The Milan IP Court on Trademark Rights Infringement in Selective Distribution
By order dated 3 March 2025, the Milan IP Court granted an application for interim injunctive relief, filed by Chanel and its Italian distributor, under Article 131 of the Italian Industrial Property Code and Article 700 of the Code of Civil Procedure. The injunction prohibited the sale of the maison’s perfumes inside the stores of the defendants, two well-known retail chains specialising in general consumer products for personal and household care.
The defendants had placed Chanel perfumes on the market outside the selective distribution network, displaying them alongside detergents, mass-market cosmetics and even pet products. In certain stores, the perfumes were not even exhibited on shelves but kept in drawers and handed over only upon request. According to the applicants, such practices devalued the brand, undermined its aura of exclusivity, and therefore justified urgent judicial intervention.
The Court agreed, reaffirming the full legitimacy of selective distribution in this case. For products with a high technological content requiring qualified assistance or - as here - luxury goods, the adoption of a selective distribution network is considered lawful, in order to protect the brand owner’s investments and the prestige of the mark.
The Judge explicitly referred to EU Regulation No. 720/2022, which defines selective distribution[1], as well as to EU case law, according to which the perceived quality of a luxury product depends not only on its material characteristics but also on its style, presentation, and sales environment.
In this case, the sale of Chanel perfumes in a general-merchandise environment was deemed inconsistent with the reputation of the brand and capable of causing serious harm to its image and prestige, thereby constituting a legitimate reason to derogate from the principle of exhaustion under Article 5 (2) of the Italian Industrial Property Code. In other words, although the products sold by the defendants were genuine, they were offered in a manner that undermined the trademark’s distinctive and advertising functions.
The fact that in some instances the perfumes were kept out of sight was not considered sufficient to exclude infringement. On the contrary, the Court found that this “atypical” sales practice - being inconsistent with the luxury image -contributed to the reputational damage. Having established that the defendants continued sales despite multiple cease-and-desist letters, the Judge granted the injunction, imposed a penalty of one thousand euros for each violation, and ordered the publication of the operative part of the decision in a major national newspaper.
This ruling confirms that, in the luxury sector, the context is part of the product. Trademark law protects not only material authenticity but also the symbolic value and experience promised by the brand. Selling a Chanel perfume next to generic consumer goods alters its perception and undermines the narrative of exclusivity that justifies its market positioning.
[1] EU Regulation 720/2022/EU; Art. 1, letter g): ’Selective distribution system’ means a distribution system in which the supplier undertakes to sell the contract goods or services, directly or indirectly, only to distributors selected on the basis of specified criteria, and in which those distributors undertake not to sell such goods or services to unauthorized retailers within the territory reserved by the supplier for that system.