On 18 December 2018, the French Supreme Court (Cour de Cassation) confirmed that the cancellation of a trade mark based on fraud does not require the declarant for invalidity to show prior rights in its sign but does require the demonstration of the presence of "interests knowingly unrecognized by the applicant".
The French judges approved settled case-law according to which the filing of a trade mark is fraudulent only if the intent behind said filing is to prevent a third party from using a sign that is necessary for his current or future activities.
On 15 July 2007, the City of Paris launched a bike-sharing system called "Vélib'". In 2011, the City launched a new service, based on the same concept, consisting of a car-sharing system named "Autolib'". The City filed various trade mark applications before the French Trademark Office (INPI) to protect the terms VÉLIB' and AUTOLIB', as well as the term SCOOTLIB'PARIS, on 22 December 2011.
On 9 October 2007, Olky International (OLKY) filed a trade mark application SCOOTLIB' for goods and services in classes 12, 36 and 39, including "
vehicle, electric vehicles, cycles
" and "transportation, rental of vehicles". OLKY granted a trade mark license to Ph Rent, which granted a sub-license to PL scoot. Scootlib France operated a car rental service under this name.
The City of Paris unsuccessfully filed an action in France against all these companies, notably:
- to have the SCOOTLIB' trade mark cancelled based on fraud
- for trade mark infringement
- for infringement of its trade mark of repute.
The court of appeal confirmed the decision issued by the first instance court stating that the City of Paris had not shown that it made a public announcement about its plan to launch "Scootlib'" before the filing of the French trade mark application SCOOTLIB' by OLKY nor that OLKY was aware of this on the day it filed its application.
This was regardless of the existence of the VELIB' trade mark filed on 19 February 2007, and of the launch of the Vélib' bike-sharing system on 15 July 2007. The court of appeal highlighted the fact that the City of Paris did not show that it had a plan to use the Vélib services in relation to scooters on the day of the filing of the application.
On the contrary, the appellate judges approved the first instance judges, who held that "
the communication around the Vélib revealed a political will to unclog Paris from its motor vehicles in order to move towards more environmentally friendly ways of transportation, whose main focus is bikes
".
Regarding the trade mark infringement actions, the court rejected these actions based on the extinction of the City of Paris' rights due to acquiescence.
The Cour de Cassation rejected the appeal filed against this decision and approved the reasoning of the appellate judges.
This decision confirms the strict assessment of fraud made by French judges and has a significant impact on the initial strategy set up by the City of Paris which did not sufficiently anticipate competing transport services.
