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The mark JAZZY PUB was registered for services in Class 43. However, the mark JAZZY had been registered seven years earlier in Classes 38 and 41 and was used by Radio Jazzy. The owner of the JAZZY mark requested the cancellation of the later mark. In its request, the owner stated that the owner of the later mark had been its licensee until February 2013 and that the latter had filed the later mark after this date.
The Hungarian Intellectual Property Office (HIPO) annulled the JAZZY PUB mark. The HIPO determined that when the JAZZY PUB applicant had filed an almost identical mark to the prior one, it had been aware of the existence of the prior mark; thus, it had acted fraudulently and in bad faith.
The owner of the JAZZY PUB mark requested a review by the Metropolitan Tribunal, but this was dismissed. The tribunal stated that the HIPO had been correct in stating that the owner of the annulled mark had been aware of the prior mark's existence. Further, the parties had cooperated for some years, using the prior mark. It was obvious that the owner of the JAZZY PUB mark's goal had been to obtain an exclusive right to an almost identical mark. Thus, it had acted fraudulently and in bad faith.
The owner of the annulled mark filed an appeal with the Metropolitan Court of Appeal, but it was unsuccessful. The court held that the appellant had defended itself by pointing to the difference between the goods and services covered by the marks, as it had applied to register its mark in Class 43. However, during the parties' former cooperation, the appellant had booked venues for jazz performances and the owner of the JAZZY mark had provided the music. As a result, the applicant ought to have known that if it had an exclusive right based on Class 43, it could prevent the other party from organising concerts (8.Pkf. 26.201/2018).
Hungarian case law has prohibited acting in bad faith for centuries – particularly since the introduction of the Civil Code 1958 and the Trademark Act 1979 (in harmonisation with EU law). As a result, there are only a few examples of bad-faith trademark cases (eg, the Duna Gate case).
The Trademark Commentary (Budapest 2014) states that bad faith is an absolute ground for refusing protection and that if a mark has been registered, it can be annulled. Moreover, even if the owner of the prior mark revokes its cancellation request, the authorities or the courts can continue proceedings as this is an action publica. The two main premises for establishing bad faith are that:
- the applicant must have known that a prior mark existed when it made its application; and
- the applicant's intention must have been unfair.
The above decisions align with the European Court of Justice's case law (eg, Lindt (C-529/07)), which holds that a finding of bad faith can be made if an applicant was aware of a prior mark when it filed its application.
