[1] In a case where damages are claimed pursuant to Article 67 of the former Trademark Act, whether the trademark right holder shall specifically assert and prove the occurrence of damages in addition to the fact of infringement and the user fees ordinarily entitled to the damages (negative), and in such a case, whether the infringer may be exempted from the liability for damages by asserting and proving that the damage cannot be caused to the trademark right holder (affirmative)

[2] The meaning and criteria for determining “a person who indicates his/her name, name, trade name, etc. in a common way” under Article 51(1)1 of the former Trademark Act, and whether such a legal doctrine is the same as in the case of a service mark (affirmative)

[3] Requirements for a trademark right holder to claim damages under Article 67-2 (1) of the former Trademark Act, and whether such a legal principle applies to a service mark (affirmative)

[1] According to Article 67 of the former Trademark Act (amended by Act No. 12751, Jun. 11, 2014), an owner of a trademark right may claim compensation for damages from a person who has intentionally or negligently infringed his/her trademark right as the amount equivalent to the trademark fee that he/she would normally be entitled to receive against the infringer. This provision seeks to reduce the burden of asserting and certifying damages. As such, the owner of a trademark right is obliged to assert and prove the fact of infringement and the user fee that would normally have been entitled to receive, and there is no need to specifically assert and prove the occurrence of damages. However, the purport of the provision is to recognize the duty of compensation even in cases where it is clear that the infringement of the trademark right alone assumes the legal presumption of the occurrence of damages or there is no occurrence of damages. Therefore, the infringer is not entitled to be exempted from the liability for damages by asserting and proving that the trademark owner cannot have suffered damages. Meanwhile, the amount equivalent to the trademark fee that would normally have been paid only to the use of a trademark registered differently from the patent right, and such legal doctrine does not apply to cases where the trademark owner actually proves the infringement of the trademark right.

[2] Article 51(1)1 of the former Trademark Act (wholly amended by Act No. 14033, Feb. 29, 2016) provides that a trademark indicating its own name, name, trade name, etc. (hereinafter “trade name, etc.”) in a common way does not have the effect of a registered trademark. Here, “the indication of trade name, etc. in a common way” refers to the indication of trade name, etc. so that ordinary consumers can recognize the trademark as a trade name, etc. without any special distinctive character by expressing the trade name, etc. in a special form, such as a unique letter, color, or pattern. As such, it means not only whether the mark itself has a special distinctive character, but also the actual quantity of the mark used, such as its location, arrangement, size, connection with other phrases, etc., and whether it has been used in combination with figures, etc., shall be determined by trade norms. This legal doctrine applies to service marks.

[3] Article 67-2(1) of the former Trademark Act (amended by Act No. 12751, Jun. 11, 2014) provides that “The owner of a trademark right may claim compensation for damages not exceeding 50,000 won, instead of claiming damages from a person who has intentionally or negligently infringed on the trademark by using a trademark identical or similar to the registered trademark that he/she uses on goods identical or similar to the designated goods. In such cases, the court may recognize a reasonable amount of damages in consideration of the overall purport of pleadings and the result of examination of evidence.” This provision provides that “Where there is infringement on the trademark right due to the use, etc. of a forged trademark, it is difficult to prove the amount of damages, so that the victim can easily receive relief from the right. Therefore, the requirements for application should be strictly interpreted as stipulated in the provision of the Act. Therefore, in order for a trademark right holder to claim damages under this provision, the trademark right holder should use the registered trademark at the time of infringement, and such legal principle should be applied where the trademark holder actually uses the registered trademark at the trademark at the time of infringement.

[1] Articles 2(3) (see current Article 2(3) and 67 (see current Article 110) of the former Trademark Act (Amended by Act No. 12751, Jun. 11, 2014); Article 288 of the Civil Procedure Act / [2] Articles 2(3) (see current Article 2(3) and 51(1)1 (see current Article 90(1)1) of the former Trademark Act (Amended by Act No. 14033, Feb. 29, 2016) / [3] Articles 2(3) (see current Article 2(3) and 67-2(1) (see current Article 11(1)) of the former Trademark Act (Amended by Act No. 12751, Jun. 11, 2014);

[1] Supreme Court Decision 2002Da33175 decided Oct. 11, 2002 (Gong2002Ha, 2705) / [2] Supreme Court Decision 2010Hu3387 decided May 10, 2012 (Gong2012Sang, 1015)

Plaintiff (Withdrawal)

Human Stick Co., Ltd. (Law Firm LLC, Attorneys Kim Won-il et al., Counsel for the plaintiff-appellant)

Crown Co., Ltd.

Defendant 2 and one other

Seoul High Court Decision 2013Na71687, 71694 decided July 24, 2014

All appeals by the Plaintiff’s Intervenor and Defendant Cown Co., Ltd. are dismissed. The costs of appeal are assessed against each party.

The grounds of appeal are examined.

1. Judgment on the ground of appeal by the Plaintiff’s succeeding intervenor

A. As to the grounds of appeal Nos. 1, 2, and 4

According to Article 67 of the former Trademark Act (amended by Act No. 12751, Jun. 11, 2014; hereinafter the same), an owner of a trademark right may claim compensation for damages from a person who has intentionally or negligently infringed his/her trademark right as the amount equivalent to the trademark right that he/she would normally be entitled to receive from the infringer. This provision seeks to reduce the burden of asserting and certifying damages. As such, the owner of a trademark right is obliged to assert and prove the fact of infringement and the user fee ordinarily entitled to receive from the infringer, and there is no need to specifically assert and prove the occurrence of damages. However, the above provision does not purport to recognize the duty of compensation even in cases where it is obvious that the infringement solely by the infringement of the trademark right has presumed the legal presumption of the occurrence of damages or that there is no occurrence of damages, and thus, the infringer may be exempted from liability for damages by asserting and proving that the infringement cannot occur to the trademark owner (see Supreme Court Decision 2002Da3175, Oct. 11, 2002).

The court below rejected the Intervenor’s claim for damages on the ground that it is insufficient to recognize that the succeeding Intervenor continued to conduct genetic testing using Defendant Crown Co., Ltd.’s service mark marks No. 1, 2, and 3, which are similar to the instant service mark, even after the succeeding Intervenor completed the registration of transfer of the instant service mark by the Plaintiff (hereinafter “the instant service mark”). Furthermore, the succeeding Intervenor’s genetic testing operation using the instant service mark through Defendant Crown Co., Ltd.’s confirmation as his subsidiary, cannot be deemed to have caused damage to the Plaintiff or the succeeding Intervenor due to Defendant Crown’s infringement of the right to service mark on the instant service mark. Furthermore, even if the succeeding Intervenor, as alleged by the succeeding Intervenor, was deemed to have conducted genetic testing by using the instant service mark through the “Co., Ltd.’s relatives confirmation.”

Examining the reasoning of the lower judgment in light of the aforementioned legal principles and records, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the grounds of appeal Nos. 1, 2, and 4, there were no errors by misapprehending the legal doctrine on Article 67(3) of the former Trademark Act, or by misapprehending

B. As to the grounds of appeal Nos. 3 and 4

Article 51(1)1 of the former Trademark Act (wholly amended by Act No. 14033, Feb. 29, 2016) provides that a trademark indicating its own name, name, trade name, etc. (hereinafter referred to as “trade name, etc.”) in a common way does not have the effect of a registered trademark. Here, “the indication of trade name, etc. in a common way” refers to the indication of trade name, etc. so that ordinary consumers can recognize the trademark by reporting it as trade name, etc. without any special distinctive character, by expressing the trade name, etc. in a special form, such as a unique letter, color, or design, etc. In that context, the determination of whether the mark itself has a special distinctive character, as well as the actual quantity of the mark used, such as its location, arrangement, size, connection with other phrases, etc., connection with figures, combination of figures, etc., shall be made in accordance with trade norms. This legal doctrine applies to service marks (see, e.g., Supreme Court Decision 2012Hu378, May 37, 2010).

The court below determined that the mark No. 4 at the time of the original adjudication using Defendant Crown was a combination of diagrams and letters, and contains the same or similar part of the service mark in terms of the appearance or name of this case, but this part does not have any special distinctive character other than its distinctive character as it is not indicated in a unique form, such as unique letters, colors, and design letters, and it appears that the combination of the word “stock company” and “Crownjin” with the word “Crown” would mean the trade name of crown, and that the trademark at the time of the original adjudication is indicated in a relatively small letter under the part of “Mrowne”, and thus, it does not affect the effect of the instant service mark right in this case, taking into account the following factors: (a) the trademark at the time of original adjudication is indicated in a common way in the name of Defendant Crown, and (b) the trademark at the time of original adjudication is indicated in a relatively small letter under the part of “mrown.”

In light of the above legal principles, the above judgment of the court below is just, and there is no error of misapprehending the legal principles or inconsistent reasoning as alleged in the grounds of appeal Nos. 3 and 4.

C. Regarding ground of appeal No. 5

Article 67-2(1) of the former Trademark Act (amended by Act No. 12751, Jun. 11, 2014) provides that “The owner of a trademark right may claim compensation for damages not exceeding 50,000 won, instead of claiming compensation for damages from a person who has intentionally or negligently infringed on the trademark by using a trademark identical or similar to the registered trademark he/she uses on goods identical or similar to the designated goods. In such cases, the court may recognize a reasonable amount of damages in consideration of the overall purport of pleadings and the result of examination of evidence.” This provision provides that “Where there is infringement of the trademark right due to the use, etc. of a forged trademark, even if it is difficult to prove the amount of damages, so that the victim can easily recover from the right. Therefore, the requirements for its application should be strictly interpreted as stipulated in the provision of the Act. Therefore, in order for a trademark right holder to claim compensation for damages under this provision, the trademark right holder should actually use the registered trademark at the time of such infringement, and such legal principle applies where the trademark holder actually uses the registered trademark at the trademark at the time of trademark and the trademark is not identical.

The lower court rejected the Plaintiff’s legal liability for damages pursuant to Article 67-2 of the former Trademark Act on the ground that the succeeding intervenor’s conjunctive claim against Defendant Crown and Defendant Crown on the ground that there is no evidence supporting that Defendant Crown used the instant service mark while conducting genetic testing with the marks Nos. 1, 2, and 3 of the former Trademark Act at the time of original trial, and that the marks Nos. 1, 2, and 3 used by Defendant Crown were similar to the instant service mark, but cannot be readily determined as constituting a service mark identical thereto.

Examining the reasoning of the lower judgment in light of the aforementioned legal principles, the lower court’s aforementioned determination is justifiable, and it did not err by misapprehending the relevant legal principles, as otherwise alleged in the grounds of appeal No.

2. Determination on the grounds of appeal by Defendant Cown Co., Ltd.

After finding the facts as stated in its holding, the lower court rejected Defendant Crown's abuse of rights on the ground that the exercise of the right to the service mark by the succeeding intervenor who acquired the right to the service mark of this case from the Plaintiff did not constitute an abuse of rights because there is no value to legally protect the service mark by causing confusion among consumers in relation to Defendant Crown or violating the principle

Examining the reasoning of the lower judgment in light of the relevant legal principles, the lower court’s aforementioned determination is acceptable, and it did not err by misapprehending the legal doctrine on abuse of rights.

3. Conclusion

Therefore, all appeals by successors and Defendant Cown-jin are dismissed, and the costs of appeal are assessed against each party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kwon Soon-il (Presiding Justice)