Unlawful to reuse trademarked containers? | In Principle

This issue, involving interpretation of Art. 5 and 7 of the First Trademark Directive (Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks), has come before the European Court of Justice on a request for a preliminary ruling in Viking Gas A/S v BP Gas A/S (Case No. C-46/10).

The ECJ must decide whether there is trademark infringement when a company refills and resells gas cylinders that originally came from a competitor, if the reseller pastes its own label on the cylinder with the statement that it has refilled the cylinder. (In the case before the ECJ, the shape of the cylinders is registered as a trademark, and they also bear a label with the original trademark.)

The court will also consider whether it makes a difference if the buyer brings in an empty cylinder and receives a similar, refilled cylinder in exchange, or the bottling plant refills the cylinder brought in by the customer and returns the same cylinder to the customer refilled.

In several published judgments, Polish courts have addressed the issue of trademark infringement related to sale of gas in cylinders bearing a competitor’s trademark.

In a judgment dated 22 February 2007 (Case No. III CSK 323/2006), the Polish Supreme Court held that there was trademark infringement in a case where the defendant had sold its product in the plaintiff’s cylinders. The plaintiff’s trademark was visible on the packaging.

In a judgment dated 14 March 2008 (Case No. IV CSK 445/2007), the Supreme Court held that there had been no infringement, because “the commercial practice must affect the way in which markings on cylinders are perceived.” The presence of successive labels on a cylinder from the various bottling plants refilling it, on top of the label from the original producer, should be regarded as an indication of reuse of the cylinder on the secondary market (from “returns”), and not as a claim of any affiliation with the companies that had refilled the cylinder before or originally introduced it onto the market. A similar position was taken by the Warsaw Court of Appeal in the judgment dated 13 May 2009 (Case No. I ACa 97/2009), which held that there had been no infringement of the plaintiff’s trademark.

The trade practice by gas retailers, in which a company will refill and resell gas cylinders originating from another producer, clearly provides cause for concern in the context of trademark protection. The notion of designating a product with a trademark is understood broadly to include any act that creates an association between the trademark and the product. The active step of affixing another company’s trademark is not required.

This practice may violate various functions of a trademark, but primarily the function of indicating the source of the goods, in a case where customers may erroneously assume that they are buying the trademark holder’s product. When identical marks are used, the holder must prove that the trademark was used unlawfully (i.e. without the holder’s consent), and with modified (similar) markets also that there is a risk of confusion. This practice may also violate the quality assurance and advertising functions of a trademark.

But a gas cylinder is more than just packaging. Practically speaking, it is a piece of equipment enabling safe use of the fuel inside the cylinder. A consumer may assume, based on trademarks placed on the cylinder, that the trademark holder stands behind the quality of the product—both the gas and the cylinder—and guarantees the customer that the gas can be safely used and that it complies with the technical specifications for the fuel.

When these expectations of the consumer are met, the trademark also serves as a way of advertising the product and strengthening the producer’s market position.

Refilling gas cylinders from another producer may thus violate the interests of the trademark holder. It may give the erroneous impression that the gas comes from the original distributor whose trademark is on the cylinder. It may also suggest that the original distributor has authorized refilling of the cylinder and continues to guarantee the quality and safety of the product.

The preliminary ruling by the ECJ on this issue will clearly have an impact on the practice of Polish courts in similar cases in the future, as well as other cases involving reuse of packaging or where there are allegations of trademark infringement involving alterations to the trademarked product.