Cancellation actions could surge as TÜRKPATENT and Court of Appeal remain at odds over acquired rights principle

The Turkish Court of Appeal and TÜRKPATENT’s diverging practices when it comes to implementing the acquired rights principle is a controversial issue.

While TÜRKPATENT strives to harmonise its decisions with that of the Court of Appeal – as explicitly mentioned in its latest webinar in October 2023 – it is critical for rights holders to consider this issue when asserting an acquired rights claim, even during the administrative proceedings. This is especially because, as of 10 January 2024, cancellation actions are now handled by TÜRKPATENT as administrative proceedings and differing practice between these two bodies puts acquired rights claims at risk.

Emergence of the acquired rights principle

The main purpose of the acquired rights principle is to allow an entity that owns a registered trademark to create and register new marks that preserve the main element of and its connection with the party’s registered trademark in terms of origin, without infringing on the rights of any other entities.

In a way, the principle aims to enable entities to register and use their renewed brand images and trademark series without any unfair advantage or likelihood of confusion among consumers.

Accordingly, a prior-dated registered trademark constitutes an acquired right for subsequent trademark applications of that entity under certain exceptional circumstances, highlighted by several Court of Appeal decisions.

Court of Appeal’s conditions

The 11th Civil Chamber of the Court of Appeal handed down two decisions that form the basis for the evaluation of acquired rights. These were in ECE LADY/ECE TOFF (19 September 2008, file 2007/7547, decision 2008/10251) and Ülker DONUT (14 November 2008, file 2007/11505, decision 2008/12839).

As outlined in these rulings, a party’s earlier trademark can constitute acquired rights for its subsequent trademark applications under the following conditions.

• The trademark that forms the basis for an acquired right claim should be registered, used for a long period of time and should not be the subject of a dispute between the parties.
• The new trademark should preserve the main element of the original mark that forms the basis for the acquired right claim, and be created in such a way that preserves its connection with the business and the impression that it makes on the consumer.
• The new trademark should not be more similar to the other party’s mark than it is to the trademark that forms the basis of the acquired right, nor should it lead to a likelihood of confusion and/or an unfair advantage.
• The new trademark should cover goods/services that are identical to or the same type as those covered by the trademark that forms the basis for the acquired right claim (ie, it should not cover a broader specification).

This approach by the Court of Appeal has been adopted by TÜRKPATENT to a large extent, but it is not currently a uniform practice.

Diverging practices – the use requirement

The subjective evaluation of the main element of and the similarity between the trademarks besides the scope of the goods/services – for which TÜRKPATENT seems to be stricter – is one of the most controversial issues often encountered when examining the concept of acquired rights claims.

Nevertheless, the main difference between the current practices of TÜRKPATENT and the Court of Appeal is the requirement for the use of the trademark registration that forms the basis for the acquired rights claim. TÜRKPATENT’s current practice is to take the period for which the trademark has been registered into consideration, regardless of whether it is used or not, and require that the subject trademark has been registered for at least five years. 

However, the Court of Appeal now explicitly requires actual and serious long-term use as well as registration for the acceptance of acquired right claims. The most prominent view on this is that a trademark that has been registered for at least five years (and is theoretically vulnerable to non-use cancellation) but has not been used seriously should not constitute acquired rights to its owner.

Therefore, even if TÜRKPATENT considers a trademark to constitute acquired rights under these conditions, then the acquired rights claim may still be rejected in case of a lawsuit in accordance with the established practice of the Court of Appeal.

Cancellation actions could be on the rise

As of 10 January 2024, cancellation actions – previously held before the relevant court as lawsuits – are now handled by TÜRKPATENT as administrative proceedings under Article 26(2), in accordance with the provisions of Article 192 of the IP Code. The risk of facing a cancellation action may increase after this date for trademarks that have been registered for at least five years but have not been validly used. Citing such criteria as grounds for an acquired right claim, simply due to the fact that TÜRKPATENT does not currently require use, may directly alert the other party to initiate a separate administrative non-use cancellation action against that registration.

Most of the controversies on this topic focus on the importance of long-term use for the acceptance of acquired right claims rather than registration. It could be argued that a trademark registered for more than five years without use constitutes acquired rights to a new application, whereas a trademark that has been registered for four years but has had extensive use and recognition does not, which is against the principle’s main purpose. Some even claimed that long-term serious use of a trademark should be sufficient to constitute acquired rights to its owner with no requirement for registration, so long as the remaining criteria are met.

The road ahead

During its webinar on ‘The Concept of Acquired Right in Trademark Law’, TÜRKPATENT mentioned that it is working to harmonise its practice with the recent Court of Appeal decisions. It has also signalled that the concept of acquired rights may be added to the Trademark Examination Guideline, which outlines the office’s practice.

The 2021 Trademark Examination Guideline briefly references the concept of acquired rights (page 91), indicating that these cannot be taken into consideration during the examination of an application on absolute grounds, except for under Article 5/1(ç) of the IP Code which prohibits the registration of identical or indistinguishably similar trademarks that cover identical or the same type of goods/services in the name of different owners.

However, there is no detailed explanation about the concept or criteria considered during the evaluation of acquired rights on relative grounds, or on the basis of Article 5/1(ç) on absolute grounds. The potential addition to the guideline will hopefully result in a more uniform practice, following comprehensive consideration and evaluation of the controversial issues in terms of the diverging practices of TÜRKPATENT and the Court of Appeal.

For the time being, rights holders should strengthen their acquired rights claims not only through a valid trademark registered for at least five years, but also with evidence of actual and serious long-term use.