Supreme Court disregards tradition of cumulative protection for trademarks in pharmaceutical case

The Turkish Supreme Court has published a highly controversial decision in which it overturned longstanding precedents, ruling that an act cannot be simultaneously considered a trademark infringement and unfair competition

Case history

In a civil action before the IP Court of Istanbul, the court of first instance determined that the defendant's pharmaceutical trademark is visually and phonetically similar to the plaintiff's registered trademark in Class 5, thereby infringing the plaintiff's trademark rights. However, the court dismissed the plaintiff's claim of unfair competition, stating that the IP Code (6769) contains specific provisions for registered trademarks, making the application of general unfair competition provisions impossible and cumulative protection unattainable.

Both parties appealed this decision to the Regional Court of Appeals, where the plaintiff's appeal was accepted. The court reasoned that the defendant's trademark application, which it continued to use on its products, was rejected by the Turkish Patent and Trademark Office due to the plaintiff's registrations. It further concluded that this constituted unfair competition in violation of the rule of honesty under the Turkish Commercial Code. The defendant subsequently appealed this decision to the Supreme Court.

The Supreme Court’s decision

In its decision dated 14 March 2022 (Merit 2019/5189, Decision No 2022/1852), the Supreme Court overturned the Regional Court of Appeals' decision.

The Supreme Court reasoned that while previous laws allowed cumulative protection for acts of trademark infringement under both the IP Code (and the abolished Decree Law 556) and the abolished Commercial Code 6762, the new Commercial Code 6102, in its relevant article, excludes the protection of "name, title, or trademark" under unfair competition provisions. The court argued that including trademark protection under unfair competition provisions would lead to interpretation difficulties and unnecessary redundancy.

Subsequently, the case was returned to the Regional Court of Appeals, which complied with the Supreme Court's decision and dismissed the unfair competition claims. The parties did not appeal this decision, resulting in the case's finalisation.

Evaluating the decision

The Supreme Court's decision to reverse its established case law has surprised practitioners and academics alike. Cumulative protection, which refers to protection by multiple provisions in legislation, has been disregarded for trademarks with this decision. Notably, the new Commercial Code has been in effect since 2012.

We believe that abandoning cumulative protection in trademark law is not justifiable. Even if the Supreme Court insists on this stance, the reasoning provided by the unfair competition provisions of the new Commercial Code is insufficient to support it.

The relevant article's reasoning does not explicitly eliminate cumulative protection for trademarks; instead, it implies that the repetition of terms such as "name, title, and trademark" is unnecessary.

Evaluating the relevant article’s reasoning in its entirety, the first sentence clearly states that the principle and purpose are identical to the previous regulation and the last sentence does not explicitly declare the will to abandon the principle, despite the reference to the principle of cumulative protection. In 2012, if there was an intention to abandon the cumulative protection in force with an explicit provision in the relevant decree laws, it should have been clearly stated in the reasoning. In our opinion, what is meant by the statement in the reasoning is that it is unnecessary to include terms such as name, title and trademark in the new Commercial Code given the principle of cumulative protection.

Ignoring the principle only serves infringers. The provisions of the Commercial Code concerning unfair competition are based on the principle of honesty. The purpose of the law is to uphold justice based on honesty, considering the specific circumstances of each case. Therefore, it raises the question of whom it would serve to restrict protection at this point. If the criteria are met, safeguarding through unfair competition provisions becomes crucial to ensure an environment of fair competition.

In light of all these factors, we would like to emphasise that the Supreme Court's decision does not currently establish a precedent, and we express our hope that the court will reconsider its decision as soon as possible.