This article is part of a series on trademarks in Norway.(1)
What is the legislative framework and what are the possible causes of action?
The relevant legislation regarding trademarks is the Trademark Act 2010 ('varemerkeloven' in Norwegian). This act incorporates the EU Trademarks Directive (2008/95/EC) into Norwegian statutory law. While Norway is not a member of the European Union, its membership to the European Economic Area involves the incorporation of a substantial amount of EU legislation. Parliament has enacted an amendment to the Trademark Act to conform with the latest EU Trademarks Directive (2015/2436/EU).
The Trademark Act regulates the registration, administrative opposition, cancellation and invalidation proceedings regarding trademarks, which are handled by the Norwegian Industrial Property Office (NIPO). NIPO decisions can be appealed to the independent IP Appeal Board. In certain circumstances, IP Appeal Board decisions can be appealed to a regular court of first instance.
Where IP Appeal Board decisions are brought before a regular court, the formal counterparty in the proceedings is the IP Appeal Board, represented by the attorney general. In opposition matters, the original opponent will thus not formally be a party to the proceedings but may act as an intervener on the attorney general's side.
Cancellation and invalidation claims can also be brought directly before the regular courts. In such matters, the court procedure is governed by the Civil Procedures Act 2005. The regular courts have sole jurisdiction over infringement claims, injunctions and claims for damages and consequently no administrative dispute resolution alternative exists for these matters.
Under Norwegian trademark legislation, trademark rights may be acquired through both registration and use. While the bar is set quite high for evidencing use-acquired trademark rights, holders of unregistered trademark rights are afforded the same courses of action as owners which hold NIPO registration certificates.
Do alternative dispute resolution procedures exist?
In addition to the NIPO and the courts, a few alternative dispute resolution procedures are worth mentioning.
Court mediation
Norwegian courts must encourage parties in trademark litigation disputes (and other matters susceptible to settlement) to consider court mediation with the aim of amicable settlement as an alternative to court proceedings. However, the parties remain free to oppose such mediation should they deem it unsuitable or superfluous.
If the parties agree to court mediation, a trained judge will be appointed as the mediator. The parties remain free to bring their attorneys, although a representative of each party must be present during the mediation procedure. The parties themselves are expected to drive the negotiations, with the attorneys playing a more withdrawn role. The judge or mediator will guide and instruct the negotiations between the parties (both separately and in the same room), with the aim of reaching an amicable settlement. If court mediation proves unsuccessful, the matter will proceed to a regular court trial. The judge who acted as mediator will not be involved in the further handling of the case and a different judge will take over.
Arbitration
In Norway, as is the case in other Nordic countries, arbitration is available as an alternative to the regular courts in trademark disputes. However, in practice, arbitration is rarely used in such matters. One reason for this is that the legal costs for regular court proceedings are relatively low in Norway and the process is efficient and straightforward. Another reason is that court cases, at least before the court of first instance, are normally scheduled within six months of the filing of the writ of summons, making them more efficient than in other countries.
The Arbitration Act (2004/25) as amended implements the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. A party may choose between the International Chamber of Commerce, the Arbitration and Dispute Resolution Institute of the Oslo Chamber of Commerce or other international tribunals. However, the most used form of arbitration in Norway is ad hoc arbitration, where the parties establish the arbitration tribunal based on the arbitration clause. This practice differs from that of most other countries, where institutional arbitration is the norm.
In what venue and format must litigation take place?
The Oslo City Court has exclusive jurisdiction over matters concerning cancellation, invalidation, registration and infringement of registered trademarks (in addition to several other areas of IP law). The Oslo City Court is the compulsory legal venue for appeals of IP Appeal Board decisions.
The Oslo City Court is not a specialised IP court but each department within the court has at least one appointed IP judge who has undergone special IP training. Civil procedures are heard by one judge, although expert judges (usually members of a relevant industry or experts in a technical field) may be appointed at a party's request in complex and comprehensive matters. This does not usually happen in trademark matters but is more relevant in patent cases.
The Oslo City Court aims to schedule oral hearings within six months of the filing of the writ of summons but will remain flexible and sensitive to the attorneys' opinions of each case's complexity and existing schedules. Once the oral hearing has been scheduled, the court will set a deadline for the parties to submit all necessary evidence and written pleadings, which will be at least two weeks ahead of the hearing but is usually (and preferably) sooner.
Do the proceedings take place in writing?
The Norwegian court system is built on the basic principle of orality, which tends to make the oral hearings somewhat protracted. The judge will not have read the pleadings ahead of the hearing and may not base their decision on any other evidence than what is documented and reviewed during the oral hearing. In most trademark matters, one or two seven-hour days are scheduled for the oral hearing. However, in cases which involve extensive evidence examination – typically in cases regarding use-acquired rights – the hearing may take a full week or longer.
The court's decision may be expected between two to four weeks following the oral hearing. On average, trademark litigation proceedings before the first-instance court in Norway take approximately seven to 12 months.
Unfortunately, the Court of Appeal is less efficient. It may take up to two years for a hearing in an appeal case to be scheduled.
Can parties claim compensation and damages?
The Trademark Act leaves any party responsible for trademark infringement liable for whichever of the following options is most favourable to the infringed trademark owner:
- a reasonable compensation for the use of the trademark (typically, a fair licence fee);
- damages for injury caused to the infringed trademark and its owner; or
- compensation amounting to the infringer's ill-gotten profits.
In matters where the infringement is committed intentionally or with gross negligence, the Trademark Act allows for compensation claims equivalent to double the amount of a fair licence fee.
While the legal framework should allow for effective enforcement in relation to compensation and damages, the amounts awarded by Norwegian courts in trademark infringement matters are usually quite moderate. Apart from the above example of doubling the fair licence fee, no punitive damages are awarded. In accordance with the general legal principles for damages in Norway, parties can seek compensation only for actual economic loss and the loss must be documented or at least proven on a balance of probabilities.
Norwegian courts, like those of most other jurisdictions, generally award the winning party its full, reasonable legal costs.
Injunctions remain efficient tools in trademark infringement matters in Norway. Under the Trademark Act, the courts can prohibit an infringer (or an accessory thereto) from continuing or resuming the infringement. The same applies to a third party that has made substantial preparations for committing infringement or has acted in a manner that gives reason to suspect future trademark infringement.
Preliminary injunctions are available in matters where the rights holder can provide evidence to render it probable that:
- the trademark has been infringed; and
- a preliminary injunction is necessary to avoid:
- complications in the subsequent prosecution of the claim; or
- substantial damage caused by the infringing action before the main claim has been decided in regular court proceedings.
On receipt of a request for preliminary injunction, the Oslo City Court will summon the defendant and schedule an oral hearing as soon as possible (usually within a few weeks). However, the court may issue an ex parte preliminary injunction in matters of particular urgency or where the purpose of the preliminary injunction would be lost if the infringer were notified in advance. If a preliminary injunction is issued ex parte, the defendant can request a subsequent oral hearing, which will result in a new decision replacing the decision granted ex parte.
When issuing a preliminary injunction in a trademark infringement matter, the court will set a deadline (usually between six weeks to six months) for the plaintiff to initiate a regular infringement lawsuit.
The courts will often condition a preliminary injunction on the plaintiff arranging for a security deposit to cover any injury or inconvenience inflicted on the defendant as a result of the injunction if the injunction is overturned by the court in the regular lawsuit.
Are criminal penalties available under the Trademark Act?
The Trademark Act warrants criminal penalties (ie, penalties of up to three years' imprisonment) for trademark infringement under aggravating circumstances. However, the courts rarely employ this provision.
How can a party evidence trademark infringement?
In any civil case before the Norwegian courts, the burden of proof lies with the parties to prove the facts and circumstances on which they base their claims. Therefore, the responsibility of submitting relevant evidence – and informing the court of any witnesses and their testimonies – lies with the parties during the preparation stage of the proceedings.
Due to the principle of orality in Norwegian courts, the judge may base their decision on only the evidence and testimony presented during the actual oral hearing, which requires each party to present and review each piece of evidence considered relevant to the case orally.
In an important exception to the above principle, the onus of proof is reversed in cancellations based on alleged insufficient trademark use. In these matters, the owner of the challenged mark must prove that there has been genuine and actual use of the trademark in Norway during the past five years.
Each party can request exclusion of evidence that is deemed to be irrelevant or too comprehensive in proportionality to the case, among other things. The court may exclude evidence on its own initiative on the same grounds.
Although there is no discovery process in Norway, each party (or the court on its own initiative) may request access to relevant documents, files or objects which it believes that the other party (or a third party) possesses.
Survey evidence
Surveys are admissible under Norwegian procedural legislation. Consumer surveys are often submitted in matters concerning:
- the validity or cancellation of trademarks;
- alleged use-acquired rights; or
- allegedly well-known or famous trademarks.
The relevance and weight of such surveys largely depend on the statistical method employed. It is common for the parties to spend some time arguing this issue before the court. There have been several decisions over the past 10 to 12 years in which such surveys have been important, or even decisive, to the court's decision.
Expert witnesses
The parties, or the court on its own initiative, may appoint expert witnesses to testify on specific non-legal issues or fields which require expert knowledge. This may be the case regarding the statistical and empirical method employed in a consumer survey. Special procedural rules apply for court-appointed expert witnesses, though expert witnesses that are called by the parties will usually give testimony and be subjected to cross-examination in the same way as any other witness.
What defences are available against infringements?
In addition to the obvious argument that the marks in question are not confusingly similar, there are several other ways to defend against an infringement claim.
For example, a trademark owner may not prohibit third parties from using:
- its trademark outside of commercial activity;
- their own name and address;
- marks which are deemed devoid of distinctive character or descriptive of the relevant goods or services; or
- its trademark in a loyal fashion if such use is deemed necessary for identifying or referring to goods or services (eg, when trademark use is considered necessary to indicate the intended purpose of a product as a compatible accessory or spare part).
Further, the defendant may file a counterclaim for invalidation or cancellation of the plaintiff's trademark. A trademark becomes vulnerable to cancellation on the basis of non-use five years after it is published in the national Trademark Gazette (or five years from the date on which the mark is upheld after an opposition procedure).
Passivity or acquiescence is another available defence in trademark infringement matters. While there is no set minimum period in Norwegian trademark legislation, the regular principles of passivity apply in trademark matters. Therefore, a party may put up a successful defence against an infringement claim if it can be established that the plaintiff has knowingly tolerated the trademark use for a long period.
How does the appeal process work?
Oslo City Court decisions may be appealed to the Court of Appeal. For all practical purposes, the appeal case will follow the same procedural rules as in the first instance but will be heard by a panel of three judges (including one or two expert judges in certain cases). The parties may introduce certain related claims or new evidence before the Court of Appeal. Therefore, the appeal case is not a mere review of the Oslo City Court's decision, although it is based on the prior decision.
Parties can sometimes make further appeals to the Supreme Court. However, the Supreme Court admits only appealed cases with a certain principal or fundamental significance beyond the case at hand (on average, some 15% to 20% of the total appealed cases are allowed, although the chances of IP-related cases being accepted are significantly higher). The Supreme Court has ruled on several trademark matters in the past five to 10 years, including cases concerning infringement, distinctiveness and the assessment of the similarity of goods and services.
Hallvard Sund, intern, assisted in the preparation of this article.
Endnotes
(1) For the first article in the series, please see "Trademark prosecution: FAQs".
