[1] Legislative intent of Article 7(1)13 of the Trademark Act / Standard for determining whether a trademark with three-dimensional shapes of designated goods or their packaging falls under Article 7(1)13 of the Trademark Act

[2] The standard and method of determining the similarity of trademarks, and the standard for determining the similarity of three-dimensional shapes of trademarks

[3] The case holding that in case where foreign corporations Gap et al. which registered the medicine for cardio-cerebrovascular and the medicine for treating sexual disorder as designated goods and made a trademark with the mark " " "," which is composed of three-dimensional shapes of a lucent color and a color of a lucent color, filed a claim against Eul et al. for the prohibition of trademark infringement against Eul et al. which produce, sell, and advertise the medicine for treating pre-donations in the form " " and "," the registered trademark and Eul's product cannot be deemed as identical or similar to each other

[1] The technical function of designated goods or their packaging (hereinafter “goods, etc.”) is, in principle, protected as a patent right or utility model right only within the scope of the duration only when a competitor satisfies the patent requirements under the Patent Act and the utility model registration requirements under the Utility Model Act. If a trademark right is protected on the ground that a three-dimensional shape essential to secure such function has distinctiveness, it would result in a conflict with the patent system or utility model system (hereinafter “patent system, etc.”) by granting permanent exclusive rights to the technical function embodied in three-dimensional shapes through registration for renewal of the duration of trademark rights. Moreover, a competitor’s use of such three-dimensional shape needs to be prevented, despite the need of competition, thereby hindering free competition.

Accordingly, the Trademark Act amended by Act No. 5355 of Aug. 22, 1997 introduced a three-dimensional trademark with a single trademark, which is only a three-dimensional shape that is essential to secure the functions of goods, etc. to be registered by newly establishing Article 7(1)13 in order to promote harmony with the patent system, etc. and ensure free and efficient competition of competitors.

In light of such legislative intent, whether a three-dimensional trademark of goods, etc. falls under the foregoing provision ought to be determined by comprehensively taking account of whether the goods, etc. are distributed in the market where the goods, etc. are traded or available as a substitute form, whether the production of the goods, etc. is equivalent or lower than the cost, whether the production of the goods is equivalent or lower than the cost, and whether the technical superior advantage is not displayed beyond the original function of the goods, etc.

[2] Whether a trademark is similar should be determined by whether there is a concern for misconception or confusion about the source of goods by observing the trademark objectively, comprehensively and externally in terms of the appearance, name, and concept of the trademark, which is compared. In addition, the determination as to the similarity of trademarks shall not be compared with two trademarks themselves, but shall be made from the perspective of whether consumers who use two trademarks differently at the time and place are likely to mislead or confuse the source of goods. In a case where there is a concern for misconception or confusion as to the source of goods when comprehensively taking into account the appearance, name, memory, association, etc. of the two trademarks as a whole, the two trademarks should be similar. In particular, in a three-dimensional trademark, the dominant impression of the appearance of the two trademarks is identical or similar, and if it is likely to mislead or confuse the source of goods if the two trademarks are used as a whole on goods identical or similar to the two trademarks, the two trademarks shall be deemed similar, but if not recognized.

[3] The case holding that in case where foreign corporations Gap et al. which registered the drugs for cardio-cerebrovascular and for treating sexual functional disorders as designated goods and registered them with the mark " "" composed of three-dimensional shapes of a lucent color and a lucent color combination, and sought injunction against infringement of trademark rights against Eul et al. which produce, sell, and advertise the drugs for treating the lucentrative drugs in the form " "" and "", although there are common parts in the shape of Eul's products, there are differences in the shape, and most of Eul's products administered by pharmacists in accordance with the doctor's prescription, can be distinguished from the registered trademark based on the name entered in the packaging and products itself, Eul's letter trademark, trade name, etc., so it is difficult to say that the registered trademark and Eul's products are not identical or similar to each other because the shape of Eul's products may cause misconception and confusion among consumers.

[1] Articles 2(1)1(a), 6(2), and 7(1)13 of the Trademark Act / [2] Articles 2(1)1(a), 7(1)7, and 66(1)1 of the Trademark Act / [3] Articles 2(1)1(a) and 66(1)1(a) of the Trademark Act

[2] Supreme Court Decision 2010Do15512 Decided March 14, 2013 (Gong2013Sang, 692) Supreme Court Decision 2013Hu1900 Decided January 23, 2014

Co., Ltd. and one other (Attorneys Son Ji-yol et al., Counsel for the plaintiff-appellant)

Hanmi Pharmaceutical Co., Ltd. (Law Firm Barun et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2013Na26816 decided October 17, 2013

The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. As to the ground of appeal that the exercise of trademark right constitutes an abuse of right, since it is obvious that trademark registration has grounds for invalidation.

A. As to whether it falls under Article 6(1)3 of the Trademark Act

A person shall be appointed.

Where it is evident that a trademark will be invalidated by an invalidation trial even before a trial decision on the invalidation of a registered trademark becomes final and conclusive, a claim for prohibition of infringement or compensation for damages based on the trademark right shall not be granted as an abuse of rights unless there are special circumstances. In addition, where a claim by a trademark right holder constitutes an abuse of rights, the court in charge of a lawsuit for infringement of a trademark right may examine and determine whether the trademark is invalidated or not on the premise of examining the propriety thereof (see Supreme Court en banc Decision 2010Da10300, Oct. 18, 2012). Meanwhile, Article 6(1)3 of the Trademark Act provides that a trademark consisting solely of a mark indicated in the form of the designated goods or their packaging (hereinafter referred to as “goods, etc.”) by means of ordinary use, not only falls under 10-dimensional technical marks indicating the characteristics of the goods, but also, 200-dimensional shapes or 3-dimensional shapes of goods, etc., which are ordinarily used within the scope of 200 after the issuance of such trademark.

According to the above legal principles and records, the registered trademark of this case (trademark number omitted) of this case, which is composed of three-dimensional shapes and colors of a color color, such as the right side, as designated goods, can first be deemed as the general form of known drug belonging to the designated goods, and even if the combined color is considered, it can be deemed that the shape does not deviate from the scope that can be employed in the form of known drug in the business area. Accordingly, the registered trademark of this case is merely an indication of the shape of designated goods as provided by Article 6(1)3 of the Trademark Act in a common way, and thus, it is not recognizable.

Nevertheless, the lower court determined that the trademark of this case does not constitute a trademark consisting solely of a mark indicating the shape of the designated goods in a common way on the ground that it cannot be deemed a general form of aware. In so doing, it erred by misapprehending the legal doctrine as to Article 6(1)3 of the Trademark Act. However, the lower court erred by misapprehending the legal doctrine as to Article 6(1)3 of the Trademark Act, i.e., that the registered trademark of this case acquired distinctiveness by use, and that this part of the judgment is reasonable as seen thereafter, and as such, the lower court’s erroneous determination as to Article 6(1)3 of the Trademark Act does not affect the conclusion of the judgment. Meanwhile, insofar as it is determined that the registered trademark of this case falls under Article 6(1)3 of the Trademark Act on the ground that the registered trademark of this case falls under Article 6(1)6 or 7,

B. As to the acquisition of distinctiveness by use

According to Article 6(2) of the former Trademark Act (amended by Act No. 12751, Jun. 11, 2014); even if a trademark falls under Article 6(1)3 of the same Act, trademark registration may be granted to consumers as to which the trademark indicates goods related to his/her business as a result of using the trademark before the application for trademark registration is filed. The system allowing trademark registration through the acquisition of distinctiveness as to a trademark through such use gives a detailed right to a mark inappropriate to allow a specific person to use the trademark solely because the trademark lacks its original distinctiveness. As such, whether a three-dimensional trademark, such as goods, etc. acquires distinctiveness by using the trademark should be determined by strictly interpreting and applying the aforementioned system by comprehensively taking into account the characteristics of the shape, timing and period of use, quantity and market share of the trademark, the period and scale of the concurrent use of other goods, etc. similar to the pertinent shape, the degree and mode of the trademark user’s reputation and credit (see, e.g., Supreme Court Decision 2014Hu38, Dec. 38, 2014).

Meanwhile, there are cases where a trademark with a symbol, character, or figure is attached to the goods, etc., and such circumstance alone alone does not immediately deny the acquisition of distinctiveness by using the three-dimensional shape of the goods, etc., and in light of the external appearance, size, location, and recognition map of the attached trademark, if the three-dimensional shape of the goods, etc., separate from the attached trademark, has independently performed the function of indicating the origin of the goods, the acquisition of distinctiveness by use can be recognized (see Supreme Court Decision 2013Hu146, Oct. 15, 2014).

After finding the facts as indicated in its reasoning, the lower court determined that it is sufficient to view the registered trademark of this case as being subject to continuous advertising activities for the registered trademark of this case, and that the registered trademark of this case is not likely to seriously obstruct the use of the registered trademark of this case, considering the following factors: (a) it is sufficient to view that the registered trademark of this case was referred to as “a flue pattern”, “blue pattern”, “blue pattern”, and “blue pattern” as a combination of a three-dimensional pattern and a flue color color color (hereinafter “Plaintiff products”); (b) the Plaintiffs’ sales period and sales quantity; (c) the Plaintiffs’ “Viaglera” and “non-agra” characters; and (d) the Plaintiff’s use of the registered trademark of this case, as a result of the survey on consumers’ awareness that the registered trademark of this case was disclosed through the media; and (e) the Plaintiff’s use of the registered trademark of this case’s products prior to the acquisition of the registered trademark of this case’s products.

In light of the above legal principles and records, the above recognition and judgment of the court below are just, and there are no errors in the misapprehension of legal principles as to Article 6 (2) of the former Trademark Act.

C. As to whether Article 7 (1) 13 of the Trademark Act is applicable

In principle, technical functions of goods, etc. can be protected as patent rights or utility model rights only within the scope of their duration only when the requirements for patent under the Patent Act or utility model registration under the Utility Model Act are met. If trademark rights are protected on the grounds that a three-dimensional shape essential to secure such function is distinctive, it would result in granting permanent exclusive rights to the technical function embodied in such three-dimensional shape through registration for renewal of the duration of trademark rights, thereby conflicting with the patent system or utility model system (hereinafter “patent system”). Moreover, even if a competitor needs to use such three-dimensional shape in order to realize specific functions, utility, etc. of the pertinent goods, it would result in unfair competition by prohibiting the use of the trademark. In light of the purport of Article 7(1)1 of the Trademark Act amended by Act No. 535 of Aug. 22, 1997, which introduced a three-dimensional trademark with a trademark, and thereby, seeks to obtain trademark registration from a person who seeks to use the three-dimensional shape that does not meet the aforementioned requirements, such as where the trademark system and other relevant goods are used.

According to the reasoning of the judgment below and the records, there are a number of alternative shapes available as diverse sizes, shapes, and colors exist in the inner-resistant eggs, and the drugs for cardio-cerebrovascular treatment, which are the designated goods of the registered trademark of this case, are actually produced and sold by various enterprises in a color and shape, not in a color of a lucent color, such as a color of a lucent color, and the combination of the above shape and color, cannot be deemed to have displayed technical elements beyond the original function of the Alban. In light of these circumstances, it cannot be said that the registered trademark of this case constitutes a three-dimensional trademark essential only to secure the function of goods for which the trademark is being registered, and that the trademark of this case is invalidated on the ground that the trademark of this case constitutes a three-dimensional trademark that is essential only to secure the function of goods for which the trademark is to be registered.

The judgment below to the same purport is just, and there is no error in the misapprehension of legal principles as to Article 7 (1) 13 of the Trademark Act.

2. As to the ground of appeal on similarity of trademarks

A. Whether a trademark is similar ought to be determined by whether there is a concern for misconception or confusion in trade by observing the compared trademark objectively, comprehensively and differently from the appearance, name, and concept in terms of the appearance of the trademark. In addition, the determination of similarity of a trademark should not be compared with two trademarks per se, but should be made from the perspective of whether consumers who use two trademarks differently at the same time and place are likely to mislead or confuse the origin of the product. In cases where there is concern for misconception or confusion as to the origin of the product when considering the overall appearance, name, memory, relationship, etc. of the two trademarks as a whole, the two trademarks are similar (see Supreme Court Decisions 2010Do1512, Mar. 14, 2013; 2013Hu1900, Jan. 23, 2014; 2013Hu1900, Feb. 23, 2014).

B. Review of the reasoning of the lower judgment and the record reveals the following circumstances.

(1) In the instant registered trademark and the original adjudication, the Defendant’s products are in a three-dimensional shape of a marina figure as a whole, and they are in a condition that each corner of a marina figure is thrhyd, and the ratio of the bandging and shortening of a marina figure is about 1.35, and in terms of this, the shape of an excursion ship type consisting of the bandging part of the pole and the shape of the said pole as well as the bandging part below and above, and the color is common in that it is in color.

(2) 그러나 ① 이 사건 등록상표의 경우 마름모 도형의 각 모서리가 완전한 호 모양으로 다듬어진 형태이지만, 피고 제품들은 마름모 도형의 좌·우 모서리를 장축에 수직 방향으로 잘라낸 후 각 모서리가 다시 둥글게 다듬어진 육각형에 유사한 형태이고, ② 이 사건 등록상표의 경우 기둥 형태 부분(Band)의 길이와 상대적으로 아래·위로 튀어나온 부분(Cup)의 길이 차이가 크지 아니하여 옆에서 볼 때 전체적으로 긴 타원형이나, 피고 제품들은 기둥 형태 부분(Band)의 길이가 아래·위로 튀어나온 부분(Cup)보다 훨씬 길어서 옆에서 볼 때 전체적으로 아래·위로 살짝 부풀어 오른 사각형에 가까운 차이가 있으며, ③ 특히 피고 제품들 중 ‘팔팔 100mg’의 경우에는 가운데 부분에 움푹 팬 직선의 홈이 있다.

(3) The Defendant’s products are in double packaging and inner packaging. The outer packaging contains, based on the verification, ① the inner package of “PPTb”, “PPb”, “sale” and “the trademark named the Defendant,” and ② the inner package of “sale 50mg” are based on the verification, and the inner package of “sale 50mg” is repeatedly indicated on the back, and ③ the inner package of “sale 100mg” is based on color, the rear side is based on the verification, and the latter side is written repeatedly.

(4) In addition, the Defendant’s products themselves are so vague that “HM 50” or “HM 100” indicating the Defendant’s abbreviation and capacity.

(5) In addition, the Defendant products are special drugs that make the Defendant products purchased at a pharmacy in accordance with the prescription issued by the doctor when the patient visited the hospital and received medical treatment from the doctor and the doctor prescribed the Defendant products. Pursuant to Article 18(2) of the Medical Service Act and Article 12(1)5 of the Enforcement Rule of the Medical Service Act, the specific drug is comprised of “the name of the terminal drugs (referring to the name of the general name, the name of the product, or the name specified in the Korean Pharmacopoeia).”

C. In full view of these circumstances in light of the legal principles as seen earlier, even though there are parts common to the shape of the instant registered trademark and the Defendant’s products, there are differences in the form thereof, and it is reasonable to view that most of the Defendant’s products administered by pharmacists according to a doctor’s prescription, as prescription drugs, can be distinguished from the instant registered trademark based on the name indicated in the packaging and products itself, the Defendant’s text trademark, and the Defendant’s trade name. Therefore, the shape of the instant registered trademark and the Defendant’s products cannot be deemed as identical or similar because it is difficult to deem that there is a concern for

D. Nevertheless, the lower court determined that the shape of the instant registered trademark and the Defendant’s products is likely to cause mistake and confusion among consumers. In so doing, the lower court erred by misapprehending the legal doctrine on similarity of trademarks, thereby adversely affecting the conclusion of the judgment.

3. As to the ground of appeal on the unfair competitive act

A. The reasoning of the lower judgment and the record reveal the following circumstances.

(1) As with the registered trademark of this case, the Plaintiff’s products, the form of which combines the three-dimensional shape of a mastro-shaped figure and the color of a mast color, also constitute prescription that allows the patient to purchase the said products at a pharmacy in accordance with the prescription issued by the doctor when the patient visited the hospital and received medical treatment from the doctor and the doctor prescribed the Plaintiff’s products.

(2) The outer packaging of the Plaintiff’s products is on a white basis, and the outer packaging of the Plaintiff’s products is written in the form in which South lugra, Viara, and Pfgr are placed in the left-hand part of the color belt.

(3) In addition, the inner packaging of the Plaintiff’s products is written on the basis of color, and is written on the back as “Korean currency interest chemical substance”, “Non-Amina”, and “Pfolr”.

(4) Also, the Plaintiff’s products themselves are negative.

B. In full view of these circumstances and the above circumstances, even though there are parts common to the forms of original and Defendant products, there are differences in the form thereof, and it is reasonable to view that most of the original and Defendant products administered by a pharmacist according to a doctor’s prescription, as prescription drugs, may be distinguished from each other depending on the name, letter, trademark, trade name, etc. indicated on the package. Therefore, it is difficult to say that the form of the original and Defendant products may cause misconception and confusion among consumers. Thus, the Defendant’s act of manufacturing and transferring the Defendant products cannot be deemed to constitute an unfair competition act under Article 2 subparag. 1(a) of the Unfair Competition Prevention and Trade Secret Protection Act.

C. Nevertheless, the lower court determined that the Defendant’s act of manufacturing and transferring the Defendant’s products constitutes an unfair competition act under Article 2 subparag. 1(a) of the Unfair Competition Prevention and Trade Secret Protection Act. In so doing, the lower court erred by misapprehending the legal doctrine on unfair competition, thereby adversely affecting the conclusion of the judgment.

4. Conclusion

Therefore, without further proceeding to decide on the remaining grounds of appeal, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench

Justices Lee Sang-hoon (Presiding Justice)