INTA (International Trademark Association) defines a Coexistence Agreement as follows: an agreement that allows two or more parties to determine the conditions under which similar trademarks can coexist without a likelihood of confusion, and live side by side peacefully. Such agreements are usually restricted by geographical boundaries when using the same mark for identical or similar goods or services (an agreement restricted in this way is also called a “concurrent use agreement”).
These agreements have been in use for many years. Since only a small portion of them ever become the subject of litigation, it is assumed that the majority remain confidential.
One of the most notable agreements in this area is the one between Apple Corps and Apple Computer (Industrial Indemnity Company v. Apple Computer Inc., Court of Appeal of the State of California, First Appellate District, Division Three, filed 16.04.1999, Ref. No. A074119).
The first agreement between the parties dates back to 1981 and concerns the coexistence of their products. Under the agreement, Apple Computer would not use its name and logo on computer products specifically suited to music recordings, and neither party would oppose or seek to cancel the other’s trademark. Under this agreement, both parties would continue their own business and build their reputations without infringing on the other’s rights.
However, particularly in the technology sector, where developments are difficult to predict, such agreements may not remain robust or durable over time. 1981, when Apple Corps and Apple Computer entered into their agreement, was a period when computer technology had not yet developed. Over time, computer products and services began to intersect — computers eventually came to be used for “recording,” which was Apple Corps’ core business. For this reason, in agreements concerning fast-developing, technology-based goods and services, it becomes important to specify — through a dedicated clause — whether the arrangement needs revisiting at a certain date, to ensure its continued workability.
The Community Trademark Regulation contains no specific provision on such agreements, but OHIM’s published guidelines explain how they are to be assessed (Opposition Guidelines, Part 2, Chapter 2D, 2007).
Accordingly, proof of coexistence of marks may carry a certain weight at national level (Aguirre y Compañia, S.A. v Paul Smith Limited (PAUL SMITH) [1999]; Lisap Laboratori Cosmetici S.p.A. v Bellure N.V. (LISA DELUX) [1999]).
However, the guiding weight of coexistence must be treated with care. Two signs coexisting at national level may have different underlying reasons — for example, a different prior legal situation between the parties, or an agreement regarding earlier rights (Hugo Boss AG v Bossi S.p.A. (BOSSI) [1999]; Mr. Francisco Gascon Prats v SIDI SPORT S.a.s. di Dino Signori & C. (SIDI) [1999]).
In addition, such an agreement requires proof that the marks in question are actually used in the relevant market. It is not enough to show that the marks are simply registered with the relevant Office (Marco-Chemie Eugen Martin KG Chemische Fabrik v Malco Products, Inc. (MALCO) [1999]; Luxor Writing Instruments Private Limited v Neoluxor, s.r.o. (NEOLUXOR) [2005]).
Various Board of Appeal decisions have also emphasized that what matters is not only registry entries but the marks’ actual presence in the marketplace (ANTAS – GESTAO E INVESTIMENTOS LDA. v MAGLIERIA S.L. (NO LIMITS) [2002]; PEPSICO, Inc. v Convent Knabber-Gebäck GmbH & Co KG (CHEE.TOS) [2002]).
Coexistence on the register may be a factor taken into account in the assessment of likelihood of confusion, but this is typically relevant only where the relative grounds examination of the national registration in question clearly reflects it.
In the GOLDSHIELD decision, the Board relied on the fact that the marks had coexisted in the market for many years and that the opposing party had made no attempt against the applicant’s national mark. The Board treated this as a fairly strong, though not conclusive, indicator that there was no likelihood of confusion — a position at odds with the Opposition Division’s approach, which regards market coexistence as carrying some weight against likelihood of confusion, but not as strong evidence of its absence.
For this reason, agreements between parties are generally not taken into account unless the following conditions are met:
The existence of an agreement between the parties during OHIM proceedings, or
The existence of a national court decision.
If the agreement is disputed, it will not be taken into account. Where litigation is ongoing, the Opposition Division will decide whether to suspend proceedings. Consequently, private agreements are no longer automatically disregarded either.
In the BAT decision of 30.01.1985, it was stated that “such agreements are lawful and useful.” In the OHIM Opposition Division’s COMPAIR decision, upheld by the Board of Appeal and by the Court of First Instance of the European Communities under case T-90/05 (OMEGA), it was held that the assessment of likelihood of confusion cannot be bound by the terms of an agreement between the parties. It was also found that filing a Community trademark application by one party while an agreement exists between the parties can constitute grounds for a finding of “bad faith.” In that case, the fact that the opposing party OMEGA SA had filed an application despite the agreement expressly stating it would neither apply for nor use a mark containing the word OMEGA for certain goods was considered, at the very least, a matter warranting assessment for bad faith.
In the 2007 SKY decision, the Board gave serious weight to the agreement between the parties. As the agreement contained provisions relating to the marks SKYROCK, SKYZIN and SKY CHANNEL, it was found that the contested SKY sign fell outside the scope of that agreement.
Written by: Deniz Çelikel • Patent and Trademark Attorney
This article by Deniz Çelikel is presented without modification as her first article on the topic, originally written in 2009. It forms the basis for the treatment of this subject in her books, publications and lecture notes.
