The recent decision of the Supreme Court overturns longstanding precedents, ruling that an act cannot be simultaneously considered as both trademark infringement and unfair competition. In this article, we express our surprise and controversy regarding this decision. Before delving into our analysis, let’s provide some background on the case that led to this decision.
Background of the Supreme Court’s Decision
In a civil action before the IP court of Istanbul, the court of first instance determined that the defendant’s pharmaceutical trademark is visually and phonetically similar to the plaintiff’s registered trademark in class 5, thereby infringing the plaintiff’s trademark rights. However, the court dismissed the plaintiff’s claim of unfair competition, stating that the Intellectual Property Code (No. 6769) contains specific provisions for registered trademarks, making the application of general unfair competition provisions impossible and cumulative protection unattainable.
Both parties appealed this decision to the Regional Court of Appeals, where the plaintiff’s appeal was accepted. The Regional Court of Appeals reasoned that the defendant’s trademark application, which they continue to use on their products, was rejected by the Turkish Patent and Trademark Office due to the plaintiff’s registrations. The court concluded that this constituted unfair competition in violation of the rule of honesty under the Turkish Commercial Code. The defendant subsequently appealed this decision to the Supreme Court.
Decision of the Supreme Court
In its decision dated March 14, 2022 (Merit No. 2019/5189, Decision No. 2022/1852), the Supreme Court overturned the Regional Court of Appeals’ decision. The Supreme Court’s reasoning was that while previous laws allowed cumulative protection for acts of trademark infringement under both the IP Code No. 6769 (and the abolished Decree Law No. 556) and the abolished Commercial Code No. 6762, the new Commercial Code No. 6102, in its relevant article, excludes the protection of “name, title, or trademark” under unfair competition provisions. The Supreme Court argued that including trademark protection under unfair competition provisions would lead to interpretation difficulties and unnecessary redundancy. Subsequently, the case was returned to the Regional Court of Appeals, which complied with the Supreme Court’s decision and dismissed the unfair competition claims. The parties did not appeal this decision, resulting in the case’s finalization.
Evaluation of the Supreme Court’s Decision
The Supreme Court’s decision to reverse its established case law has surprised practitioners and academics alike. Cumulative protection, which refers to protection by multiple provisions in legislation, has been disregarded for trademarks with this decision. Notably, the new Commercial Code has been in effect since 2012.
In our opinion, abandoning cumulative protection in trademark law is not justifiable. Even if the Supreme Court insists on this stance, the reasoning provided by the unfair competition provisions of the new Commercial Code is insufficient to support it.
The relevant article’s reasoning does not explicitly eliminate cumulative protection for trademarks; instead, it implies that the repetition of terms such as “name, title, and trademark” is unnecessary.
Moreover, when the reasoning of the relevant article is evaluated as a whole, it is inconceivable that the first sentence clearly states that the principle and purpose are identical to the previous regulation, and that the last sentence does not explicitly declare the will to abandon the principle, despite the reference to the principle of cumulative protection. In 2012, if there was an intention to abandon the cumulative protection in force with an explicit provision in the Decree Laws, it should have been clearly stated in the reasoning. In our opinion, what is meant by the statement in the reasoning is that it is unnecessary to include terms such as name, title, and trademark in the new Commercial Code in view of the principle of cumulative protection.
Ignoring the principle of cumulative protection only serves infringers. The provisions of the Commercial Code concerning unfair competition are based on the principle of honesty. The purpose of the law is to uphold justice based on honesty, considering the specific circumstances of each case. Therefore, it raises the question of whom it would serve to restrict protection at this point. If the criteria are met, safeguarding through unfair competition provisions becomes crucial to ensure an environment of fair competition.
In light of the aforementioned points, we would like to emphasize that the Supreme Court’s decision does not currently establish a precedent, and we express our hope that the Supreme Court will reconsider its decision as soon as possible.