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Print articleUnilateral Consent to Use Trademark as Company Name Deemed Irrevocable
October, 2008 -
On June 17, 2008, the Supreme Court of Lithuania rendered a decision restricting the rights of the trademark owner to revoke his consent to use a trademark as a company name.
In UAB Solvex Baltic v. UAB Scandihouse (Case No 3K-3-335/2008 (S)), the owner of the trademark SCANDIHOUSE petitioned the defendant to change its company name. The parties had entered into a lease agreement under which, among other things, the plaintiff consented to the defendant’s use of its trademark SCANDIHOUSE as a company name and registration in the Register of Legal Entities. The defendant registered its name as UAB Scandihouse, but after a few years the plaintiff decided to terminate the lease agreement and consequently asked the defendant to change its company name, which the defendant refused to do.
The Supreme Court dismissed the plaintiff’s claim. It ruled that giving consent to use one’s trademark as a company name is not of the same nature as an assignment of rights to the trademark or the granting of a license to use the trademark. Nevertheless, when giving such consent the trademark owner accepts and confirms that the use of his trademark in the company name does not infringe his rights in the trademark. Such consent is a unilateral contract.
The Court held that once the defendant had received and implemented the plaintiff’s consent to use the trademark as the company name (i.e., it registered the name in the Register of Legal Entities), the plaintiff lost the right to revoke its consent unilaterally. The Court noted that the consent agreement did not include any provisions regulating its termination or validity, nor did it mention that the validity of the consent was linked to the validity of the lease agreement—that is, the consent lacked a provision stating that upon the occurrence of particular circumstances the defendant would have to change its company name.
Accordingly, the Supreme Court ruled that the defendant did not infringe the plaintiff’s rights of the trademark owner when it refused to change its company name, and it ordered the plaintiff to pay the costs of the litigation. This is a final decision.
In UAB Solvex Baltic v. UAB Scandihouse (Case No 3K-3-335/2008 (S)), the owner of the trademark SCANDIHOUSE petitioned the defendant to change its company name. The parties had entered into a lease agreement under which, among other things, the plaintiff consented to the defendant’s use of its trademark SCANDIHOUSE as a company name and registration in the Register of Legal Entities. The defendant registered its name as UAB Scandihouse, but after a few years the plaintiff decided to terminate the lease agreement and consequently asked the defendant to change its company name, which the defendant refused to do.
The Supreme Court dismissed the plaintiff’s claim. It ruled that giving consent to use one’s trademark as a company name is not of the same nature as an assignment of rights to the trademark or the granting of a license to use the trademark. Nevertheless, when giving such consent the trademark owner accepts and confirms that the use of his trademark in the company name does not infringe his rights in the trademark. Such consent is a unilateral contract.
The Court held that once the defendant had received and implemented the plaintiff’s consent to use the trademark as the company name (i.e., it registered the name in the Register of Legal Entities), the plaintiff lost the right to revoke its consent unilaterally. The Court noted that the consent agreement did not include any provisions regulating its termination or validity, nor did it mention that the validity of the consent was linked to the validity of the lease agreement—that is, the consent lacked a provision stating that upon the occurrence of particular circumstances the defendant would have to change its company name.
Accordingly, the Supreme Court ruled that the defendant did not infringe the plaintiff’s rights of the trademark owner when it refused to change its company name, and it ordered the plaintiff to pay the costs of the litigation. This is a final decision.
Although every effort has been made to verify the accuracy of items carried in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.
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