By Laura Spagnoli and Elena Martini

By order no. 4721/2020, the Italian Supreme Court recently ruled in favour of the well-known publishing house Arnoldo Mondadori Editore S.p.a., owner of the trademark «Grazia», ascertaining that its trademark was counterfeited by the sign «grazia.net». The three instances of the case are briefly summarised below.

In 1999, Mrs G. S., operating in the field of journalism and literature, registered the sign «grazia.net» to use it as a trademark and as a domain name in order to identify the website www.grazia.net, which hosted a telematic magazine for women. However, according to Mondadori, that sign constituted counterfeiting of its earlier trademark «Grazia», registered by the publishing house since 1963 and used by it to identify the famous Italian women’s magazine published since the 1940s. Therefore, the publishing house sued Mrs S. to enjoin her from using the disputed sign, both as a trademark and as a domain name.

In the first instance proceedings before the Court of Milan, the defendant had firstly pointed out that the sign had been registered as «grazia.net» since she was a writer known to the public under the pseudonym of Grazia V. . She then had claimed that the disputed sign had meanwhile been validated (both as a trademark and as a domain name) pursuant to Article 28 of the Italian Intellectual Property Code. According to this provision, in fact, if the owner of an earlier trademark tolerates for five consecutive years the use of an identical or similar registered trademark, despite being aware of its existence, he cannot subsequently ask it to be declared invalid or oppose the use of the same for the products/services in relation to which it was used, unless the later trademark has been registered in bad faith.

The Court of Milan had firstly recalled that the invoked Article 28, being a special rule, was exclusively applicable to registered trademarks, but didn’t also apply to unregistered trademarks or domain names. As the «grazia.net» trademark had not been registered anymore since 2009 due to its non-renewal, the Judge had ascertained that the validation of the same trademark under Article 28 was limited to the utilisations made before that date, having found that Mondadori was actually aware of the existence of the disputed sign at least since 2000. On the contrary, according to the Judge, the use of «grazia.net» after 2009 as an unregistered trademark and as a domain name constituted counterfeiting of the plaintiff’s trademark pursuant to Article 20(1)(b) of the Intellectual Property Code: the disputed sign, in fact, was similar to the earlier trademark and was used to distinguish a comparable website – for the topics covered and the relevant public – to the well-known magazine «Grazia» published by the plaintiff.

This decision had been partially overturned on appeal. The Judge of the second instance, in fact, had found that the disputed trademark had been registered in bad faith, therefore the validation provided for by Article 28 could not be applied. According to the Judge, in fact, Mrs S. had registered her sign in order to attract the public of the well-known mark «Grazia», as also evidenced by the fact that she had been using the sign as a meta-tag to facilitate access to her website. On the contrary, the toleration by Mondadori of the disputed trademark until 2008 had no relevance; instead the defendant’s bad faith at the time of the registration was considered sufficient for the non-validation. The Milan’s Court of Appeal had therefore found the use of the trademark and the domain name «grazia.net» to be unlawful.

This decision was appealed before the Supreme Court by Mrs S., which claimed that the Judge had wrongfully applied Article 28 and therefore wrongfully ruled out the validation of her trademark. According to Mrs S., in particular, in ascertaining her bad faith, the Judge had improperly paid attention to the reputation of the earlier trademark and mistakenly concluded that she had consciously registered her trademark using the appellation «grazia.net» precisely in order to take advantage of the earlier trademark’s reputation. In this regard, the appellant claimed instead that, on the one hand, the reputation of the earlier trademark had no relevance for the purposes of the applicability of Article 28 and, on the other hand, that the Judge had failed to consider that the trademark had been registered as such for the sole aim of directly distinguishing her journalistic activities, since she was known to the public as Grazia, also pointing out that, in order to differentiate herself, she had added the suffix “.net”.

The Supreme Court found Mrs S.’s appeal to be inadmissible in so far as it was directed to review the facts already assessed by the prior Judge with the aim of ascertaining the existence of the conditions for the validation of the trademark. In fact, the Judge of the second instance had fully substantiated the inapplicability of Article 28, grounding it on an ascertainment of facts which was uncontested by the parties and which could not be reviewed by the Supreme Court.

The appeal was also deemed groundless in so far as claiming that the Judge of the second instance had not considered that Mrs S.’ sole aim was to distinguish her services, without any prevailing intention to exploit the reputation of the earlier mark. In this regard, the Supreme Court found that the appellant had certainly meant to take unlawful advantage of the «Grazia» trademark, registered several decades before «grazia.net», taking into account, on the one hand, the reputation of the earlier mark, and, on the other hand, the fact that the well-known sign had been entirely reproduced by the later mark.

Therefore, stressing that the assessment made by Milan’s Court of Appeal on the existence of the appellant’s bad faith at the time of registration of the «grazia.net» trademark could not be reviewed, the Supreme Court confirmed the inapplicability of Article 28 to the present case, dismissing the request for validation of the later trademark.