National courts can be designated as Community trade mark courts to rule on issues related to the EU trade marks system. The ECJ has said that because the system is a pan-EU one those rulings should apply across the EU in most cases.
Courts can restrict the rulings just to countries in which a trade mark owner takes action or only to countries where a rival's activity threatens the function of the trade mark to identify the goods or services offered by the trade mark owner, it said.
"A Community trade mark court, such as that hearing the case in the main proceedings, has jurisdiction in respect of acts of infringement committed or threatened within the territory of one or more Member States, or even all the Member States. Thus, its jurisdiction may extend to the entire area of the European Union," said the ECJ ruling.
"The exclusive right of a Community trade mark proprietor ... extends, as a rule, to the entire area of the European Union, throughout which Community trade marks enjoy uniform protection and have effect," it said.
Decisions on trade marks must be made in relation to the whole of the EU because the trade mark protection extends across that whole area under the Community Trade Mark Regulation, the Court said.
"[Parts of the preamble to the Regulation say] that the effects of decisions regarding the validity and infringement of Community trade marks must cover the entire area of the European Union, in order to prevent inconsistent decisions on the part of the courts and OHIM and to ensure that the unitary character of Community trade marks is not undermined," said the ruling.
The ruling said that a previous ECJ decision had already established that Community trade mark protection must operate throughout the EU.
"In order to ensure that uniform protection, a prohibition against further infringement or threatened infringement issued by a competent Community trade mark court must therefore, as a rule, extend to the entire area of the European Union," it said.
While the ECJ said that decisions that applied only to single countries would risk fragmentation of the Community trade mark rights, it is acceptable when the trade mark owner only takes action in relation to activity in some countries.
"If a Community trade mark court ... finds that the acts of infringement or threatened infringement of a Community trade mark are limited to a single Member State or to part of the territory of the European Union, in particular because the applicant for a prohibition order has restricted the territorial scope of its action in exercising its freedom to determine the extent of that action or because the defendant proves that the use of the sign at issue does not affect or is not liable to affect the functions of the trade mark, for example on linguistic grounds, that court must limit the territorial scope of the prohibition which it issues," it said.
Community trade mark courts can order companies to pay penalties if they infringe another company's trade mark rights. The ECJ said that these penalties, too, must usually apply across borders.
It said that if other countries do not have laws allowing for penalties like the ones ordered by the Community trade mark court they must find another way to make the penalties a reality because they have an obligation to do so under EU regulations.
"Under the principle of sincere cooperation laid down in [the Treaty of the European Union] it is for the Member States’ courts to ensure judicial protection of an individual’s rights under European Union law," the ruling said. "By virtue of that same provision, the Member States are to take any appropriate measure, general or particular, to ensure fulfilment of the obligations arising out of the Treaties or resulting from the acts of the institutions of the Union."
"Where the national law of one of those other Member States does not contain a coercive measure similar to that ordered by the Community trade mark court, the objective pursued by that measure must be attained by the competent court of that other Member State by having recourse to the relevant provisions of its national law which are such as to ensure that the prohibition is complied with in an equivalent manner," it said.
The ECJ made its ruling following a referral by the Court of Cassation in France about a trade mark dispute involving two logistics companies.
Chronopost SA sued DHL Express France SAS in 2006 over DHL's use of the term 'WEBSHIPPING' to describe a mail service DHL offer to firms on the internet. Chronopost registered the term as a Community trade mark in 2000.
The regional court in Paris heard the original case and ruled that DHL had illegally used the trade mark to describe its mail service and banned DHL from using it again in France.
Chronopost asked the Court of Appeal in Paris to extend the ban to prohibit the term being used EU-wide by DHL, but the request was rejected. The court did uphold the original decision and ruled to prohibit DHL using both the terms 'WEB SHIPPING' and 'WEBSHIPPING' on French territory.
DHL and Chronopost made separate appeals to the Court of Cassation; DHL arguing against its ban and Chronopost arguing for the ban to be extended to all EU countries. The Court of Cassation referred the matter of whether a national ruling on trade mark infringement should apply EU-wide to the ECJ.
The original ruling should have applied to all EU countries as the regional court in Paris heard the case as a Community trade mark court, the ECJ said.