OLG Düsseldorf: No compensation for damages of gratuitous licensing

The German Düsseldorf OLG has made a ruling on the use of the ÖKO-TEST label in violation of the trademark, with effect on many IP rights: No compensation for damages in the case of gratuitous licensing, not even in the case of its use in violation of the trademark. The appeal is now pending before the BGH.

The case concerning the use of the ÖKO-TEST label in violation of the trademark has been going through the German courts for years and was even judged by the highest European court in 2019. The question before the ECJ was whether retailers may use the ÖKO-Test label exclusively to advertise the specific products tested.

The ECJ ruled (EU:C:2019:317) in a weighing manner: the ÖKO-TEST brands do enjoy esteem, especially in Germany. However, it was for the referring court to determine whether the defendant could take unfair advantage of the distinctive character or the repute of these marks.

The defendant in this case is a manufacturer of toothpastes and also used the ÖKO-TEST label for different packaging of the product than it had agreed to under a license agreement with ÖKO-TEST. ÖKO-TEST filed a lawsuit against this unlicensed advertising with the ÖKO-TEST label.

This case is complicated by ÖKO-TEST’s practice of allowing manufacturers of tested products to advertise with the ÖKO-TEST label. The prerequisite for this is the conclusion of a free license agreement that provides details on the right of use.

OLG Düsseldorf: Decision of November 19, 2020

Most recently, this case was again decided before the OLG Düsseldorf, which ruled on it on November 19, 2020 (I-20 U 152/16, see also 2a O 197/15). The OLG thus made a decision that can still reach far beyond the ÖKO-TEST label.

For no damages can be claimed in the case of gratuitous licensing, ruled the OLG Düsseldorf, not even in the case of an infringement of his rights. In the case of an infringement of his rights without a concrete loss of assets, the trademark owner is entitled to injunctive relief, but not to damages.

In principle, there are three ways of calculating damages for infringements of IP rights, the OLG explained:

Concrete damage
License analogy
Surrender of the infringer’s profit

Necessary for any calculation of damages, however, is a loss; a loss of assets on the part of the infringed party is therefore a prerequisite for damages.

Injunctive relief was granted. The OLG Düsseldorf conceded that the ÖKO-TEST label is a well-known trademark within the meaning of Art. 9 (2) c) of the EU Trademark Regulation. Therefore, the rights of ÖKO-TEST may be infringed by the fact that the label was used as a test seal and quasi proof of quality and not as a classic trademark, the OLG ruled.

However, this does not give rise to a claim for damages, the court added, as there is no concrete loss of assets.

Why is this ruling so relevant?

There is the possibility of licensing in all areas of IP protection. Often, for certain strategic reasons, gratuitous licensing is granted subject to conditions of use. This was also the case in the present case.

However, the OLG Düsseldorf concludes from this that no damage can have occurred, since the commercial exploitation was waived by the free licensing.

OLG excludes any calculation of potential damages

Therefore, the OLG also excludes any calculation of potential damages; neither a claim for information nor a calculation of the infringer’s profit is admissible, the OLG ruled. The same applies to the license analogy. If the infringed party waives any commercial use of its exclusive right, the objective value of the use can only be set at “zero”, the OLG Düsseldorf explained.

Gratuitous licensing: Appeal pending before the BGH

Due to the relevance for any free licensing of IP rights, an appeal to the Federal Supreme Court of Justice (Bundesgerichtshof, BGH) is expressly permitted. The case is now pending there under case number I ZR 201/20. The ruling of the Federal Court of Justice on this explosive case is eagerly awaited.

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