Determination of Trademark Ownership
13.09.2023
INTRODUCTION
This legal opinion analyzes the Judgment of the Appellate Court Skopje, GŽ no.3207/22 dated 17.11.2022, by which in the procedure following an appeal filed by the defendant, the appeal request was rejected and the Judgment of the Basic Civil Court Skopje, P1 no.524/21 dated 27.04.2022 was affirmed (once amended by the Supreme Court). The judgment of the Appellate Court Skopje is analyzed from the aspect of the reasoning given by the court when it confirms the first-instance judgment.
FACTS OF THE CASE
The persons (, N.M, D.M and D.M-plaintiffs), filed a lawsuit against B.M for determining the right of ownership of a trademark.
The first plaintiff is the wife, and the second and third plaintiffs are the children of D. M former from Skopje and the same are his heirs. DM died on July 15, 2014. D. M is the brother of the defendant B. M and the same in 1993, started a family business by establishing A. Production. According to the official site of A. P, for ten years of existence (1993-2003), through the activities undertaken by D. M and B. M as founders, A.P as production, and therefore as a brand from the specific area, became so recognizable that it received the status of the first buyer for Macedonia and Serbia when it comes to the biggest agents of the world music industry, i.e. A. P grows into the largest promoter and executive production house in the Republic of Macedonia. For the legal entity, where D. M. is the manager of the "Society for Cultural Entertainment Productions, Trade, Hospitality, Traffic and Services" G. Agency. A. P. DOOEL export import Gostivar, submit an application for trademark registration. The holder of the right to the trademark is the Society for Cultural Entertainment Productions, Trade, Hospitality, Traffic and Services Gloria A-A. P DOOEL export import Gostivar, where the manager is D. M. From the article about A. P made for the purposes of Super brand, it is evident that Super brand has indicated the development of brand A. P is D's common share. M and B. M. In 2009, a new trademark application was submitted, requesting the recognition of trademark rights for the same logo for which they already have a solution for a recognized trademark. Still, now, in the new application, they are also seeking protection for new classes, that is, the new application refers to the same logo for class 35 and class 41.
Due to practicality in the operation and undertaking of the activities, as the applicant for the trademark application in 2009, only B.M. BM never objected that D. M is unjustifiably using the trademark representing the logo which has become a recognizable brand.
The plaintiffs, with the claim, sought to establish that D. M is the owner of 1/2 ideal part of the trademark right, registered in the trademark register and to oblige the defendant B. M, on the basis of this judgment, to undergo registration in the register of trademarks at the State Office for Industrial Property.
PROCEDURAL ACTIVITIES, FIRST INSTANCE AND SECOND INSTANCE JUDGMENT
The Basic Civil Court Skopje accepted the claim of the plaintiffs.
During the retrial, the court took into account the instructions of the Supreme Court, which refer to the evaluation of the possible statute of limitations of the lawsuit referred to by the defendant in this procedure, according to Art. 295 of the Industrial Property Law. This court considered that the mentioned legal provision is not applicable in this case, because it is not a question of a lawsuit for the protection of trademark rights to which the said law is applied, but rather a question of ownership in accordance with the Law on Ownership and Other Real Rights, according to which, the realization of such a right does not expire.
In the specific case, the dispute between the parties is whether the now deceased D.M acquired the co-ownership right to 1/2 ideal part of the said trademark due to equal contribution and the creation of the same, in a family community and due to the uninterrupted use of the trademark, together with the defendant until his death in 2014.
When passing the judgment, the Basic Civil Court Skopje and the Appellate Court Skopje applied Articles 59 and 63 of the Law on Ownership and Other Real Rights ("Official Gazette of the Republic of Macedonia" No. 18/2001; 92/2008; 139/2009 and 35/ 2010), and Articles 3,6,7,8 175, 176, 206, 217 of the Law on Industrial Property ("Official Gazette of the Republic of Macedonia" No. 21/2009, 24/2011, 12/2014, 41/2014, 152/2015, 53/2016 and 83/2018 and 31/2020).
Considering that it is indisputable that the contribution of the two brothers to the creation and acquisition of the rights is equal (which was also confirmed by the testimony of the defendant at the hearing), there is no legal obstacle to transforming the joint property into a co-ownership right of 1/2 ideal part of a trademark, in the sense of art. 63 of the Law on Ownership and Other Real Rights.
Appellate Court Skopje rejected the defendant's appeal as unfounded and confirmed the first-instance judgment of the Basic Civil Court Skopje. He stated that the first-instance court acted correctly when it determined that the now deceased D. M. acquired the co-ownership right of 1/2 ideal part of the trademark due to equal contribution and creation of the same, in a family community and due to the uninterrupted use of the trademark, together with the defendant until his death in 2014.He noted that the fact that only the defendant is registered as the holder of the trademark right in the register of the Industrial Property Office, which is a public book, does not exclude the right of the plaintiffs as legal heirs to prove the right of their legal predecessor, acquired in a family community and with a joint contribution with the defendant.
ANALYSIS OF THE JUDGMENT
The right to intellectual, that is, industrial property is part of civil law because it is a system of norms that regulate civil legal relations that arise during the creation of the exclusive subjective civil law. The Appellate Court acted correctly when it confirmed the first-instance judgment and rejected the defendant's appeal as unfounded. From the content of thejudgment, it can be concluded that AP is a family business, started to be created at the time when the two brothers lived in a family community, continued to function and act in all fields and in all aspects as a family business and in all decisions and in all actions, they share a common share as brothers, D.M and B.M. Pursuant to Art. 92 of the Law on Ownership and Other Real Rights - "In a family union, every member, except for spouses and common-law partners, acquires the right to own things for himself (separate property) unless otherwise agreed upon or if this does not result from the circumstances of the case".
According to Art. 93 of the Law on Ownership and Other Real Rights "when it is agreed that the right of ownership of things in a family community is acquired for several members or it arises from the circumstances, the size is determined according to the agreement, and according to paragraph 2 of the same article, if there is no special agreement, the size of the share for each member is determined based on the contribution of the members who participated in the acquisition of the right of ownership, depending on the effort invested. According to the commentary of the Law on Ownership and other real rights to this article by Dr. Kiril Chavdar (2012 edition), if there is an agreement, even tacitly reached, or if it arises from the circumstances of the case and in the family community, joint property is created (until the share of each member of the family community is determined, joint ownership arises). According to Art. 59 of the Law on Ownership and Other Real Rights "When the thing is jointly owned, the fact that it is recorded in the public book as the property of only one of them has no influence on it". Pursuant to Art. 63 of the Law on Ownership and Other Real Rights, each co-owner may request the determination of the share of the joint property, if such determination is permitted and possible. This does not legally expire. Also, in this article, it is established that each joint owner can request at any time in the joint property to determine the parts so that it will be determined how much part belongs to the joint owner for his share in the joint property. With the determination of his share, he becomes a co-owner with others who remain joint owners. Pursuant to Art. 3 of the Law on Industrial Property - a trademark is an industrial property right, that is, the trademark right is an ownership right (subjective property right).
Subjects of industrial property rights as stipulated in Article 5 of the Law on Industrial Property can be domestic and foreign natural and legal persons. The Law on Industrial Property stipulates that the property right acquired in accordance with the Law on Industrial Property can be regulated and exercised by the subjects and in accordance with an international agreement, other domestic law, and agreement (Articles 6 and 8 of the Law on Industrial Property).
The industrial property right, as an ownership right, is part of the estate and the same can be inherited, hence the active legitimation of the plaintiffs.
Given that the Industrial Property Law does not specifically regulate the acquisition of such rights in a marriage or family union, in accordance with the property character contained in the trademark law, the provisions of the Law on Ownership and other real rights in terms of the way of acquiring rights in such a community also find appropriate application. Namely, from the content of the judgment, it can be determined that the court does not fully equate the right to the trademark with the real right, but considering the legal basis of the claim, by applying these legal provisions, it characterizes the way of acquiring the common, that is the co-ownership of the trademark that is the subject of this dispute.
It is indisputable that the registration of the trademark in accordance with the Law on Industrial Property is subject to formal rules and gives the holder of the trademark right protection from third parties who would use the trademark in trade without any basis and without authorization. However, the fact that this law provides for the possibility of inheritance, points to the conclusion that the trademark can represent a legacy of the right holder.
Given that the subject of this dispute is the determination of co-ownership rights to a trademark, acquired in a family community, the specific provisions of the Law on Ownership and other real rights referred to by the plaintiffs in this procedure have appropriate application. The plaintiffs, as legal heirs of the first line of succession of the deceased brother of the defendant, have a legal interest in conducting this dispute, in a situation where the defendant, as a registered holder of the right in a public book, challenges the same to their legal predecessor, that is, to the current plaintiffs.
The fact that only the defendant is registered as the holder of the right to a trademark does not exclude the right of the plaintiffs, as legal heirs in this dispute, to prove the right of their legal predecessor, acquired in a family union and with a joint contribution with the defendant, by creating, use and uninterrupted use of the trademark, from the moment of joint creation during the 90s until the death of D. M in 2014.
Bearing in mind that the contribution of the two brothers in the creation and acquisition of the rights is equal, which is also confirmed by the statement of the defendant at the hearing, there is no legal obstacle to transforming the joint ownership into a co-ownership right of 1/2 ideal part of a commercial property mark, in the sense of art. 63 of this law.
With regard to property legal powers in the area of creation, disposal, use, i.e. the actual use of the same, the persons who acquired this right in a marriage or family union, with the formally registered holder of the right, regardless of whether they did not simultaneously and formally protect their right, in accordance with the provisions of the Law on Industrial Property, they have the right, according to the provisions of the Law on Ownership and Other Real Rights, in civil proceedings, to prove their right to the trademark, if the same is challenged by the registered right holder. The Law on Industrial Property does not exclude such a right, and the same derives from the property character of the right of industrial property.
Despite the fact that after the death of DM, the defendant continued to use the trademark independently, he points to the fact that the deceased brother (in terms of the provisions of the Law on Industrial Property, which refers to the exercise, protection, and termination of the right to a trademark that is, in order to maintain it, it is necessary to use it in sales...), he did not lose the acquired right to a trademark, but he is prevented from using it due to death.
Pursuant to Article 201 of the Law on Industrial Property, which provides for the possibility to make changes to the registration in the trademark register that refer to the holders of the right or the right itself, the court correctly decided when it adopted the claim. With this judgment, the defendant should undergo a change of registration in the register of the Office of industrial property and the established right should be registered in the name of the legal predecessor of the plaintiffs. In this way, based on the right entered in the register, they will have the opportunity to exercise the right of inheritance, which is also provided for in accordance with the mentioned law, in an appropriate procedure before a competent authority.
This legal opinion analyzes the Judgment of the Appellate Court Skopje, GŽ no.3207/22 dated 17.11.2022, by which in the procedure following an appeal filed by the defendant, the appeal request was rejected and the Judgment of the Basic Civil Court Skopje, P1 no.524/21 dated 27.04.2022 was affirmed (once amended by the Supreme Court). The judgment of the Appellate Court Skopje is analyzed from the aspect of the reasoning given by the court when it confirms the first-instance judgment.
FACTS OF THE CASE
The persons (, N.M, D.M and D.M-plaintiffs), filed a lawsuit against B.M for determining the right of ownership of a trademark.
The first plaintiff is the wife, and the second and third plaintiffs are the children of D. M former from Skopje and the same are his heirs. DM died on July 15, 2014. D. M is the brother of the defendant B. M and the same in 1993, started a family business by establishing A. Production. According to the official site of A. P, for ten years of existence (1993-2003), through the activities undertaken by D. M and B. M as founders, A.P as production, and therefore as a brand from the specific area, became so recognizable that it received the status of the first buyer for Macedonia and Serbia when it comes to the biggest agents of the world music industry, i.e. A. P grows into the largest promoter and executive production house in the Republic of Macedonia. For the legal entity, where D. M. is the manager of the "Society for Cultural Entertainment Productions, Trade, Hospitality, Traffic and Services" G. Agency. A. P. DOOEL export import Gostivar, submit an application for trademark registration. The holder of the right to the trademark is the Society for Cultural Entertainment Productions, Trade, Hospitality, Traffic and Services Gloria A-A. P DOOEL export import Gostivar, where the manager is D. M. From the article about A. P made for the purposes of Super brand, it is evident that Super brand has indicated the development of brand A. P is D's common share. M and B. M. In 2009, a new trademark application was submitted, requesting the recognition of trademark rights for the same logo for which they already have a solution for a recognized trademark. Still, now, in the new application, they are also seeking protection for new classes, that is, the new application refers to the same logo for class 35 and class 41.
Due to practicality in the operation and undertaking of the activities, as the applicant for the trademark application in 2009, only B.M. BM never objected that D. M is unjustifiably using the trademark representing the logo which has become a recognizable brand.
The plaintiffs, with the claim, sought to establish that D. M is the owner of 1/2 ideal part of the trademark right, registered in the trademark register and to oblige the defendant B. M, on the basis of this judgment, to undergo registration in the register of trademarks at the State Office for Industrial Property.
PROCEDURAL ACTIVITIES, FIRST INSTANCE AND SECOND INSTANCE JUDGMENT
The Basic Civil Court Skopje accepted the claim of the plaintiffs.
During the retrial, the court took into account the instructions of the Supreme Court, which refer to the evaluation of the possible statute of limitations of the lawsuit referred to by the defendant in this procedure, according to Art. 295 of the Industrial Property Law. This court considered that the mentioned legal provision is not applicable in this case, because it is not a question of a lawsuit for the protection of trademark rights to which the said law is applied, but rather a question of ownership in accordance with the Law on Ownership and Other Real Rights, according to which, the realization of such a right does not expire.
In the specific case, the dispute between the parties is whether the now deceased D.M acquired the co-ownership right to 1/2 ideal part of the said trademark due to equal contribution and the creation of the same, in a family community and due to the uninterrupted use of the trademark, together with the defendant until his death in 2014.
When passing the judgment, the Basic Civil Court Skopje and the Appellate Court Skopje applied Articles 59 and 63 of the Law on Ownership and Other Real Rights ("Official Gazette of the Republic of Macedonia" No. 18/2001; 92/2008; 139/2009 and 35/ 2010), and Articles 3,6,7,8 175, 176, 206, 217 of the Law on Industrial Property ("Official Gazette of the Republic of Macedonia" No. 21/2009, 24/2011, 12/2014, 41/2014, 152/2015, 53/2016 and 83/2018 and 31/2020).
Considering that it is indisputable that the contribution of the two brothers to the creation and acquisition of the rights is equal (which was also confirmed by the testimony of the defendant at the hearing), there is no legal obstacle to transforming the joint property into a co-ownership right of 1/2 ideal part of a trademark, in the sense of art. 63 of the Law on Ownership and Other Real Rights.
Appellate Court Skopje rejected the defendant's appeal as unfounded and confirmed the first-instance judgment of the Basic Civil Court Skopje. He stated that the first-instance court acted correctly when it determined that the now deceased D. M. acquired the co-ownership right of 1/2 ideal part of the trademark due to equal contribution and creation of the same, in a family community and due to the uninterrupted use of the trademark, together with the defendant until his death in 2014.He noted that the fact that only the defendant is registered as the holder of the trademark right in the register of the Industrial Property Office, which is a public book, does not exclude the right of the plaintiffs as legal heirs to prove the right of their legal predecessor, acquired in a family community and with a joint contribution with the defendant.
ANALYSIS OF THE JUDGMENT
The right to intellectual, that is, industrial property is part of civil law because it is a system of norms that regulate civil legal relations that arise during the creation of the exclusive subjective civil law. The Appellate Court acted correctly when it confirmed the first-instance judgment and rejected the defendant's appeal as unfounded. From the content of thejudgment, it can be concluded that AP is a family business, started to be created at the time when the two brothers lived in a family community, continued to function and act in all fields and in all aspects as a family business and in all decisions and in all actions, they share a common share as brothers, D.M and B.M. Pursuant to Art. 92 of the Law on Ownership and Other Real Rights - "In a family union, every member, except for spouses and common-law partners, acquires the right to own things for himself (separate property) unless otherwise agreed upon or if this does not result from the circumstances of the case".
According to Art. 93 of the Law on Ownership and Other Real Rights "when it is agreed that the right of ownership of things in a family community is acquired for several members or it arises from the circumstances, the size is determined according to the agreement, and according to paragraph 2 of the same article, if there is no special agreement, the size of the share for each member is determined based on the contribution of the members who participated in the acquisition of the right of ownership, depending on the effort invested. According to the commentary of the Law on Ownership and other real rights to this article by Dr. Kiril Chavdar (2012 edition), if there is an agreement, even tacitly reached, or if it arises from the circumstances of the case and in the family community, joint property is created (until the share of each member of the family community is determined, joint ownership arises). According to Art. 59 of the Law on Ownership and Other Real Rights "When the thing is jointly owned, the fact that it is recorded in the public book as the property of only one of them has no influence on it". Pursuant to Art. 63 of the Law on Ownership and Other Real Rights, each co-owner may request the determination of the share of the joint property, if such determination is permitted and possible. This does not legally expire. Also, in this article, it is established that each joint owner can request at any time in the joint property to determine the parts so that it will be determined how much part belongs to the joint owner for his share in the joint property. With the determination of his share, he becomes a co-owner with others who remain joint owners. Pursuant to Art. 3 of the Law on Industrial Property - a trademark is an industrial property right, that is, the trademark right is an ownership right (subjective property right).
Subjects of industrial property rights as stipulated in Article 5 of the Law on Industrial Property can be domestic and foreign natural and legal persons. The Law on Industrial Property stipulates that the property right acquired in accordance with the Law on Industrial Property can be regulated and exercised by the subjects and in accordance with an international agreement, other domestic law, and agreement (Articles 6 and 8 of the Law on Industrial Property).
The industrial property right, as an ownership right, is part of the estate and the same can be inherited, hence the active legitimation of the plaintiffs.
Given that the Industrial Property Law does not specifically regulate the acquisition of such rights in a marriage or family union, in accordance with the property character contained in the trademark law, the provisions of the Law on Ownership and other real rights in terms of the way of acquiring rights in such a community also find appropriate application. Namely, from the content of the judgment, it can be determined that the court does not fully equate the right to the trademark with the real right, but considering the legal basis of the claim, by applying these legal provisions, it characterizes the way of acquiring the common, that is the co-ownership of the trademark that is the subject of this dispute.
It is indisputable that the registration of the trademark in accordance with the Law on Industrial Property is subject to formal rules and gives the holder of the trademark right protection from third parties who would use the trademark in trade without any basis and without authorization. However, the fact that this law provides for the possibility of inheritance, points to the conclusion that the trademark can represent a legacy of the right holder.
Given that the subject of this dispute is the determination of co-ownership rights to a trademark, acquired in a family community, the specific provisions of the Law on Ownership and other real rights referred to by the plaintiffs in this procedure have appropriate application. The plaintiffs, as legal heirs of the first line of succession of the deceased brother of the defendant, have a legal interest in conducting this dispute, in a situation where the defendant, as a registered holder of the right in a public book, challenges the same to their legal predecessor, that is, to the current plaintiffs.
The fact that only the defendant is registered as the holder of the right to a trademark does not exclude the right of the plaintiffs, as legal heirs in this dispute, to prove the right of their legal predecessor, acquired in a family union and with a joint contribution with the defendant, by creating, use and uninterrupted use of the trademark, from the moment of joint creation during the 90s until the death of D. M in 2014.
Bearing in mind that the contribution of the two brothers in the creation and acquisition of the rights is equal, which is also confirmed by the statement of the defendant at the hearing, there is no legal obstacle to transforming the joint ownership into a co-ownership right of 1/2 ideal part of a commercial property mark, in the sense of art. 63 of this law.
With regard to property legal powers in the area of creation, disposal, use, i.e. the actual use of the same, the persons who acquired this right in a marriage or family union, with the formally registered holder of the right, regardless of whether they did not simultaneously and formally protect their right, in accordance with the provisions of the Law on Industrial Property, they have the right, according to the provisions of the Law on Ownership and Other Real Rights, in civil proceedings, to prove their right to the trademark, if the same is challenged by the registered right holder. The Law on Industrial Property does not exclude such a right, and the same derives from the property character of the right of industrial property.
Despite the fact that after the death of DM, the defendant continued to use the trademark independently, he points to the fact that the deceased brother (in terms of the provisions of the Law on Industrial Property, which refers to the exercise, protection, and termination of the right to a trademark that is, in order to maintain it, it is necessary to use it in sales...), he did not lose the acquired right to a trademark, but he is prevented from using it due to death.
Pursuant to Article 201 of the Law on Industrial Property, which provides for the possibility to make changes to the registration in the trademark register that refer to the holders of the right or the right itself, the court correctly decided when it adopted the claim. With this judgment, the defendant should undergo a change of registration in the register of the Office of industrial property and the established right should be registered in the name of the legal predecessor of the plaintiffs. In this way, based on the right entered in the register, they will have the opportunity to exercise the right of inheritance, which is also provided for in accordance with the mentioned law, in an appropriate procedure before a competent authority.