Although by no means yet common place, it is possible for owners of trademarks to successfully take legal steps against product pirates in this country. The available legal remedies are based on provisions of three different laws, namely the Commercial Code, the Trademark Act and the Criminal Code.
Unfair competition in the Czech Republic is generally regulated in sections 44-55 of the Commercial Code. The general definition of unfair competition under Czech law is " conduct that is contrary to the standard practices of competition and conduct that may be detrimental to consumers and competitors." sec 44. The act then lists several specific acts which are to be considered as acts of unfair competition, notably for matters of product counterfeiting:
Sec 46: Deceptive marking of goods or services: This is defined as marking of goods or services in such a manner that it may create an erroneous impression in business circles that the goods or services so marked originate in a certain country, region or location or are made by a certain producer. It is irrelevant whether such markings appear on the goods, packaging, in commercial documentation, etc. or whether the deceptive marking was provided directly or indirectly, or by what means.
Sec 47: Acts contributing toward mistaken identity: These acts include use of a specific designation, a specific pattern or a specific design related to products, services or business documentation which consumers associate with a certain enterprise (e.g., packaging, printed matter, advertising materials, etc.) if capable of creating the danger of mistaken identity in respect of a certain enterprise, its commercial name, its special designations, products or services. Acts contributing toward mistaken identity shall be considered the imitation of another product, its packaging, etc. unless this imitation involves elements which are predetermined functionally, technically or aesthetically, and the imitator has taken every possible measure which could be required of him to avoid the possibility of mistaken identity, or at least has restricted such danger substantially.
Sec 48: Misappropriation of reputation: This is defined as making use of the reputation of the enterprise of a competitor, its products or services in order to gain extra benefits for one's own or another's business activity which would otherwise not be achieved by such person.
From the procedural point of view, an action based on the above provisions would be brought in a district or commercial court, depending on the circumstances. The plaintiff in such an action can claim preliminary and permanent injunctive relief, damages, surrender of unjustified enrichment and publication of the final decision. It would be possible to receive a preliminary injunction if the plaintiff so requests and the court decides based upon the offer of evidence in the petition that it is necessary to temporarily regulate the relations of the parties or if there is a risk to the ultimate execution of the final decision. As the court does not normally have a hearing on the request for preliminary injunction, it is important that the petition presents clear evidence of the need for the injunction.
Rights of trademark owners are set forth in sections 14 and 15 of the present Act on Trademarks. Article 14 (1) states that no one may use, without the consent of the owner of a trademark, a denomination identical or confusingly similar to the trademark for identical or similar products or services for which the trademark is registered or use it in connection with such products or services; in particular, place it on products or their packaging, offer or introduce in the market products thus marked or store them for this purpose, import or export products with such denomination or use the denomination in any business name, correspondence or advertising.
The Trademark Act specifically allows that the owner of a trademark has, vis-a-vis any person who introduces or intends to introduce in the market products or services, the right to information on the origin of the products or documents accompanying the products or services on which there is a denomination identical or confusingly similar with its trademark. Furthermore, at the request of the owner of a trademark, the Customs Office shall not release any goods of commercial nature into free circulation if their marking infringes the rights of the owner of the trademark.
Article 15 (1) of the Trademark Act allows that the owner of a trademark may petition a court of justice to prohibit parties from using its trademark or denominations confusingly similar to it for identical or similar products or services and for any articles marked in a manner infringing its rights to be withdrawn from the market. If any damage has been caused by any infringement of the rights attaching to a trademark, the injured party is entitled to compensation therefor. If any prejudice of non-financial character has been caused, the injured party has a right to reasonable satisfaction, which may consist of financial compensation.
Finally, under the provisions of the Criminal Code, individuals can be criminally liable for infringement of trademark rights. The relevant provisions of the Criminal Code state that "an individual selling products bearing the trademark of another party who has exclusive right to such trademark, or selling products bearing a mark which is confusingly similar, without permission, may be punished by imprisonment of up to six months, monetary fine or forfeiture.". The allowed monetary fines range from 2.000, Kc to 5.000.000, Kc (approximately DM 115,- to DM 275.000,-) and may be levied if the defendant obtained or attempted to obtain monetary benefit from his intentional acts. Forfeiture may be imposed on items used in the commission of the crime or acquired as a result of the crime.
Generally the regional or commercial civil courts would be involved in the obtaining decisions based on violations of the Commercial Code or the Trademark act, with the exception that matters involving the validity or cancellation of a trademark are decided first by the Office of Industrial Property. Enforcement of these decisions would primarily be the responsibility of the courts, through use of court officers or customs authorities. As for the Criminal Code, the basis for a prosecution would either be with the police or directly with the state prosecutor.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
