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Trademark litigation in Russia/CIS: News & Trends

Each IP practitioner from the jurisdictions where IP law and dispute resolution do not have a longstanding tradition is always happy to have an opportunity to share with clients and peers news on positive trends and developments in the field. Russia and other CIS countries have been for many years considered by the IP community as problematic from the IP enforcement perspective. Fortunately, there are several promising developments to report for the region.

Local forums for IP dispute resolution

Over last couple of years the judges in the respective CIS countries have become more knowledgeable in the IP law generally and more experienced particularly in trademark litigation. This applies, for example, to Armenia, Kazakhstan, and Ukraine. On the top, Russia went an extra mile and established in July 2013 the IP Court, a specialist forum for resolution of IP disputes in Russia. Since then there was no month when the Russian practitioners have not learned something new from the cases heard by the IP Court. The presence of the IP Court in the system of Russian courts materialized simultaneously in a closer IP focus of both the Russian legislator and the Supreme Court of Russia. Simultaneously, the intraregional increase of IP expertise of the courts has had a positive impact on cross-border trademark litigation in the CIS.

Eurasian Economic Union and Eurasian trademark

Nowadays the Eurasian Economic Union includes five countries: Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia. The Eurasian Economic Union is aimed at creating a single regional market and the regulations of the Eurasian Economic Union introduce a definition of Eurasian trademark. The latter is inspired by the EU trademark but does not presume creation of a specialist authority as EU IPO. On the contrary it is expected that the PTOs of the member states of the Eurasian Economic Union deal with the registration process at the local level. Some efforts will be needed to have this happening but the Eurasian trademark as such creates an opportunity providing right holders additional intra-regional protection.

Mandatory Pre-Trial Procedure

It is not uncommon in the CIS that the judge considering the IP dispute on merits checks if sufficient steps have been taken by the parties to resolve a conflict amicably. For example, in Russia, both the Supreme Court and the IP Court have been consistently emphasizing importance of the parties' efforts to resolve a dispute at a pretrial stage. Even upon commencement of court proceedings on the merits, the IP Court's judges carry on asking the parties if there is still a chance to settle the case.

This trend has been now set in stone by the Russian Federal Law of 2 March 2016 No. 471 (in effect from 1 June 2016). According to this new law, any civil court claim may be filed not earlier than 30 days from the date of sending out the warning letter to the infringer unless a different term is established by law or contract.

For the parties that would mean that they would need to be able to present to the court evidence of their pre-trial discussion. Based on the literal wording of the law, the claimant will most likely be required to attach to the civil claim a copy of the warning letter together with the registered mail/courier confirmation that the letter was dispatched. The law does not require that the claimant provides evidence of receipt of warning letter by the defendant but we may expect that in practice the defendants would try to claim non-receipt of the letter and consequent impossibility to cure the infringement at a pre-trial stage as a part of the strategy to delay court proceedings.

For trademark infringement actions, mandatory pre-trial procedure increases the risk of trademark cancellation action being commenced by the infringer before trademark infringement action is heard by the court. Given this, a practical recommendation for the potential claimants in trademark infringement actions is to even more thoroughly than before assess the chances of success of potential trademark cancellation action and get prepared to it before approaching the trademark infringer with the warning letter. There is also a hope that the practitioners' efforts to settle the disputes at a pre-trial stage would help right holders to avoid litigation costs in cases where out-of-court solution is present.

Remote Hearing

Russia sets an exemplary approach to follow in terms of remote trademark dispute resolution. Since 15 January 2016 the hearings before the Chamber for Trademark Disputes under the Russian PTO, the administrative institution considering, in particular, cancellation actions directed against the Russian trademarks and IRs in the Russian part, may be attended by way of a videoconference. The participant may attend the hearing "without leaving home" and using his own technical equipment. The motion to participate remotely in the hearing before the Chamber for Trademark Disputes shall be filed by the participant via email not less than 15 days before the date of the hearing.

This new mechanism is based on the institute of remote hearing available before the Russian courts. The difference is that remote participation in court hearing requires the remote participant to attend the Russian court which is the nearest to his/her office/home and having videoconference facility. The participant of court hearing may not dial in from home or his office using his own technical equipment. The motion to participate remotely in a court hearing shall be filed as early as possible, preferably before the date of the hearing is even scheduled.

As such, remote participation aims at reducing costs of the participants for the hearings before the Chamber for Trademark Disputes and courts and enabling the participants from distant regions to take part in the proceedings. It is hard to assess at this stage how popular the institute of remote hearing will become and how eagerly the Chamber for Trademark Disputes will grant motions for remote participation. In practice, the Chamber for Trademark Disputes may refer to "lack of technical resource" (e.g. if there is only limited number of videoconference facilities available and they have already been booked for the other hearings) and dismiss the motion for remote participation.

Involvement of Business Representative

It is becoming not infrequent in the CIS based trademark disputes that claimant's (defendant's) business representatives participate in the hearings along with the legal representatives. It remains at the court's discretion to limit time given to the party for presenting its respective position where a number of representatives are involved into such presentation. However, it may often be hard for the court to reject a request of business representative to contribute to the proceedings from the business perspective since such a refusal may be seen by higher courts as limitation of the procedural right of the party.

Involvement of business representatives into proceedings may be recommended in cases where they may be better placed to explain to the court business concerns and business related aspects of the case. Simultaneously, participation of business representatives may demonstrate to the court importance of the case for the company.

Trademark Licence Related Disputes

In the past, many CIS countries have considered registration of trademark licence agreement with the local PTO as a mandatory condition for validity of such licence in the respective country. The approach has been adjusted over the years and now not in all CIS member states the trademark licence recordal with the local PTO is mandatory required. Russia still requires a recordal (though the procedure of recordal has been substantially simplified and does no longer require provision of the whole text of the licence agreement to the Russian PTO). In addition to that, in case A40-177319/20142 the Russian IP Court provided a fresh approach to interpretation of the validity of IP licence agreements. The Russian IP Court stated that non-registered licence may not be automatically recognized as invalid. According to the IP Court, lack of written form (and not lack of registration) is an existing legal ground for recognizing a licence agreement as invalid. In the IP Court's opinion, lack of registration with the Russian PTO has no impact on validity of contractual obligations of the parties which are to be fulfilled.

As it can be seen from the above, there have been some substantial recent developments in the CIS region which may have a great impact on access to and quality of trademark litigation and availability of efficient cross-border trademark dispute resolution in the region. There is a big hope that further developments will aim at strengthening position of right holders in the CIS.

  1. The Federal Law "On Introducing Amendments to the Arbitrazh Procedural Code of the Russian Federation" No. 47 of 2 March 2016
  2. Resolution of the Russian IP Court of 19 October 2015 on case No.A40-177319/2014