taken in such cases. If it concerns a single use of the trade mark, a lawsuit might not be worth the trouble and provide the defendant with the platform the claimant does not wish them to have.

What should also be considered in such instances is filing a criminal complaint for trade mark infringement against the politicians involved. The representatives of the defendant and the political party certainly had full knowledge of all relevant facts, including the fact that IKEA owned registered trade marks. Even if the criminal complaint ultimately leads nowhere, the prospect of criminal charges may deter politicians from misappropriating trade marks.

2. The decision shines a light on the weak spots of trade mark protection, namely their use by third parties outside of the commercial sphere and not for goods and services. Enforcement of trade marks in EU Member States that have not implemented Art. 10(6) EUTMD may prove to be more challenging. In Germany, for instance, the courts acknowledge personality rights of companies and prevented political parties from using trade marks for political campaigns.

3. The CJEU confirmed that national courts can draw on case law of the ECtHR when solving fundamental rights issues where the provisions of the European Convention on Human Rights and the ChFR are comparable – as in the case of freedom of speech. This can reduce the need for preliminary rulings in similar cases.