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Specific Model or Sizes Not Limited to the "Original Goods" Under Prior Trademark Use Defense Exception
Taiwan adopts a "first-to-file" trademark system, meaning that the protection over a trademark is granted to the first applicant to file an application and subsequently obtain the registration. Even so, there is an exception with regards to this general rule given that the concept of use is still essential under the Trademark Act in Taiwan. According to Article 36-1(3) of the Trademark Act, a good faith user may establish a defense against an infringement claim under the following condition: (1) The user has in good faith been using an identical or similar trademark with the same or similar goods or services before the date of application of another person's trademark registration; (2) This exception applies only to the original goods or services with which the mark has been used; (3) The trademark registrant also may demand that the user add an appropriate distinguishing indication.
While the Article protects the trademark registrant's right by restricting the good faith user's use of trademarks to the original goods or services, this restriction will inevitably limit the good faith user's future business operations and in turn affect their rights to work. Therefore, the scope of "the original goods or services" in this provision has still remained unsettled in practice. In a recent civil litigation case regarding trademark infringement, the Intellectual Property Court expressed an important view on this issue.
The plaintiff in this case is a service provider of a patent analysis platform. The plaintiff acquired the registration of the trademark at issue in March 2010, and designated the goods such as magnetic data carrier with computer program, magnetic disk with computer program, CD with computer program, optical data carrier with computer program. In February 2017, the plaintiff found that the defendant was using an identical trademark on laptop bags on the internet. On the same month, the plaintiff dispatched a cease and desist letter requesting the defendant to stop selling the laptop bags. In response, the plaintiff refused the request based on the reasons that the plaintiff's trademark registration did not cover laptop bags and the trademark on the laptop bags can be distinguished from the plaintiff's registration since the trademark was used along with the defendant's house mark.
Afterwards, the plaintiff filed a civil lawsuit against the defendant with the Intellectual Property Court, claiming for damages for trademark infringement and demanding that the defendant should add appropriate distinguishing indications on its products. In addition, plaintiff claimed that the defendant should only use the trademark on specific models that were put on sale before the date of application of the trademark at issue if the good faith trademark prior use exception applies.
With regards to Article 36-1(3) of the Trademark Act, the Intellectual Property Court explained that the legislators of Taiwan did not intend to limit the scale of production and sales of a good faith user, and neither did they intend to impose limitation on specific models or sizes on the "original goods" in the provision.
The Intellectual Property Court further specified that, the defendant began using the trademark at issue in good faith as early as December 2008 and did not suspend from using the trademark since. Although the plaintiff applied for the trademark in 2009, the designated goods of the registration were quite different from the goods such as the backpacks produced and sold by the plaintiff. In addition, plaintiff's registration and the defendant's use of the trademark had coexisted in the market for a long time. Given the above, the Intellectual Property Court concluded that the defendant's future use of the trademark should not be limited to the specific models that were put on sale before the date of application of the trademark at issue.