A trademark right holder has an exclusive right to use the registered trademark. However, Article 92 of Korea Trademark Act limits active effects of the trademark right by prescribing that consent of a prior-right holder must be obtained in case use of the registered trademark is in conflicts with earlier-filed patent rights, utility model rights, design rights, or an earlier-generated copyright. Meanwhile, as Article 92 does not define the case of a conflict between trademark rights, whether it would fall under an infringement of an earlier-filed registered trademark in case the trademark right holder of a later-filed registered trademark, which is the same as or similar to the earlier-filed registered trademark, uses one’s own registered trademark without consent of the right holder of the earlier-filed registered trademark.
1. Previous Stance of the Supreme Court
In case of a conflict between trademark rights, even in a case the right holder of a later-filed registered trademark uses the registered trademark without consent of the right holder of an earlier-filed registered trademark, it was deemed that an infringement is not constituted. (Decision of Case No. 86Do277, Supreme Court)
However, in case a later-filed registered trademark is invalidated by an invalidation trial, the corresponding trademark right is deemed void ab initio, and an act of using the later-filed registered trademark would constitute an infringement retroactively from the time of its first use. The Supreme Court ruled in previous decisions: in case a later-filed registered trademark is invalidated, ① in a civil suit, the defendant is responsible for compensation of damages for an illegal act from “the time of first use” unless the defendant has a justifiable excuse for not being aware of the existence of the plaintiff’s trademark or for believing that the defendant’s trademark does not fall within the scope of the rights of the plaintiff’s registered trademark (Decision of Case No. 2013Da21666, Supreme Court); and, ② in a criminal proceeding, a criminal act of infringement is recognized for an act committed after “confirmation of decision of invalidation,” (Decision of Case No. 86Do277), respectively.
2. En Banc Decision of Supreme Court Case No. 2018Da253444
(1) Factual Findings
(2) Key Points of the Decision
Priority among conflicting trademarks is determined based on the date of application for the trademark under the trademark laws. A trademark registered in violation of this is subject to invalidation by an invalidation trial. In addition, Article 92 of the Korea Trademark Act prescribes that a registered trademark may not be used without consent of the right holder of earlier rights in patent, etc., in case use of the registered trademark interferes with the earlier-filed patent rights, utility model rights, design rights, and earlier-generated copyright of another, so an infringement is constituted if the right holder of the later-filed registered trademark uses the registered trademark on designated goods without consent of the right holder of earlier patent rights, etc.
In view of rules and intent of trademark laws relating to such effects of trademark rights, the first-to-file rule, relationship with rights of others, etc., it can be seen that trademark laws are based on the principle that first-filed or first-generated rights take precedence between mutually conflicting intellectual property rights, and it would be reasonable to find that the principle equally applies to conflicts between trademark rights. Accordingly, if a trademark right holder has a trademark registered which is the same as or similar to an earlier-filed registered trademark of another, which was applied for and registered prior to the date of application for registration of the trademark and uses it without consent of the right holder of the earlier-filed registered trademark on goods which are the same as or similar to the designated goods of the earlier-filed registered trademark, regardless of confirmation of decision of invalidation against the later-filed registered trademark, an infringement of the earlier-filed registered trademark is constituted.
This decision from the Supreme Court changes only the previous decision which found “an infringement of an earlier-filed registered trademark is not constituted until the confirmation of a decision of invalidation of a later-filed registered trademark” and does not change any other decisions. Accordingly, it would be reasonable to view that treatment of the case after confirmation of decision of invalidation would follow previous decisions. A summary of this would be as follows:
Going forward, the right holder of a later-filed registered trademark which has close similarity to an earlier-filed registered trademark would need to pay sufficient attention, in important business deployments, to prevent a great harm as much as possible by reviewing (1) whether the consequences of losing the case is something the right holder can afford and by carefully determining (2) whether consent of the earlier right holder may be obtained in case it is necessary, as an infringement may be constituted even if the registered trademark is used before confirmation of decision of invalidation unlike before in case of a dispute. Otherwise, it would be a safer course of action not to use a trademark whose likelihood of dispute is great in the first place even if the trademark is registered.